When You Take Over a Cafe or Restaurant – How to Do It Right

A while back I wrote about the decline of a favourite cafe now under new ownership. I was challenged to give suggestions for how this could be done well, so here’s my To-Do list for the new business owner:

New Faces: own it, and let people know who’s who. Now’s the time for name tags (yes!) and the owner or manager could even add a cheeky label to say ‘Proud New Owner’.  Could you get a ‘best wishes’ message from the old owner? Put it up on the wall for all to see.

This is also time to say goodbye to staff who weren’t adding to the business – the slow and the negative. In most situations, you have a unique opportunity to let go of previous employees without any obligation – the previous owner should be paying them out, or compensating you for any accrued benefits they have (eg long service leave). New owner, new start – talk to your lawyer.

Do More of What Was Done Well: the great cakes, the friendly greeting, excellent coffee (don’t change the blend!) and the special services. Keep buying flowers and providing newspapers.

Fix the Weak System: businesses are rarely sold because they’re making too much money… it’s usually the opposite, no matter what stories you were told by the broker! Audit and start upgrading the ordering systems, stocktaking, recipe costing, booking and customer service procedures. Are staff signing on and off correctly? Assume that there’s been internal theft, and look for system gaps that have allowed this eg stocktaking, POS not being used correctly, cash handling etc. Once you close off these opportunities, the thieves will soon leave.

Dig Into the Numbers: the figures you were given from the old business are probably a bit sketchy, but you will soon find valuable information from your POS and the bills you pay. A well-setup cloud accounting system is essential eg Xero or MYOB, so you can track results day by day – get your accountant onto this immediately. Detailed figures from the POS will soon show best and worst sellers, plus sales by hour and day. A good roster system like Tanda or Deputy let’s you compare wage costs against sales – even a spreadsheet will help to find areas of strength and weakness. Slice and dice all the numbers you can – opportunities will be right there in front of you.

Clean and Repair: businesses for sale often look tired, and cleaning is one of the first things to be neglected. Blitz the floors, and ceilings, plus behind counters and shelves – you’ll be surprised at what you find. Fix the broken appliances, toss out old platters and pots, ditch the broken furniture. Front of house, fix wobbly tables and repair all the dings and scratches on furniture. Paint the toilets and install new toilet seats and amenities.

Don’t Redecorate Just Yet: if you’re launching a whole new concept, go for it. But if you value the concept you bought, minimise the redecoration until you’ve settled in. Once you know more about the customers and service rhythm, you’ll be clearer about new decor.

Leave the Menu Alone: there will be weaknesses that need to be fixed, but in the first few months you are stabilising the ship, sorting out the staff and making friends with customers. You’re also finding out what customers really like, so use the specials board to try new ideas. Ask questions and listen.

Improve the Marketing: another area where the previous owners were probably economising or forgetful. Increase the friendliness and frequency of posts on Facebook and Instagram, including targeted ads. Check that your ‘Google My Business’ listing is up to date and has plenty of photos. The website may need a major improvement – this should be a high priority, with better photos, more relevant information and optimised for mobile phones. If an email newsletters was being send, use it to spread good news – another area where things had probably slipped.

Improve Staff Culture and Conditions: that includes fairer treatment, proper pay, better rostering and good communication channels. There will be times you are told ‘that’s the way we’ve always done it’ – just smile and explain why it needs to change. Don’t be surprised if within 3 months all the old staff have left – it usually happens with new management. Yes, even the ones who say you’re much nicer than the old boss! Staff manuals and policies, job descriptions and a noticeboard – they’re all part of the healthy new broom.

Time to Tighten Up Your Facebook Privacy – How Long Since You Checked It?

I like Facebook for keeping in touch with friends and family, but worry about the privacy side – who else knows what I say and like? The latest news about political use of Facebook data shouldn’t come as a surprise – it’s just a sophisticated extension of what you can do to target local customers with Facebook ads.

It’s important to review your privacy settings – the options keep changing and you might be surprised at the information you make available. If you’ve never done this, chances are that strangers can see all of your posts. And what about your staff? It’s amazing how unaware they are with privacy – challenge them.

