Toast Restaurant Management Blog 

Subscribe to get weekly restaurant resources right in your inbox &
receive the FREE ebook, 15 Creative Restaurant Staff Training Ideas.

The 5 Real Reasons Your Restaurant Traffic is Dipping

Posted by Ryan Gromfin on 7/10/17 3:00 PM in Industry News & Trends

restaurant.png

Let’s get this out of the way: the real reason your traffic is dipping is not because people are dining out less. 

In fact the National Restaurant Association predicts that by year end 2017, Americans will have spend $799 billion eating out, while in 2010 we only spent $586 billion.  

In addition, for the first time ever in history, Americans are spending more at bars and restaurants than on groceries. 

So, in general, people are eating out more often than usual. If your restaurant traffic is dipping, something else must be to blame.

Let's talk about what that might be.  

The Modern Restaurant Problem

I agree - there is a problem plaguing restaurants. In fact, restaurants in general are no better off now than they were 5 or 10 years ago. I see it in my restaurant consulting practice all the time…really good restaurants are struggling with really low numbers.

If you ask any restaurant consultant, they will all tell you the same thing - Good is Not Good Enough Anymore.

I heard Tony Robbins describe this effect on business today better than anybody else. He states that your business will be rewarded 1 step below the quality of its operation.  

  • Good restaurants are getting poor results
  • Great restaurants get good results
  • Excellent restaurants get great results

The odd part is that even though there is a level above Excellent, those restaurants don’t get excellent results, they get everything

The Idea of "Mastery"

To quote another hero, Ricky Bobby (Will Ferrell’s character in Talladega Nights) says “If you're not first, you're last.” 

For restaurants, this simply means that the best ones get everything.

These restaurants are not just busy, they are slammed 7 days a week. They are the ones getting so much free media that they would never consider spending a penny on marketing.

What does it mean to the be the best? To me, it’s simple…mastery. You are either mastering or dabbling.

Expectation Economy

What caused all this chaos to happen? How come restaurants that were once very good and consistently busy are not anymore?

Every industry has a media outlet to thank for the new economy or poor results. In our industry, we can thank Food Network.

I call this economy the “Expectation Economy.”  The food network brought the best from all over the world into our living rooms.  I grew up on it, it inspired me and an entire generation to cook.  And not just to cook, but to cook with ingredients that were never available at our local grocery stores before.

To not just make food taste good, but to make it look incredible. 

Looks Delicious. Tastes, Well...

No matter how good, great, or excellent your burger is, there is one on TV or on a Facebook Tasty video that's better looking. And did you know that we see a picture of food, we actually taste it a bit in our brain?

There is very interesting science regarding this, and it causes us to actually enjoy the real food a bit less because our brain is already slightly satisfied. 

But this is happening when I eat at your restaurant.  If you burger does not look as good as the one I have seen from some other restaurant or on TV or in a magazine, I am already disappointed before I even taste yours.  

So then, the next time I want a burger, I just go to a “cheaper” restaurant where I know it won’t be as good, but it won’t cost as much either. 

This also explains why quick service and fast foods numbers continue to grow while casual dining and full service are slowing. For these restaurants, presentation - good or bad - is practically irrelevant. It's worth the cost and convenience.  

Market Saturation Takes its Toll

If the industry is growing as a whole, why aren’t you? That is even simpler to explain. 

There are just too many restaurants. 

res

In my humble opinion, there are just too many restaurants out there. It’s like 10 years ago, when everybody became a foodie, everybody decided to get into the restaurant business. 

What we are seeing now are chains that are getting huge investments from capital markets all over the world and are growing at an insane pace.  A new concept can open 100 franchise locations and be sold in year two. This is eating away at the profits from respected and established brands because diners want to try the next new thing.

The 5 Real Reasons Your Restaurant Traffic is Dipping

The market is due for a correction. Some of these restaurants are going to close and some need to close.

If you want to be one of the ones that stays open, then you to accept, change, and move on from these five hindrances. Only then can you ensure your restaurant is one that survives and thrives. 

