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A Filipino’s Guide to Surviving the First Year of Restaurant Business

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I belong to a group of pioneer restaurant owners. Although the restaurant landscape has changed since we entered it, it is still no easy task to open a restaurant and the first year is by far the hardest to survive. These are a few tips that we used to tide over our business in the first year.

According to a study by The Perry Group study most restaurants in the Philippines close during their first year of operation.

70% of those that make it past the first year close their doors in the next three to five years. 90% of the restaurants that are still operating past the five-year mark will stay in business for a minimum of 10 years.

So as a restaurant business owner, what can you do to reach that 90% group?

1. Think and Breathe Like an Entrepreneur

We believe that one thing that many restaurant owners forget is that they are essentially running a business. You should be able to pin point the losses and profits that each dish brings to your business because you are always looking for the potential to make the most money from a situation. This keeps your business alive and thriving so that you can continue bringing delicious dishes to your consumers.

2. Engage With Your Customers! [restrict]

Back when we started out, marketing was limited to mostly limited to email marketing. This marketing techniques are still highly relevant today but have gotten a tad bit more complex.
One way to master email marketing, where you send your consumers promotions or inform them about special events, is to create an irresistible subject line. Make sure that your subject line stands out from the rest by adding emojis and by being concise. Make it super personalised is important as well. . For example, promote your hot new item with “We have a treat in store for you!” subject line. The next most important step is to add a call-to-action number to drive them to whatever action you want them to take.
Now social media is all the hype and we have jumped on this bandwagon as well! We use simple editing tools like Canva to create infographics for our Facebook and Instagram page and make sure to answer to every comment or direct message to engage with our consumer base. 
Marketing is all about communicating with your consumer and building up this relationship is vital to keeping your business afloat.

3. Maintain a Low Food Spend

According to Restaurant Report, a profitable restaurant only spends 28%-35% on food cost. Struggling to meet this percentage? Make sure that you constantly review your suppliers to see if they are offering the cheapest prices on the market.

4. Cut Back On Your Waste

Cutting back on your waste is key to reducing losses. Some small tips you can follow is the First In First Out (FIFO) rule where your restaurant uses older ingredients first over newer ingredients. This makes sure that no resources are wasted. 
As with your staff, make sure that you are not overpaying them or over working them. For example, if Mondays are quieter days, don’t schedule the same amount of part-timers as a busy Saturday. This helps you save on staff pay significantly. 
Actionable Takeaway:
It’s not too late to save your business by cutting back on losses. It is also important to use marketing to retain customers and gain more customers at the same time.

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