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Blog at Chefify

What Red Flags To Look Out For In Your Restaurant

Apr 18 2019 - 9:55am
The restaurant and hospitality industries are often considered volatile. Rising trends can lift an establishment; but consumers can be fickle and costs can become overwhelming. Whether you’re running a restaurant, kitchen or a bar, there are always red flags that a business isn’t doing quite as well as it should. Sometimes these problems are easily solved - other situations indicate there are deeper issues to deal with.

Your staff are unsettled

There are many indications that staff are not quite satisfied with what they’re doing, from something as simple as being disruptive, to more serious issues like stealing or regular absenteeism. It’s often easy to blame an individual member of staff but sometimes it’s worth looking at the bigger picture to see if there are wider problems to address, such as there just not being enough for them to do.


Complaints from customers

To a certain extent, complaints are part of the industry. Even a high-end restaurant or bar suffers from them at some time. However, if you’ve noticed the volume of customer complaints is on the rise then this is a major red flag. If those complaints relate to the quality of the food, drinks or service then something needs to be done as soon as possible.


Inventory turnover is too high or low

Inventory turnover is a financial calculation and divides the cost of food or beverage sold by average food or beverage inventory. The figure it produces will show you how well food stock and inventory is being managed, and could be affecting your restaurant's profitability. Too low and you could be seeing high volumes of food wastage and spoiling; too high and you could be looking at situations where there frequently isn’t enough stock to function.


You’re struggling to pay debts

They could be bank loans or amounts owed to your restaurant suppliers. Either way, if you’re struggling to meet payments it’s time to look at where the problem is coming from and do something about it. Don’t put off what you could try and solve today.


No one is coming through the door

A lack of customers is probably the single biggest red flag there is that the business is not doing so well. There could be any number of reasons for this, from choosing the wrong location to a concept that has confused people. You could be overcharging for food or simply not reaching your target audience with marketing. With this kind of red flag it’s crucial to find out as quickly as possible what reasons are behind it and to start experimenting with ways to bring customers back in.

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