Best Practices

Maintaining Your Restaurant’s Competitive Edge

A component of being successful as a restaurateur is recognizing that the business environment is constantly changing and that you must juggle a lot of information to stay on top and manage your restaurant productively. In addition to running the day-to-day operations, you must keep an eye on the future to keep pace with your competition and other restaurant trends, in particular:

Your competition. It is good business sense to keep up to date with what your restaurant competitors are doing. That does not mean peering across their parking lot with binoculars. It can mean knowing their menu items and specials, their prices, and how they are different and the same as you. Some restaurant owners think that since they are the only "family-style Italian" or "upscale steakhouse" in the immediate area they have no competition. That is shortsighted reasoning. Your restaurant competitors are every "substitute" activity on which your guests can spend their discretionary dollars. Your competitors include any alternative activity that your customers spend their discretionary income on. Depending on your target customer, your competition could be a restaurant with a different menu but similar pricing. Or it could be a brewpub with food truck service. Know who lures your customers into their businesses, how they do it, and what they offer. Attempt to do everything better than they do.

The entrepreneur always searches for change, responds to it, and exploits it as an opportunity.
– Peter Drucker

Your industry. Ask your industry distributor and supplier sales representatives how things are going. What are the current restaurant trends? How are other restaurants like yours faring? Your representative can also pass along good information about successful ideas they see being used elsewhere. Part of keeping up with the industry means reading industry publications and listening to podcasts to learn about new products and restaurant trends.

The economy and best practices of non-restaurant businesses. We can become so involved in running our business that we ignore the world around us. Stay abreast of economic and general business trends; they can reach every sector, including local restaurants. You can also develop a sense of how current events and changes in the business cycle affect your restaurant. Look "outside the box" for good ideas. The florist or optometrist next door is not in the restaurant business but could be a source of clever marketing or operation ideas. If you notice that a neighboring business seems to be doing particularly well, invite the owner to your restaurant for coffee and dessert and ask her what she is doing to keep the business thriving.

Check out these valuable resources that will help you effectively analyze and stay ahead of your restaurant competitors:

Competitive Analysis Worksheet: A useful tool for thoroughly assessing your restaurant's position relative to competitors, helping identify strengths and weaknesses.

Competitor Review Download: Conduct detailed reviews of competitors, focusing on market trends and pricing strategies.

I-Spy: Keeping an Eye on Competitors: Practical advice on how to monitor competitors’ activities and use that data to inform your restaurant’s strategy.

Have a profitable week!

The RestaurantOwner.com Team