Restaurant Seasonality: Factors Affecting the Industry
Like in most businesses, sales in restaurants tend to fluctuate. Depending on the season, customer numbers can either remain steady but then face a sudden decline. Seasonal changes heavily impact the success in the restaurant business. In such instances, restaurateurs look for strategies to boost their marketing campaigns. In efforts to keep up with the latest trends in the food industry, owners desperately rely on gimmicks to keep visitors coming. You can avoid finding yourself in that quandary by paying close attention to the seasonal factors affecting the restaurant industry.
Facts about Restaurant Sales by Month
When it comes to seasonality, there are several contributing factors that affect the restaurant’s profitability. Therefore it should come to no shock that the worst months for restaurants occur during a seasonal holiday, or a major event. The decline in patrons at dine-in restaurants can reach as much as 20 percent, according to a report from Sky Blue Local. Customers are less likely to dine out during holiday seasons as they spend more time at home with family. In some cases, however, fast food restaurants thrive during such times. This is primarily due to a busier schedule where patrons are more likely to order meals on the go in between holiday preparations.
Between April and August are the busiest months for restaurants. Owners witness a spike in sales due to tourism. Warmer temperatures typically encourage locals and visitors alike to venture outdoors. The hotel industry also sees an increase in business during tourism season. Restaurants located within the vicinity of hotels might notice an increase in business as well. Furthermore, some restaurants host events such as outdoor music festivals and other entertainment during the summer months – which is likely to attract customers and ultimately increase revenue.
Weighing in on the Statistics
The study of balancing unbridled desired to scarce resources is not less applicable to the restaurant business than any other commerce. Restaurants are tirelessly devising ways to entice and maintain their customer base. The success of a restaurant is measured by the marketing and economic conditions. A report from National Restaurant Association shows that there are over a million restaurant locations nationwide. The United States Mountain Region was expected to see the biggest increase of sales in 2017 with a 5.3 percent growth. Restaurant sales has skyrocketed by 6.2 percent in Florida but plummeted in North Dakota by 2.4 percent. Since 1955, the restaurant industry has come a long way from comprising of 25% of the family food dollar to 48% in 2017. During post hurricane season, gas prices have steadily declined from $2.67 to $2.49 per gallon which means that consumers may be more likely to dine out more often. Consumers spend 12.6% of their income on food. Although prices on wholesale food were on the rise, they are lower in 2018 than 2015.
How to Plan for Seasonal Factors
You can invest your time and energy into developing the perfect menu, attract potential customers with the best marketing campaign, or updating your layout design with the right amount of lighting or quality patio furniture for your outdoor dining space, but you can’t change nor control seasonality. However, you can change how your business deals with the slowest month for restaurants. With meticulous planning and strategizing, you can change your outlook in dealing with spikes and slumps of seasonal impacts in the industry. This can be achieved by analyzing your sales and revenue from previous years. Even during your most fruitful month, it’s especially important to remain within your planned budget as your business may reach a low point in sales.
When reviewing your business plan, you should examine whether you have enough or too many employees. 36% of restaurant owners named their staff as being the biggest challenge to success. 47% of bar managers feel the same way. Roughly, 3 out of 10 restaurateurs across the US struggle to fill job openings thus signaling a hiring crisis in restaurants. Overstaffing your restaurant but not providing enough hours may have a disastrous effect on the business and result unhappy employees. To avoid this dilemma, you should inform your employees about your plans and properly train them on how to schedule enough people per shift.
Maintaining your inventory is another important factor to consider. From cleaning equipment, kitchen utensils, produce, to linens and dinnerware, restaurant owners need to ensure that they are sufficiently supplied from the back of the house to the dining area in order to meet their patrons’ expectations. Category management, a strategy that typically applies to manufactures and retailers, can do a great service in helping restaurant owners maintain their inventory.
Keeping the Flow of Business Consistent
In spite of all the planning and strategizing, there are things that happen beyond our control. Climate changes are one of them. Weather affects customer traffic. For instance, warmer seasons allow people to drive out to dine whereas winter months may discourage them from doing so. Delivery and takeout services are options that can combat these issues. In addition to keeping your business afloat and running, new marketing strategies or innovative sales promotions that coincide with the season or holiday can generate more foot traffic to your establishment. Evidently, these business tactics may not bring you the results you hope to see immediately. Keeping your business running at a steady pace, especially during an off-season should be your priority. Every bit of perseverance and patience with realistic expectations can make a big difference. Remember, slow periods do occur but they are temporary so long as you keep them as such.