What Are The Potential Risks That Could Impact A Restaurant Business?

Most times, restauranteurs who have no prior experience in running such a business will find it difficult to identify risk areas early, which is why for such businesses, it is important to have experienced senior management who can help. Each division can be run by its own manager, such as the Head Chef in his chef coat and hat for the kitchen, head waiter for the front of house etc, who can give the right advice to the owners regarding potential problems they may be coming across that could impact the business.

Here are some of the potential risks that could impact a restaurant, and how they can be avoided.

• Poor customer service - This is one of the leading causes for restaurants going out of business. It is important to make sure you have enough employees who will take care of customers with a good attitude in order to avoid poor reviews or complaints by customers which can lead to a decrease in business. A restaurant that doesn't offer stellar customer service could find its establishment quickly losing potential customers who don't feel appreciated or cared about during their visits. A simple pleasant greeting by the server or waiter can make a big difference.

• Poor food quality - Poor customer service can cause customers to leave, but if the food is bad and not up to par with what's expected from your restaurant then it may be even worse for them. This will lead potential customers into thinking that they won't have a good experience at your establishment which could result in lost sales and revenue. It is always beneficial to hire the best when it comes to food preparation, because without a good chef and team heading your kitchen, you cannot be a success in the restaurant business. Experience is very important in this sense, and hiring a chef who has a good reputation and years of experience is vital.

• Poor food preparation standards - If a restaurant isn't careful with the way they prepare their food, customers may experience undercooked or raw food. This is not good for business and can result in lost revenue from unhappy customers who would likely choose to never return if this was the case. Again, this stresses the importance getting an experienced professional to head the kitchen team. Another aspect of this is cleanliness and hygiene. Ensuring that the kitchen staff have proper training on cleaning and hygiene is very important, as providing the necessary equipment and other items such as chef hats, aprons etc.

• Noise levels - Noise levels are something that can greatly impact the atmosphere of a restaurant. If customers can't hear themselves talk, this could be a major issue. Customers may not want to return because of an uncomfortable environment which is bad for business.

• Incompetence of staff - The staff is the backbone of any restaurant. Incompetence by staff members can create a number of customer complaints. For example, if the wait staff forgets to bring utensils or napkins with their orders, this will be noticed by customers who might not return again for lack of satisfaction. Treating them well ensures that a restaurant has an ample supply of workers who are dedicated and loyal to the business. The employees need to be taken care of so they don't leave with only weeks left in their contractional period, leading to an overabundance of labor vacancies within the restaurant establishment. This means fewer servers on the floor, which in turn means less service for customers.

• Bad location - A restaurant that is in an area where there are very few people may have trouble staying afloat. This is because it will have more trouble getting customers to walk in and buy food.

• Quality of ingredients - The quality or freshness of the ingredients can affect how well a restaurant is received by its guests. If the customer feels like they are eating something that has been sitting around for a while, this will not be viewed favorably. Getting fresh produce sent to the restaurant on a daily basis by local suppliers can solve this issue.

• Competition - Another factor is competition from other businesses in the area. When one restaurant starts experiencing a decline in sales or the quality of food declines due to lack of staffing, this could attract more customers away from his business towards others with better reputations or lower prices elsewhere.

As you can see there are many things that can impact the operation of a restaurant business in a negative manner, and in order to avoid this, it is good to get together an experienced and loyal team to back you up, who will support you with suggestions on improvement and be accountable.