How to Make Sure Your Restaurant Survives, and Succeeds

How to Make Sure Your Restaurant Survives, and Succeeds

How to Make Sure Your Restaurant Survives, and Succeeds

Opening and running a restaurant is a dream for many people but it doesn’t come without its struggles. The restaurant industry can be very volatile and has one of the highest turnover rates. According to a study by Ohio State University, 60% of restaurants do not make it

past the first year, while 80% go under in five years. Over the course of this blog, we will highlight some of the reasons restaurants fail and look at how to avoid them.


Location is on the top of all the lists for restaurant failure. It’s very easy to believe that people will come and seek your restaurant out, but that’s simply just not the case, especially at first. Sure, some notable restaurants are tucked away in corners but you will make your life just that much more difficult. When choosing a location, look for high traffic areas, great visibility and ease of parking. Always keep your budget top of mind and don’t spring for that “perfect spot” if your cash flow simply can’t handle it.

Lack of Differentiation

“Hey look! Another sandwich place!” said nobody; don’t let yourself fall into the trap. The last thing you want to do is offer the same product or service as every other Joe in town. The restaurants that survive are the ones that stand out from the crowd. This can be done in many different ways, exceptional food, décor, service, etc. The ideal situation is a combination of them all, once again while staying within your budget.

Poor Management & Inexperience

In its simplest form, a restaurant is a business. Sure, you may be in it for the love of the food, entertaining customers, etc. but the bottom line is things need to run like a sound business day to day. The chef might be able to prepare a meal worthy of royalty but can he crunch the numbers? It’s crucial to have someone on the team who has an extensive business background or you risk having your hobby empty your bank account.

Quality of Food

This one is really a no-brainer. It doesn’t matter how great the service and atmosphere is. If the food isn’t up to par your customers won’t be paying to come back. Celebrity chef Robert Irvine insists that food undergoes taste testing regularly to ensure the quality doesn’t falter.

Lack of Working Capital/Funds

This is another big one and one were very familiar with here at Evolocity. Running a restaurant not only requires a significant upfront capital investment to get things up and running but continued influxes of cash for things such as renovations, new equipment and marketing. There are many options out there to help keep your restaurants ahead of the game such as lines of credit, merchant cash advances and business loans. Don’t hesitate to contact us should you wish to know more about the financing options available to your business.

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