Six Reasons Awesome Restaurants Close
People want to believe that making great-tasting food is the number one factor in building a successful restaurant, but the cold, hard, heart-breaking fact is that it’s probably barely hanging in the top ten.
While I (and likely you, if you’re reading this article) choose restaurants almost solely on the quality of the food, we—even in this day of King Foodie culture—are in the minority.
I learned to make pizza at the side of a man who once put Domino’s Pizza out of business in his town; I have served frozen chicken fingers in a dingy pub; and I was mentored in restaurant marketing by some of Seattle’s most successful restaurateurs. What I learned from this is that having amazing food and a successful restaurant are two very different things—with very little correlation. Here’s what causes the best-tasting restaurants to close:
- Location, location, location: It’s not all about being in the busiest place—it’s about being in the right place. Your late-night hot dog stand is going to do best near the dance clubs, while your child-friendly brunch spot should probably be in a neighborhood with plenty of families.
- The ingredients are too good: Farm-to-table stuff doesn’t often pay off. Well-sourced ingredients are a point of difference to a small percentage of customers—but all of them are asked to pay the premium. Bad restaurants can be successful because Sysco french fries are costing them pennies on the dollar that a customer pays them. Meanwhile, the idealistic chef is paying not only for the better potato, but also for the labor to cut, peel, chop, and fry them. Thin margins in the industry make the $20 frites a hard sell.
- The ingredients are too weird: Serve foie gras, fish with the head on, or pig ear, and you’ve made the choice to alienate a population. There might be a burger elsewhere on the menu, but some people will fixate on the pig ear—and be frightened away from the entire restaurant.
- Too much concept—or too little: It is overwhelming to walk into a place that is super-stylized down to every detail, the kind of place where you begin to wonder if you should have dressed in costume. It’s stressful, as a diner, to play the part of someone in this fantasy world. It’s equally stressful to have no idea what it is that ties the place together. Why are there tacos on a menu with curry? A cohesive—but not stifling—concept sets customer expectations.
- It’s not a pleasant place to sit: Many mistakes on the plate can be forgiven if a restaurant is a great place to hang out. The restaurant group I worked for probably earned an extra turn on the early side of brunch just by being known as a place that was great with kids. On the other side, I’ve stopped going to tasty restaurants because of: a waiter who touched me while I ordered, having those awful, uncomfortable French bistro seats, lack of purse hooks (especially at a high bar), it’s too loud, it’s too quiet, or it just feels weird. These reasons seem silly, I’ll admit, but frankly, there are other places out there with good food AND pleasant experiences—so why pay money to be even the slightest bit uncomfortable?
- Poor management: This is the clincher. From the chef/owner who tries to do it all himself, to the one who doesn’t do enough and loses employee confidence (and effort), this is the culprit. Poor personnel management or poor food cost management drive a busy restaurant financially underwater, while poor reputation management or poor customer service management deter customers from enjoying the food. The list of ways to easily upset the delicate balance of managing a restaurant is infinite, and turning out great food, can sometimes even be the enemy of good restaurant management: the desire to serve good food will wreck your food costs and make you pressure the customer not to make substitutions.
So many restaurants, so many ways to fail.