Low Restaurant Sales Isn’t Your Problem, It’s a Symptom

That’s right. Having low or insufficient restaurant sales volume is always the “result” of one or more causes. Sometimes the causes are external, such a recession or a bad local economy, but many, if not most problems associated with low sales, are due to internal factors that owners and managers have some degree of control over.

As you can imagine, this is one of the most popular topics on our RestaurantOwner.com Discussion Forum - “My sales are too low!! How can I increase my restaurant’s sales?”

While there are certainly hundreds of ideas for increasing restaurant sales, many of them are marketing related which tend to ignore the issue of “what’s causing it.” However, we believe it's best to start by examining a restaurant’s unique operating situation and key practices to find clues as to “why” restaurant sales are insufficient or low.

Typically, low restaurant sales can be attributed to one or more of the following causes:

The restaurant concept has insufficient market demand. Consumer dining trends are forever changing. As a result, many restaurants are forced to adapt to changing demands. A gradual decline in sales may be an indicator it's time to reevaluate your concept.

If you are not taking care of your customers, your competitor will.
– Bob Hooey

The quality and consistency of the guest experience is lacking. Lack of quality and consistency in executing day-to-day business is the single biggest reason for low restaurant sales. If you want to improve your results, you must first improve the guest experience.

The price/value perception is out of line. Great restaurants can command a higher price point. But even great restaurants have a ceiling when it comes to price vs. value perception. If your customers are having difficulty in justifying the price you are asking then you have two choices: 1) Improve the guest experience to align with your prices, or 2) Lower your prices to align with market demand.

Location, location, location. A great location can help overcome other shortfalls, but a poor location may be impossible to overcome – regardless of how good your food and service are. Some of the factors affecting your location are traffic counts, parking availability, surrounding market and ease of access.

Lack of marketing or market awareness. Sadly, the first strategy most restaurant owners apply when trying to increase sales is to immediately increase their marketing. While this tactic may work, keep in mind that if the quality and consistency of the guest experience is lacking the only thing heavy marketing will accomplish will be to let more people know (faster) that you may not be a good restaurant. Be sure you have your act together before embarking on heavy marketing or advertising as a fix for low restaurant sales.

Again, always keep in mind that low sales are NOT your problem. Low restaurant sales are a SYMTPOM of one or more core issues that are causing fewer first timers to come in or keeping existing customers from returning more often.

Accurately identifying the core cause(s) keeping customers away is always the best place to begin the sales improvement process.

For more tips on increasing restaurant sales and other restaurant operations best practices, read our article 7 Sales-Busting Mistakes Many Independent Operators Make & How to Avoid Them and check out our course The Gift of Hospitality to start maximizing your restaurant sales.

Have a profitable week!

The RestaurantOwner.com Team