Why Small Diners Often Find It Too Hard to Survive Today: Poor Financial Management?


A small dinner, a bed & breakfast, or a café has a certain charm, unlike anything that the bigger and far more expensive places can offer. Tourists and locals alike are still fond of them in the UK, due to their simplicity, the sense of belonging which they offer and of course, the cost-effective menus.

In spite of all that, a lot of smaller establishments are failing in the food business today, with even some of the oldest names in their respective localities going out of business for one reason or another. Here we look at why that is.

Financial Mismanagement is the Main Problem Here

While there are far too many reasons to be discussed within the small scope we have here, it remains true that there is a direct correlation between financial mismanagement and smaller eateries going out of business. What are those mistakes that they are making then? Read on if you have a small diner or café of your own, or plan to open one soon.

Overpriced Menus Throw You Out of the Competition

A common problem that we often see with both new and sometimes even older restaurants these days is that of overpriced menus. Not that they can be blamed for trying to make up for the ever-increasing expenses, but one of the top reasons why small eateries often choose to increase the price of food and drinks available has a lot to do with the feeling that they need to.

This is a phenomenon particularly observed in the UK’s top tourist spots, as a lot of smaller cafés believe that they would be losing out by keeping their prices down. In reality, the idea should be to neither keep it too low nor too high, in order for the menu to be practical and profitable at the same time. If the price is too high, then the small restaurant owner is taking away one of the diner’s unique advantages, which is to offer good food at great prices.

Once a certain price barrier is exceeded, even the smallest diner is now competing with the top of the line, big restaurants near its location, which is a battle they cannot win, since it was not their field to begin with.

Staying with the Same Energy Provider without Incentive

The price of business gas and electricity increasing in the United Kingdom, and the rates fluctuate multiple times a year nowadays. However, that doesn’t necessarily mean cheaper business gas and electricity isn’t available. Any smart business owner knows this fact all too well, and they keep changing providers to get a better deal during the tenure of their next contract. Given that business gas and power are two of the main requirements in the restaurant business, it would make sense to shop around. Use a site like Utility Bidder to get a better quote for business gas and electricity. Smaller establishments are often amazed by how much they have missed out on so far by sticking to their original provider for years, without opening the lines of negotiation. Understand that it makes a huge financial difference for a business if it has the opportunity to cut costs without sacrificing productivity in any way. This will, of course, help the owner to keep the prices down as well.

Part of the charm behind smaller cafés and such is the fact these are not run by corporate chain management. They are the places that are still being run by locals, offering a unique sense of belonging and nostalgia to everyone; something that they do not really want to let go. This is the reason why small food businesses are not doomed to fail if they are careful about their financial management strategies and proper identification of the market.

Author: Naveen EThis is E.Naveen Kumar full time Content Writer, SEO, Digital marketing Expert, founder of financesrule.com. Really enjoying playing cricket at free times. Being a Btech Graduation from Computer Science stream Selected full-time blogging as my Profession.

Leave a Reply