Even small commodity fluctuations can have a substantial impact on restaurants. Take Chipotle, one among thousands of restaurant brands where guests expect to find avocados. Aaron Allen & Associates reported that in 2017, surging demand for avocados, paired with smaller crops in Mexico and California, had analysts predicting that every 10-percentage-point increase in avocado prices would lower Chipotle’s earnings-per-share by 30 cents on an annual basis. And that was for just one ingredient. Developing a plan to track global shortages and surpluses can help you avoid similar scenarios. Restaurant Nuts recommends several strategies: When you plan promotions to bring people in, make sure the items you promote are those whose ingredients are more widely available and profitable. During periods when producer costs are stable, anticipate times when they may fluctuate and build in incremental price increases early so you can maximize your profitability and avoid shocking guests with price surges. Cost out your menu. Add items that don’t use volatile commodities, and for popular but less profitable items, identify areas where you can easily make substitutions. Mine your data so you understand your most popular menu items and pairings, then design your menu and promotions so you direct guests to those items. Securing long-term contracts with suppliers can help you weather potential market fluctuations. Where this isn’t possible, you can always tell your guests about the challenge (without overusing this tactic). If a major hurricane wipes out a crop of an important ingredient you feature on your menu, for instance, guests are likely to understand if you’re transparent about why that ingredient is temporarily unavailable — and what appealing item you’re offering in its place.
In the first quarter of this year, 46 percent of consumers who ordered Uber Eats in the U.S. also ordered from one of its competitors, according to the data research firm Second Measure. That’s despite these companies offering incentives to keep customers coming back. As a result, Vox reports, third-party delivery companies are currently engaged in a price race to the bottom. But before long, these companies won’t be able to continue their streak of losses and will need to charge higher prices. Their relationships with partner restaurants and customers will be all the more critical. As vendors risk getting weeded out, restaurants may wield some leverage.
As labor costs rise, your ability to monitor and manage your team’s schedule has the power to protect your restaurant’s bottom line. A Restaurantowner.com report advises operators to start by auditing the first last 15 to 30 minutes of a shift. A leisurely pace of work during those times could indicate that you need to make staffing adjustments. Then look to your anticipated sales and guest counts and build your schedule around that instead of leaning on a repetitive schedule that doesn’t flex when business speeds up and slows down. Cost out each schedule by multiplying each person’s hourly rate by hours worked and compare that figure to your sales each day to understand where you can be more efficient with staffing. If you find you have lulls but still need staff on hand in case a large group comes in, plan to have prep work available throughout the day (versus at the start of a shift) to make best use of the people you have on hand during the day. If your shift manager carries a shift card listing employees and hours, it will be easier to see who can be assigned some prep work or cleanup, or who can be sent home. Finally, find the right balance of part-and full-time employees. Restaurantowner.com advises operators maintain one-third to one-half of staff as part-timers. It can help you avoid paying excessive overtime costs and keep staffing affordable.
At the pace restaurant technology is evolving, it can feel like restaurant manager candidates should be just as capable of navigating IT challenges as they are of handling guest complaints. But according to The Spoon, one nascent tech tool — voice-enabled ordering via Google Assistant or Alexa — could soon be an easy, plug-and-play solution for operators, with some help from a firm called Orderscape. The company makes a voice-ordering software layer that works with browsers, mobile phones and watches, and Alexa speakers, and partners with restaurant platforms like Olo, Onosys and Monkey Media. Orderscape can then tell users where a desired food item is available in their area. If someone asks Alexa where to find a bacon cheeseburger nearby and you serve a popular one, your restaurant would be suggested among other options in the area. Marrying a menu with voice-enabled tech isn’t normally a seamless process for restaurants but Orderscape is looking to make the process possible with no installation or training on the restaurant’s part, and no downtime.
