Small Business Resources

Q&A LIST ASK A QUESTION! BACK TO RESOURCES

Ask An Expert By Warren Coughlin Warren is a business coach with ActionCoach, who is committed to helping entrepreneurs and executives grow themselves and their businesses so they can live the lives they seek. He has been recognized as the Canadian Coach of the Year Award (2005), The Top Performing Coach Award (2006) and as one of the top 10 coaches among the 1000+ coaches around the world in ActionCoach.

I have a restaurant in a food court that has been operating for the last 2 years. It hasn’t been successful and I now have a debt of $100,000 with more piling up from my credit cards. In short, I'm sinking in debts very quickly and don't know what to do.

1. I have around $30,000 of credit left in my credit cards.
2. Currently, my wife is taking care of the business (and has for the past 2-3 months) and I’ve spent my time trying to think of a way out of this situation. I also have a 3 year old son at home.
3. I bought the restaurant for $50,000 about 2 years ago and its market value nowadays is around probably closer to $30,000.
4. This is my first experience running a business of my own.

– Kashif

1. The first one takes some guts and depends on the relationships you have with the other shops around you. And I suggest this possible approach because the landlord may not allow one vendor to do a public survey in the food court. What you could do is ask neighbouring shops if they would share in a survey of customers. Ask on the written survey how often they come to the food court, why they chose the shop they did and why they didn't choose others. That information will give you a good idea of where you need to improve.
2. Second, you have to train those who interface with clients to be extraordinarily friendly. I remember with the chain "Bourbon Chicken" first arrived on the scene, their staff smiled widely at anyone who passed by and offered a sample of their different chicken selections on toothpicks. Invariably, the majority of people would buy. And train them to be fast.
3. Market like mad. There is a flag for me in your question. It is your business; you are losing money; but you aren't tending to it. Get on it my friend. You don't have to be serving the food to be helping the business. Have offers; print up coupons to distribute to the neighbouring offices where they get either a discount or a free drink or complimentary dessert or some such offering. (Fountain drinks usually cost you pennies but have a high perceived value because of the price) Have frequent buyer cards; ask regular customers what features of the week they would like to see so they come back more frequently. There are lots of good ideas out there. Go to other food courts where people are serving the same kind of food you do. Ask them what they are doing. You might pick up a book called "Guerilla Marketing" by Jay Conrad Levinson or his follow on books. They have lots of ideas about how you can do powerful marketing for little or no money.
4. Measure what works. If a marketing idea works, keep using it. If it doesn't, stop.
5. Know what your break even sales figure is by the day, week and month. Target that number everyday. Setting a clear quantitative goal helps attract that result.
6. Watch your inventory. How much are you throwing away everyday? Reducing that can make the difference between profit and loss.