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Are Soft Openings a Better Option?

🔥 Bonji Hot Takes: Volume 56 🔥

Hi all, welcome back to the Bonji Hot Takes! We hope your week has been filled with success and happiness. The weekend is near but we hope to offer some value before this week closes and you are enjoying the time off. In the restaurant business, there seems to always be a desire to open more locations. We love that passion and drive to focus on continuous growth. However, there are a few ways to go about new locations. There's the big, grand opening that tends to pull in a ton of attention. And then there are soft openings, usually with little marketing or intentionally for friends or family. Although it may depend on your situation, after research throughout the industry, it seems a soft opening strategy may have more long-term benefits for your overall business.

How Soft Openings Benefitted Portillo's & In General Recently, the Chicago-based hot dog/beef chain restaurant, Portillo's, went through a process of major openings in new cities. The owner and CEO described their opening strategy as “soft” rather than big and grand. They learned from experience and market research, as grand openings tend to set a business back. That may seem counterintuitive, especially because it's nice to quick success, but in reality, it can harm the long-term success of your business. For example, a chain opened a new restaurant in the grand style and did over $300,000 in the first week! Yes, of course, that sounds incredible, however, there were many drawbacks: 1. Brutal experience for new management and the team of workers - 400% turnover rate in the first month 2. Long wait times for customers - which leads to little return customer value 3. Skewed numbers that die off quickly, especially when service is troubled Portillo's changed their approach and began launching their new locations as soft openings. This will especially work when there is already pent-up demand in the area, many restaurants already have long lines without blowing up their marketing efforts. Now, we aren't saying always go with soft openings, nor are we suggesting having an “invite-only” event. Maybe it's best to have a mix of the two strategies, where you start slow and see when a good time is to launch a large marketing campaign to showcase the opening. The benefits of soft openings are powerful: 1. Testing your menu and receiving feedback before it gets too late 2. Predict demand for the future 3. Sufficient time to train employees (OFTEN OVERLOOKED) 4. Build hype and word-of-mouth advertising, the most powerful of all marketing 5. Offer first customers discounts or coupons for the future, building further demand There are a ton of benefits to a soft initial open, and with research, you will see many restaurants do so. However, keep in mind that your first restaurant probably should involve more of a bang. It's also important to note that this may vary based on location and business, especially if it is early in your expansion process. Regardless, you shouldn't commit too hard to either strategy, keeping your options open and flexible. Nonetheless, we believe soft openings are key for long-term expansion success!


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