3 Restaurant Management Traps to Avoid

By Donald Burns, Foodable Industry Expert

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There was a post on the Internet the other day about a famous chef being ordered by a judge to pay back over $5 million in tips that was skimmed from staff. What drives people to cheat their own staff out of money? Two simple answers: One is greed, the other is that it was the easy path. 

Restaurant owners and operators tend to focus on things that they know, understand, or feel they have control over. Let’s clarify for the record that control is only an illusion. And we all know that the restaurant industry is a very fluid and ever-changing enigma.

Think of your restaurant like a world champion team. You recruit the best players you can. You put people in positions that play to their strengths and talent. You practice and practice for as many scenarios as possible. Then you go out every game and play all in. 

Restaurants get in trouble when they go down the easy path. 

Again, let’s clarify… there is no easy path in the restaurant industry!

Taking the easy route often leads to dangerous traps that can get a restaurant in deep trouble, and fast. Here are three traps that you want to avoid:

1. Taking advice from people who are not in the industry.

The restaurant owner who gets advice on how to run their business from someone who has no restaurant experience is probably the most common trap out there. It’s not that people don’t mean well; they just don’t really have the insight to give valuable information.

It’s the “Uncle Waldo Effect.” You know, that one person who just thinks they know what is best for everyone else. “Your sales are slow? Then you need to add Mexican to your menu!” (Even though you're a burger restaurant). The Uncle Waldo's of the world love to give advice, but they're really bad at taking their own medicine. Usually their life is in disarray and perhaps telling other people how to run their life helps them take the focus off their own.

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2. Managing from behind a spreadsheet.

This is the owner or operator who basically tries to manage their operation from behind the desk or computer in the office. They barely ever step foot in the restaurant, and rarely engage with guests or the team. It’s true that not everyone is a “people person” — however, the restaurant industry is all about people.

Managing by spreadsheet is a very dangerous game. When you manage by the numbers alone, you are heading onto thin ice. Out of fear of not making bonus or even losing their jobs, these owners and operators will cut corners, then rules, and even violate laws to make the numbers. 

This creates a Pandora’s Box of issues that, once opened, has a tendency to destroy a company. Restaurants that look at employees as merely a line item suffer from high turnover, theft, and very low customer satisfaction scores. While restaurants do need to make a profit to stay in business, there has to be a balance between profitability and productivity. It’s very hard to motivate your team to produce more when you keep making deeper and deeper cuts. Sometimes owners get so focused on one-line items like labor cost that they drive and push their managers to keep lowering the number. The same owners have no clue what every item on their menu costs to make. They get so focused on picking up a penny that they overlook a dollar right next to them.

3. Not trusting your team.

The restaurant industry is full of martyrs. Many people wear it like a badge of courage. Some common phrases include:

“I work 80 to 90 hours a week.”

“I have to do everything myself.”

“I just don’t trust them.”

Do any of these sound familiar? If so, then congratulations — you suffer from a bad case of what famous motivational speaker Zig Ziglar calls “stinkin’ thinkin.”

Are you really doing high-quality, productive work if you are there 90 hours a week? Doubtful.

You say have to do everything yourself? Then hire better people.

Don’t trust your team? Then why did you hire them?

There are some people that will say, “People are your most valuable asset.” We should add to that, “The RIGHT people are your most valuable asset.” 

The road to hell is paved with good intentions and easy distractions. Many times, this happens when there is a disconnect between you and your core values. It takes willpower and integrity to avoid the easy path. It takes courage to stand up and enforce the standards. The saddest thing about selling out and falling into one of these management traps, is just how cheaply most people do it for. Nothing is worth compromising your integrity. Nothing.