Restaurants Fail But Yours Doesn’t Have To Be One of Them

Rebecca Rosenberg
January 31, 2020
Rebecca is a content & social media marketing strategist with expertise in the restaurant industry.

We’ve all seen it before. A popular local restaurant opens a second location. Then a third and maybe even a fourth. The brand remains strong, but the newest location sees lagging sales.

The owner is taken aback. Why aren’t the same great menu items flying out the door like they do at the other stores? Little does she know, the new staff is a nightmare and the new chef can’t make the signature lobster risotto to save his life.

If you’re opening new locations of your successful restaurant or expanding your current space, a good impression is critical from day one. In fact, it’s key to making sure your business grows smart and stays successful as you expand. 

But how do you know if your new restaurant location is set up for success?

Look for These Early Signs of a Failing Restaurant 

If you’ve been in business for a while, you know the pitfalls that cause many restaurants to fail. But can you recognize the warning signs in your own business? It could be tough on top of managing inventory, hiring, marketing, permits, and all the other stuff. 

Running two or more locations is an entirely different ballgame than running one, and successful single-location restaurants often struggle to find their footing as a chain operator. Whether it’s a bad location, lack of signage, foot-traffic, or parking, there are plenty of outside factors that can do you in. Much more often, however, restaurants fail due to internal issues with quality and customer service. 

Financial Issues/Setbacks

There are many financial and logistical factors that will affect your growing chain. Expansion opens you up to all kinds of financial planning errors such as: 

  • Insufficient capital
  • Miscalculated food or labor costs
  • Tax complications
  • Major quality differences from one location to the next
  • Flawed or no market research

Customer Service and Staff Management

Maintaining food and service quality as you grow will be your biggest challenge - and if you nail it - your key to success. Here are some of the most common service and staffing errors to keep a close eye out for:  

  • Too many or too little staff
  • High employee turnover
  • Poor management and training
  • Inconsistent food quality, service, or menu offerings
  • Sacrificing quality to save money

Prioritize Operational, Menu and Server Performance as You Grow 

Growing your brand is exciting and it means people like what you’re doing! And you have a responsibility to provide the same great quality, the same friendly service, the same food prep time and most importantly, the same flavor. 

If the quality of food or service goes downhill in your newly opened locations, people will notice. And they will talk. Word gets around via social media, Google reviews, and at the neighborhood playdates. Every restaurant owner dreads the bad Yelp review - and with good reason. 

As you grow, it’s critical to keep track of customer feedback. If you’re receiving negative social media reviews, take it as a sign that something’s not working. The good news is, this is feedback you can learn from. But if you really want to learn from your customers and improve your business, you need to go beyond social media. 

Get Live Feedback for Immediate Action

When you collect customer feedback in real-time, you can use it to improve service and food quality right away. And when you can’t be everywhere at once, having a dedicated platform for collecting feedback (such as in-store tablets or sms surveys) will help you monitor and compare your restaurants’ performance:

  • Spot inconsistent service standards or training
  • Gauge customer reaction to new menu items 
  • Identify star employees and valuable customers
  • Collect specific feedback about location, promotions, menu offerings, and more

How To Set Your New Restaurant Location Up For Success

Don’t make the mistake of thinking your new location is an automatic shoo-in--keeping an eye out for issues and addressing them early is the best way to ensure that your new restaurant location succeeds when others may fail.


With customer feedback in real-time, you can react quickly and efficiently manage your business growth across multiple locations. You’ll know a lot quicker if you’re having issues with staff - and gain insight into the root cause.


Get access to live dashboards for your team and insight-rich reports that let you:

  • Enhance staff meetings, performance reviews
  • Use as market research for customer loyalty programs
  • Improve operational, menu and server performance
  • Help your staff feel appreciated, but also know when to intervene

You can even get text and email alerts pushed live to anyone on the leadership team that you like. Humm helps you monitor and manage your customer reputation so you can make smart decisions and make sure your chain stays on top as you grow.

If you’re looking to grow smart and enhance your overall customer experience through customer feedback, let’s chat.