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The first year in business is often a whirlwind—your primary focus is on getting customers in the door, perfecting your processes, and simply staying afloat. As you find your footing and establish a steady rhythm, it’s time to think beyond just the basics and explore new ways to grow. One of the most effective strategies is to diversify your restaurant revenue streams.
Why Should You Diversify Your Restaurant Revenue Streams?
Diversifying your income sources can significantly boost your overall revenue while also safeguarding your business from unforeseen challenges (hello, 2020…). By introducing multiple revenue streams, you’re not only creating new opportunities to attract and retain customers, but you’re also setting your restaurant up for long-term success.
In this article, we’ll explore seven ways to diversify your restaurant revenue streams and offer tips on how to manage them effectively. Ready to dive in? Let’s get started!
7 Ways to Diversify Restaurant Revenue
1. Online Ordering
If you haven’t already, your first move should be to add an online food ordering system. Online ordering has consistently shown higher-than-average sales per ticket and taps into a growing segment of customers who prefer the convenience of ordering online rather than in-store or over the phone.
During the pandemic, online ordering became a lifeline for many restaurants, and even in its aftermath, the trend has only continued to grow. By offering online ordering, you not only cater to customer preferences but also expand your reach beyond your immediate geographic area.
2. Gift Cards
Gift cards are a win-win for restaurant owners. When a customer purchases a gift card, you receive immediate cash flow without dipping into your inventory—almost like getting a mini loan. But the benefits don’t stop there. When customers redeem their gift cards, they often spend more than the amount on the card, leading to higher ticket sizes.
Additionally, restaurant gift cards are excellent for attracting new customers and encouraging existing ones to return more frequently. During the holiday season, gift card sales can skyrocket, providing a substantial revenue boost at a crucial time of year.
3. Catering
Catering is another lucrative revenue stream that can significantly boost your bottom line. Whether it’s a corporate luncheon, a graduation party, or a wedding reception, people need food for events, and they often turn to their favorite local restaurants to provide it.
Catering orders tend to be much larger and more profitable than typical in-store orders. Moreover, catering allows you to utilize your kitchen during off-peak hours, maximizing your resources. Promoting your catering services can also help spread the word about your restaurant to new audiences who may not have discovered you otherwise.
4. Merchandise
Why not turn your customers into walking billboards? Selling custom merchandise, such as t-shirts, mugs, or tote bags, not only provides a small revenue boost but also helps to promote your brand.
Merchandise can be sold in-store or added to your online ordering menu for easy access. Every time someone wears your t-shirt or carries your branded tote bag, they’re spreading the word about your restaurant, potentially attracting new customers. Make sure your merchandise is high-quality and reflects your brand’s personality to make it a desirable purchase.
5. Memberships/Clubs
Creating a membership or club program can build a sense of community around your brand while providing consistent revenue. For a monthly or annual fee, members could receive exclusive perks, such as discounts, free items, or early access to special events.
Panera Bread’s Unlimited Sip Club is a great example, offering members free drinks anytime they visit, along with bonus perks and discounts. This not only encourages repeat visits but also fosters customer loyalty.
Think about what kind of membership program would resonate with your customers—whether it’s a coffee club, a loyalty program for frequent diners, or something unique to your restaurant.
6. Events
Events are a fantastic way to bring new customers into your restaurant and give regulars a reason to visit more often. Whether it’s a trivia night, live music, or a themed dinner, events create a buzz and draw in crowds. The key is to tailor events to your core customer base.
For example, Agape Juices in Foley, Alabama, hosts educational lectures on health and wellness topics that resonate with their health-conscious clientele.
7. Contests and Challenges
In addition to special events, hosting contests and challenges is another innovative way to increase revenue and add a new stream of income. Contests can attract competitive customers and draw in spectators who may not have visited your restaurant otherwise.
For instance, K’s Japanese Kitchen in Provo, Utah, runs a Big Bowl Challenge where contestants are dared to finish a triple-sized rice bowl within a set time. This challenge not only brings in enthusiastic participants but also their friends and family, increasing sales across the board. Contests like these can become signature events that keep customers coming back.
How to Keep Track of Multiple Restaurant Revenue Streams
While diversifying your revenue streams is an exciting prospect, it’s crucial to have a solid system in place to manage them effectively. With various income sources coming in, it can be challenging to keep track of everything, from sales to expenses and profit margins. This is where a comprehensive restaurant budgeting tool comes in handy.
Our restaurant budget management tool, Cash Flow, is specifically designed for restaurants ready to manage multiple revenue streams. Integrated directly into your POS system, Cash Flow connects to your bank accounts, making it easy to monitor your cash flow in real-time. With Cash Flow, there’s no need for separate apps, additional subscriptions, or extra fees—it’s all part of the Table Needs package.
By utilizing Cash Flow, you can seamlessly manage your restaurant’s finances, ensuring that each revenue stream is contributing to your overall profitability.
Want to learn more about Cash Flow and how Table Needs can help you on your path to profitability? Book a demo today!
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