Here’s Canadian tech guru Steve Dotto, showing how to tighten up access to your private Facebook information. Read his article or watch him show you how on the video…

UPDATE: Seems like the data Facebook collects from our phones is way more than imagined, although I’m sure we gave permission in those Terms & Conditions we agreed to. This tweet alerted me to the range of data, and how you can access it – read the details here on TechCrunch

Watching the Decline of a Cafe Under New Owners

It’s painful to watch the decline of a favourite cafe – it’s been under new management for the last 2 months. It was probably not an easy business to sell, as the menu is complex and standards high – that would make it intimidating for many potential purchasers. The previous owners set it up ten years ago, and it has a passionate following – for the product and for them as people. But new owners should expect this –  it is too personal a business for them to assume people won’t care about changes. Just doing the same as before is never enough in situations like this.

What else have I noticed?

  • The beautiful fresh flowers on the front table are now skimpy, or missing. No more quirky signs or humorous touches.
  • Instagram action has fallen away – previously we would see something wonderful just out of the oven almost every day.
  • Most of the familiar staff have gone. That is inevitable with a changeover, but we miss the friendly greetings, especially from the previous owners. This ’emotional leadership’ can be replaced by new faces, but there are no obvious owners taking on this role – who is running the show? Who is the new chef? Many people like to know this…
  • Cake cabinets are a little less full and abundant. They may have been overstocked before, but all that great food piled high was part of the attraction.
  • Signs of carelessness – staff touching hair between serving, cash sales not rung up properly. Maybe I’m watching too closely?
  • Decline in coffee quality – have they changed brands?!? This can be a disaster for regulars, and I’ve heard comment from others.

Taking over a popular business will always be a challenge, and the last thing that regulars want is change. There’s a strong need for stability, continuity and even more friendliness. Once a slide starts to happen, it can be reversed, but it needs ‘turnaround marketing’ skills that many people don’t have.

>> Check the positive companion article to this: When You Take Over a Cafe or Restaurant – How to Do It Right .

 

8 Enterprise Skills – the New Essentials for a Well-Paid Hospitality Career

The New Basics is a very interesting report on the Enterprise Skills young people need for the new work order. It’s been prepared by the Foundation for Young Australians, and they have a steady stream of good articles about work and wellbeing.

Enterprise Skills are transferable skills, and Technical Skills are those specific to a particular industry. It’s a good checklist for people who are thinking about moving into or out of hospitality, and finding a well-paid job.

I’ve had some recent conversations with chefs and managers about where they will take their careers after restaurant work – this is useful to see what they need to strengthen. I’m guessing #1 would be on most people’s improvement list…

I’ve taken the 8 Enterprise Skills they’ve listed (in the order of increased demand for these skills), and added some examples from hospitality – what else would you add under these headings?

  1. Digital Literacy – using business software, POS and cloud-based services, typing, Google searching, managing email, using photos and editing images, managing social media.
  2. Critical Thinking – comparing supplier quotes and proposals, weighing up options for menus and events, choosing between a number of job candidates, examining options for business changes.
  3. Creativity – recipe and menu development, music and entertainment, events, improving restaurant design and atmosphere, motivating staff in new ways.
  4. Problem Solving – handling conflict between staff, managing a sudden growth or decline in business, dealing with critical customers and staff not performing as expected.
  5. Financial Literacy – recipe and menu costing, working out wage costs, using a calculator and spreadsheet, reading POS reports, working out Return on Investment for equipment purchases, understanding a Profit & Loss statement.
  6. Presentation Skills – explaining changes to a team meeting, talking on your feet, presenting a new menu to senior management, justifying the cost and benefit of a proposal, using PowerPoint, talking to prospective employees eg school students.
  7. Communication – having a constructive conversation with staff, writing a report, expressing praise or dissatisfaction to a supplier or staff member, effective emails, having a good sales manner with prospective customers – phone and in person.
  8. Teamwork – organising and running a meeting, monitoring performance and results, supporting staff who are not performing, creating a team with a positive mix of skills and personalities.

