Q. Abdul writes, 

I opened an authentic restaurant in a city that isn’t very multicultural assuming that the uniqueness and originality of the cuisine and environment would be an advantage.  However I’m struggling to break even most months. What can I do to turn this around? 

A. Dear Abdul, 

You are right- being unique and original often helps to build a loyal customer base.  On the other hand, without proper research, it can also be very risky.  In such cases, the price factor (with quality in mind) is always the key to make or break any new business. You may be resistant to lowering your prices because of the cost and availability of the exotic ingredients you need to maintain the quality of your food.  Scarcity can result in higher prices, which, especially if customer flow is slow, can really hurt your bottom line.  

I would suggest the following action:

Re-evaluate your suppliers in terms of price, responsiveness, and quality to ensure that you’re getting the best deal possible. And make sure that the middle men are cut out wherever possible, and
Your marketing campaign must be strategic meaning in addition to your advertisements in local media, you should also make a point to invite local celebrities, food columnists and bloggers, and politicians. Such a strategy will put the spotlight on your establishment much more quickly. 

For more detail about supply chain evaluation, please see our Supply Chain Assessment Process section.  

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Q. John writes, 

I have been running my own gift shop for two and a half years now and despite my best efforts, I simply cannot afford to hire any staff and I am literally not seeing my children during the week because of it.  If this doesn’t change, I’ll have to give up my entrepreneurial dream and go back to a 9-5 job to support my family.  Any advice you can offer would be helpful.

A. Dear John,

If your business has survived for two and a half years, I would say that you’re selling the right product in the right place, however, there are a few things I would suggest you look into in order to increase revenue.  Consider renegotiating your lease with your landlord to reduce your monthly expenditures. For example, your landlord maybe open to consolidating some of your utilities with the rent. You could also look at increasing the prices of some of your more exotic products.  Visit your competitors and confirm which items you stock that they don’t.  Those “hard to find” items can potentially fetch a higher price.  Finding an investor/partner to share your business can also be a wise endeavor. Lastly, many college/university students are required to complete work experience that is related to their field of study, and in many cases, their efforts would come at no cost to you with the various government grants supporting the programs.  I would advise you to contact the post-secondary institutions in your area for further information on such programs.