A Downturn Is a Terrible Thing to Waste.

If you're one of the many casual dining restaurant operators who are terrified about the state of the economy, I've got some encouraging news to share.

I just returned from the Restaurant Finance and Development Show a week ago and what did I learn there? Things are going to get better for the restaurant industry next year.

Yes, that's right.

Here's why:

• The downturn will weed out weaker competition. Primarily, this group is made up of single-unit "mom and pop" restaurants, but it also includes inefficient chain operators. Once the dust settles, customers with fewer dining options will be yours to capture.

• Real estate opportunities are everywhere. Boarded-up "A" locations are up for grabs at a discount. So, keep your eyes open!

• Pretty soon aging baby boomers will be succeeded by a larger, untapped demographic group: Millennials. This is great news for restaurants because millennials have no desire (and no idea how) to cook! Instead, studies show they travel in packs to QSR, fast-casual and casual restaurants.

• Higher unemployment gives you the opportunity to upgrade your people. Highly qualified individuals will be looking for employment at all levels and in all positions.

If you want to turn things around, you can't just wait out the storm. You have to put forth serious effort and, probably, make major changes. Here are my recommendations:

• Conduct research to determine who your real core customers are, and why and how they use your concept. (Most operators think they know this, but they don't!) I recommend Perception Testing, a qualitative research instrument offered by the top restaurant marketing firms. It will reveal truths about your concept that you never even suspected.
  

• Based on what the research reveals, take a hard look at your branding. It must be one-hundred percent aligned with your core customer! If it's firing on all cylinders, stick with it. If not, find a trusted chain restaurant marketing firm to fix it.

• If you don't have one, invest in a new, professionally produced custom photo library. Do not cut corners in this area. People eat with their eyes, so give them top quality fare. Spend what it takes to get a mouth-watering "menu" of shots that will last for years to come. (See our white paper about this at www.ideastudio.com).

• Examine your trade dress. Is it time to modernize? If you want to succeed in downturn, you must be up with the times!

• Stay top-of-mind. Expand your marketing with promotions built around existing menu items that are operationally easy to execute. I'm a big believer in LTOs that utilize a variety of mediums, including inexpensive ones such as e-mail and four-walls marketing and PR events. But don't try to create your promotion on the cheap; hire a good marketing firm to do it.
  

• Step up your service. Every guest should be greeted upon entering or leaving your restaurant. If your customers feel especially appreciated, they'll tell their friends. (On the other hand, if they feel they haven't been treated well, they'll tell the whole world!)
  

So how will you respond to this economic downturn? Will you hunker down, slash costs and hope for the best? Or will you seize an unprecedented opportunity and position yourself to ride high on the upswing? You can be sure that the most agile and assertive operators today will be the powerhouses of tomorrow.