The biggest increase in demand is for skills in 1, 2 and 3:  Digital Literacy, Critical Thinking and Creativity.

How to Get Work Instructions & Recipes Written Up Quickly & Cheaply

Two finger typist? You’re not alone, but when it comes to typing up the recipes in your black book, or preparing an instruction manual, it can be yet another excuse to put it off… again.

Two low-cost online services can do the work for you in a few hours – I use them, and find them fast and accurate.

1. Typing Up Notes with Fiverr

Fiverr is a service that does a wide range of small tasks, usually for about $5 each – photo or video editing, logo design, menu translations, fixing spreadsheets, resume writing and lots more. I recently used Fiverr to have 40 hand-written forms typed – it cost $US 11 and was done overnight! A job that would have taken me hours, or more likely never be done – I scanned them as a pdf and uploaded to Fiverr.

Have all your recipes typed: I know of chefs who have scanned their hand-written recipes and sent the images to a Fiverr typist. Use a PDF Scanner app on your phone, and as you photograph each page it turns into a pdf, adding one page after another.

Tip: send the person you are considering for the work a message with a sample page, to see how they handle it – can they read your writing? If you want the recipes set out in a particular way, give a sample with your instructions. The $5 fee is for a short job – expect to pay more for longer jobs, but it’s still way less than the value of your time.

2. Typed Notes from a Voice Recording

An interview with a staff member may need to be written up, or it could be quicker to read aloud instructions for your new Kitchen Systems Manual, have them transcribed, then tidied up in a Word document. Get the words out of your head and onto paper!

For these transcriptions, I recommend Rev.com – a brilliant service that turns transcripts into recordings, usually within a few hours – all for $US 1 per minute! Use their recording app, or upload a recording you’ve done from the voice recorder on your phone. I recently had a 10 min. recording written up for $10, producing an 8 page document – something I could never have done myself. Another time I sent them the link to a fairly technical YouTube video, and shared the transcription with people who wanted to read it.

This is just the start of outsourcing the time-consuming jobs in your restaurant – start here and look around for lots more possibilities…

Also relevant: this Profitable Hospitality podcast on How to Outsource Hospitality Administration & Design Work.

Interviews with Ken Burgin on Restaurant Management and Podcasting

It was great to meet Adam Yee through Linkedin, when I commented on an article he wrote a few months back. He’s a food scientist and also has his own podcast, with the discussion often focused on food flavours. It’s a topic that was on my interview wish list, and now I had found an expert!

Enjoy the discussions I had with Adam on his My Food Job Rocks podcast…

Interview: My Work as a Restaurant Management Advisor

Bonus Interview: Podcasting and How to Build an Online Platform

Reversing the tables, here’s the interview I did with Adam about Food Flavours for the Profitable Hospitality podcast – it’s well worth your time…

Invisible? How to Stop Customers Forgetting Your Restaurant

Unless you’re a major industry icon, or they’ve visited 5 times, most people don’t remember your business name…

True story: 2 people in café, one on the phone. She looks at her friend and asks ‘what’s the name of this place?’…and the friend doesn’t know! Worse, there was nothing inside the café to tell them – no signs, nothing on the table or staff uniforms. Future business lost for sure.

Before you go spending big money on expensive promotion, check that you’ve covered all the small, personal promotional items within your 4 walls. You could double your business if everyone came back at least once!

Increase the number of times your business name is seen:

  • The business name on the wall or menu – make it part of the decoration.
  • Business name on awnings and the front window – if it’s just on the awning, people walking or driving by may not see it.
  • The name on the side and back of your company vehicles – include the website so it’s easy to find you later.
  • Name and contact details on the docket a customer takes away.
  • Business cards for people to keep. Makes sure there’s one with every account.
  • Souvenir menus at the counter, even if it’s just a sample.
  • Auto-response to inquiry emails. It automatically bounces back saying something like:
    Thanks for your inquiry – we will be in touch with you shortly. Don’t forget all our menus are online at wvw.ourwebsite.com’…
  • Business name on staff uniforms – just as important as the staff name.
  • Prominent website address – as big as every other mention of your name. If it’s not logical eg hgc.com instead of HillsideGolfClub.com, fix this – register the easier name as well, and have them both directing to the same website. If you spell the web name with some capitals (like this example), it’s easier to remember and won’t affect search behaviour.
  • Business name used in menu items eg at Café Troppo we had the ‘Troppo Burger’ and ‘Troppo Trifle’ – distinctive and memorable.
  • And of course your website comes up first when we do a Google search – many businesses still don’t have this happen.

