Congratulations! Your restaurant has made it through its first year, or maybe its second. Maybe its third or fourth. Maybe I could keep going like this indefinitely, but you get the idea. You’re in a zone. Now buckle up and learn these proven strategies on how to grow your restaurant.

1. By David Eagle
Making it Big
in Hospitality
Strategies for Growing
Your Restaurant

2. Introduction
A written amuse-bouche for your reading pleasure, to whet your appetite for what’s to come.
Chapter 1: Be Yourself-ier
Your restaurant is a success, so whatever you’re doing, your customers must like it. This chapter covers ways to find out exactly what your
customers love so you can give them more.
Chapter 2: (Check) Size Matters
The simplest way to start earning more money is to get your customers to spend more money. That part is obvious: this chapter details the
methods you can use to make that happen.
Chapter 3: Marketing
Marketing is that thing that no one feels they do enough of. Here are some strategies to use that are more than enough to retain customers,
and convert new ones.
Chapter 4: Come On, Get Happy
Happy Hours aren’t just for bars anymore. Learn ways to create demand and drum up business during those slower periods.
Chapter 5: It’s Getting Mobile Out There
Mobile technology gives customers more ways to find and buy from you, wherever they are. But it also enables you to take your show on
the road and meet them where they’re at.
Table of Contents

3. Congratulations! Your restaurant has made it through its first
year, or maybe its second. Maybe its third or fourth. Maybe
I could keep going like this indefinitely, but you get the idea.
You’re in a zone.
Everything you spend on inventory, employees, and overhead has become
predictable, you’re bringing in enough income to provide some breathing room.
Or, maybe you’re the type to look at breathing room and you see space to fill: you
want to grow. Perhaps you’d like to offer more on your menu, expand your hours,
add space or even another location. And then maybe the thought of that makes
you feel a little claustrophobic. How will you do it? What kind of paperwork is
involved? If you’re in New Jersey, who will you have to pay off to make things
happen? Like any enterprise, it’s sure to be fraught with decisions. In all cases, it
helps to have as much data as possible—the ability to track trends in peak hours,
to understand how much of your inventory goes to waste, to know who your
customers are. These are vital to the growth of any restaurant. You can’t build your
audience if you don’t know who they are to begin with.
In its 2014 report on corporate insolvency, the Australian Securities and
Investments Commission (ASIC) identified the top two reasons businesses went
broke. The first was “inadequate cash flow.” Let’s all pause for a moment and
reflect on this: a group of people studied the data, and determined that the
number one reason a business ran out of money was due to its not having
enough money.But let’s not let that cloud our judgment on the second reason,
which is far more enlightening; business failure is linked to poor strategic
management.

4. It’s a general enough statement to sound obvious on face value, but don’t dismiss
it out of hand. If you’re not pausing to unpack what it means to have good
strategic management you’re probably not managing things so strategically. That
doesn’t mean you’re mismanaging, either. You’ve made it this far and looking to
take things further, so you’re doing something right. But starting a restaurant is lot
different than growing it. It’s not that you didn’t start with a solid plan, but when
reality hits there’s a lot of coursecorrection that happens. A little something you
didn’t foresee here, a complete bolt from the blue there. It happens. Now that
you’ve been operating for awhile, you should be able to know who your customers
are, know when to expect them, what they’re going to order, and how they’re
going to pay. You’ve got all kinds of data—not projections—and the power to
keep surprises to a minimum. There’s no reason you can’t be strategic about your
growth.
The rest of this guide will operate under the assumption that you’ve already taken
the first step towards your restaurant’s future by implementing a modern, open,
and scalable point of sale system. This not only makes running your business
easier, but a good one will do more than just take orders and payments. It helps to
view a POS for your business the same way you’d look at an operating system for
your computer or smartphone: you need the OS to make the device work, but
you’ll still want to add more apps. Your point of sale is your business’ OS. It’s
making things work, and now you want to do some more with it. Inhouse or third
party addons can be connected to your POS, and sharing the data between the
two apps allows you to use it in better ways. Scheduling shifts for employees,
marketing to customers, online ordering, loyalty rewards, automated account: all
these things are possible when your business runs on the right operating system.