Something is lurking in your trash. If you’re lucky, it’s money: Many foodservice operators who have changed their approach to trash disposal have minimized waste when it comes to both food and finances. (There’s a lot of waste to reduce: According to a 2014 study by the Food Waste Reduction Alliance, more than 84 percent of unused food in American restaurants is thrown away — and while those figures have likely improved in the past few years, there’s still plenty of room for improvement.) Restaurantowner.com suggests several tips to help operators take charge of their trash. First, remove trash bins from the kitchen — even as a temporary experiment — and give each employee a clear, labeled bin to be filled with food scraps or trimmings they want to discard during food prep. Following the shift, have a manager inspect the contents of each box for usable product. If any is found, the manager can provide on-the-spot training to that employee to make sure usable product isn’t wasted in the future. Inspecting bins in the dish room can be helpful too: Make sure china, silverware and other expensive tableware aren’t getting damaged or accidentally tossed out. Finally, monitor your dumpster, which can provide easy cover for a dishonest employee. It’s a common practice in the industry for someone looking to steal a case of wine to hide it in the dumpster only to retrieve it later. Having a manager approve who takes out the trash and when, or even monitor the dumpster via video, can help protect your business from those losses. (Want to talk trash? Contact Team Four about how your operation can save on trash disposal.)
The images of menu items you share online need to sing — or at least motivate people to pay you a visit. While it can help to have a professional photographer do it, a couple of pros recently shared some food styling tips with Edible Manhattan that are easy for amateur photographers to implement. When setting up a shoot, try having an ice bath on hand to keep vegetables and herb stems looking fresh. A brush of olive oil can help food glisten. Use natural light when available and, to minimize shadows, a piece of white cardboard, or even a white cutting board or plate can serve as a makeshift reflector. While the colors in your dish are a focal point, you can accent them with table linens or glassware in similar (or complementary) colors. If there is a memorable spice or other seasoning used in the dish, accentuate it by adding seeds, sprigs or other natural elements to your photo setup.
Bring your costs and the market into “Alignment”
Before any product arrives at your door and on the plate of your guest, it passes through many hands and layers of pricing and profit formulas. The system is complicated — and ripe for pricing errors due largely to the manual processes still used to conduct business. One weak link in the supply chain can result in billing errors between manufacturers, distributors and you. Team Four launched a new program — Alignment4 — to help you identify those errors and correct them quickly so you can proactively manage your food costs. The program starts by analyzing receipts from your distributors, then examining product-level detail by invoice for a set amount of time. We can then plug in items that have been specially priced and compare them to what you were actually charged. The program can not only determine if a billing mistake was made, but it can also help you identify purchasing trends so you have a better sense of market values. If you are having a food-cost problem, Alignment4 can analyze your data and determine (soon at a daily speed) if a pricing mistake was made, if there was a temporary change in the market following a hurricane, or if a simple shift in your product mix might solve the problem. It converts data into actionable steps to lower food costs while helping you maintain standards for food quality and guest satisfaction. Gaining this insight into your data (all while keeping it anonymous) through Alignment4 provides other benefits too: You will get a customized inflation and market report that considers your past purchases and product mix, providing you with meaningful information to help you set menu selections, prices and portion sizes. Team Four can also approach suppliers on your behalf and solicit opportunities for you to consolidate purchases with other operators, whether you have 1000 locations or just one. For more information about how Alignment4 can help your restaurant, contact us at firstname.lastname@example.org.
Restaurant investment designed to maximize shared resources
As investors look to bring the next foodservice concepts to fruition, a new trend is becoming clear: Much like the transportation, retail, media and logistics industries before it, foodservice businesses are now attracting technology investment designed to streamline and bring efficiencies to multiple operations at once. For example, Tech Crunch reports that millions of dollars are now flowing into networks of shared kitchens, storage facilities and pickup counters that are likely to become the next big restaurant brands. These networks can help cut back on overhead and make operators more nimble when it comes to hiring labor and conceiving of new menu concepts. The trend is something existing operators can put into practice too: How might you and your neighboring businesses collaborate or share resources to become more efficient and flexible?
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 email@example.com or 888-891-3103 for more information.
About Food For Thought and Profit
Food For Thought And Profit is brought to you by Team Four Foodservice/Value 4. We offer the latest foodservice trends, news, safety, and technological advances in the industry. We are an outsourced purchasing and logistics company that provides comprehensive supply chain solutions to our customers. Our executive team has many years of foodservice experience and we bring that experience to work for you. We have expertise in all areas of the foodservice sector.