Why 60% Restaurants Close In 1st Year Of Business

Why 60% Restaurants Close In 1st Year Of Business

Many people had come up with a thought of opening their own restaurant at least one in a life Sometimes we fail to open the restaurant because of some circumstances or sometimes the restaurant didn’t work well Some people also think that restaurants are a source of passive income. The money will come automatically after opening that If I tell you the fact that 60% of restaurants closed in their first year 80% of restaurants closed in their first 5 years So in this video, we will talk about why this thing happens and how to market your restaurant. So if you are a restaurant owner or thinking of opening it so watch this video till the end. First, let’s talk about why most of the restaurants fail Location is the most important factor Restaurant owners fail to choose that location where people like to come There are some restaurants which are located in the streets but still, people go there because those restaurants are famous now But you are new and nobody knows you so you need to open your restaurant where people usually comes and try out your recipes. So location is the most important factor for a restaurant. another thing is which type of cuisine you are going to offer l If you are thinking of selling Chinese, Italian, Burger or something else than location should be suitable for your food So always choose the location according to your food. For example, if I am going to sell any foreign dish so I wouldn’t go to any local area. So always choose the location wisely The second most important thing is restaurants owner thinks it is a source of passive income and because of that they don’t do hard work One thing that you need to understand is you have invested the money so you need to work in your restaurant and nobody can understand your business better than you. So the restaurant is a type of liability business. It’s not like you open the restaurant and will start to make money from the first day In order to make it the source of passive income, you can start the franchise model and chain model but for this, you need to work hard to make your restaurant full-fledged business. The third reason is management is not that good As you know as an owner you can’t be available at the restaurant all the time. Suppose you expand your business to 50 restaurants so you can’t be available everywhere, right? So for that, you need a good leader who can manage your restaurant whenever you are absent and this is necessary fI you don’t choose a good leader then he won’t be able to handle all other employees and will lack good leadership qualities due to this thing employee will be left your restaurant soon and then the thieves will start and things like this will keep happening. I personally saw this thing in my life to many restaurants owner the next thing is customer service Customer service means they came to your restaurant and everything is fine the food, price everything is OK but your communication is not good or your behavior to your customer is not acceptable. For example sometimes what happens is you gave your customer burnt food and he started complaining but instead of listening to him you are avoiding him So due to this, the customer will spread negative word of mouth and at the end, you will get a negative response from the market For this, we have to build a feedback system. I am giving you a link in the eyeball for the video I made on how to build an impressive feedback system in the service industry. Next, the biggest problem is the accounting problem Most of the people don’t know how much money I need to start or run my business for the next 8 months or 10 months until it becomes profitable. people just consider the one-time investment and don’t think about the extra cost They just have one lakh rupees extra which they don’t want to spend in initial days so because of this they don’t spend on marketing, additional dishes, and staffs which is required And due to this thing, only a few audiences will come to our restaurant because we have already skipped so many things. Less audience means fewer sales and automatically restaurant will be in loss and unfortunately, it will be closed soon They are not good at accounting and this is one of the reasons why many restaurants failed They didn’t do calculate properly about how much time and money do they need to run restaurant It will easily take around 4-6 months for any restaurant to become profitable So you need to calculate the expense for 6 months and you should have that amount of money In the last video which was about the business revenue model, I have talked about all these things like how to do proper calculations and accounting. I also provided you an excle sheet where you can calculate by putting the values The second calculating mistake people do is they don’t calculate the proper costing of their product which is a bad thing You should know the exact cost of your product or service whatever you are selling and if you don’t know so don’t do that business In big places, some people do reverse calculation They calculate like how much sales do we need to earn a certain profit on behalf of that stats they set their daily sales target So you also need to set a daily sales target like 5k or 10k etc. If the target didn’t achieve so you can also run some offer to achieve that offer. we will talk about that thing later Next problem related to finance is which I have seen in many restaurants that they usually hire unnecessary staffs. According to me if any of your staff is waiting for work so it means we don’t need that worker. So there is no need to hire extra staffs because if you do your overall expenses will be high and ultimately you will be in loss There was a restaurant which was located nearby my house and their food was good but it was expensive because due to unnecessary staff overall cost was increasing So the point is we shouldn’t hire extra staff unless it required For me and for the majority of the people taste is the biggest factor Without taste, you can’t expand your business Instead of sell, every food item sells a few ones but it should be tasty. So good taste is a mandatory thing because In initial days try to sell only a few things just focus on one or two foods dishes and then try to increase more food items according to your specific industry Don’t ever try to compromise food taste because of the price. Nowadays people are ready to pay the extra price for food but the taste should be worth the amount For example – as well all know chole bhature of Delhi are famous ew time ago the price o chole bhature was around 20rs but now many sellers are selling for 60-70-80- rs and still are in profitable just because of the taste and hygienic good There are many people who are adding paneer and cooking their dishes in different cooking oils so it is up to you But my point of view is never compromised with the taste you might become cost leader by selling more units at less price but you can’t stay in the long term by doing business in this way But if you want to become a brand in the food industry you have to offer delicious taste in your food now come to the main point and that is marketing