5. Chapter 1
Be Yourself-ier

6. So, if you haven’t researched and found a good POS yet, stop
here. The first step to planning strategically is having the
evidence on which to base your decisions. Without a good
POS, nothing else that follow this introduction will help you.
There are other guides out there, like this one, that do a good
job of explaining what to look for in a restaurant point of sale so
go ahead and do that—research, try, buy—and I’ll meet you
back here. In the meantime, the rest of us are going to move
ahead to Chapter 1 for the first method.

7. That’s good! But don’t get complacent and rest on your laurels,
especially if you grow laurel plants in your herb garden. No one
wants the flavor of a bay leaf you’ve slept on. What your custom-
ers do want, though, isn’t necessarily more of the same. The
things that excite people at first can become commonplace after
a while; this is why divorce rates are so high. But that doesn’t
mean you should preemptively become something you’re not, or
diverge from your original plan/concept. It does mean that you
ought to switch up your menu now and again, adding new
dishes, subtracting others, and putting something extra into
promoting your most popular dishes. And when you do that, do
it with an eye towards refining your brand or image—that central
concept of the restaurant that makes it yours. What does that
mean in practical purposes?
Let’s use the fast food chain Taco Bell as an example, because
in a bout of laziness I took my kids to eat there the night before I
wrote this and the indigestion today makes it hard to think about
anything else. But they started with a concept—cultural
appropriation with cheap, tasty food that resembles Mexican
cuisine—and have really run with it over the years. Even though
there are dozens of items on the menu, they all rely on some
combination of the same 15 20 ingredients assembled in
various ways. That kind of concept can get old quick, and so
they’re constantly experimenting with ways to keep the menu
fresh (while somehow not worrying so much about keeping the
food in the same condition). Large companies like Taco Bell (or
whatever multinational behemoth now owns it) have long had
access to advanced reporting and analytics that help them to
understand what their customers like. Decisions about what
stays, what goes, what’s added aren’t the result of a
temperamental chef in a creative rut, much as we all believe. The
menu is the result of data driven, focus group tested market
analysis. The world didn’t love the Enchirito as much as I did,
and so it’s off the menu, replaced by other items that jibe even
more with the central concept of the place.
If you’ve made it this far, it’s probably safe to
assume that you’ve succeeded in creating
some sort of unique identity that sets you
apart from your competition.

8. One of their biggest recent successes, the Dorito Loco Taco, is
an item that is so quintessentially Taco Bell it’s kind of a wonder
it took so long for anyone to think it up. They understand their
market, their image, and their brand, and were able to dream up
a concoction that reinforce every notion we have about the
chain: quasiMexican Frankenfood that is irresistibly delicious.
Now, I’m not suggesting you go out and hire a team of
marketers and food scientists to refine your menu. But you can
follow this model of success, and with minimal investment. Your
POS ought to have a reporting mechanism, and it shouldn’t take
you too long to get detailed reports on how the items on your
menu are selling. You might be able to retire an item or two that
isn’t selling well, and you’ll get an idea of your customers’ favorite
dishes, which should help inspire you to create something new
that you’ll be confident people will appreciate. Beyond that, you
might also notice some trends that can help shape changes.
Perhaps you’ve noticed that an overwhelming number of people
like for you to add gravy to go with the their cheese fries. That’s
a good time to add Poutine to the menu. Use the data you get
out of your POS to identify what it is your customers like about
you, and find ways to double down on those things.

9. Chapter 2
Increase the Average
Check Size

10. OK, so this method sounds downright tautological. How do
you increase revenue for your restaurant? Get people to
spend more money. “Excellent problem solving, Sherlock,” I
hear you saying.
I think this is why so many people nowadays say things like “Increase your
customers’ average spend.” Because what I said sounds self-evident. But when
they change a verb to a noun like that, it has the subtle effect of making people
listen. Clearly this person has a business background, because he is using words
in ways I never heard before, the masses will say. But really, the opposite here is
true. Anyone who uses spend as a noun should be automatically dismissed, while
I should be taken more seriously because I’m not insulting your intelligence.
Besides, advising you to get you customers to spend more money is one of those
concepts so obvious we tend not to even think it, not unlike the Dorito Loco Taco.
Now that we’ve got the basic concept out there, we can look at some ways that
you can achieve this goal.
The classic upsell.
“Would you like fries with that?” is more than just the punchline to a joke about a
Fine Arts degree. It’s an effective way to get people to buy stuff they might not
have ordered on their own. It’s one of those human behavioral things: people
might be embarrassed to order too much, but if you’re the one offering—Hey, I
didn’t even think of that! Good idea!—it’s easier to go for it. Sometimes, though,
the decision not to go for a side dish or a beverage is a monetary one. People
might buy one or the other to save a little money. These are the people you can
convince to buy both, and it’s easier than it sounds.

