Restaurant Business Expansion-7 Tips to Replicate the Success of Your First Restaurant

Restaurant Business Expansion-7 Tips to Replicate the Success of Your First Restaurant

The best part of opening a second restaurant is that you already know the challenges faced while running the first one. The worst part of opening a second restaurant is that the things that worked for the first restaurant venture might not work at all for the second one. And you wouldn’t even know why. Restaurant business expansion without diluting your brand name and credibility,  and replicating the success of the first venture is a difficult task that requires careful strategy and execution. This article will help you write a winning Restaurant Business plan for your new restaurant outlets.

The Checklist for Restaurant Business Expansion

We have created a checklist of the top things you need to do before your launch your second venture.

1. Current Model Evaluation

The first thing that you need to consider is whether the model is successful enough to be replicated. You also need to analyze if the current restaurant is churning out a profit. If yes, then you must further identify these based factors, and evaluate whether these factors can be simulated at the new venture as well. For example, the current location may be the single most important factor in the popularity of your restaurant. If the restaurant is a success just because it is the only restaurant in the 10 km radius, then opening another one in a restaurant crowded location is not a good idea.

Do a SWOT (Strengths, weakness, opportunities, and threats) analysis to gain a better understanding of your restaurant’s business model.

Another important thing to consider is the sustainability and scalability of your establishment. The restaurant should be able to function without you. You would no longer be able to physically monitor the operations of all the outlets.

2. Planning and Market Research

Before you put your hands in the restaurant expansion, careful planning and evaluation of the market is a must. Conduct a market research and demographic survey to identify your customer base, and to make sure that you’re catering to the right audience. Primary research consists of personal interviews and online surveys that give a direct insight into your target customers’ mind. Secondary research includes the analysis of the already collected data to identify competitors

Location of the new outlet is extremely important as well.  It is important to consider the existing competition in the area, and whether your restaurant the right fit for that particular demography. Location and target customers are some of the most determining factors of a restaurant’s success.

conduct market research before you go ahead with restaurant business expansion

3. Financial Planning

Opening a restaurant is a financially taxing task and restaurant business expansion is even more so. Raising enough capital on your own, or taking a loan involves a lot of financial risks, and needs to be done carefully. Therefore, restaurateurs often come together and form partnerships to make the investment more affordable. In this way, the risk of losing money is also reduced.

With the startup wave hitting the country, startup restaurants have also become popular in the hospitality industry VCs and angel investors are considering restaurants a profitable venture, and are now investing more than ever into interesting ideas. Investors look for scalability, standardization, and quality in the restaurant venture. The model needs to be successful enough to be replicated, and therefore, the first three or four restaurant outlets are evaluated before investing in them.

4. Robust Central Management

A robust central management is inherent to any long chain restaurant, without which the chain cannot grow profitably. It is impossible to manually oversee all the restaurant operations, therefore a restaurant ERP software is used to manage and monitor the operations.

Central Kitchen Management is especially required in long-chain restaurants and Quick Service Restaurants, where there are multiple outlets, and consistency needs to be maintained throughout. Right from keeping a track on the inventory needs of all the outlets, to maintaining menu and recipe consistency throughout, your ERP software can handle the entire central management. Learn how you can use a restaurant ERP to manage a large restaurant chain seamlessly here.

5. Hiring Right

It cannot be stressed enough that employees are the backbone of any restaurant, and they are the ones who keep it running. Therefore, hiring enough resources before the launch of the new restaurant, and training them adequately is an absolute must.

Often, a restaurant is known for its exceptional service and the signature dish. Hence, investing in a strong and efficient staff is a wise step and crucial for restaurant business expansion. Hiring the staff that can pull off the legacy of your restaurant brand, and then training them right is extremely important.

6. Consistency and Quality

The success of your first restaurant and the brand name will bring customers to your next restaurant, but only great food and service are going to help retain them. Therefore maintaining consistency and quality across all outlets are a must while running a chain of restaurants. Standardization of recipe is essential and helps to maintain the taste and quality of the food. In case of long-chain restaurants, brand image is integral to the chain’s success.  A standard format and menu help to keep the brand image intact.

7. Maintaining the Effort

It is often seen that the other branches of a successful restaurant are not as popular as the first one. This is usually because restaurateurs often get laid back and do not pay as much attention to the new restaurants as they gave to the first one. This is the foremost cause of failure of restaurant chains and leads to the stagnancy and failure. Each restaurant outlet is just as important and requires the same level of effort as given to the first successful outlet.

Hiring a strong management team, and using a centralized POS with mobile analytics and reporting feature helps you keep track of all your outlets at one place. You can remotely view the restaurant operations such as total sales, total bills generated, and the number of customers served real time.

Make sure to implement these tips during your restaurant business expansion, and let us know how it helped you in the comments below!

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  1. […] The USP of a successful restaurant is usually the taste of a particular signature dish. When a restaurant expands and opens a second or third outlet, the taste is often not the same. Inconsistency in taste is the major reason other branches of popular restaurants often fail and shut down. When it comes to restaurant brands, customers are looking for a familiar dining experience. People prefer eating at a recognized restaurant chain as the food and service are expected to be similar as that of the main branch. Maintaining consistency across restaurant outlets is extremely important to maintain as it helps build brand loyalty among customers. For this reason, multiple-outlet restaurants need to maintain the consistency in taste, as well as service, not only to attract and retain customers but also to replicate the success of the first restaurant outlet. You may also find this article about how to do the expansion of your restaurant business useful. […]

  2. Tips for business expansion are very impressive, also you can add an ongoing feedback ideas when customers are present at your place. I have seen many lounge and restaurant using CRM in phones and Ipad to get valuable feedback and tips for their services, this helps can help you to get genuine feedback in short time.


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