How to tell when you customers are running your business into the ground…before your broke.

I recently had the opportunity to work with a restaurant whose customers were going to be the root cause of its failure.  I say going to be, they still have some time left in their slow painful death.

My final suggestion to this restaurant was; FIRE YOUR CUSTOMERS.

Here is the back story, build into a hundred and fifty year old estate this long-established restaurant is considered to have been one of the first in the city’s business district.  For the last 38 years it has operated as City House Restaurant (Yup, changed the name to protect the client, wouldn’t you?).

For years it was a destination eatery and jazz club (yup lied about the music style too, but they do have some.).

The current owners bought it a few months ago.  No longer a destination, a quick internet search revealed dozens of negative reviews over the last ten years, “I’m sorry the brand name you just bought has a negative reputation.”

Suggestion One: Re-Brand

Now you know as well as I do that simply changing the name or the drapes do not fix the real issues but it does give them a chance at a fresh start.  So why were the reviews all negative?  The food.

Alright, well the new owner is a veteran chef, having cooked for world leaders and parties of thousands, He may just have the right stuff…except he’s been run ragged and has not had the time to even begin fixing the kitchen so the same food keeps rolling out.

Suggestion Two: Create your own menu and control the quality of food coming out of the kitchen.

Which begs the question of why he’s been too focused outside of his expertise?

The wait staff; with an average experience of two weeks typically don’t stay for more than a week.  With no floor manager he is trying to run the front of house himself without the skill (IMHO) to do so.  The same attention to detail that a chef should have with his food and kitchen is misplaced with independent contractors who serve the food and provide personalized service to the guests.  Service flair is a different art form from cooking, that being said the majority of the customers don’t help but we’ll talk about them in a second.

Suggestion Three: Hire or promote someone to run the floor staff and step back.

So what is the big deal with these customers I keep mentioning?  One of the things that drew him to buying the restaurant was a guaranteed contract with several tour companies that brought 50 to 400 people to eat and what a great deal they had.  For $15 per person including tax and gratuity they received a soup and salad to start, main course of grilled salmon, or steak, or chicken and desert course with coffee or tea…wow, just wow, 1995 pricing at it’s best.  Aside from a very narrow profit margin these tour groups are foreign tourists who speak little to no English or French making the serving staffs interaction with them minimal at best and simply do to the fact they are on tour of Canada the chance of repeat patronage nil.

Final Suggestion; Fire you customers and build a local reputation.

The amount of energy, time and money spent trying to simply service this client group is staggering with absolutely no return.

Removing the offending customers, even at the cost of a penalty and gaining the ability to spend the same energy of making a better products and giving a different client group more service can serve your business far more in the short run.

The urge to hold onto something familiar and predictable no matter how little return your business derives from it could be your ball and chain, so I need to ask, “are your clients holding you back?  Is it time to FIRE your customers?”