Comments (100)

  1. Apko bhature pasand h..shi kha

  2. Is video me ek ek baat sahi kahi h sir, mera abhi kuch months phle hi restaurant band hua h, i can relate…..

  3. Mens choth showroom ke uper ek business plan ke uper ek video banaoo

  4. Great video we loving this type video….
    THANK YOU SAHiL sir.

  5. How to choose right banda 🙏🙏🙏🙏

  6. Bhai , aap best👍👌 ho yr ..but bhai vo Chhole-Bhature hota h ,, Bhature-Chhole nhi…! 😁

  7. Majburi ka naam mahatma gandhi 😀😀😀😀😀😀

  8. salad bar business py plz

  9. Sir you have taken many variety of courses and completed them I want your guidance to choose a right course for learning Stock Market whether from udemy, etc please guide
    Thank you

  10. I want consultant for rent a shop, and to take Loan,I stay in Pune, where can I take guidance.

  11. sir jawed habib case study

  12. Sahil bro, in Digital Era I think location doesn't matter As I ordered from Swiggy I had never seen that restaurant . The things what matters the quality of Food & packaging shows the Hygiene level of that Restaurant.

  13. Thank you very much really very useful video

  14. best sir…great work😍😍😁😁

  15. Hey Sahil please make a video on bada business app

  16. Thank you so much bhaiya !!

  17. Sahil sir , a'm a management student and I really passionate about going deep down into the corporates business modals so what should I do to actualize my passion or if I can contribute in your mission a little bit.

  18. Without any experience , we should not give any knowledge bro

  19. Unisex salon pr video bnaye sir ji,,,,,,,

  20. Sabse bda reason rehri

  21. Osm sir….💖💖 keep it up

  22. Thanks for guidance

  23. Sir,, आपने अपने वीडियो में कहा है कि अगर हमें एक भटूरे की लागत नही पता तो business loss में जायेगा।।

    तो छोटी unit की कैलकुलेशन कैसे करें।।plz इस पर कोई वीडियो बनाइये।।आपकी बहुत कृपा होगी

  24. Ebay exactly follow your strategy for customer life time value , once i buy product from ebay and found change than i see in photo so ebay give me my money back and also give that product free…


  25. sir agar bati ka business kya se kare

  26. tea business ke upar ek video banaye

  27. Gandhi katil he

  28. Opening a chain of QSR is more profitable or restaurants?

  29. Sir, you mentioned in the video that most people are not able to calculate the cost for their product can you please elaborate on that. How to estimate the cost of the product?

    Thanks in advance!!

  30. Sir please batayie hivay per restaurant chalna ok ha ki nhi?

  31. B.o.m pee video banaiye

  32. New product ki sales price kese nikale

  33. Bhature bole bolte,bhai ke mu me paani aa raha tha 😂

  34. 👌👌🙏Apka bat to 100% sahi hai..bcoz mera 5 year ka hotel management ka experience hai…

  35. Good video love you brother.

  36. i liked this video for that taste wala part and the explaination given. STRONGLY AGREED BRO. KEEP UP THE GOOD WORK.

  37. Bhai ek saal pehle video dal diya hota

  38. Home product Ko kase grow kare

  39. Its amazing and usefull information sahil bhai bahot hi common but very unique aur detailed video banaya hai
    Keep it up
    ©Support from Vaibhav Vlogs(YouTube Channel)

  40. 10 sal ho Gaye dhaba chalu kiye jindagi badal gayi Bhai par mehanat or time to denahi Dena he

  41. Aap jis tarah se batate ho dusre aise koi nahi batate aap bahut acche ho sir.

  42. Hamara ek restaurant he highway Pe daily 80,000 to 100,000 revenue and 7000 to 10000 Net profit

  43. Raandikay bhebchid kuuutiya chood taati kay aapni lucknow wali ko chod ley

  44. I don't understand you shit

  45. Bhai chole bhature apke favorite food hai kya

  46. Very well explained

  47. Sahil bro don't place ads between sentences. Place it after your sentence is over. It brings distortion of information or somewhere disturbs the focus of viewer.

