There’s no doubt about it; restaurant businesses are lucrative. They’re one of those relatively recession-proof endeavors many starting entrepreneurs go crazy for. But of course, getting into this business isn’t without any challenges.
In fact, even before you start running a restaurant, there are already setbacks that can throw you off if you don’t prepare yourself. A huge part of your preparation should be knowing really well the risks you’ll face along your path. That said, here are the challenges you should expect when opening a restaurant.
1. Cutthroat competition
The lucrative nature of the restaurant business is also the very thing that makes for a highly competitive industry. In almost any location, you’ll find a tight restaurant competition. So, it’s not really a question of whether or not you’ll get a share in the pie, but rather how much you’ll get.
In general, the huge, popular restaurants draw in a lot more customers, giving them the biggest share. Independent operators, on the other hand, will have to work doubly hard to compete. This is the reason many aspiring entrepreneurs start by maximizing franchising opportunities, say, opening fast casual pizza franchises.
Regardless of the route you’ll be taking though, you need to do a survey of your competitors as part of your preparation. Visit their stores, take note of their products and services, and ask the customers around for what they think about the restaurant.
2. Fast-paced trends
The restaurant industry is one of those fast-changing sectors, with new trends cropping up one moment, then dying, and giving way to newer ones the next. So, you could be jumping into a new trend, and before you know it, that trend already sizzled out of popularity.
Tracking and predicting trends can be very overwhelming for a newbie foodpreneur, especially if you don’t have any firsthand experience in the industry yet. That’s why the way to better prepare for this is to have a mentor. Because these people are immersed in the industry for so long, they would have valuable insights as to the trajectory of the market, and therefore help you prepare and maximize trends even before they become the next big thing.
Another way to be familiar with market trends is to attend conferences and seminars. This will not only give you actual, empirical data per se but also impart skills crucial for tracking trends.
3. Need for strong supplier relationships
The restaurant business relies heavily on the kind of suppliers you have. The challenge here is that developing relationships with those people takes time. It entails trial and error many times.
This is another reason people go into franchises, as they’re able to secure already tried-and-tested vendors. If you’re going to put up your own though, you should be able to find suppliers who are reliable, flexible and most of all, cost-effective. Ask your social circles for recommendations.
Aside from the suppliers, you should be able to find good employees as well who can build rapport with your customers.
The restaurant business is filled with unique challenges that can either break or further strengthen your entrepreneurial spirit. Choose the latter. Get yourself well prepared for the challenges.