Restaurant Wars - and how to win them!

About fifty percent of Tenant Mentorship clients these days are restaurants. Large and small, experienced and start up, franchise or independent, record openings and increased competition are leaving restaurants hungry for loyal customers.

The restaurant business demands extraordinary skills from an owner. For the most part, these operators are seriously deficient in the full scope of talents necessary to run a successful business and run too lean to hire the appropriate staff to fill in the gaps. Further, even the most seasoned owners are befuddled by the fast-paced change in taste and experience today’s consumers are craving.

In addition to rising food costs, high turnover, labor costs and waste, and poor management, here’s what we’re finding as the top issues among our clients:

Out of touch with food trends/concepts

Success is fleeting; consumers fickle. Many long-term owners are holding on fast to what was once a good thing and stubbornly not changing with the times. Today’s businesses need to be fluid and current with evolving tastes. Furthermore, the environment demands a clearly defined niche or concept as the basis for a brand platform. Even neighborhood restaurants need to pay attention to the lessons taught by celebrity chefs.

The food!

Sadly, the food seems to be the last thing on the assessment list when evaluating a restaurant’s performance. It’s easy to identify bad food as a problem but the more commonplace challenge is “ordinary.” If the food is forgettable, it’s hard to build a loyal following.

We’re also seeing leases signed by first time operators without proof that their food is pleasing. Hard to believe someone could get a lease worth hundreds of thousands without proof that their food will be a draw.  

Unrealistic expectations

Some restaurants are immediate hits but those instances are rare. For the most part, even someone armed with a good concept, good food and good management needs to understand that a profitable restaurant business takes time to build. We see many small  business plans that require $750k to $1mm to get to breakeven and are projecting that kind of revenue in year one! That level of performance is exceedingly rare and if you’re leasing to someone who needs that kind of growth, beware! On the other hand, if the build is too slow, it means something isn’t resonating with the consumer and the owner should make changes sooner rather than later. Listen to the silence. 

Too few revenue streams

A good lunch or dinner business can no longer sustain a restaurant. Happy hours, delivery, private parties and catering and special events all need to contribute to the bottom line.

Customer Service

A pleasant and solicitous experience can overcome a lot of flaws. This takes consistent and top-notch training which is usually at the bottom of the “to do” list at many restaurants.

Discounts and couponing

Discounting seems to be the default marketing strategy for the unsophisticated owner. Rarely does volume make up for the reduction in profitability. A full house doesn’t necessarily translate to a healthy balance sheet.

These problems are all solvable if the owner is willing to regroup and move forward. We’ve seen it time and time again with our restaurant clients. Keep an eye out for any of these issues in your centers’ restaurants and work with these tenants to move them into a more profitable and successful direction.

For more information on Tenant Mentorship counseling for restaurants or our new “Restaurant Wars and How to Win Them” webinars, please contact us at




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