Originally posted on restaurant-hospitality.com
By Tom Jednorowicz
In my 20-plus years experience with fast casual, high-growth, early-stage restaurant concepts, I’ve learned several business lessons along the way. Below are five specific lessons I learned while launching my first restaurant concept, Meatheads, and some tips on how to apply these lessons to future startup concepts.
- Any startup business plan needs to be flexible. A business plan should provide for short to intermediate-term financial viability and contain a set of guidelines that steers the decision-making process. Five- or 10-year financial and growth plans are largely fictional beyond the first 12 or 18 months.
Similar to public companies pushing for quarterly results instead of developing solid long-term strategies for growth and profitability, business plans too literally interpreted and executed can create rigidity in the decision-making process, not allowing for adaptation to the often-changing realities of the marketplace. Opportunities for real growth could be lost in the quest for growth as defined by a plan that may have gone stale, which could put a restaurant in a vulnerable spot.
When we started Meatheads, we did have a business plan that encompassed startup economics and long-term strategy. Since we were operating in an established restaurant segment, we didn’t really focus much on brand appeal and target customers. We felt like it was obvious: males, especially those age 18 to 35. We didn’t think much about the ambient factors of the business. Instead, we spent time on engineering the menu and cost structure that we thought would lead to profitability.
- Execution: Create an atmosphere of winning for both employees and customers. When we opened our first Meatheads location in Bloomington, IL, in 2007, we didn’t know what we were doing. We were far busier than we anticipated. And while this seems like it would be a positive, it almost led to our destruction. Since we lacked experience, our execution couldn’t keep up with demand and we aggravated a lot of customers.
While at the beginning, it was all we could do to get the customers the food they ordered, we soon came to appreciate every person who walked through our doors. We needed to find a way to turn them into repeat customers, so we created training programs for all our employees, from chefs to point-of-sale to managers, to ensure execution was flawless and we were providing an enjoyable eating experience during every visit. We rewarded employees who excelled at executing and provided opportunities for growth within the company, which has resulted in a higher-than-average employee retention rate.
Customers, branding and commmunity
- Take care of every customer. As I mentioned, in our initial business plan we didn’t factor in the intangibles of running a restaurant. We soon realized that every person who walked through our doors was leaving with an impression. It was up to us to ensure it was a favorable impression. We also recognized how they felt about their experience was not entirely based on the food they were served, but about how they were served in general. This is really when our service culture took root. We decided that, if it was in our ability, no matter what we were going to take care of every customer.
We tried to anticipate our guests’ every need and take care of it. And when we made a mistake and received a complaint, we would go over the top to repair any damage. For example, if a customer had a to-go order they found was wrong when they returned home we would jump in the car and bring them the correct order along with some flowers or candy.
Going above what many customers consider “good service” will help your restaurant in the long term. The more we demonstrated that we genuinely cared about our customers, the more forgiving they became. The “take care” culture was ingrained in every employee and they were not only encouraged to find opportunities to go above and beyond with customers, they were rewarded for doing so.
- Branding: It’s okay to modify your brand and target audience. About 18 months after first launching, we realized that our service culture was embraced by an entirely different clientele than we had originally anticipated. At the time, we were essentially a burgers-and-fries spot, but when you looked around the dining room it was full of women and children. It was the opposite of our initial business plan, but we embraced it and decided to make changes to further ingratiate ourselves with our new core clientele.
We changed our logo from big block capital letters to a softer lowercase version. We added chicken, then salads to our menu as well as carrots and veggie melts. We hand picked new music soundtracks that would appeal to women. We started a reading program for kids, a rewards program for youth athletes and a fundraising program for schools. In addition to garnering loyalty from customers, these changes helped differentiate us from our competition, which further drove our success.
- Community: Hyperlocal connections will help your business establish roots. Connect with customers in your restaurant’s backyard first, then expand your reach. Think about using your soft openings as opportunities for local community members, neighbors and organizations to come in and meet your staff, sample your menu and learn more about what your brand represents.
As we started opening more locations in the Chicagoland area, we realized the importance of being ingrained in the local community. Before construction started, we reached out to the local chamber of commerce, local sports clubs, schools, playground/parks, and other organizations to ask how we could become part of the community. Our best restaurant locations are in areas where we’ve made the deepest community connections.
Tom Jednorowicz is c.e.o./founder of Meatheads, a fast casual family concept with 15 locations in the Chicagoland area.