The restaurant industry is a dynamic business, and relying on consumer spending makes it a tough business to know when to expand or change. The gut instinct for most successful restaurant owners, is “if it isn’t broken, don’t fix it.” That philosophy may have worked in the past, but with today’s consumers, change is part of the expectation. If you don’t change, it will break!
Many believe “expansion” is limited only to increasing space, but there are many other ways to expand a business. The most basic form is to focus on your current customer base and adapt your offering to fit their changing needs. This may require purchasing new equipment, changing your inventory, or adding more training and service. Sometimes even small changes, such as purchasing new small wares or making updates to your menu, can impact expanding your business.
Another form of expansion is to expose your restaurant to new customers through a new location or cross selling into a related industry. Both of these expansion ideas help to strengthen your position in the market and enhance your overall value once it comes time to exit your business.
Making a decision to expand requires some research, and it always helps to study those who came before you or your competition. Some quick, healthy questions to ask are:
- Will the expansion result in any cost advantage for the business?
- Will the expansion expose you to new customers, and how does it affect your existing customers? (Never harm those that are loyal to you already. They are your bread and butter!)
- Will the expansion increase or decrease the stress in your life?
- Can you afford the expansion? (There are myriad of ways to fund expansions – one is right for you.)
- What is your plan to implement the expansion?
- How will you measure your success? (Give yourself a break and be sure to set realistic goals.)
Don’t hesitate to reach out to others in the industry or other merchants in the area. Reviewing the possibilities and pitfalls is always better with someone that has been through the experience. In addition, there are many resources at your fingertips – answers to your questions are just a Google search away.
The bottom line is that expansions are not a decision you make overnight, but they are also something well worth the consideration. You never know what is possible!
Want to know more about how Rewards Network can help fund your expansion?