What percentage of restaurants fail?
The restaurant failure rate is 30% in the first year. Restaurants have been among the hardest-hit industries. Around 60% of new restaurants fail within the first year. And nearly 80% shutter before their fifth anniversary. Once a restaurant gets past its first year in business, its chances of failure drop.
What is the life expectancy of a restaurant?
The Restaurant Brokers’ study concluded that up to 90 percent of independent establishments close during the first year. Chains have an average five-year life span.
Factors affecting restaurant longevity
- Customer expectations
- Location
- Menu innovation and pricing strategies
- Franchising and brand recognition
- Sustainability trends for environmental improvement and competitiveness
In 2020, customers will expect smaller, simpler menus. Plant-based meat items are also becoming more popular. Menu engineering and pricing strategies are key components of menu innovation. The restaurant industry offers entrepreneurs opportunities through franchising and brand recognition. Digital channels are essential for the restaurant of the future to engage guests and encourage repeat business. There are many sustainability trends restaurants can follow to improve the environment and stay competitive, like using eco-friendly takeaway packaging.