The Ultimate Restaurant Failure Checklist

restaurant failure

restaurant failureIt’s no secret that restaurants are notorious businesses for having high failure rates. The frequently cited statistics point to 60% of new restaurants going under within three years, while the failure rate after five years is 75%. But don’t let that fool you into thinking you can lay back and do nothing if you want your restaurant to fail. Anyone who’s run their shop to the ground will tell you it’s hard work—you’ll work long days, which will most likely be stress endurance tests as you struggle to figure out how to leave your customers dissatisfied enough to never come back. No one said it would easy to start and then shut down your own restaurant. But we’ve made it easier for you. Kounta customers are an accomplished lot, and by reading through our myriad success stories certain patterns emerge to tell the story of how these restaurants do it. And once you know how to do it, not doing it becomes that much easier. Here, then, is a checklist of things to get you well on your way to locking your doors one last time and handing the keys over to the bank.


  1. Don’t worry about developing a unique concept that will make you stand out. Time and time again, we see that our most successful customers delivering a clear vision of what their establishment is all about. From sourdough bakeries to fast-and-fresh  burgers to microbreweries, they all execute a concept that can be described in just a few words. More importantly, they’re offering something unique to the neighbourhoods they serve, and aren’t relying simply on tasty food to drive business. This is exactly what you shouldn’t be doing if you’re trying to fail spectacularly. Instead, convince yourself that food is what brings customers to restaurants then focus solely on cooking spectacular meals. That will be reason enough for people to show up and spread the word.

    Photo by Hernán Piñera (Flickr)

  2. Be friendly with your customers and serve them a good meal, then wait for them to come back and do it again. Then keep waiting. To create loyalty with your customers is a two-pronged approach. First, they need more of an incentive to come back than a good experience. The second is getting to know them as more than revenue sources, on a personal level. The Kounta users who we’ve seen grow the most are the ones who use our POS with this in mind. Customer profiles that include individual purchase histories facilitate both of these tasks; the data gathered can be used to push personalised offers through standard marketing channels. The they take it a step further with various mobile app integrations—for loyalty, social media, or credentialed wi-fi access—which let them connect directly with customers in and out of their store. Don’t do any of this. It might be tempting to, since customer outreach in this method is so much easier and more effective than ever, but this is a checklist of failure—and you’re reading this for a reason, right?
  3. Experience is overrated: you cook the food then serve the food. It isn’t rocket science. This goes for you and your staff. Your friends keep telling you your Tapas are amazing, so you’re golden. You’ll figure the rest out—or not. As for staff, the experienced ones will want more money. Sure, that seems like a good way to burn through cash quickly, but did you know you can haemorrhage money even faster when your newbie staff is wasting food and time and making customers so angry they won’t pay? Of course you didn’t know that: you’re inexperienced. Our most successful users are the ones who’ve spent a life in hospitality before going out on their own and know the ins and outs of several aspects of the running a restaurant. And they look for the same credentials in their staff. Even then, they don’t just rely on their people to make things run smoothly, they use the advanced order flow features in Kounta to keep everyone in sync. This is not what you’re going for, though. Just keep cranking out those Manchego-stuffed phyllo puffs, buy a cash register, and pray that your 19-year old sous chef doesn’t burn the place down before you have a chance to go out of business with class.IMG_2422
  4. Don’t bother with inventory. Just check what you’ve got at the end of each day and buy what you need the next morning. Who’s got time for keeping inventory, anyway? Not you, and your soon to be ex-restaurant. Fun fact, though: successful restaurateurs don’t have the time to do a proper inventory, either. So how do they stay on top of everything? They leave it to their technology. We built a pretty robust inventory module into Kounta, capable of deducting ingredients as they’re ordered in a dish and generating new purchase orders when they get low. Your cash register can’t do that, so at least you won’t be tempted to even try this.
  5. Ignore the past and don’t fret about the future. There is only today!  They say that those who ignore the past are doomed to repeat it. In your case, that’s not possible: you opened a restaurant in the past, and you’ll have a pretty hard time securing credit for another venture after you’ve delivered the death blow to this one. Mostly, it’s the owners who embrace the past—and apply its lessons to the present—that will have a future. There’s a lot of valuable data inside Kounta, and the longer you’re running it the better information you can get out. The reporting features can help identify any number of ways you can improve things. Knowing when your busy and dead hours are help you schedule staff accordingly. Seeing which side dishes tend to get ordered with which entrees can help you create combo offers that will sell. Knowing which ingredients are almost near the end of their shelf life can determine the special of the day. There is much to learn from the past, which is why you should pretend like it never happened.

If you can accomplish these 5 easy items, I can guarantee you the failure of a lifetime. It’ll be a great story to tell your grandkids one day. If they even listen to you, that is. They’ll probably be ordering a pizza on their smartphone from your old competitor.

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