Please call our customer service for cancellation.
Strategies for Success: Overcoming 4 Common Challenges in the Restaurant Industry
Prasad Vemulapalli | February 26, 2024

Restaurants are an integral segment of the ever-evolving hospitality industry. Over the years, restaurants have adapted to market needs and customer demands. Today, you don’t have to walk to a restaurant whenever you wish to eat something; you can simply pick up your smartphone or laptop to order your favorite meal from the comfort of your home. While the paradigm shift in restaurant service has been a boon to customers, it has also brought up various challenges for restaurants.

In this blog, we’ll discuss some of the primary challenges that restaurants are currently facing and subsequently try working out strategies that can help your restaurant business craft its niche.

In recent times, technology has been a boon for restaurants. Not only are restaurants expanding geographically to establish multiple catering platforms, but simultaneously ensure ease of order and delivery management.

Today, restaurants seek to reach out to more customers while establishing long-term relationships with them. Technology has been integral in bringing a fresh lease of life with endless opportunities to the restaurant industry. While that sounds reassuring, many more concerns must be addressed for restaurants to flourish in the competitive market.

Understanding the Current Challenges Posed by the Restaurant Industry in 2024

Here’s an attempt to bring out four common areas of challenges that most restaurants experience.

1. Growing Operational and Food Costs

Costs have been a continuous concern for restaurateurs. The rising prices of supplies have increased the expenditure on food cost manifold times. While paying for ingredients is one factor, manpower and location also add to the expenses. Inflation has hit the restaurant tables, and with rising inventory costs, you may need to increase prices if you don’t want to land a loss-making proposition. However, a sudden rise in the pricing of your menu may not go down well with the customers.

2. Difficulty in Retaining Customers

You might be doing well in attracting customers, but what would you do if your customers don’t showcase loyalty? Returning customers can ensure some consistency in your restaurant’s revenue. However, as the number of people in an area is limited, getting repeat customers may become difficult.

3. Trouble Attracting and Retaining Productive Employees

Not just customers but your restaurant staff are equally important to running a successful business. One of the prominent challenges restaurants today face is the difficulty of retaining employees. Here are some reasons that can trigger such a challenge at your restaurant.

  • Not offering fair pay or benefits
  • Inflexible work schedules
  • Poor management
  • Work overload

4. Not Enough New Customers

While you must ensure customer loyalty, streaming new customers is as important for your business to grow. However, reaching new customers and convincing them to trust your restaurant as a great place to dine or order food from may not be as simple. The competitive market in the contemporary world makes this a lot more challenging.

Tips to Overcome Bottlenecks of Restaurant Business

Managing Costs with Optimization of Resources

One way restaurants can handle the concern of impeding costs is by expanding their reach to more customers. This can be done by setting up a parallel sales point online. You can tap more customers with online restaurant services. Moreover, this setup may reduce some of your overall operational expenses while continuing to draw more customers to your restaurant. An online ordering system can help you streamline the ordering process and simultaneously market your restaurant to a larger customer base online.

You can check out OrderEm’s online ordering system, which can help you launch your online business and manage it with an app customized for your brand. Not only can it help you reach more customers, but also facilitates online ordering, online payments, in-store pickup, and delivery. You can sell more food with this unified order management system and offset the growing operational costs.

Instead of announcing shocking price hikes on your menu, you can handle the rising food costs with a few smarter moves that would neither pinch your customer’s pockets nor leave them dissatisfied with the quality of food or service. Here’s what you can do:

  • Slightly reduce the portion size as it can help reduce your food cost and minimize food waste.
  • Offer a smaller menu that makes it easier for your customers to browse and assures them that fresh ingredients are used.
  • Make smaller price increases for items on the menu so that it doesn’t deter your customers from returning to your restaurant.

Getting Repeat Customers by Providing a Customized Experience

Offering a personalized experience to your customers can increase the prospect of customer loyalty. This can be done by establishing an efficient online ordering process where your customers can find the updated restaurant menu and offers easily within the reach of their fingertips.

Online ordering apps can help build a transparent relationship with your restaurant. Advanced food ordering apps can give personalized suggestions on food preferences, help customers track their orders, and recommend promotions based on their choice of food.

Aligning your menu with changing customer food preferences is a good way to stay relevant to your existing customers. You can also introduce in-demand offerings to your customers, especially those that you think your customers will be ready to pay a premium for. For instance, based on the data collected from your customers' last visit to your restaurant, you can check if they prefer vegan food, if they are enquiring about gluten-free options, etc. You can send email or phone notifications to your customers whenever you launch a deal matching their preferences.

Making the Work Environment Employee-Friendly

While you treat your customers graciously, assuring a safe, fair, and amicable work ambiance for your staff can go a long way in defining their efficiency at work.

Ensure you pay your employees by industry standards, create a healthy work environment, and provide necessary medical insurance. Erratic work schedules and no breaks from work can demotivate workers, impacting their productivity and your relationship with them.

Assuring an organized workspace where employees can work in shifts can encourage workers to enjoy their jobs and boost chances of job satisfaction. Staying flexible and rewarding employees with small perks from time to time for consistent performance can mutually benefit you and your workers.

Introducing technology for order management, delivery and billing can take much load off your restaurant workers. You can install an online ordering system like OrderEm that can handle a range of time-consuming manual jobs. This will also minimize the possibility of incorrect order placements, billing errors, etc.

Streaming New Clients With Efficient Marketing

Going online offers the benefit of reaching out to a larger audience. Hence, you can use the online platform to popularize your restaurant. An SEO-optimized website can help you score a high rank in restaurant searches launched by your potential customers. You can customize your website to highlight your restaurant’s services, such as home delivery, drive-through, curbside pickup, takeout, in-room, etc.

As most customers today use their smartphones to order food online, you can ensure the responsiveness of your site across different types of devices, including laptops, tabs, and smartphones.

You can consider promoting your restaurant on social media by creating advertisements on sites such as Instagram, Facebook, etc. Signing up with an online ordering and food delivery app like OrderEm can generate new lines of sales and optimize your return on investment.

The Way Forward

Regardless of the challenges, make sure to reevaluate your business’s needs in 2024. An optimistic outlook, innovation, and technology adoption to improve order management and restaurant services are the best ways to take your business to the next level of success.

The role of automation is indispensable as the appropriate use of technology like AI can help minimize your costs, streamline back office work, and boost your employee’s productivity. Many restaurants have already used AI chatbots for registering complaints and feedback from customers. The use of technology in billing, reporting, data collection, and analytics in the restaurant business can be called a boon for accomplishing everyday tasks.

It would be in your favor to take advantage of an online ordering management system. This, along with a powerful digital marketing engine, can help your restaurant business overcome the core challenges and emerge successfully in the industry.

Mobile Number
How can we help?