  48. Main problem h ki staff ni rehta jiska aapne jikar nhi kiya

  49. Saala alux. Com ka content chura liya h

  50. Bakwas band krla yr

  51. Delhi main Chole Bhature nahi kahye ho, toh tum papi ho…that was great…
    Majboori ka naam Mahatma Gandhi…that was……Subscribed…Thanks

  52. this is really a very good video and guidelines. thank you so much for your time and valuable efforts

  53. Excellent points.. mind blowing presentation

  54. That's why I did try

  55. सर में कोल्हापूर महाराष्ट्र से हूँ ,सर हमारे यहाँ मिसळ पाव बहोत फेमस हें और हम भी कोल्हापुरी मिसळ पाव बनाते हें और इसका हमने ब्रांड बनाया हें ता की हमें इसकी फ्रच्याइसि हर शहेर मे हो , अगर किसिको च्याहिये तो हमें फोन करे , ट्रेनिंग और मटेरियल हम देंगे और भी कुछ – 8380997788

  56. Sahil, Please do a video on the Hotels too with same deep homework -/–:♥️

  57. Sir aapki video bahut informative hai

  58. U shouldn't utter our father of the nation's name Pujya Mahatma Gandhiji like this

  59. Very much correct Sir!🌷

  60. Genuine guy :)😊

  61. Genuine guy :)😊

  62. Good helpful sir 🤗🤗🤗

  63. Test and some uniqueness in food test and good services key points for restaurant success.

  64. Brand-able Restaurant Business Domain Name for Sale Buy it now.

  65. ek no. kdk sirji me aur mera friend new restarant ki opening krne vale he isliye humm bhi tayari kr rahe he

  66. Sir good information

  67. Sir muhje resturant kholna h lekin thoda dur me 2 resturant h plz btaye?????

  68. in 2009 it's 2019 ur wrong..u can start from ur kitchen..and sell it via swiggy Zomato uber eats..fresh menu has 100s of cloud kitchens in lol

  69. Best digital marketing channel

  70. I am not fully agree with have half of half knowledge about hotel business.plase i dnt want demotivate you but grow your experience and practical knowledge in it otherwise your advice will be one reason for winding a restaurant. Thanks….

  71. Truly and kuch logo ko samjhane kelia bahat achhe se bataya aapne.

  72. He told 7 sabse zyada important chiz…

  73. Kaboose Restauant Franchise available!

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  74. Thanks brother your video is useful for me

  75. how to do guerilla marketing for restaurant business ??? please tell

  76. Sir mera restaurant pr in sab cheezo ka dhyan nhi rakha or ab restaurant band hai

  77. sir dosa restaurant kese start kre ?
    please tell me overall about dosa restaurant.

  78. Please let me know that how & from where we can hire good chef for a new restaurant?

    PLS REPLY OR WHAT'S APP ME 9920388068

  80. Saahil bha kya baat kahi aap ne. Ki aap paapi ho. 😂😂😂

  81. Bhai app to barbeque nation wale ho , food is ur passion.

  82. Mein nahi maanta, without food quality and good taste it’s impossible to run a restaurant

  83. Sahil bhai khali lecture de rahe ho..kabhi khud restaurant chalaya hai kya??motivation speech dena bahot aasan hai..bhai hotel chalana hai to gutter bhi saaf karana padata hai..bartan bhi saaf karane padate hai..khana pakana. padata hai..mai aur mera bhai milake mumbai me char restaurant cum bar chala rahe hai..woh bhi rent pe..puri life sacrifice karani padati gai..chutti nahi le sakte..picnic ko nahi ja ke sath..mall me ghumane nahi ja sakate..saturday aur sunday ko double mehanat karani padati hai..eak restaurant chalke dikhao…sab samaz me aayega..

  84. Ghanta sale… Tujhe kuch nahi pata. Blogger bane firte hai

  85. Gordon Ramsay jis bhi Hotel mein gaya
    Saare Workers hata dega

  86. what about Mughali and tandoori take away. Make a video on same

  87. Super b yaar you are genious

  88. Bhai fast food or restaurant frienchies kaise start kare… Video bano ne..

  89. Life should be be purposefull..then only we will be succeed.whatever we do.

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