Growing a Restaurant Strategically – The Keys Are Alignment, Timing and Control

Ambitious restaurateurs often want to expand quickly to capitalize on initial success. However, rapid growth without an intentional strategy frequently erodes quality, culture and profits over time. Sustainable restaurant expansion requires balancing excitement with patience and perspective.  

There’s an art to scaling any small business intelligently. You want to build deliberately from core strengths rather than reacting to every new opportunity, which can undermine what makes your concept work.

Festaurant growth done right starts with leaders aligning around operational priorities and smart key performance indicators (KPIs). They research potential new offerings extensively, preparing thoroughly before launching rather than rushing to market. Funding is secured strategically to fuel key aspects of the expansion plan rather than used as a general shortcut that potentially forfeits control.

Set Mutually Beneficial Key Performance Indicators (KPIs)

KPIs are the quantifiable metrics that provide restaurant leaders with the most actionable insights on progress towards expansion goals, guiding crucial decisions.

Typical restaurant KPIs involve monitoring costs around food, labor and supplies, pricing adjustments, table turnover rates during peak periods, customer wait times, promotion effectiveness, brand sentiment on review sites, and training completion rates.

Sustainable restaurant expansion requires balancing excitement with patience and perspective.  

Define the one or two KPIs most critical for your top growth goals. They must connect to priorities across key operations, marketing, customer service and finance roles. Don't select indicators that could encourage behaviors undermining staff capabilities downstream. KPIs lose relevance if unrealistic for teams execute across the business.

KPIs can't be set up in ways that make it harder for other departments to deliver expected outcomes. They need alignment with practical operational realities and bandwidth.

For example, an aggressive table turn target could unduly pressure servers to rush patrons, impairing their experience. Unattainable expectations around order accuracy or ticket times risk frustrating kitchen teams, especially without proper tools, training or staffing support.

Leaders must consider systemic connections so KPIs unify staff efforts instead of demoralizing people or diminishing service quality. The metrics should motivate and focus priorities but not create operational disconnects or unhealthy tradeoffs.

Research New Offerings Rigorously Before Adding

The question of whether, when and how aggressively to add new menu items, expand hours/days, launch catering options or open another location has substantial implications for restaurateurs. Poorly vetted moves strain capabilities across kitchens, servers, support staff and systems. They can also erode quality, consistency and brand prestige if not executed well at scale.

Sometimes what customers explicitly request isn’t what they most need or want long-term. People naturally ask for incremental improvements versus conceptual leaps addressing underlying needs they can’t yet articulate.

Leaders shouldn’t spread efforts across too many disparate new offerings in parallel but build capabilities in sequence.

Conduct extensive upfront research before determining which new products and services represent smart, stage-appropriate investments versus reactionary moves with slim upside for distinctive restaurants unwilling to compete primarily on convenience. 

Truly addressing annoyances guests don’t consciously convey or introducing dishes redefining what they previously considered possible take creativity and guts. But the payoff for calculated risks meeting unmet needs can be tremendously rewarding.

In addition to substantial customer research, use concept tests for new offerings with small control groups to gather feedback and assess operational readiness before full unveilings. Small pilots expose weaknesses, risks and required iterations so leadership can determine if initial plans need adjustment, delay or abandonment.  

Most importantly, restaurateurs should ask themselves candidly whether an innovation aligns with the restaurant’s three to five-year vision versus distracting strategic focus and resources from higher-impact growth priorities. Leaders shouldn’t spread efforts across too many disparate new offerings in parallel but build capabilities in sequence.

Take on Investors Only When Absolute Necessity Calls for It

During growth phases, bringing on outside investors can be a tempting path to accelerate expansion plans. Capital infusions fund additional equipment purchases, hire staff quickly or secure upgraded real estate locations. However, restaurateurs need to be cautiousabout the substantial downsides of ceding control through outside funding.

Investor dollars come with demands that distort focus from guests, staff and strategic priorities – reshaping everything to drive short term profit. They typically lack hospitality experience and starve long play investments that may temporarily compress margins like training, retention, community building and quality.

Private equity investors particularly pressure leadership for rapid revamps and location expansions that often degrade original hospitality vision and culture over time. Corporate investors aren’t quite as extreme but still redirect attention towards homogenizing systems, cost reduction and mimicking competitors. 

Restaurateurs should assess potential investors on key hospitality passions more than financial metrics alone when fundraising necessity arises.

For family-owned restaurants or small chains at early stages, only secure funding from sources like Small Business Administration loans when absolutely necessary. Restaurateurs should thoroughly model out growth plans, get creative on managing cash flow and run lean before considering outside investor dollars. 

If funding becomes essential,  structure agreements retaining as much control as possible for hospitality experience senior leadership. Investors generally push hard for influence or even majority board seats directing strategy and operations. 

Restaurateurs should assess potential investors on key hospitality passions more than financial metrics alone when fundraising necessity arises. He advises asking questions like:

  • What attracts you to the dining/cuisine hospitality space specifically? 
  • Where have you supported small brands balancing personality with scalability?
  • How do you define and measure success – beyond revenue and profit dashboards?
  • How have you empowered creative teams through growth phases in past investments?
  • What kind of decision authority are you expecting in return for capital investments?

Carefully structured arrangements allow just enough funding support for key near-term moves while restricting external influence from reshaping the restaurant’s core vision long-term.

Expand Thoughtfully from Your Strategic Core   

Rather than rushing to mimic competitors or appease every customer request, restaurateurs should focus on delivering an excellent signature experience consistently first. Growth stems sustainably from meticulous mastery of the basics – hospitality, food, ambiance, and operations. 

From that strategic platform, align leaders around smart KPIs, research-backed moves to delight guests uniquely and occasional calculated risks that redefine excellence. Expand thoughtfully at a manageable pace that allows teams and culture to season properly.

Discuss new ideas openly, challenging assumptions and pressure testing feasibility. But also celebrate small wins along the expansion journey to stay grounded, patient and focused on hospitality fundamentals versus short term rewards alone.