My favorite restaurant (a Japanese / sushi place) closed awhile back. The business had grown from nothing into a thriving business in about 3 three years. They had expanded into larger and larger facilities and were going gangbusters — when the bottom fell out.
Apparently the owner (who, as in most cases, was also the chef) wanted to expand beyond what he was able to do in the small town in which he was located (about 75,000 people.) He opened restaurants in two other cities, each about an hour away. That’s when things started to unravel. Not only were the second and third businesses unsuccessful, they dragged down the one that was.
It seems the owner was spending way more time in the failing businesses than in the going concern. Things in the successful business started to go downhill — a little at first, and then to an extent that it began costing him his customers. Before long, what was once a thriving business was dead.
There are several lessons to be learned from this. First, before you go elsewhere, you need to determine if “you” are the business. That was the case here. This guy was a fantastic chef, a personable fellow who walked around the tables spreading good cheer, and he knew how to grow a business. He took care of his customers and people loved him. But when he wasn’t there to do all those things . . . .
Second, he probably didn’t train his employees properly. If you’re going to be gone, you have to be sure there’s someone left behind doing what you do. And they have to be able to do it as well as you do. And before you actually leave, you should watch them for awhile to make sure that is the case. It wasn’t.
Third, if you’re not going to watch the gate, you’d better take good financial care of whoever is. This man’s best chef (basically his replacement) became disenfranchised over everything that was happening and left to start his own restaurant. The competition from a former employee was the final nail in the coffin.
If you’re thinking about expanding (and you should be) make sure none of the preceding points apply to you. Or, if they do, make sure you do whatever you need to do to mitigate them. This is no place to underestimate. If you aren’t sure you’re fully prepared to expand, make sure you take the proper steps before you open that can of worms. Because it’s like they say: when you open another office (or restaurant, or store or manufacturing facility, or whatever) you’re jumping onto the back of the tiger. And you don’t ride until you get tired. You ride until the tiger gets tired.
One Response
JW
February 27th, 2009 at 12:04 am
1You hit it right on in your third lesson. If you are the business then you are limited by what you can do. Whether it is taking care of customers or running your business. If you train employees to do exactly what you do then they often don’t need you anymore. The idea that they do all the work and you make all the money can push them to leave and take the customers with them. I think it is important to think it through in the beginning if you are going to be the business or if you are going to oversee the business. If you are the business and I enjoy your service and product I will pay the price for you. At the point that I pay the price for your service and you give me one of your flunkee employees, it’s a deal killer.
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