Business plans often include an analysis of the strengths, weaknesses, opportunities, and threats (SWOT) a company might face. To conduct a SWOT analysis of a restaurant, you would likely examine both positive and negative factors that potentially influence the business. Location, great customer service, and pricing might be strengths, while cost of rent, limited advertising funds, or staffing limitations would likely fall under weaknesses. Opportunities might include strategic development of new training programs or an expansion of services offered, while threats might consist of competition and an economic downturn.
A SWOT analysis would possibly start with an analysis of any strengths. Many times, this is an easier component of the examination. Look at the reasons you started the restaurant and the passions that drove you to make the decisions you did. A great location, exceptional customer service, and a special or unique offering are all possible strengths to include in the analysis.
An examination of weaknesses should also be included. These are things that do not necessarily spell disaster for the company, but they are areas that should usually be improved. Many times, the weaknesses are things you have the ability to change or work toward changing, bettering the business in the process. A high turnover rate is one example of a weakness that might be presented in your analysis.
Opportunities often represent a chance for growth. Funding for expansion or streamlining a process in the restaurant are two examples of opportunities for improvement. Often, an examination of the weaknesses in the SWOT analysis of a restaurant will lead to several discovered opportunities.
Threats consist of factors that threaten the stability of the restaurant. During a severe economic downturn, individuals might eat out less, possibly decreasing your income. Competition that is close to your facility might also be considered a threat in a SWOT analysis. It is often possible to examine the threats and make decisions that allow you to weather each storm better than if an analysis had not been made.
While a SWOT analysis of a restaurant would often appear in a business plan, a business plan is not required to complete one. Simply examining the various aspects of the restaurant and making a list will often help owners identify areas that should be focused on. The analysis might need to be revised at certain points as well.