11. Combo meals didn’t become the norm because those nice mega-chains want
you to save money; it’s because they boost revenue like mad. And fountain drinks,
as you probably know, carry huge profit margins—leaving you lots of wiggle room
to knock down the price as part of a combination. If your customers have
incentive to spend a little more money, they will.
Offer coupons to your regulars.
Sounds counterintuitive to expect more money per check if you’re offering
coupons; if you’re just sending blanket offers out to everyone through an ad or
storewide promotion, this strategy isn’t going to work. But you’ve been entering
your regular customers into your POS’s database right? If you have, then you can
target offers to specific people. Find all the people who, on average, don’t spend
more than $20 per meal and give them a 10% discount if they spend $25. Do the
same for people who generally spend no more than $30 by giving incentive for
them spend $40—and so on. These are your regulars: they were going to come
back, anyway, and now you’ve given them a reason to spend more than they
normally do.
Integrate an online ordering app with your POS.
When people order online or through an app, the data shows that they tend to
spend about 10% - 20% more on each meal. This goes back to the human
psych element I mentioned above: without the public pressure of being on a line
and staring at a menu trying to figure their order out, people buy more food. When
they can order at their own, relaxed pace, people can really absorb the menu and
not feel rushed into the decision. And when no one’s looking over their shoulder,
they’re more inclined order more than they would otherwise.

12. Chapter 3
Marketing

13. Do enough research on anything over the internet, and
you’re bound to come to one conclusion: the Obvious
Institute of SelfExplanatory Statistical Analysis has been
churning out more graduates than ever.
Over at her website succeedasyourownboss.com, Melinda Emerson’s got a
helpful little guest post on “Proven Methods to Fill Your Restaurant.” Emerson, also
known as the “Small Biz Lady,” published this piece written by Misty Young, also
known as the “Restaurant Lady,” which is filled with things that could only be
described as “words.” So, what’s the first proven method to filling your restaurant?
Get more guests! But don’t worry: if you’d already figured out in your quest for
more guests that getting more guests would help, Young dials it in more
specifically: use marketing. Got that? Oh, you want to know what kind of
marketing would be most beneficial? The Restaurant Lady’s got you covered.
She expands on this point, by telling us: avoid the marketing that isn’t working.
She leaves it to us, her readers, to infer from this that marketing that does work is
more likely to work. But that’s what makes her such a good leader in her field: she
knows we’ll never learn if we don’t figure it out for ourselves. I feel better now that
I’ve gotten the sarcasm out. We can move on now.
Of course, if you want to grow your restaurant, you’ve got to market. If you want
something, you must go and get it—and if you want more customers, it’s up to
you to find them. While there may never be an advertisement as effective as word
of mouth, there are a dozen better marketing strategies than relying on only that.
As a restaurant owner, you can safely divide the world into two distinct groups:
those who’ve eaten at your place before, and those who haven’t.

14. Those are the first demographics you ought to consider, and your strategies for
each are going to be different.
Strategy #1: Create a marketing campaign for the
Has-Eaten-At-Your-Restaurant demographic.
The conventional wisdom says that 80% of your business will come from the
same 20% of your loyal customers. Whether those percentages are accurate or
not, the general sentiment is right on: most of your customers are going to be
people who’ve already been there. And it’s on these people you’ll want to focus
much of your marketing efforts. These are your best customers, and they ought
to be rewarded for this! Just because they keep coming back doesn’t mean they
don’t want incentives to do so. And they’re more likely than first-timers to take you
up on a deal, because they already like you. If you haven’t already made it a
priority, now’s the time to start collecting your customers’ contact info and storing
them in your POS’s database. This helps you to reach out to them with marketing
emails and coupons; when you’ve got a record of all the meals they’ve eaten with
you (Hello, POS reporting features!) you can personalise these materials to a high
degree of specificity. You can also start implementing a customer loyalty program
to encourage repeat business.
Remember, though, that marketing oughtn’t be a one-way conversation. With any
kind of hospitality business, every interaction with a customer is a dialogue. Not
some metaphorical dialogue, either, but an actual dialogue, where your servers
ask questions, and your diners answer them—they’ll even have a few questions of
their own. One great way to start a dialogue is with a freebie. You’ve got to pay to
play, the old saying goes, and this is a pretty low cost option to generate some
good will.

