As the COVID-19 pandemic continues to spread, more and more businesses are being forced to shut their doors. Restaurants are no exception. While some establishments have been able to stay open by switching to delivery or take-out only, many have been forced to close their doors completely. The sudden closure of restaurants has had a devastating impact on the industry, with thousands of workers being laid off and left without income.
In addition, the closure of restaurants has had a ripple effect on the food supply chain, with farmers and food suppliers being left with surplus products that they are unable to sell.
As the sector deals with post pandemic issues such as rising energy costs, it is likely that more restaurants will be forced to shut down. This will have a significant impact on the economy and the food supply chain,with potentially far-reaching consequences
How to close a restaurant
Closing a restaurant is never an easy decision, but sometimes it is the best course of action. There are a few things to keep in mind when closing a restaurant. First, be sure to notify your employees as soon as possible. They will need time to find new jobs, and they deserve to be given notice in advance. Next, contact your suppliers and let them know that you will be closing. Be sure to cancel any outstanding orders and make arrangements for any products that have already been delivered. Finally, reach out to your customers and let them know that the restaurant will be closing.
You may want to offer a discount on their final bill, or you may decide to hold a special event to say goodbye. Whatever you do, be sure to thank them for their patronage over the years. Closing a restaurant is never easy, but with careful planning it can be done smoothly.
Know when to call it quits
No one likes to admit defeat, but sometimes it’s necessary in order to avoid further losses. This is especially true in the restaurant business, where margins are slim and competition is fierce. If a restaurant is consistently losing money, it may be time to call it quits before the debt becomes too large to handle.
Of course, this is a difficult decision to make, and it’s important to weigh all of the factors before making a final decision. However, sometimes it’s better to cut your losses and move on than to keep throwing good money after bad.
List your business for sale
If you’re considering selling your restaurant, there are a few things you need to do to prepare. First, you’ll need to compile a list of everything that’s included in the sale, such as the building, equipment, and any inventory. Next, you’ll need to set a price for the business.
It’s important to be realistic about what your restaurant is worth, as this will help you attract serious buyers. Once you’ve done these things, you can start advertising your restaurant for sale. You can do this by listing it in online directories or by placing ads in local publications. By taking the time to list your restaurant properly, you can increase the chances of finding a buyer who’s willing to pay the right price.
Set a make-it-or-break-it date
For restauranteur Jamie Oliver, February 21, 2019 was a make-it-or-break-it date. After years of financial struggles, Oliver made the difficult decision to close 12 of his restaurant locations in the UK. This was no small feat – Oliver employed over 1,000 people at these locations.
However, he felt that it was necessary in order to keep the rest of his restaurant business afloat. While it was undoubtedly a difficult decision, setting a make-it-or-break-it date gave Oliver a clear goal to work towards. It also helped him to focus his efforts on saving the restaurant locations that were most viable. In the end, Oliver’s gamble paid off – all of his remaining restaurants are still in business today.
Plan the ending
When it comes to restaurant closings, the old saying “fail to plan, plan to fail” definitely holds true. If you’re thinking about closing your restaurant, it’s important to have a solid plan in place to ensure a smooth transition. First and foremost, you need to decide how you want to handle the closure. Will you be closing permanently or temporarily? If you’re closing permanently, you’ll need to take care of things like selling your equipment and transferring your lease. If you’re closing temporarily, you’ll need to make arrangements with your landlord and suppliers.
Either way, it’s important to give your employees plenty of notice so they can make other arrangements. Once you’ve got the details sorted out, it’s time to start spreading the word. Write a press release and reach out to local media outlets. Post a sign on your door or window announcing the closure. And most importantly, don’t forget to thank your loyal customers for their support over the years. With a little advance planning, you can make sure your restaurant closes on a high note.
Instruct an insolvency practitioner
If your restaurant owes money to creditors, you should instruct an insolvency practitioner (IP) to help you deal with the businesses debts. IPs are regulated professionals who can offer expert advice on financial matters. They can also negotiate with restaurant creditors on your behalf, and may be able to agree on a payment plan or help you get a reduction in the amount you owe.
In some cases, they may even be able to get restaurant creditors to write off some of your debt entirely. If you’re struggling to deal with restaurant debts, an IP will help you effetely close down the business.
