Like any business, over time, a restaurant’s takeout, delivery and catering operation can grow inefficient. This is especially true if profitability has been high and cash flow is positive. When a business lacks urgency, it can suffer. Even in large multinational companies, at the divisional level, there needs to be urgency for the enterprise to thrive.
The most efficient place for a business to operate is just above break-even. If your enterprise is thriving above break even, then please don’t leave excess operating cash in your bank account. Not ever! Too much cash creates complacency in a business. If your catering operation is generating cash, then take the cash out and either reinvest it in the operations, pay down debt or simply put it away for another day. If you leave the cash in your business account, complacency will creep in. It will destroy your momentum.
When complacency sets in, your people will get tired, stressed and lose their sense of purpose. Many of the behaviors that made you successful in the earlier and hungrier days may disappear. When complacency sets in, it is time for change. And change is hard for everyone. But change is necessary to keep your business efficient.
In fact, change is essential in order to grow. People, products, markets, customers and processes are dynamic and must change in order to adapt and grow. Nothing stays the same forever and if it does, it can easily lose its relevance and complacency will settle in. It’s just human nature.
We have all heard the terms before. Reorganize, downsize and streamline are all words that are common in business and is part of the dynamic and organic nature of an organization. And while these words are often discussed in business matters, they do serve a purpose.
My father used to tell me that every once in awhile, a person needs to get a haircut to grow healthier hair. And even more so, if your hair is getting out of control or wild, “don’t worry, it always grows back,” he said.
If your restaurant takeout, delivery and catering business is struggling, or if you just can’t seem to meet your budget expectations, I’d recommend a “haircut.” We’ve all been there, and as hard as it is, your business will grow again when you are on the other side of it. Take your operations down to the most common denominator and go from there.
Reorganize at the executive and divisional level. Downsize your expenses and personnel if necessary and streamline your operational processes. These steps are not easy, but they are important for keeping your business and your people on track. Don’t be afraid to raise your prices, renegotiate your supplies and leases and most important, reset the expectations for your team members. Yes, you can renegotiate their compensation packages. Put some urgency back into their day. It will serve them well.
Within my own organization I am sometimes reminded of my father’s words. And when that happens I quickly look to myself and my team to make sure complacency hasn’t set in. If it has, we work together to figure out how we got there and how we can move in a more positive direction. We change things. That’s what we do.
I’ve been in business for more than 30 years and I can attest to the fact that “haircuts” are needed even when we don’t think they are. My intuition usually tells me when it’s time to “shake it up.” I can promise you that I’ve always come out on the other side with a stronger sense of purpose for the business and the team members that are resilient enough to change follow along.
If you need to make a change In your restaurant’s takeout, delivery and catering operation, don’t wait until complacency creeps in. Just do it! Your whole organization will grow just like you originally intended. Oh, and one more thing, remind everyone that it won’t be the last time because change is good and is essential to surviving in any business.