Over the years, many people came to talk to me about their idea/dream of opening their own cafe/restaurant/bar and asked what I thought about it. Most of them usually have a pretty solid idea of what they want to sell. But very few of them actually have a real plan of how to sell it. Assuming everyone wants to earn money and create a sustainable business (as some people do not open a restaurant to make money) – the number one question I always ask before anything is: WHY DO YOU THINK CUSTOMERS WOULD WANT TO BUY FROM YOU?
By asking “Why customers want to buy from you?” – we are talking about what is so special about your restaurant that people will need to buy from you but not anyone else. If you can answer this question, it means that you have a position, a niche which is extremely important as this will gonna help you survive and make money. When you answer this question, apart from doing something you like, you also need to be neutral and think from the customers’ view point. Reasons such as “I think my food/coffee etc. tastes the best” is OK, at least it shows you are passionate about your idea and that is going to help get you through all the ups and downs. Yet at the same time, you will also need a more neutral reason to support the business operation.
If you talk to people who have the experience of running their own business, they most likely will tell you that the most important thing in running a business is not to earn money but:
Finding a niche in your restaurant will certainly help you survive. One of the most frequent questions I have been answering in the past 8 years is – Why Mexican food?
Apart from the fact that I LOVE Mexican food, I chose the cuisine because it has a strong position, a strong niche. It is hard to be the best Italian/Chinese/French restaurants in Hong Kong because they are already saturated with so many venues. Competition is keen. However for Mexican restaurants the scene is relatively new with fewer competitions here. More over Mexican food is already extremely popular in North and South America, a proven food concept even though still novel in Hong Kong with room to grow. One of the main reason that I still can keep Verde MAR running is because I have found the right niche for the business.
Opening restaurants can be a risky business venture especially in Hong Kong due to the sky-high rent and high setup cost (high capital expenditure), but it can still be a very profitable business if you have a plan and get the formula right. Next time, let’s discuss other factors on how to create a successful restaurant.