There’s a lot that goes into running a successful restaurant — you have to keep track of inventory, make sure the kitchen is fully staffed, control your spending, and come up with creative ways to bring in more business. And that’s all on a good day! You also have to be prepared for emergency situations like a sudden outbreak or natural disaster. That’s where restaurant risk management comes in.
Risk management is an important part of running a successful restaurant. It helps you identify possible risks to your business, analyze the impact they could have, and come up with strategies to prevent or minimize those risks. For restaurants especially, risk management is key to weathering whatever storms come your way.
What is Risk Management?
Risk management is the process of assessing and mitigating potential dangers that could threaten a company’s bottom line. This includes everything from financial loss to damage to a brand’s reputation. It’s critical to have a plan in place to deal with the possibility of suffering serious setbacks if things go wrong. Without one, your business is exposed and vulnerable.
Why is Restaurant Risk Management Important?
Getting into the restaurant business is hard enough, but staying afloat is an even bigger challenge. Some of the most common risks restaurant owners face are:
Poor Food Quality
Maintaining the food quality is essential for avoiding matters spiraling out of control. Customers falling sick after eating your food is a nightmare for restaurant owners. It brings bad publicity for the brand, draws crowds away from the restaurant, and sometimes leads to financial implications. For example, the American chain, Chipotle faced a $25 million fine when customers fell sick after dining with them.
A restaurant kitchen is a hot, high-stakes environment where one wrong move can have serious consequences. A spilled cup of coffee or a lit candle on a table can quickly lead to an accident that injures people and causes significant financial loss for the restaurant.
Dropping a hair in the lentil soup or serving nuts to an allergic person are major service issues that can bring lawsuits and a poor reputation for the restaurant owners.
Many restaurants record credit or debit card details for repeat customers. A cybersecurity breach like Wendy’s could wreak havoc on the brand image.
Every restaurant needs to prepare for such scenarios and mitigate risks to:
- Safeguard people present on their premises
- Maintain food standards
- Shield the restaurant from bad reviews
Here’s how you can make a risk management plan for a restaurant.
Building a Restaurant Risk Management Plan
To build an efficient plan, simply follow this restaurant risk management checklist.
Train your Staff
In busy restaurants, where things can go from good to bad very fast, your staff must be trained to spot and steer clear of possible hazards. A key part of maintaining a safe workplace is knowing how to recognize these potential risks.
Identify and Analyse the Risks
By conducting regular audits, you can identify any weak spots or potential risks. Use benchmarks to gauge the likelihood of a risk occurring and how severe it could be for your business.
Find the Trigger
Do this collectively with your team. Spot the warning signs to prevent them.
Plan and Execute Safety Measures
Plan safety measures to prevent severe damage to people or property and contingency plans in case they occur. Share the risk management plan for the restaurant with everyone.
Since accidents can occur during any activity or with anyone within the restaurant, spreading awareness and delegating responsibilities is essential.
It’s important to regularly check in on the safety procedures you have in place to prevent any accidents. If any accidents do occur, make sure to document them, and take necessary action right away.
A reliable restaurant management system like KNOW can help your employees quickly file incident reports with just a few clicks, automatically alert the right groups for each type of issue, and track progress with real-time updates.
How can KNOW help with Restaurant Risk Management?
How well you can manage risk depends on your ability to plan ahead, carry out your plan and report back in a timely manner. Fortunately, KNOW has lots of great tools to help. Let’s take a look.
Digitized Checklists and Audits:
Prepare and share restaurant risk management checklists digitally, get timely reminders, trace audit compliance, and generate reports with one click.
Micro-Training and Assessment.
Prepare your staff well with engaging bite-sized training. Employees can complete the training anytime, anywhere, and you can track their status in real time.
Receive real-time information about incidents, issues, faults, and requests. Your staff from any chain outlet can share photos, videos, and information to report an incident and trigger automated alerts to the concerned authorities. Plus, you can track their progress live. KNOW’s detailed dashboard gives you a complete overview of what’s happening in the restaurant.
To be successful, sometimes you have to take risks. But it’s important to know when those risks could potentially get out of hand. That’s where KNOW comes in. A digital solution like KNOW helps you scale safely. Connect with us to learn more, or book a demo today!