1. You Still Haven't Mastered the Restaurant Industry

Get really good at a few things instead of trying to be average at a lot of things. A great restaurant cannot be everything to everyone, particularly when you're not the best at it.

With a competitive environment and consumers more quality-driven than ever, mastery is what will win. Chick-fil-A has mastered the quick service chicken sandwich, In-N-Out has mastered the quick service burger - yes neither is on their way to releasing the next big steak and cheese. 

Every system, process, and procedure they have in place is designed around their core product offering. If pizza is your thing, then crush it. Don’t mess with the other 50% of your menu that represents 10% of your sales, just do pizza, but do it better than anybody else. 

Master it.

2. Your Staff Needs to Be Better

I know, its hard to find great staff. You see millennials as those who are lazy, entitled, and don’t want to work. 

Yep, so what?

  • Make your place more fun to attract better employees.
  • Create better systems so that you don’t need the “best” employees to do the best job. 
  • Correct training and onboarding systems so you can get employees up to speed faster. 

If you continue to complain about it or fight it, somebody else will get the best employees because they are embracing the challenges and working with it, instead of fighting it. 

3. You Need to Improve Your Food Quality

I'll say it again - good is not good enough anymore. 

People want what they are seeing on TV and in the Media. You can’t just serve good anymore. If your food is not amazing and leaving me wanting more before I even leave your restaurant, you have already lost the battle. 

4. Your Prices Are Way Off

I did this long research project for a high-end steak house client that kept telling me customers are saying they are too expensive, so naturally, they believed they were too expensive because of this feedback.

I proved that they were about 8% cheaper than their competition with the newest and by far nicest dining room and amenities. 

So why were customers saying they were too expensive?  

It only took me a few days away from the research and in their restaurant to see it was the value. 

  • Their martini glasses were too big, so the proper size martinis only filled them half way. 
  • They were having major speed issues and consistency issues from the kitchen. 

The list went on and on, which lead a customer to complain about “price.”  In actuality, they were not angry about the price - they were angry that they spent so much for something that was not perfect. They were okay with the price, so long as they got what they expected. 

Do I really need to say it again? Good is not good enough anymore. 

If you are serving the same frozen burger, sesame seed bun, and frozen fries as 3 other places in your area, then why would I pay more for yours? When you are thinking about value, you also have to think about distinction, originality, difficulty to duplicate, atmosphere, kindness of your staff, and all of the little things that contribute to the overall perceived value of the experience your restaurant provides. 

5. Your Restaurant is Inconvenient

Don’t confuse this with location. You don’t have to be across the street from all your customers, but you do have to make it easy on your customers.

  • Is splitting checks for guests or transferring a tab from the bar to a table effortless? 
  • Do you have great parking?
  • If not, how are you easing the burden of find a parking spot?
  • Is your staff inviting, welcoming, and genuine? 
  • Is your menu easy to understand? 
  • Does your staff know the menu so they can answer questions and make recommendations with needing to “ask the chef?”  

People are busier than they have ever been. We live in a hectic, chaotic world, and are in a constant state of stress. 

If your restaurant is not a glimmer of joy and escape from the day-to-day grind, then you are a commodity. Commodities can never charge enough to be the best.

You Don’t Need More Marketing to Bring Restaurant Traffic Back Up

To wrap this up, Monty Moran - the Chief Marketing Officer for Chipotle - has been quoted saying “The best marketing we do, is the experience a guest has when dining in our restaurant.” 

Step up your customer experience, step up your operations, and you will spend a lot less time and money on marketing. You'll be spending a lot more time serving customers and making bank deposits. 

restaurant podcast 

toast restaurant management blog

Written by: Ryan Gromfin

The Restaurant Boss™ works with restaurant owners and operators all over the world to help them move from the stress, struggle and overwhelm of operating a restaurant to more money, more freedom and more joy of operating a restaurant business. Clients who seek out Ryan for his proven strategies, systems and tools range from corporate chains and international hotel brands to independent mom & pop restaurants. As an author, speaker, restaurant coach and consultant Ryan has created TheRestaurantBoss.com as a resource for you to get valuable tips and tricks, so you can run a High Profit and High Performance Restaurant.


Leave a comment today.