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The Survival of the Smartest

I was at my apartment in southern Spain last week. During dinner one evening with some friends and neighbours we were discussing how some of the local restaurant businesses have survived the financial crisis, with the resultant reduction in people visiting the area, really well. However others have suffered and many have gone. Most of the people we were with were current or retired business people so it was interesting to hear the informed discussion about what they thought made the worthwhile differences. Many of the conclusions relate to the work I do as a consultant, so I thought I'd share the top three.

An obvious first element we decide was to do with perceived value for money. By that I don't mean being the cheapest. But the survivors were definitely the places that offered what we considered to be great value. The food was always excellent without being expensive, some even offered fixed price two or three course menus. They never overcharged for the wines. And they always gave more than was expected (e.g. Extra portions of things they knew regular customers liked, offers of free drinks to end the evening, etc.) This all contributed to make them popular, with many needing to be booked well in advance to secure a table.

We thought that another key difference was consistency. The businesses with a successful formula stuck to it, believing that what had served them well in the good times would also serve them well in the lean times. And they were right. Their regular customers stuck by them and they survived. Others however decided to cut costs, change menus, reduce staff and in some cases even increase prices. Their regular customers, like us, noticed this, didn't like it, and stopped going.

The third main one was the staff. All the survivors had great teams of people. In most cases they were teams that had been together for a long time. This meant they new each other and they new their regular customers. This obviously helped with consistence but it also made them able to ensure those regulars always got an especially warm welcome when they came and great service while they were there. If the staff had always been changing, as they were in many of places that didn't survive, it was not possible to do this.

So there are a few lessons from the restaurants that survived, and in many cases flourished, during the effects of the financial crisis in southern Spain. I think they are things we can all learn from.

I hope you agree.