The restaurant business in Ukraine is experiencing a real boom. Over the past year, the number 
the number of catering establishments increased by 25-30 percent, and that's not the limit, their number will grow in various segments. Unfortunately, a certain portion of them will disappear without ever winning over their customers or recouping their investments. And this portion is not as small as it might seem. Even professionals, let alone newcomers to the business, make many mistakes when setting up a restaurant (cafe, bar, fast food outlet, or club).
Of course, if you know about potential mistakes in advance, you can avoid them entirely or at least mitigate their impact. The challenge is having the will to do so. At first glance, the restaurant business seems very simple: a few good ideas, a fashionable designer, professional staff, and high-quality promotion – and a successful restaurant is ready. But it's not so. And it's not because the people doing it are amateurs – there are many professionals and experienced people in the Ukrainian market. It's the market itself – competition is growing, and consumers are becoming more demanding.
How to build a successful restaurant business?
The foundation of any catering establishment's concept is marketing. This science provides answers to questions such as: who will be the future establishment's customers? What type of cuisine, service, and interior design do they prefer? How much are they willing to pay per visit? Where will they come from? Two main methods are used to answer these and many other questions: expert assessment (conducted by experts in the field); Marketing, technology, and service specialists) and marketing research methods. Using these two methods not only helps avoid mistakes but also, to a certain extent, guarantees the success of a business.
Unfortunately, just a few years ago, marketing analysis was practically ignored when creating restaurant (cafe, bar, etc.) concepts or reorganizing them, relying on intuition or copying what they liked elsewhere. And that's a shame. Then there wouldn't have been restaurants that were wonderful in every way but undesirable, failing to find their customers. These customers either stick around in similar establishments and have no intention of leaving, or they simply don't exist. The food service market is like a mitten that can't fit 20 people at once. Likewise, the restaurant market can't be infinitely divided into an infinite number of establishments.
Because as a result, we get the same picture called the “communicating vessels effect” - when one establishment fills up at the expense of another. These establishments may not even be similar in concept—they may have different designs, cuisine, and locations. But their patrons are the same, in terms of age and social status, as well as leisure habits and preferences.
The new generation of Ukrainian restaurateurs (or future restaurateurs) is increasingly turning to marketing, primarily to protect their investments. Of course, the surest path is to thoroughly analyze the market situation before planning a venture, much less investing in it. It may turn out that your dream restaurant simply won't be in demand, and you and your friends will end up going there alone.
Before unleashing creativity, it's important to identify a few key factors, or, as marketers say, conduct market segmentation. The primary principle of segmenting the food service market is price, based on the average bill. This makes sense, as the ability to pay a certain amount for eating out clearly divides people into groups.
Analyzing the Kyiv restaurant market over several years, we can see some interesting trends. The market itself began to develop from the elite, upper-price segment. Let's recall the successful establishments of the "new generation" of 8-10 years ago – all of them catered to the wealthiest clientele of the time. Over time, this segment expanded dramatically and then plateaued, while a segment of mid-price restaurants and cafes, lower-price establishments, emerged and grew.
The purpose of restaurant visits has also changed: just a few years ago, the main purpose was relaxation and entertainment. That's why nightclubs of all levels were so popular, and discos were springing up like mushrooms after the rain. According to this year's surveys, the most popular purposes for visiting restaurants in Kyiv are meeting with friends, family vacations, and simply eating out. Of course, the need for entertainment hasn't disappeared completely; it has shifted to a different age group (18-25).
The main one (both in terms of needs and financial capabilities) Audiences aged 28-38 don't consider entertainment to be the primary criterion for choosing a particular establishment. They prioritize cuisine, interior design, service level, location, availability of additional services, and many other factors, which can only be identified through marketing analysis.
Thus, we came to the need to define our target audience. I want to point out that the audience is least dependent on the customer database of other restaurants. Customers are not balls that can be tossed from one establishment to another. Each has their own preferences, habits, and desires, and if a customer has an emotional connection with a particular establishment, only exceptional circumstances can disrupt it.