15. Since you already know what they like, give them something else they might want
to try. Tyson Cole, the self-described “white sushi chef” who owns two successful
restaurants in Austin, Texas, explains it this way:
“Guests love it when a dish comes out and the server says, ‘The chef wanted you
to try this,’ because that creates a real connection and makes the experience
personal.”
Give someone a great meal, and they’ll come back for another. Give them a great
experience, and they’ll tell their friends. Which brings us to the second marketing
strategy.
Strategy #2: Create a marketing campaign for the
Has-Never-Eaten-At-Your-Restaurant demographic.
There are any number of popular, time-tested ways of achieving this. Newspaper
ads, radio commercials, local TV (if you can swing the cost) are all fairly effective.
But the internet and social media can often accomplish similar—if not
better—results at a fraction of the cost. Geo-targeted tweets can reach thousands
of people within walking distance with little to no effort. Facebook ads directed at
friends of people who already “like” your page can also help convert folks to try
you out. Beyond these micro-bursts of proactive messaging, the social media
platforms you use should be engaging and fresh, and focused more around
fostering a community than plugging your eats. Not that you shouldn’t showcase
your food, but if that’s all you’re doing people will tune out quickly.

16. And then, again, there’s the good old loyalty program. Sure, you
can’t rightly give loyalty rewards to people who’ve never stopped
in for a meal, but integrating your POS with a social rewards
program—like Collect Rewards—kills two birds with one stone
(which birds you can then dress, roast, slice, and then serve as
a sandwich with cranberry chutney and a mild cheese). With
apps like these, you can push offers out to participating
customers—directly to their smartphones, with further incentives
for sharing the same offers out to friends. It’s kind of like word of
mouth, but better—and with a much bigger mouth.

17. Chapter 4
Come On,
Get Happy

18. It’s one of those trends that will just reach out slap you in the
eyeballs as you look at sections of graphs where your charts
barely climb the Y axis. These are the hours where “increase
average check size” isn’t a suitable strategy. If, from 4pm to
6pm you get an average of 10 customers, adding a few bucks
to each bill isn’t going to make much difference. There’s safety in
numbers, and there’s one proven method to increase traffic in
your restaurant that’s been around for over a century. That’s an
paralleled test of time when it comes to marketing strategies, so
we need to make a big deal over. Give it a proper introduction.
“Therefore, my lords, omit no happy hour That may give
furtherance to our expedition…”
- William Shakespeare
King Henry V: Act 1, Scene 2
Yes, Happy Hour. Who doesn’t have an hour to be happy?
Though it’s often associated only with bars, there’s no actual law
that says restaurants can’t play along. Remember, kids: you
don’t need alcohol to get happy.
You can always eat your feelings with half-price wings. But
alcohol helps, I’m not going to lie. As a restaurant owner,
though, you can pretty much count on happy hour to give
furtherance to your expeditions, as the Bard himself attested.
Sure, you’ll make less profit per item, but you’ll also increase
revenue—which raises profit overall.
The good thing about happy hour is that it isn’t only about the
immediate benefit of doing more business during business
hours. It’s also a way to get people to think about coming back.
Remember our two demographics in the previous chapter? Well,
any good happy hour is going to attract a decent number of
people from the second group, the
Hasn’t-Eaten-At-Your-Restaurant demographic. You’ll recognize
them instantly, because they’ll be the people you’ve never seen
before. Some time between entering and exiting, they switch
over to the Has-Eat-At-Your-Restaurant group—and it’s during
this jump from one demographic to the other that you can create
great customers. The nature of a happy hour food menu is that
you’re offering smaller sized, but economically priced portions of
items from your regular menu. Make it a habit of bringing free
samples of dishes that people didn’t order. Whether it’s to whet
their appetites for another round or another time, it’s good for
business to display some of the range of your menu. If your
menu and concept supports it, combination platters of your
most popular items can be an excellent way to sell yourself and
some food at the same time.
With all the POS reporting you’ve done over
the first three chapters, you’ve probably
noticed right now that there are some hours
where you business is much slower than
others.

