Chamber Chat - Restaurant Business

Dec 23

By Meg Moss

 

Starting a business is no easy feat, especially when you’re talking about a restaurant. There’s a core of startup business types that have consistently been shown to be the most likely to fail. They are those in the independent restaurant, direct sales, retail store and consulting and business services arenas. All of these types of businesses suffer from a 50 percent rate of failure overall, and all also suffer from a 60 percent rate of failure within the first 5 years. Restaurants in particular have a 60 percent chance of failure over the first five years. Fifty nine percent of restaurant operators name staffing as a top challenge to success.

 

The good news is there are many great restaurants to choose from. The bad news is … the same thing. According to The Statistics Portal, the number of restaurants in the United States has gone from just over 600,000 in 2011, to over 660,000 in 2018. Restaurants have grown from 25 percent of food spending in the 1950s to more than half, today. In 1970, food and drinks sales in U.S. restaurants amounted to 42.8 billion U.S. dollars. This figure has since increased and, in 2016, it reached 766 billion U.S. dollars.

 

Earlier this week, I spoke with the owner of Davison’s Steaks, located in Tramway. I asked Mike how, and why he got into the restaurant business. It turns out that when Mike Davison was 17 years old, he needed a job. A friend of his had opened a Kentucky Fried Chicken, so Davison went to work cooking chicken and moved up pretty quickly and became a crew leader, and then assistant manager. Then there was a store with problems one county over, and he ended up taking over that store. There were thirteen stores in that franchise, and it was number twelve on the bottom. “Within about a year, I increased sales by about $550,000 and took it from number twelve on the bottom to number two. From there, the restaurant business just got into my blood, and so that’s what I do for a living” Davison shared.

 

“I opened Davison’s Steaks on July 21, 2005. We’ve been in business over 13 years, and we’re very thankful for the customers we have. The restaurant business hasn’t always been easy, but things are going great and we’re very thankful for it.”

 

Successful restaurants know the recipe for success comes in four key areas according to Rewards Network: increase the number of new customers, increase the frequency of existing customers, increased per-ticket spending, and increase table turn, or flow-through.

 

Davison went on to share that “right now we’re in the middle of our Christmas season, so it’s very, very busy. We almost double our business during the month of December versus normal times of the year.

 

 “The restaurant business is definitely not for everybody.” Davison likes staying busy and wants to be in business long term, but admits that there are always some kinks when you cook for people, but he tries to be flawless. “The main goal is to do business long term and make those customers happy so they’ll come back again.”

 

Whether your family caters in a family meal from a restaurant for the holidays, or cooks from scratch, I hope that you all have a very Merry Christmas!



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