Insolvency professionals will offer insolvency advice and help you compare a restaurant closure checklist as its important to be prepared for every eventuality. If you find yourself in the unfortunate position of having to close your restaurant, there are a few key things you need to do to protect yourself and your assets.
- First, you’ll need to notify all your creditors, including suppliers, landlords, and banks. It’s important to be upfront about your situation and work out a plan for repaying your debts.
- Next, you’ll need to deal with any perishable food items; either sell them off at a discount or donate them to a local food bank.
- Finally, you’ll need to remove all your personal belongings from the restaurant and return the keys to the landlord. While it’s never easy to close a restaurant, following this checklist will help you minimize your losses and move on to your next venture.
Inform your team
It’s always difficult to hear that a business is struggling, but it’s even harder when that business is set to close its doors for good. This is the unfortunate situation facing many small businesses across the country right now. The pandemic has taken a toll on everyone, but businesses have been hit especially hard.
With people staying home and spending less, many businesses have struggled to stay afloat. As a result, we’re seeing more and more businesses closing their doors. While it’s heart-wrenching to see these businesses go, it’s important to remember that the people who owned and operated them are just as affected by this as we are.
Support your team during the closure process of the restaurant, inform them that they can make a claim for redundancy if they have worked for the restaurant for longer than two years.
Inform your guests & followers
It’s always disappointing when a beloved business closes its doors, but it’s important to let people know as soon as possible so they can make alternative arrangements. The sooner you let people know that the business is ceasing to trade, the better.
This way, they can start to make other plans and won’t be left in the lurch. Obviously, it’s not easy to break the news, but it’s important to be clear and concise.
Let people know when the business will be closing its doors for good, and thank them for their support over the years. It might not be what people want to hear, but it’s better to be upfront and honest.
If you know a closure date at this point also let them know that no further booking will be taken after the set date or you will be operating a reduced menu as not to purchase stock that will simply go to waste.
Inform your partners & suppliers
As any business owner knows, ceasing to trade can be a complex process, the restaurant sector is no different as over the years you will have built up a personal relationship with your trading partners and suppliers. There are a number of important considerations, from letting suppliers know that the business is closing its doors to ensuring that all financial obligations are met.
Of course, the decision to close a business is never an easy one, but it is important to take the time to carefully plan for the process. By doing so, you can help to minimise the disruption and stress associated with ceasing to trade.
Create a cleaning plan
As the final days of your tenancy come to an end, it’s important to give your rental property a thorough clean before you hand it back to the landlord. This will help to ensure that you get your full bond back, and it will also give you peace of mind knowing that you’ve left the property in a good condition.
There are a few things to keep in mind when creating a cleaning plan for your rental property. First, make sure to allow enough time for the cleaning tasks that need to be completed. Second, be sure to focus on areas that tend to get dirty quickly, such as the kitchen and bathroom. Finally, don’t forget to empty all of the trash cans before you leave.
With a little planning and effort, you can make sure that your rental property is clean and presentable for the next tenants.
Take meter readings of utilities
One important detail is your business’s utilities. When it’s time to move out of your commercial space, you’ll need to take final meter readings for both gas and electricity. This will ensure that you’re only responsible for the utilities used during your tenancy. To get an accurate reading, make sure all appliances are turned off and there’s no one in the business premises.
Once you have the readings, give them to your landlord so they can start billing the new tenants. Taking these simple steps will help ensure a smooth transition for both you and your landlord.
It’s also a good idea to take pictures of the meters as evidence of the reading, if the business is entering an insolvency process the final bill will be forwarded onto the insolvency practitioner and they will need the readings.
Close & turn the sign over.
Finally time to turn the lights off. Give the keys back to the landlord.
Tie up loose ends
Now the restaurant has closed, but there are still some loose ends to tie up. The restaurant’s phone number will be redirected to a businesses voicemail, so customers can still leave messages. The restaurant’s website will stay up for the time being, but it will eventually be taken down.
All of the restaurant’s social media accounts will be deleted. Finally, the restaurant’s email address will be deactivated. restaurant is now closed, but these loose ends will help to ensure that the restaurant is completely off the grid.
With over three decades of experience in the business and turnaround sector, Steve Jones is one of the founders of Business Insolvency Helpline. With specialist knowledge of Insolvency, Liquidations, Administration, Pre-packs, CVA, MVL, Restructuring Advice and Company investment.