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It's Time to Recession-Proof Your Restaurant ASAP

Updated: Apr 10, 2023




We all hear what uncertainty means in everyday conversations. According to the consumer price index, Without Cashflow, Then Everything Else Is Irrelevant. Consumer prices are still climbing rapidly in second quarter of 2022. Inflation is possible, and people are hesitated to spend like they used to. As a business owner, what are you going to do about it? Personally, I think, it starts from where you are. This is the perfect time to look inwards.


Here's Top 6 How to Improve Your Cashflow



1. Know Your Number As a business owner, you have to know your numbers. Manage overhead costs is essentially necessity. Business overhead costs are expenses that are related to the day-to-day running of a business. Reducing overhead costs is important in a business downturn. When business is slow, cutting overhead costs is normally one of the easiest ways to minimize losses and return your business to normality and ultimately profitability.

Business overheads which usually include

  • Your rental space, insurance and contracts.

  • Your utilities, maintenance, repairs and misc. expenses.

  • Your sales and marketing, inventory, product ordering, vendors, payroll down to your revenue streams.



Your restaurant revenues are usually coming from these areas:

  • Your daily revenue, and sales per table revenue.

  • Your bar/alcohol sales.

  • Your to-go sales, deliver services and referrals.

  • Your ability to upsells, restaurant special promotions, offers and giveaways.

  • Your online orders, reservations, walk-ins, to various traffic leads.


Again you have to know your numbers especially the different between cash inflows and cash outflows. The rule is when your restaurant's cash inflows exceed your outflows, you get positive cash flow. And certainly, this increases your business's cash account and provides money to grow your business.

“The first thing you have to know is yourself. A man who knows himself can step outside himself and watch his own reactions like an observer.”Adam Smith,The Money Game


2. Start Boosting Your Cash Flow. I Mean Now.

Can your business survive a cash crunch? In addition to monitoring your restaurant’s cash flow from week to week is necessity, but also having a Basic Fundamental Understanding of Your Cash Flow Activities is a good way to start.

Understand this, there are two main types of cash flows - cash inflows and cash outflows. However, first of all, let's simplify this cash flow concept. Your restaurant’s cash inflows usually include cash received from customers, money received from selling assets and cash obtained from financing sources. Your cash outflows for a restaurant usually consist of cash spent on operating costs, money used to buy assets and money paid to financing sources, such as dividends distributed to investors.


The basic rule is when your cash inflows exceed your outflows, you get positive cash flow. And in terns, this increases your cash account and provides money to grow your business.


A. Monitoring your numbers. First, monitoring your cash flow allows you to see how your sales, and the corresponding cash flow, ebb and flow over time. At the same time, it also makes it easier to create an accurate forecast of your sales and cash flow projections. As a business owner, tracking your cash flow on a weekly can highly beneficial the foundation of your restaurant business. Understanding the fluidity of sales cycles is very necessity.


B. Monitoring your Budget. A budget is the cornerstone of any cash flow management plan. Knowing your numbers also including knowing where are you revenues are coming from, what sells most or to least favorite items. Learn to manage your budget. You must budget seasonally to be on top of things.



3. It's Time to Reevaluate Your Menu

Your Menu is one of the selling tools for your restaurant. In fact, it's so essential part of your point of sale. Update your menu seasonally. Keep track of what your customers order most and which menu items will generate the most profit for your bottom line and highlight those prominently. Keep the favorites and signature dishes on the menu as a focal point. For our menu, I put our big-ticket items at the center area. This would be the first things they see when they pick up the menu.



In addition, you should also use seasonal special items as a way of introducing new menu items to your customers. We like to periodically come up with different campaign throughout the season for our table advertisement menu stance. There is one important thing restaurant owners should understand is to avoid the trap of wanting to be all things to all people. It's because by trying to put too many items on the menu to please everyone, not only it's time consuming to look through your entire menu, this drive-up food costs, but can also confuse customers. So, learn to say no.



4. Keep Pursue Alternative Revenue Options

Sometimes, to achieve the change or improvement your revenue streams, you have to think outside the box. In my experience, in boosting our revenue, we're determined to find another solution simply to increase positive cash flow. Collectively as a team, we have to brainstorm new sources of income.

  • New marketing plan should be top of your priority.

  • New Services or products to boost upsells.

  • Promote special events, private dining, or special invitations weekly.

  • Create a new marketing strategy to increase customer traffic, repeat customers to membership program.

  • Lead generation, referral programs, to customer rewards.

  • New campaign should be done weekly

More ideas about your boosting weekly revenue,learn more



5. Focus on Your Customers

It's a fact, brand trust is loyalty. In fact, some of the most successful brands are the most relevant brands. Brand relevance comes down to trust. It's not enough for a brand to just promise change, your brand must actively engage and drives change through brand consistency. Your loyal customers help boost your cash flows more than any other advertisement tactics.


"As business owner, you should ask yourself "Is your brand story coming across in everything you do?" or "Is that story consistent across all marketing channels?"


As business owner, you should ask yourself "Is your brand story coming across in everything you do?" or "Is that story consistent across all marketing channels?" At the same time, you also need to understand how people are experiencing your brand every day? Remember, your brand consistency counts just as much as your brand promise. Collectively, there are ways your restaurant can help build your customer loyalty.



6. Boost Customer Royalty Program

Building customer royalty program is a great way to build cash flows safety nest. Remember loyal customers usually buy more and are often willing to pay more. They refer others to your establishment. At the same token, this saving you the marketing and advertising costs of acquiring customers significantly. By increasing customer retention can boost your bottom-line profit by 25% to 100%.


Customer Royalty Program Ideas

  • Offer value to your customers

  • Loyalty program rewards

  • Birthday surprises

  • Give First-Time Purchase Discounts to Attract New Members

  • Reward Referrals to Build Your Customer Base

  • Award Points to Promote Spending

  • Celebrate Special Events with Rewards and Limited-Time Offers



How To Measure Your Weekly Business Overall Performance:

  • Daily Occupancy: Paying attention to the trend

  • How Do Your Customers Know About You? Search, Referral, Promotion Ads etc..

  • Overall Customer Satisfaction: What is the percentage?

  • Repeat Customers: Did you reach your goal?

  • How's Your Website Visits: Increased by how much?

  • Online Weekly Orderings: Increased by how much?

  • Review Your Website traffic and Performance: Increased by how much?

  • Review Your Online Reputations: What your customers are saying about your brand?



"Hi, My Name is Chez, A Brand Specialist in Sarasota. I Collaborate with Restaurant and Retail Owners on Their Digital Branding and Building Stronger Online Presence. "


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