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Restaurants are an integral part of any society’s social fabric. They serve as a meeting point for people to gather, share a meal, and socialize. Despite their importance, many restaurants fail to thrive and eventually go out of business. In fact, the restaurant industry is notoriously hard to navigate, and statistics show that roughly 60% of new restaurants fail within the first year of operation. The reasons for failure vary, but there are some common threads that run through most restaurant failures. In this blog post, we’ll examine some of the most common reasons why restaurants fail or go out of business, and how Aldelo Express Cloud Point-of-Sale (POS) helps operators succeed.
Weak Selling Proposition
Restaurants that fail to distinguish themselves from their competitors are likely to struggle. A restaurant’s unique selling proposition (USP) is what sets it apart from other restaurants in the area. A restaurant’s USP can be its menu, its ambiance, or its service. Without a clear USP, a restaurant may struggle to attract customers and generate revenue.
Merchants that use Masa+ customize a unique online storefront to fit the “look and feel” of their restaurant brand. This includes vibrant images of the dining environment, food, drinks, and the restaurant logo.
Restaurants that fail to distinguish themselves from their competitors are likely to struggle. A restaurant’s unique selling proposition (USP) is what sets it apart from other restaurants in the area. A restaurant’s USP can be its menu, its ambiance, or its service. Without a clear USP, a restaurant may struggle to attract customers and generate revenue.
Merchants that use Masa+ customize a unique online storefront to fit the “look and feel” of their restaurant brand. This includes vibrant images of the dining environment, food, drinks, and the restaurant logo.
Merchants that use Masa+ customize a unique online storefront to fit the “look and feel” of their restaurant brand
Careless Financial Management
A lack of financial management can also lead to restaurant failure. This is one area that restaurants can control, but many fail because they lack the discipline and technology to effectively manage their finances. This can result in cash flow problems, debt, and an inability to pay bills. To succeed, restaurants need to carefully manage their finances, including their expenses, revenue, and profit margins.
Aldelo Express POS for restaurants promotes strong financial management with:
- AI-based Facial Recognition Logins that secure POS access, employee time cards, and manager functions
- multi-level sales reports in a cloud back-office environment
- native Inventory Module for purchase forecasting and real-time inventory statuses
Inconsistent Quality
Consistency is essential in the restaurant industry. Customers expect a consistent experience every time they visit a restaurant. Restaurants that fail to deliver consistent quality in their food, service, or ambiance are likely to struggle. Consistency requires a focus on quality control, which includes staff training, menu development, and process standardization.
Aldelo Express provides several tools that support consistent guest experiences:
Consistency is essential in the restaurant industry. Customers expect a consistent experience every time they visit a restaurant. Restaurants that fail to deliver consistent quality in their food, service, or ambiance are likely to struggle. Consistency requires a focus on quality control, which includes staff training, menu development, and process standardization.
Aldelo Express provides several tools that support consistent guest experiences:
- integrated Kitchen Display Systems (KDS) that reduce order mistakes and long wait times
- native Inventory Module that notify staff and guests of out-of-stock food and drinks
- automatic cloud-based data synchronization across all POS terminals for clear staff communication and a consistent “look and feel” across all POS, Kiosk, and Masa+ digital menus
Aldelo Express Kitchen Display Systems (KDS) reduce order mistakes and long wait times
Location, Location, Location
One of the most common reasons why restaurants fail is because of a poor location. A restaurant’s location can make or break its success. A restaurant that is located in a remote area with low foot traffic or limited accessibility will struggle to attract customers. Similarly, a restaurant located in an area with too much competition can struggle to stand out among the crowd. A restaurant’s location should be carefully selected based on factors such as accessibility, foot traffic, and local competition.
Aldelo Express merchants use QR codes that direct customers to their website or digital menu. By placing QR codes in mailers, handouts, business cards, window decals, or signage at local events, restaurants promote their brand and provide convenient access to the Aldelo Express Masa+ Online Ordering, Delivery, Loyalty and/or Gift Card services.
Second-Rate Customer Service
Customer service is a critical component of any successful restaurant. Customers who receive second-rate service are unlikely to return, and they may share their negative experiences with others, which can damage a restaurant’s reputation. It is essential for restaurants to prioritize excellent customer service, which includes attentive staff, prompt service, and responsiveness to customer needs.
Aldelo Express POS supports customer-centric services with:
Customer service is a critical component of any successful restaurant. Customers who receive second-rate service are unlikely to return, and they may share their negative experiences with others, which can damage a restaurant’s reputation. It is essential for restaurants to prioritize excellent customer service, which includes attentive staff, prompt service, and responsiveness to customer needs.
Aldelo Express POS supports customer-centric services with:
- All-in-one mobile POS software for tableside ordering and payments
- Digital Hostess and Reservation Modules with SMS text message customer alerts
- QR Code-based Masa+ Online Ordering and Digital Payments for customer-driven transactions
- Self-Service Kiosks that cut customer wait times
- “Shared Item” services to split the cost of individual items across multiple tickets
- “Split Check” services
- and much more
Aldelo Express POS supports customer-centric services with all-in-one mobile POS software for tableside ordering and payments
Lackluster Marketing
Marketing is an essential part of any successful business, including restaurants. Many restaurants fail because they are unable to effectively market their products or services. Lackluster or ineffective marketing can result in low customer turnout, which can negatively impact revenue. It is essential for restaurants to have a well-defined marketing strategy that includes targeted advertising, social media, and public relations.
Aldelo Express supports several restaurant marketing solutions, such as:
- QR codes for cross-pollination advertising with local businesses
- Multiple Store Loyalty and Rewards programs
- Customizable Promo Cards to promote initial purchases and encourage enrollment in Loyalty / Rewards programs
- cloud back-office reports with multi-level insights
Changing Market Trends
The restaurant industry is constantly evolving, and restaurants that fail to keep up with changing market trends are likely to struggle. For example, the rise of online food delivery has led to nearly every restaurant offering delivery and/or other off-premises services. Restaurants that fail to adapt to these trends are likely to lose customers to competitors who offer online ordering and delivery.
By prioritizing these critical success factors and implementing a powerful restaurant POS solution such as Aldelo Express, restaurants can increase their chances of success and thrive in a notoriously competitive industry.
Learn more about Aldelo Express Cloud POS solutions by contacting an Aldelo representative today at [email protected] or 925-621-2410
The restaurant industry is constantly evolving, and restaurants that fail to keep up with changing market trends are likely to struggle. For example, the rise of online food delivery has led to nearly every restaurant offering delivery and/or other off-premises services. Restaurants that fail to adapt to these trends are likely to lose customers to competitors who offer online ordering and delivery.
By prioritizing these critical success factors and implementing a powerful restaurant POS solution such as Aldelo Express, restaurants can increase their chances of success and thrive in a notoriously competitive industry.
Learn more about Aldelo Express Cloud POS solutions by contacting an Aldelo representative today at [email protected] or 925-621-2410
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Restaurants that use ultra-competitive Aldelo Pay or Aldelo Partner Merchant Services obtain access to a Centralized Multi-Store Restaurant Technology Platform that includes Masa+ Online Ordering, Unlimited Software Releases, Unlimited Software Upgrades, and 24/7 Technical Support! *** Please contact an Aldelo representative today for more details, including a free Aldelo Express POS demo trial [email protected] | 877-639-8767 | [email protected] |
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