Make Sure Your Manager is Helping Your Business

17 Things a Restaurant Manager Should Never Do

Rebranding - Is it Time to Make a Change

There is nothing worse than getting stuck in a rut.  What may have worked when you first opened your restaurant just doesn’t seem to be cutting it anymore.  A few signs that some changes may be needed are as follows:

• Have you noticed that your business is not what it used to be?  
• The food doesn’t seem so special
• Your regulars seem to be visiting less and less
• Morale with the staff is low
• Staff turnover seems high
• You lack motivation
• You dread coming to work

Don’t worry, these things are normal but they are definite signs that you have got to get you and your restaurant out of the rut if you want to stay in business.   You may have to dig deep to get yourself motivated, but you did it years ago when you opened your restaurant and you can do it again now!  Here is how:

1. Create a new tagline.

Begin with refreshing your brand image.  Just like you did when you opened your restaurant, take some time to figure out what you want to deliver to your customers.  In other words, when a customer hears your restaurants name, what do you want to immediately come to their mind?  Form this idea into a new tagline attached to your restaurants name.  An example of this would be, “The Wharfside, any closer to the ocean and you would be swimming.”  Or “ Anthony’s Pizzeria, smile and say cheeeese.”   For more information about branding click here.

2. Find out how people see you now

The process of creating a new tagline has given you the opportunity to clearly see your vision of the new you. The next step is to accentuate the positive and eliminate the negative so you need to start asking questions.  You must ask your employees, your customers, and even people you meet in the grocery store.  Ask them what they know about your restaurant, what they think about your restaurant and things they may like to see added or changed.  This is going to give you the opportunity  to work on the perceptions that are currently out there that may not be what you want them to be.  It will also give you the opportunity to connect with the community by giving them what they are looking for.

3. Take a look at your competition

Go and visit your competitors.  Take notes on the things they are doing right and the things they are not.  Is there something that nobody else is doing that may be a unique selling opportunity for you? Explore different restaurant concepts to help you find new ideas.  Check out different price points and what is being offered.  Also go to review sites and see what customers are saying about you and your competition.  This information can give you great insight on where you need to be focusing.

4. Revamp your décor to fit your new brand

Don’t let this idea scare you.  You do not have to spend a lot of money to revitalize your space but it is essential that your customers will notice a difference.  New colors, textures, and lighting can make a tremendous difference.  Research other restaurants with the similar themes and get ideas for new color combinations and decorating ideas.  Think about how you may be able take your existing furniture and rearrange it to give the restaurant a new feel.  This is a great time to think about the traffic flow of your restaurant and work on ways to make service more efficient.   Places like Homegoods or even garage sales can have great inexpensive decorations to fill empty spaces and add a splash of interest.

5. Redesign your menu

A menu redesign will fill three important purposes.  The first is to promote your new brand and give your new image credibility.  The second is to make the food special again by adding exciting new items or specials.  The third and most important is to help bring in more money.   It is a fact that customers look at menus in a certain way.  Placement, highlighting, typeface, and descriptions all play a huge role in what your customers will buy.  You need to design your menu so that your customers order what you want them to order  (click here for detailed information regarding menu design).  Don’t forget your drink menu.  Be creative and come up with some great signature drink ideas that help enhance your brand.  

6. Get your staff to “buy in’

Your staff is your sales team.  Makes sure they fully understand what you are trying to accomplish with the rebranding and make sure you let them know how it will positively affect the money they make too.  Train your staff to encourage feedback from customers and encourage them to ask the customers to come back.  You cannot rebrand your restaurant without the support of your employees.  If they are unwilling or not excited about  what is happening it might be time to let them go.  

7. Get the word out.

Just because you work so hard to rebrand, don’t assume people know or care about what you are doing.  You need to build excitement and let everyone know what going on.  Since your staff is your sales team, encourage them to tell everyone what’s going on.  Try giving your staff $10 Gift Certificates to hand out to everyone they know or use social media channels to get the word out.  Post pictures of the changes and talk about the new menu; build excitement by having a ‘Look What We Have Done” party.   

8. Monitor reactions and financial results

It is important to know reactions to your changes.  Hopefully by the increase of revenue you will know that you have made a huge difference. However, don’t take anything for granted.  Once again consult your staff for any feedback, listen to them and ask questions, and use comment cards in the check holders to get feedback from your customers.

Now that your rebranding has brought new life to your business keep the momentum going and set one day every month to brainstorm new ideas to keep your restaurant from getting old.  Little tweaks make a big difference and keep you relevant to your customers.

If you need help finding motivation or figuring out where to begin, we can help.  Call us at 845-598-4760 or email us at info@TheRestaurantPlaybook.com and we’ll get you started.

Understanding Credit Card Processing

Merchant service providers act as middlemen for your business and bank to help process and manage bankcard payments. Regardless of how small your business is, you need to offer card payment services to make it in today’s times. Card payments have become the most common method and so it is essential for restaurant owner’s to make sure they offer convenience to their customers to reap bigger profits.But it is not as simple as that. Credit card processing requires planning, research and complete understanding to make sure you aren't paying higher discount rates than you have to. Following is an explanation of exactly how much you are charged for various transactions:

Interchange

Discount rates are broken down into numerous categories known as interchange. Interchange can include more than 100 different rates that change every year, however, in most cases Independent Sales Organizations (ISO) charge bucket rates to merchants. Bucket rates are an easier way to categorize the dozens of different rate categories into groups to form a simple rate structure comprising of similar interchange levels. Bucket rates include Non-Qualified, Mid-Qualified and Qualified rates.