Make contact more personal to reinforce the memories:

  • Hand written ‘thank you’ on the docket or account
  • A personal acknowledgement: ‘Thank you Mr Burgin’ – when my credit card is brought back to me, or when my account details are present eg checkout. If Qantas can do it loading 200 people on a plane, so can you!
  • Real faces on the website gallery – happy staff and happy customers, plus busines owners and managers with short biographical details.

Nice place, but where am I?

Is this the real reason we can’t find chefs?

Is the chef shortage a result of work that’s too hard, low pay, a sudden lack of work ethics … or because of a housing problem?

Instead of blaming young people or immigration changes, or even Masterchef, I’d put a lot of it onto the lack of affordable rentals close to the main hospitality and tourism hubs, where the work is. In my city of Sydney, that’s in the CBD, on the harbour and at beach-side suburbs.

At the wonderful Aust Culinary Federation Chef’s Dinner the other night, I talked to a wide range of young chefs. They love their work, mostly in those busy areas, and they live a looooong way away – a couple of them told me about catching the last train home at 1am and falling asleep for an hour until they get off at 2.30am. Then back to work for lunch the next day. Some live with parents, others with friends in cheap housing.

OK those hours aren’t exactly fair (and probably illegal), but at another time they would have found a reasonably-priced house to share or a flat within 5km, with a 20 min. bus or train to work. Adding four hours of travel to every work day is just asking for burnout, and a resignation. This is not just a problem for chefs, but also for teachers, police workers, cleaners and all the people doing the essential middle-level work that keeps society functioning.

Let’s stop blaming young people and social media, and understand that the problem is much more fundamental…

What Profits Are Used For: An Explanation for Restaurant Staff

Sales – costs = profit. It’s simple. If profits are good, there are more smiles and generosity – the fundamentals of hospitality. If money is tight, there’s not much for extras, and shortcuts will usually cut into service and quality.

It’s easy for staff to misunderstand the profitability of a business – they assume that you’re making money on the first coffee sold on Monday morning, and it’s $3.50 profit on the $4.00 price. The financial literacy of staff is another training topic, but in the meantime it’s good for them to learn more about business essentials…

So why are profits so important?

  • Profits mean more tax is paid – which pays for schools, roads and hospitals. If the tax rate on business profits is 30%, that’s $300 paid for every $1000 of profit. No profit = no taxes.
  • The business can afford better (and often expensive) kitchen and coffee equipment, which is usually easier to use.
  • They can afford better-quality ingredients instead of always hunting for the cheapest.
  • Profitable businesses can pay for good uniforms, not cheap ones. Or provide them for staff instead of insisting they use their own.
  • Profitable businesses can afford professional cleaning, so the place sparkles everywhere. They also buy flowers, quality furnishings and good tableware – small things that add up.
  • Pay for staff training and offering staff opportunities for staff development. Hard-up businesses never do this.
  • Profits allow for business expansion, which means more people employed and more opportunities for promotion, and work for your friends.
  • The boss is more likely to take staff to a trade show and dinner afterwards, or take all the staff to the restaurant awards dinner.
  • Managers don’t stress if someone has time off for urgent family reasons – they can afford to be generous.
  • A profitable business shows staff how to operate successfully – a great learning opportunity if they have dreams of their own restaurant in the future.
  • Profit gives the business a value, making it easier to sell. A business that’s easy to sell is usually fresh, lively and popular.

…and finally, a profitable businesses can give the boss a good holiday – making her more generous, smiling and easier to be around!