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the Restaurateur

Top 10 Challenges Facing Restaurants Cont.

February 27, 2014

The restaurant industry is a tough place, understanding common challenges can help you succeed.

Let’s pick up right where we left off from our first post, starting with challenge #6:

6. Minimizing turnover

It is important to keep in mind that once the proper employees are both hired and trained, keeping turnover to a minimum is important. One key concern is maintaining a corporate culture that will keep employees engaged and wanting to come back. For workers to remain enthusiastic and motivated to pursue the goals of a restaurant, they should be given a clear set of processes, manuals and procedures.

7. Understanding minimum wage laws

Wages are crucial for retaining trained and knowledgeable staff. Understanding legal guidelines on minimum wage - which can vary on a state-by-state basis - is an important way to ensure staff receives a fair income.

8. Understanding and taking advantage of tax credits

Business owners should ask their tax advisors if they are eligible for certain tax-favored provisions in the law such as the Work Opportunity Tax Credit and the FICA Tip Credit. Taking advantage of these credits can have a positive impact on reducing payroll and payroll tax costs for the employer.

9. Staying on top of technology trends

Technology is constantly evolving in the restaurant industry and smart restaurant owners will jump on the bandwagon. Current trends show customers want frequent-diner and loyalty reward programs. Software programs compatible with your existing POS systems are available that will track customer trends and demographics to make offering such programs easy. The data tracked with these programs can give valuable insight to the business owners as to what customers like and don't like.

New technology can help create a better client service experience as well as enhance operational efficiencies. Current trends include online reservation systems, ordering and paying tableside with hand-held wireless devices and texting customers when their tables are ready. Smartphone apps for restaurants are gaining increasing appeal. High-tech savvy customers would like to see more of these options available.

10. Leveraging social media

According to the National Restaurant Association's 2013 Restaurant Industry Forecast, six out of 10 adults said they have gone online to view a restaurant's website or menu. More than one-third of people who visit restaurants look at the social media pages of these organizations, according to data provided by the National Restaurant Association. Restaurants that want to succeed, and especially market effectively to young people, need to make the most of social media. Read my previous blog on challenges 1-5.

For additional information or to learn more, contact Laura DaLomba, CPA or any member of our Hospitality team at or call 401-274-2001.

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