Qualified Rates

Qualified rates are bankcards that are used on premises. For businesses like restaurants that usually run on a brick and mortar structure, most transactions are done on the premises, via card swipes. These transactions don’t include any reward credit cards like Bonus cash, Flyer miles or other incentives for the customer. Merchants are charged the lowest discount rate in this category which ranges from 1.65% to 1.95%. Qualified rates are usually low because the chances of a merchant getting a chargeback are the lowest and due to the lesser risk for the card and the merchant to absorb the cost of accepting fraudulent bankcards.

Mid-Qualified Rates

Mid-Qualified rates are charged for bankcards where the transactions are made via telephone/email etc. where the cards aren’t swiped. Although for restaurants offering cash on delivery, mid-qualified rates hardly apply. However, in cases where restaurants may accept payments on phone, or via online forms or websites, or are offering reward cards, then mid-qualified rates apply. The risks of fraudulence increase if a bankcard is not present, thus the discount rates are higher and range from 0.85% to 1.29% plus the qualified rate.Reward cards are also charged the same because eventually it is the merchant that absorbs the cost of MasterCard/Visa’s ability to offer reward card incentives.

Non-Qualified Rates

Non-qualified rates include International, Corporate and Business bankcards. These have the highest discount rates among the three and can range from 1.12% to 1.63% in addition to the qualified rate. Multiple factors are responsible for the high discount rates including the following:

• These bankcards of the highest risks comparatively.
• Business and corporate cards have highest limits.
• The processing company deposits the funds into the merchants account upon approval and receives the funds afterwards.
• International cards require thorough verification due to the high risks.
• With international cards, more often than not, the processing company has to calculate the rate of exchange of the currency to the US dollar before withdrawal.
• The non-qualified rates remain the same regardless of whether the card is swiped or not.

Item Fees

Apart from the discount rate, an item fee is also charged on bankcard transactions. This fee is reflected when a merchant receives a bankcard where the merchant has to settle all transactions for the day or needs to obtain approval. The terminal has to dial out to obtain an approval or batch out for the day. For each transaction where a merchant has to batch out or obtain an approval, the merchant is charged a cent. Depending on the type of business, a merchant is charged from 18 to 20 cents per dial out.

Monthly Statement Fees

Merchants are charged for the monthly report of discount fees and transactions that they receive. This statement is provided at the end of each month in order to help the merchant tally their revenue and accounting from bankcard transactions. Depending on the type of business, merchants are charged somewhere between $7.50 and $10 per month for the monthly statement. This monthly statement is also analyzed and reviewed by Independent Sales Agents when consulting with a merchant about converting current ISO.

How to Find the Right Processor

It can be very difficult for restaurant owners to find the right processor for bankcard transactions. There are numerous things that you need to keep in mind to make sure you are not paying higher rates and fees than you have to. Following are a few things to keep in mind when looking for Credit Card Processors:

• Be on the lookout for processors who claim they can ‘save you money’ without having any knowledge of your business and card processing needs.
• Steer clear of agents wanting to check your statements right away. Yes, it is important to check the statement before they can plan your discount rates, but both of you need to get a better understanding of what is needed and what is on offer before jumping to confidential financial reports.
• There is no such thing as ‘whole sale pricing’ as far as MasterCard and Visa are concerned, so if that’s what the sales agent is offering, then there isn’t much validity to their claims.
• If the representative starts offering you rates without understanding the nature and structure of your business, then that’s a red flag waving right at you. There is a huge difference between the rates on a statement and the total cost incurred. In the end, it is the total money you are charged that matters, not the numbers on your statement, regardless of how tempting and pretty they look.
• Service is just as important as the offer at hand. So steer clear of representatives who choose the trickiest of times to ring your bells. A reliable agent will help you find the best deal at the right time and most importantly at your convenience.
• You have questions about matters you don’t understand? Good for you. Don’t let complex, default answer fool you. If you don’t understand what your representative is trying to tell you, then the chances are neither does he/her. And it’s time for both of you to move one and for you to find someone who knows what they are offering and knows how to tell (sell) it too.
• A good processor will stay updated on cost fluctuations or reduction in cost from MasterCard/Visa and will inform you about the changes too. So you need to know that they know what needs are.

The more you know the easier and more convenient it will be for you to find the right processor. It can be both frustrating and costly to let your processor tell you stories that although take you to fantasy land on paper, end up costing you real time money. Your business is all about you, your costs, your profits and your transactions. So by knowing how credit card processing works and how you are charged for it will help you make a more profound decision. Because in the end, it is very easy to identify processors who work for your best interest, and they are usually the ones that companies have stuck to for longer period of times. So do a little research to find out who the other merchants, especially in the restaurant business, are entrusting their credit card processing with.  

One of the Main Reasons Restaurant Fail

Keeping Up Momentum

New restaurant owners many times fail to realize that no one "needs" a restaurant, in most cases restaurant purchases are discretionary in nature so getting it right from the beginning is so important.

Lack of clarity in the concept is a huge reason for failure, but most of all it’s the mistakes and poor decisions made during start up that cause businesses to go belly up too. The first months of getting a restaurant open is a minefield of leases, permits, licensing, certifications and approvals. Not knowing how to navigate the process can land up costing the new restaurant owner plenty besides time and money. It cost momentum, which many fail to realize is crucial in a new opening. A restaurateur can borrow money, hire and cultivate vision and talent, but its momentum—the energy of progress--that keeps a plan moving forward and into living restaurant. Without the "momentum," the money dries up, visions get foggy and talent moves on. What happens next is that each pause, every stall, affects the momentum of the project. These interruptions wear away at the interest of everyone, partners, investors, prospective hires and anticipated customers. The restaurant is in a bad situation before the first dollar ever hits the till. 

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