Restaurant Best Practices: Add a Patio, Increase RevenueMay 8th, 2013
One of the best things about summer for restaurants is the opportunity for guests to indulge in outdoor dining. Adding a patio is a win-win – guests will love dining al fresco, and increasing the footprint of a restaurant, lounge, café or coffeehouse is a great way to add more revenue and gross profit.
VSAG conducted a recent business analysis for a client on the benefits of adding a patio to their operation. Our research showed that with a proposed initial investment of $200k, the forecasted seasonal use return could result in $500k in sales. Hence, by leveraging base costs (adding labor, furnishings, real estate use taxes or public space fees and anything else associated with the front end investment) gross profit of 65% was achieved. Overall, we also found that with a robust strategic management plan in place, there is great potential for a hearty profit return on investment.
By looking at the space/layout options you can envision transformation of a designated area into an oasis for guests, while help to boost sales and increase your business’s outdoor dining visibility and exposure.
The goal is to develop an outdoor dining space design to complement not only the interior décor, but also align with the brand. For example, if the interior has warm, rich and substantial wood pieces, placing delicate white tables in the outdoor space is not advised. Keeping within the same basic schematics and tones of large pieces or elements will help unify the space. That said … introducing complementary colors, textures and accessories to complete the design is a great way to set the patio apart and give it its own flavor and flair. And, be sure to consider furniture that is all-weather resistant, easy to clean and maintain. Some harsh conditions of heat and/or rain can wreak havoc on outdoor furnishings.
Since a patio space is a great opportunity to create unique focal points, and a lush setting, here is where creativity is key. Adding large planters filled with fresh herbs grown for the chef’s use is a nice way to add texture, color, understated fragrance and a connection to the kitchen; or transform the space by creating an inviting outdoor garden escape with planters fixated on an open wall; or play up great outdoor scenery with complementary colors of linens, glassware or fresh cut flowers on tables; and don’t for get about creating evening date-night type ambiance with candles, a fireplace or twinkle-lights.
Want to create a comfortable, welcoming space? Keep tables at arm’s length. Guests want to be able to focus on their tablemates. The last thing they want is to hear the conversation happening at the table next to them.
Specialize service for outdoor diners by designating enough servers for the patio area to adequately attend to guests. If it is a secondary spot to servers, guests will pick up on that. Also, offering a patio menu will also set this area apart and offer special appeal. No need for a full menu revision, just maybe adding (or deleting) a few items to enhance it. For example, if your design includes growing fresh herbs, add a few mojito cocktail selections featuring mint freshly picked from the patio.
Lastly, contact your county clerk or local chamber of commerce to verify requirement codes/permits for operating an outdoor dining space as there may be special requirements, regulations and code compliance issues to address.
So, whether you have seating for eight or 80, and the layout is a traditional outdoor space or extends service area and better utilizes wasted space on the second floor or rooftop, including a patio in your business plan as a revenue source and profit center can breathe new life into your restaurant … and your bottom line.