How to Compete With Chain Restaurants
Competition in the restaurant industry is fierce across the board, but when independent restaurants find themselves up against a big chain moving in next door it can seem like an impossible battle. Chains have the leg up on independents for a number of reasons: they can spend more on marketing, they can afford to spend more on bigger spaces in better locations, they can negotiate better prices for supplies, and they instill a brand recognition in consumers that independents can hardly compete with.
But do not go gently into that night! Though Big Burger might have a lot of advantages over the little guy, independent restaurants have advantages of their own and with the right strategy can put up a pretty scrappy fight. The key is to leverage your strengths in order to get the most from them.
So, what are these advantages, and how can independent restaurants make the most of them?
Advantage 1: Independent restaurants can get to know customers more intimately.
Though corporate chains are increasingly trying to be more personal, this is one arena in which they cannot compete with independent restaurants. By making customers feel special, remembering their names or making them items that aren’t on the menu, small businesses can create a relationship with customers that corporate chains cannot.
How to make the most of it: In addition to doing small things like remembering customers’ names, use the intimacy of your establishment to create direct marketing campaigns. Collect information from your customers, such as their birthdays, anniversaries, likes and dislikes. Use what you learn to offer them special deals and cater to their tastes.
Advantage 2: Independent restaurants can offer a wider variety on the menu.
Menu variety is another great way that independents can close the advantage gap. While big chains can offer limited time offers (LTOs) for short-term menu variety, they cannot do so on the nearly the same scale as small restaurants. Chain restaurants are bound to a corporate agenda and have to follow set menu and marketing rules. But independent restaurants can change the menu daily, weekly or however often they see fit. This allows the independent operator to market a changing menu with LTOs catered to what their customers are looking for.
How to make the most of it: It is not enough to simply offer variety; you need to get the word out. Update your Twitter and Facebook followers on your daily specials, and communicate through email marketing when your menu is going to change. Do your research, use comment cards and find out what customers would like to see more of, and adjust your menu accordingly. Wondering how to get more Twitter and Facebook followers? Click here to learn more about social media marketing for restaurants.
Advantage 3: Independent restaurants can focus on quality.
Though some chains try to source local, organic and fresh ingredients, this feat is still best accomplished by independent restaurants. It is difficult for corporate entities to ensure the freshness of ingredients in each individual store, and oftentimes quality can be overlooked.
How to make the most of it: If you are going to provide quality ingredients, you need to get the word out to guests and potential guests. If you source local or organic ingredients, definitely put this on the menu, as well as on flyers and other advertisements.
Advantage 4: Independent restaurants can band together.
Though this is not an inherent advantage, it is one of the best ways for independent restaurants to compete with chains. When independents work together, they can wield power comparable to the power of a corporation.
How to make the most of it: By getting together and creating a buying group, independents can negotiate better prices on supplies. This, in turn, allows you to lower menu prices and remain competitive. Independent restaurants can also pool together marketing resources in order to compare to the marketing power of chain restaurants. You can work to promote one another’s businesses by the simple act of handing out business cards in your establishment. Other independent restaurant groups, such as this group from Cardiff, Wales, have banded together to offer a discount card that can be used at a number of different local restaurants.
Though at first it might seem daunting when a corporate chain moves in next door to your restaurant, there is no reason to panic. The world still needs independent eateries and with a little cooperation and creativity, independents have proven they can grow and thrive alongside their corporate neighbors.
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- Restaurant Marketing Glossary
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