All the projections are in. The restaurant industry is expected to be hit with upward spiraling food costs and lower consumer discretionary spending on dining out. The National Restaurant Association expects real growth of only .9% for 2008. Most sources blame the economy and gasoline prices.

On the street, I am hearing friends from Chicago to Florida that are showing dismal sales in the last couple of months. Food prices as escalating faster than you can change menu prices. Many restaurants are closing their doors after a lack luster year in 2007. One of the nation’s largest food wholesalers tells me their bad receivables are higher than they have ever been. Chains are are closing many weak performing operations.

What can you do? Stop the madness!

Take eight hours off - right now, to reverse the double whammy. Higher prices are coming. See an earlier post on controlling costs in 2008. At the very least, listen to the consumer, they want reasonable priced entrees. Use menu items where the margins remain high. Offer smaller portions, half size plates and focus on comfort food. These and other details are in the post from January 30, 2008 titled “Price Increases Threaten Industry“.

After getting your cost control plan in place, now focus on increasing sales. You must start now. There are no quick fixes. Implementing plans that will boost sales take weeks to produce long term results. Here are the steps to protect your restaurant in 2008;

• Write a Marketing Plan for the next six months.
• Address each of the marketing functions - communicating with prospective customers, selling those prospects and delivering your product.
• Once you have your plan, involve every staff member. Even if you only have a couple of employees, let them know your plans and get them involved.
• Implement your plan immediately. Many things in your marketing plan can be done overnight with little or no cost.
• Schedule a monthly review of your plan. Keep track of results.

If you don’t know how to write a marketing plan or are new to the industry, you can rely on The Restaurant Ebook to show you all the detailed steps. There are forms for a marketing plan and over 100 ways to increase sales and market your restaurant. Each idea not only tells you what to do, but exactly how to do it.

As an author and veteran of the restaurant business, I am not immune to the whims of economic conditions. My restaurants started an all new marketing plan in October, 2007. So far, we have not felt the downturn many other restaurants are reporting. Did I have a crystal ball and know that conditions were going to be bad in 2008? No, one of my restaurants had flat sales through the third quarter of 2007 and we embarked on a new marketing plan in October. It’s paying off now with sales above 2007 levels.

Again, stop the madness - right now! Turn the double whammy into a whimpering memory.

Larry Edger, Author

The Restaurant Ebook