What is a SWOT analysis of a restaurant?

A SWOT analysis of a restaurant can be done as a way of making improvements to your business. SWOT stands for Strengths, Weaknesses, Opportunities and Threats. When doing a SWOT analysis of a restaurant you are measuring and evaluating the overall performance of the business to that of your competitors.

By doing a SWOT analysis for a restaurant you will be able to make smarter decisions for the company that will allow the restaurant to grow. It can be used either as a way of gaining more customers or if you are looking to do a major change like a rebrand.

The first two categories, strengths and weaknesses, involve looking inward at factors such as reputation, the success of your team and menu. These considerations are things that you have control over and are relatively easy to change.

So, if one of these factors seems to have more weaknesses than strengths you will find out through the SWOT analysis for your restaurant. You will be able to come up with ideas on how to improve these factors once you’ve completed the analysis.

The other two categories, opportunities and threats, are more related to external influences such as competitors, market trends and prices of materials. Some of these things you may not be able to change but being aware of them can give you some ideas on how to deal with them.

An example of this that restaurants have to deal with is the price of groceries. Prices for groceries have gone up a lot in the last few years, which can easily affect your bottom line. By doing a SWOT analysis for your restaurant, you will be able to see clearly how this is affecting your entire business and the possible ways you can offset this issue.

Why do a SWOT analysis for a restaurant?

Performing a SWOT analysis can be a lengthy process, but it will help your business make improvements. Once the data is collected for the different categories, you are able to see the big picture clearly, making solutions an easy thing to find.

A SWOT analysis of your restaurant can also allow you to see things you might otherwise miss. For example, your menu may need to be updated to take into account new food trends or the eating habits of your customers. Without doing an analysis of your business, you may not see the need for this and the restaurant could be losing out on gaining new customers.

This type of business analysis is also a good way of assessing your competition and what they might be doing better than you. By seeing areas in which your competition is doing better, you will be able to come up with a strategy for improvement.

An example of this will be if your competitors have an easier system for ordering take-out. Having a good online ordering system is essential in today’s restaurant market. Clients expect to be able to easily go online and order take-out or delivery and if your system for this is difficult to use, you could easily be losing out on certain customers.

Doing a SWOT analysis for a restaurant can also be a collaborative effort if you allow your staff to participate in the identifying stage of the analysis. Having your staff help with identifying the strengths, weaknesses, opportunities and threats can give you a good perspective on the business as they will see things you do not.

Also, this type of activity can be great for team building. Being transparent with staff about the need to make improvements will make them feel part of the team and they are likely to work hard at helping improve business.

Related: 3 Exercises for Team Building You Can Try This Week With Your Group

3 Steps to a restaurant SWOT analysis

Here are the three steps to do a SWOT analysis of a restaurant

Step 1: identify strengths, weaknesses, opportunities and threats

This step can be done alone or as a group. Make sure that you are thorough with your lists so that the analysis is accurate. The following questions will help you fill in the different categories:

• Strengths: what are your competitive advantages over other similar restaurants? Do you have unique offerings? What draws in customers? What turns your customers into repeat customers? Is your staff happy with their compensation?

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• Weaknesses: what could you be doing better? Are there things that make customers not want to eat at your establishment? What do your customers complain about? How often do you need to hire new staff?
• Opportunities: Are you doing enough social media marketing? Are you involved in local events such as a farmer’s market? How often do you update your menu? Do you have a clear brand or point of view for your restaurant?
• Threats: In what areas does the competition do better? Are customers complaining about a particular aspect of service? Are there new government regulations to watch out for? Are grocery prices negatively affecting your bottom line?

The above questions can all be asked in order to help you identify the information that you need for each category of the SWOT analysis.

Taking a good amount of time on this step is necessary as it will help you analyze the data and make the changes. Being careful not to leave anything out, no matter how small it seems, will allow the process to be a success.

Step 2: come up with what you want to improve

Once you’ve done the identifying step, you need to decide on what things you will improve.

If you didn’t involve your staff in the prior step, it might be time to bring them in on the process. Any change that you will implement will have a direct impact on them so having their opinions will help you figure out which way to go.

Getting feedback on the SWOT analysis of the restaurant from your employees will help you see what should be prioritized. Also, your wait staff will be able to tell you more about the customer experience as they are the ones interacting with them on a daily basis.

This perspective can be a good one to follow as it will be your customer base that can help you see what needs to be improved. Gaining more business in the restaurant industry is not easy, so having good communication between you and the customer is an essential part of creating change.

Step 3: implement the changes

Once you’ve figured out what you need to change, you need to implement the changes. The best way to do this is to come up with a plan that will make the changes easy to achieve.

To do this start by communicating with your team what the changes will be and when they will be made. That way you can make sure everyone is on board and are able to ask any pertinent questions if needed.

Make sure you have actionable steps when implementing the changes so that everything comes to fruition.

For example, if you are updating your website, take the steps to find someone who can do this for you in the timeframe that is needed. That way the changes that you are trying to implement are not forgotten.

Once you’ve implemented the changes remember to check in with staff about how well they think the changes are working. Continue to be open to tweaking your original plan so that the problems you were trying to fix do not come back.

A SWOT analysis of a restaurant can be done on a regular basis if needed. In an industry like this one, it is important to be constantly changing and updating how you do things. A regular SWOT analysis can help you determine what types of changes you need and give you the ability to implement them.

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