Hospitality Bandits Are Stealing Your Profits

If you’re in the restaurant or hospitality business, you may have bandits lurking around every corner. These thieves pinch a percentage here and another there until you wonder where all your profits went. Who are these tricky bandits? You know them as poor service, lengthy payments processes, and disgruntled employees.

No matter how delicious a restaurant's food may be, these hospitality bandits can make guests feel unsatisfied. Since upset guests can hurt your bottom line, it's crucial to expel hospitality bandits from your operation.

Poor Service Stops Customers from Returning

Thriving restaurants depend on a loyal base of returning customers. Industry statistics show that repeat guests spend an average of 33% more than first-time guests. Returning customers are so critical for restaurants that a 5% increase in retention can lead to up to 95% more in profits.

Unfortunately, if your restaurant is home to poor service, many guests won’t want to come back. Empty water glasses, unpolished silverware, and servers who don’t know the specials can all scare away would-be regulars. Every time a bandit strikes, you can lose the opportunity to increase your retention rate and profits. While your fantastic food should have them returning time and time again, they can’t shake the memory of the bad service they received.

Quick Payments Matter

Excellent customer service shouldn’t end when the guest finishes their meal. Waiting a long time for the check can make the guest leave unhappy, even if the food and service were terrific. There are times when a server can’t help but take a long time to process payment. When guests want to split their bills in complicated ways, the process can become unavoidably lengthy. Additionally, this can harm service for other tables as they wait for their server to execute a complex split bill and run several cards.

Since it can give customers their final impression of a restaurant, the payment process can make or break a customer’s experience. Most people don't want to spend an excess amount of time in a restaurant merely waiting for the check. Don’t let a long payment process be the reason customers don’t come back.

New Customer Acquisition Costs

When one-time diners don’t turn into regulars, you not only lose the opportunity for more business from those people, but you also lose money trying to get new people to fill the house. Some restaurants turn to deep discount sites to attract new customers, even discounting meals below the profit margin just to bring people in the door. Other establishments may spend a lot of money on advertising. No matter which route you take, attracting new customers can get costly.

Bad Reviews Cost Your Business

Managers in any business instinctually know that a bad review is bad for business, but just how much of an impact can a few unhappy customers have? A study discussed in the Harvard Business Review found that negative Yelp reviews can bring the average restaurant’s revenue down by nine percent.

This effect is worse for independent restaurants, which don't benefit from a national or global reputation. The more your business relies on reviews to build a reputation, the more negative reviews can impact your bottom line. That online reputation may be hindered every time a hospitality bandit attacks a customer. Luckily, there are some simple ways managers can ban those hospitality bandits once and for all.

Support Your Employees

Your servers and other frontline staff can make or break a customer's experience. Managers who want to impress customers and get rid of hospitality bandits should ensure that the team is happy. An in-depth study from Cornell University found that when employees trust their managers, customers are more satisfied and profits noticeably increase.

The researchers outlined the process by which this happens:

1. The manager builds trust by keeping promises and living up to the company’s values.

2. That trust leads employees to feel more emotionally committed to their roles in the company.

3. Because they are more committed to their jobs, employees go above and beyond minimum expectations. This service includes providing discretionary services to customers.

4. Customers notice the special treatment and feel valued.

5. Satisfied customers become repeat customers who boost profits.

Don’t let hospitality bandits steal any more business. Providing your servers and staff with the right tools and strong support is the first step to their providing excellent customer service. And with excellent customer service, you can build a loyal customer base, earn great reviews, and give your bottom line a boost.