The foodservice and accommodation industry is the fourth-most-automatable sector in the United States. That’s according to an article in The Atlantic that cites research by Michael Chui, a partner at the McKinsey Global Institute. Chui’s research found that 54 percent of the tasks that workers perform in American restaurants and hotels could be automated using currently available technologies. Automating restaurant tasks or using robots to assemble the ingredients in a dish can save on labor costs and potentially save money, but many in the industry remain skeptical about the potential for restaurants to lose the human touch with increased automation. Not so, according to Michael Farid, cofounder and CEO of Spyce, a new restaurant in Boston with a robotic kitchen. In an interview with Toast, Farid dispelled some beliefs about robots in restaurants: For one, he said, they will not replace human employees in restaurants but will change (and likely improve) the kinds of roles they have. In fact, Farid believes robots can help enhance hospitality in a restaurant — and even help a restaurant’s turnover rate—because they allow employees to focus more on serving guests and less on mundane kitchen tasks. Second, robots can minimize a restaurant’s costs because they don’t waste food, and they assemble orders correctly and consistently. Finally, Farid says though the robots in Spyce’s kitchen are an interesting novelty for guests at the outset, they don’t dominate the experience. In the end, it’s about the food—and the robots are simply there behind the scenes to ensure the operation churning out the food is running as smoothly as it can.
The price is right
Menu items are moving targets. Especially now that point-of-sale systems can track the appeal and profitability of menu items, there is always a need and an opportunity to tweak or replace the choices in your lineup. So when you debut a new dish, how do you ensure you’re pricing it correctly from the start? According to an article in RunningRestaurants.com by restaurant veteran Warner Siebert, operators should first list every ingredient that goes into a new item and the amount of each ingredient. Next, price each ingredient starting with the bulk price of each item and calculate the fraction of the bulk item that was used in the dish. Then consider the overhead costs required to prepare and serve the item, from the cost of the wrap needed to cover it in the refrigerator to the amount of labor hours needed to prepare it. Your total food cost + your total equipment cost + your total labor cost = your total cost. From there, your total cost + your profit margin = the price you charge guests. Siebert suggests choosing a low, but reliable, profit margin so that every sale helps your bottom line. Finding the price that feels fair is an ever-changing process due to ingredient price fluctuations and other factors, of course, so leave room for adjustments that still keep you in the black. According to Toast, restaurant profit margins can vary widely, from 0 to 15 percent, with most falling within the 3 to 5 percent margin.
Trust through transparency
Amid the FDA’s rollout of menu labeling requirements for larger restaurants, it’s easy to think this enforced transparency could scare off customers. Reframe it as an opportunity. While Americans may understand that making healthier choices is easier when cooking at home, convenience still often wins out: The average American eats out four times every week and a Millennial is apt to eat out even more frequently, according to a 2016 survey by Zagat. At the same time, Statista reports that more than half of Americans are buying organic produce, and the health and wellness market continues to climb. Even if your restaurants is not among that that must post calorie information, Toast suggests giving your staff talking points about modifications and substitutions they can make that would improve the health of a dish, or calling out menu items that allow guests to adhere to trending diets like the Whole30 and Keto, so eating out doesn’t force guests to derail health-conscious habits.
Be an 80/20 operator
Do you apply the Pareto principle to your restaurant? The concept, named for the Italian economist Vilfredo Pareto, says that for many situations, about 80 percent of the effects come from 20 percent of the causes. Restaurant coach Donald Burns sees several applications to the restaurant industry: Identify the 20 percent of customers who are helping your restaurant make money and the 20 percent who are giving you headaches—focus the bulk of your time on the former group and try to minimize the latter group. The same goes for employees who drag down the team, menu items that cost you more time and energy than they should, or time-consuming tasks that could be delegated to others. In sum, spend 80 percent of your energy on what you do well and 20 percent on everything else.
Go with your gut
Gut-friendly menu items are emerging as a top trend of 2018. Recent research has linked the bacteria in a person’s gut to immune system regulation and the control of challenges ranging from depression to obesity. To expand the digestion-friendly items on your menu, the BBC suggests adding fermented items like sauerkraut, kimchi, miso and kefir to the menu, as well as foods high in inulin—leeks, onion, chicory and asparagus are all good sources that add beneficial bacteria to the gut.
Stand firm and deliver
The demand for food delivery continues to climb and operators are embracing the need for it—though not so much the pricing of third-party services or the relinquishing of customer data that can go along with hiring a delivery provider. As a result, new delivery models are emerging all the time, giving restaurants power to find an ideal arrangement. Restaurant Hospitality reports that several businesses in certain markets are changing the game for delivery and have the potential to challenge the larger third-party players. For example, ShiftPixy, which helps restaurants find shift workers on demand, is testing a potential network of on-demand delivery drivers. Another player, EpiFruit, allows restaurants to request and set a price for deliveries, and couriers then bid on the ones they want to accept. EpiFruit then takes part of its commission from the restaurant’s delivery fee and part from the courier’s accepted fee. A third player, Jolt, lets operators choose between paying a flat delivery fee or a 10 percent commission for the delivery, plus a delivery charge.
Harness technology to manage inventory pricing
Can your back-of-house technology tell you what you should be paying for supplies? To ensure you’re paying the right price for the items you receive, the restaurant technology company Orderly advises operators to look out for consistent price rises over time, unexplained price spikes and drops, prices charged in relation to those paid at average restaurants, and the efficiency of pack sizes. Schedule a quarterly business review with each supplier and before each meeting, tally your total spend with them since your last meeting and what percentage of your total food spend they represent. Focus on your top-20 items according to spend and compare that expense to the previous quarter. Then identify your top-10 items by price increase and your top-10 most-purchased items, and find out what other suppliers are charging for those items. Of course, consider the less tangible positives and negatives about the relationship too—but having the statistics at your fingertips will give you power to ask a supplier for price relief, particularly on frequently purchased items that had the highest percentage of increase during the quarter.
What’s your challenge? Whether you need help developing recipes and concepts, analyzing food costs, fine-tuning purchasing, planning a marketing campaign or managing another aspect of your business, we can provide guidance tailored to your needs. Contact Team Four at firstname.lastname@example.org or 888-891-3103 for more information.
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