19. For more upscale—or downright fancy—restaurants, the idea of
a happy hour might a little too out of place with your vibe. Not to
fear: this is why the tasting menu was created. It’s essentially
happy hour, but you get to tell people what to eat for a few
courses, and pair it all with the appropriate wine.
Conventional wisdom—or is it common sense?—tells us that
filling your available seats will increase revenue. Just remember
it’s not enough to say, I’m going to get more customers and
hope for the best. Identify when you need more customers, and
how you’re going to get them in. That’s going to look different
depending on how your business operates, but in all cases: get
poeple’s butts in your seats and then show them a good time!

20. Chapter 5
It’s Getting Mobile
Out there

21. A bookstore has to compete with Amazon for the business
because customers don’t need to leave the comfort of their
home or bubble to make the purchase. But going to a restaurant
is exactly the opposite: your potential customers are either
already on the go, or are looking to get out. So meet them where
they’re at before they’ve figured out where to go.
An increasing number of apps for smartphones and tablets use
locationbased technology to find nearby stores and restaurants.
From review apps like Yelp to mobile ordering platforms like
Boppl, people are never more than a few taps from finding out
you exist. Make sure they can find you. Spend some time doing
research as if you were a potential customer looking for a place
to eat, and see how you stack up against the competition.
Where are listed on Google in relation to your competitors? Do
you have a listing with Google and Apple Maps? Are you
advertising on Waze? What about Yelp? Go through every place
you can think of that people would look to find you and get as
much info there as you can: your website/menu, hours of
operation, the types of payments you’ll accept, parking—all of it.
The less questions people have about you before they even
show up, the more comfortable they’ll feel. That’s human
psychology insight #3 here: people don’t like to appear as if they
don’t know what the deal is, or they simply are nervous about
those kinds of situations. Arm them with as much knowledge as
possible by establishing a thorough presence on these mobile
platforms.
The same goes for online ordering. There are a number of apps
that will integrate directly into your POS that can alert people to
your presence. If a group of people are out at a bar and decide
they’re hungry, I’ll guarantee that at least 3 of them will pull out a
smartphone and start finding the closest place to eat. If they can
look at your menu and order through the app, even better. And if
they can pay for the order with it, as well: bonus.
It’s an increasingly mobile world. Of the
different kinds of retail businesses, restaurants
are the most perfectly suited for a population
that’s on the go.

22. All they need to do is show up, grab their food, and go. The
more that can be done in advance of their arrival, the more likely
people are to do business with you. This doesn’t mean you’d
want to foster a cold and automated relationship with mobile
customers. Again, there’s a good chance these are people who
are in your NeverEatenHere demographic. Greet them with an
extra warm smile and then throw them some extra hot sauce.
Make it personal somehow and invite them back.
Of course, going mobile isn’t only about finding those hungry,
wandering souls and bringing them to you. With a mobile POS,
you can take your restaurant anywhere and open up a
completely new revenue stream. Maybe you’re eyeing a second
location but don’t have access
to the kind of capital required to make that happen. A food truck
can be a nice middle ground—maybe even a better middle
ground. With a food truck—or even just portable equipment that
you can transport, set up, and take down easily—you’ve got a
roaming ambassador for your flagship location. Hit festivals,
farmers markets, sporting events, or just get a permit to be in a
public space—and bring a tablet or smartphone. You’ll be ready
take orders and ring them up—with cash, credit cards, and
mobile payments—and have it all tie back to your main inventory
and books without any extra work. The more centralised the
POS the better, meaning that you should be able to manage
anything—for one location or more—from a single app or
website.
Taking your show on the road can be a big undertaking: at least
make sure your POS makes it easy to prepare. Make sure you
can spawn off new menus or price lists easily, and that you have
the flexibility make changes on the go. Make sure people know
you’ve got a permanent location. If they like you they’ll appreciate
knowing they can find you again.