What Are the Main Challenges for a Restaurant Entrepreneur?
There are several major challenges for any restaurant owner. These start with competition — your local area only has a certain footfall, and you’re likely competing with dozens of other local eateries. Although you will build up a good reputation over time, strong marketing is essential in attracting patrons to your business from the start.
Another major issue for restaurant owners is financial management and making a profit.
The vast majority of payment you receive from patrons will go toward food ingredient costs (30-35 percent), staff salaries and wages (30-35 percent), occupancy costs like utilities and rent (5-10 percent) and other costs. After all expenses are taken into account, overall profit margins typically clock in at between 2 and 6 percent.
Staff management also comes with its own list of challenges. From unexpected absenteeism to interpersonal conflicts, juggling staffing priorities will take up a lot of your time!
No two days are the same for a restaurant owner, but all those days will be long! From working out menus, training staff, marketing and administration in the mornings through lunch and dinner services, you can expect to start work before 8 a.m. and not finish until well after close. If you open a restaurant, you need understanding family and friends...because they will not be seeing much of you.