Knowing the intended target audience, it's important to determine their needs and criteria for choosing a restaurant (rather than those of colleagues or partners). In many cases, the opinions of potential customers do not align with the preferences of the future restaurant's organizers.
And finally, the most important thing is to determine how much and how often a potential client will spend on a restaurant. This will determine the design of the premises, the menu (and, consequently, the equipment), the type of service, the tableware, furniture, and cutlery, and, of course, the profitability of the establishment.
What can be learned from dry marketing information about the market and potential consumers?
First of all, to see the full picture of the catering market, promising directions for its development (in a particular region, city or district).
In addition, you have a clear portrait of a potential consumer in your hands.
It is he, your beloved, who you will rely on when developing your advertising campaign and promotions; the interior will be created according to his taste, and the menu will be tailored to his needs and capabilities.
So, the first stage of creating a successful restaurant concept has been completed. Based on the data obtained, the organizational and technical components of the enterprise are planned:
- Explication of the restaurant premises: division into trade, production, warehouse, service and administrative zones.
- determination of the range of dishes (kitchen and bar) with an indication of the optimal trade margin and outputs;
- Selection and arrangement of technological equipment and technological furniture, holding a tender for equipment suppliers. Note: Equipment selection is carried out only after determining the kitchen type and menu – to ensure optimal food preparation and avoid unnecessary items.
- arrangement of seats taking into account the zoning of the hall.
- determination of the type of service, operating mode of the enterprise,
- enterprise staffing table, management structure;
- necessary set: bar and kitchen equipment, hall and bar inventory, office equipment; hall furniture; tableware, glass; staff uniforms; table linen; cutlery for the hall; software.
All these points form the basis for the next element of the concept—the business plan. The organizational and technical content provides an understanding of the project's investment and potential ongoing costs. The purpose of a restaurant business plan is to "convert" the previous parts of the concept into figures and determine the return on investment, the overall profitability of the project, the cash flow diagram, and the investment plan. When developing a business plan, it is essential to consider factors unique to the restaurant business: the average bill structure, the dynamics of the average bill over different time periods, customer turnover, the length of time a customer spends in the restaurant, and the consumption rates of various food groups. Without these data, the business plan will simply be biased.
So, the concept is almost ready; all that remains is the pure creativity: creating the style, the idea, and the name of the establishment. It's worth noting that the creative part isn't the primary concept, although many try to start with it. Many, especially designers, would disagree. However, it's always important to remember that the restaurant business is a business like any other, so even if the idea seems very promising, it's necessary to carry out the steps outlined above to ensure its validity and timeliness.
So, the concept has been created, all the plans have been drawn up, now it's time to create the working project, estimate documentation, design project, and – finally – implement the concept itself. But now the restaurant isn't being built blindly.
It's worth noting that so much time is devoted to pre-project work because proper planning accounts for 70% of a facility's success. The actual project implementation must be based on the previously developed concept.
During the finishing stage, it is necessary to order technological equipment and technological furniture (delivery time can be 1.5-2 months), everything necessary for the restaurant: dishes, glassware, cutlery, table linens, kitchen and bar utensils, dining room equipment, equipment for utility, domestic and administrative spaces, music and lighting equipment, etc.
No later than two months before the project's launch, it's advisable to begin recruiting staff, starting with key specialists (department and department heads). A month before the start of operations, a "dress rehearsal" begins, rehearsing the menu and rehearsing the staffing of the dining room, bar, and other departments.
And a little about promotion.
The success of promoting any food service establishment depends not on the amount of money invested (although achieving success on a shoestring is difficult), but on how well the chosen tools align with the needs of the target audience and the establishment's market positioning. For example, if the business is local, meaning it targets people living and working in the area, there's no need to spend money on advertising in the citywide press or on the radio. It's enough to "mark" the establishment with outdoor advertising elements and send out mailings to nearby office and residential buildings. If you need to expand your potential client base, knowing your audience makes it easy to identify relevant advertising media. However, presenting your establishment as a citywide business requires identifying and effectively communicating the competitive advantages that will compel potential customers to travel from across town.
