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Mkt Strategy of Restaurant

Mkt Strategy of Restaurant

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Published by Gaurav Kumar

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Published by: Gaurav Kumar on May 18, 2012
Copyright:Attribution Non-commercial


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Marketing strategy
Your marketing strategy is one of the most important weapons in your toolkit to find and keepcustomers, reach sales objectives, and secure a high income for yourself. When developing a
marketing plan, the most important rule to keep in mind is to know your market. Know yourproduct/service well and know your competition even better!Every business owner needs to be able to answer at least all of the following questions in order tobe able to develop a sound marketing strategy:
What is the age of your customers?
Do the customers tend to be more males or females or equal?
What is the education level of the customers?
What is the approximate income level of the customers?
What occupation(s) are most representative of your customer?
What a
re your customer’s preferences when it comes to eating out?
Do your customers have any particular buying patterns?
These questions need to be answered not just at the beginning but throughout the restaurantownership process on a regular basis. As you answer these questions, be sure that all yourmarketing efforts are reaching your target customers.To help answer these questions, seek help from trade publications, vendors and your own personal
research into the neighborhood and competing restaurants. Remember that markets are dynamic;they change and evolve over time. You must keep up with these changes and adapt your businessto match these changes, if you intend on staying in business for a long time.An important distinction in marketing any business is the subtle difference between its featuresand its benefits. A feature is used to describe what you sell: for example, the service may be fast.However, a benefit is used to describe why the customer is buying your product or service: forexample, the service may save the customer time.Put yourself in the position of one of your customers and try to answer the question: Why would Iwant to go to this restaurant? Use your answer to come up with a list of benefits (not features)
associated with your restaurant. This list will help keep advertising costs down because you will
focus directly on the restaurant’s benefits. Do not make the mistake of assuming you automaticallyknow your customers’ preferences without researching it! Starting a restaurant is a time
consuming and costly endeavor. Researching your target market is too important of a step to tryto save some time.One way to keep track of your competition is to create file folders for each one of them. Collectads that they run in the newspaper and put the ads in their file. If the competing restaurant runs
sales a certain time every month, note that down in their file. Has the restaurant been targetingthe business lunch crowd recently? Jot that down. By creating folders for your competition, youcan keep all your research organized and in one place.
Starting restaurant .com
 As a restaurant owner, you may occasionally want to know what your business is like on a givenday. The balance sheet is like a financial snapshot of your restaurant. It lists the value of all your
restaurant’s assets and liabilities. Total liabilities are subtracted from total assets to generate a
net worth or net value of your company on a particular date. When looking at a balance sheet, it is important to keep in mind that you are only looking at thefinancial situation of your restaurant on a specific date. The balance sheet might look entirely different on another day. Investors use balance sheets to look for trends to determine the overallhealth of your business. Does your restaurant usually have a positive or negative net worth? Is itgaining or declining in net worth? They are interested in long-term trends and are not looking at balance sheets for specific periods in time.The following is a sample balance
sheet. You can input the values depending on your restaurant’s
situation. You may have different types of assets and liabilities. Here is what a typical balancesheet looks like:
 Current CurrentCash Salaries Owed Accounts Receivable Accounts PayableFood Inventory Taxes OwnedBeverage Inventory LoansSupplies Inventory TOTAL CURRENT ASSETSFixed Long-termLand MortgageBuilding Term LoansEquipmentFixtures VehiclesTOTAL FIXED ASSETS TOTAL LIABILITIES
  Assets are listed on the left hand side and are categorized as either Current Assets or Fixed Assets. (Current assets are any assets that are expected to or can be easily converted to cash within a year. Fixed assets are any assets that take longer than a year to convert to cash.) Add upall your assets to determine the total assets for your restaurant.
Liabilities are listed on the right hand side. Like assets, liabilities are classified as current ornoncurrent/long-term. (Current liabilities refer to items that are expected to be satisfied withinthe next twelve months, such as paying your food vendor for a purchase. Noncurrent liabilitiesare those liabilities that are not expected to be satisfied within the next twelve months.)Determine the total liabilities of you restaurant by adding up all the liabilities.The net worth of your restaurant is the difference between the total assets and the total liabilities.This is the value of your restaurant on a particular day.
The health of a restaurant can be analyzed from the
Balance Sheet 
at any point in time(i.e. today, last month or tomorrow). The
Balance Sheet 
allows operators to forecastshort and long-term cash flow. As important as it is to review the
Balance Sheet 
, fewrestaurants ever bother to prepare it. By checking the accuracy of the
anoperator can ensure the accuracy of the
Income Statement 
. The
Balance Sheet 
lists allthe assets, liabilities and equity of the restaurant. The formula for the
Balance Sheet 
Assets = Liabilities + Equity
In the simplest terms, assets are what the business owns such as equipment, inventoryor cash. Liabilities are what the business owes such as vendor bills, loans, notes andleases. Even a gift certificate is a liability because the restaurant owes someone a mealat a future date. Equity is the ownership of the business. The most common form of equity is stock. Whoever owns the stock owns the equity. (For example, the 5 millionshareholders of Microsoft own the company. Bill Gates just owns the largest number of shares).
It is important that assets and liabilities are properly classified on the
Balance Sheet 
. Toget a clearer picture of the business, an operator should break down the
into sub categories. The breakdown is explained as follows:
Current Assets
- assets with life less than a year (i.e. cash, credit card receivables,inventory and prepaid expenses).
Fixed Assets
- assets with a life greater than a year that directly attribute to producingrevenue (i.e. equipment, computers, furniture and leasehold improvements).
Other Assets
- assets with a life longer than a year that are not directly involved in theproduction of revenue (i.e. security deposits, trademarks and artwork).
Liabilities require a similar classification and are broken down as follows:
Current Liabilities:
debts due within one year (i.e. accounts payable, accruedexpenses, short-term loans and even gift certificates).

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