“I’d have a tough time sleeping at night if I was handing our food to an untrained, random third-party driver to then carry that over to our customer, because what happens when you have a service failure or you have a product quality problem in that situation?” That’s what Domino’s CEO Ritch Allison said during an April 2019 earnings call. Of course, Domino’s has the scale to be able to manage delivery orders in-house (and also a vested interest in making consumers doubt the reliability of third-party delivery providers). But if you’re using third-party providers, it’s worthwhile to note – and attempt to manage – their shortcomings, since consumers are more likely to blame the restaurant for service failures than the delivery provider. A recent nationwide survey of 1,000 consumers by Steritech asked questions about the pluses and minuses of delivery and offered suggestions on how to address challenges. When the surveyed consumers have had problems with delivery, they included such challenges as the food taking too long to arrive, the packaging not keeping the food at the proper temperature/containing spills/preventing tampering, and order inaccuracy. Steritech advises taking a range of actions to help: To better resolve service issues, consider printing phone numbers for problem resolution on receipts, packaging or seals – or create an online portal for resolving disputes. Minimize phone orders in favor of online orders for better accuracy. Prioritize order accuracy and quality checks before food leaves your restaurant. Provide real-time delivery tracking or time estimates and send text alerts when food is en route. Offer online tipping options. Communicate your fee breakdown clearly so consumers understand where their money is going. Finally, it’s worth mentioning that some brands are trying to provide the best of both worlds: Panera, for one, is offering a hybrid system whereby it relies on third-party providers to take orders but then uses its own fleet for delivery to better manage quality control.
Chances are your waste management practices have evolved in recent years, whether you are finding new uses for vegetable stems and roots, donating unused ingredients or integrating other practices altogether. As Shannon Bergstrom, a sustainability operations manager at the tech-driven waste and recycling company RTS, told the Rail, new methods for reducing and rerouting food waste are appearing all the time. Coffee grounds are being used to create such items as ceramics as well as logs that can be used as fire wood. Spent grains left over from beer production are being remolded into all-natural dog treats. Even if you can’t go to those lengths to find uses for your food waste, you likely can make better use of technology to improve your practices. RTS, for one, helps foodservice operators use technology to access on-demand collection services that can help businesses connect to a wide range of vendors looking for anything from raw ingredients to cooked meals. It may help you find uses for leftover ingredients that you’re not even aware of.
As the bounty of local summer produce begins to wane in many areas, your cooler can help you store favorite items and draw out the season. Make sure you’re storing ingredients in a way that maximizes your available space and keeps the contents fresher for longer. FreshPoint suggests that you make the most of the cooler space you have by storing items not in the cardboard boxes they arrived in but smallers containers that fit more snugly in your cooler. Order splits instead of full cases, particularly if you have a smaller cooler. Remove items that don’t need to be refrigerated, such as onions and root vegetables. Finally, the cold air in your cooler flows from the back to the front, making certain areas of your cooler colder than others, so make sure you store items where they are happiest – berries and carrots at the back, cucumbers in the middle and apples and melons at the front.
As delivery ramps up, are drive thrus on the way out? Minneapolis may have set a precedent recently by banning the construction of new drive thrus in the name of health and safety: The city wants to cut back on vehicle noise, idling and traffic and make sidewalks safer for pedestrians. Existing drive thrus in the city will remain intact, however.
From the clattering of dishes to the blaring of music to the loud conversations of guests trying to hear themselves over the din, restaurants can be noisy places. It can be enough of a turn-off that guests will avoid your business. (Case in point: There is an app called Soundprint that dubs itself the “Yelp for noise” and allows users to search for restaurants quiet enough to allow for conversation.) If the sound levels in your restaurant bother guests and employees, take some cost-effective steps to lower the volume. Toast suggests minimizing the scraping of chairs on the floors by using felt pads on chair legs. Keep music at a level where people can have a conversation without shouting. Use textiles to absorb noise – curtains, tablecloths, area rugs, and soundproof panels on walls and ceilings can all help. Finally, keep noisy food preparation equipment in the kitchen, or if you have an open-concept space, consider installing a transparent barrier between guests and food prep areas.
If you serve avocado on your menu, you’re well aware of the rollercoaster ride it has been taking lately with regard to supply and demand. According to a USA Today report, the price of avocados in early July had skyrocketed 129 percent since the same period during the previous year. While restaurants are making adjustments such as diversifying suppliers, raising prices and finding substitutes for the beloved avocado where possible, these are steps that should be taken not just when one key ingredient is in short supply but across the spectrum of a restaurant’s inventory year round. When you monitor your inventory more closely – even in times of plenty – you can more easily ride out times of scarcity. MarketMan suggests you take such steps as tracking food costs throughout the year so you’re more able to spot seasonal fluctuations in price, as well as what you have paid historically. (Team Four can help you with this.) Where possible, fill your menu with seasonal produce to minimize costs – it will also encourage guests to visit you while a favorite item is still available or when a new one is about to be featured on the menu. Partner with your chef to make sure he or she is able to use what’s in season and can minimize costly extras. When it comes to suppliers, try to lock in prices for the long term and don’t hesitate to shop around for better deals when it’s time to renew your contracts. Look around for deals online, particularly for non-perishable items that can be purchased in bulk. Monitor your spending regularly using software with purchasing and ordering management features that can help you stay on top of price fluctuations.
If the restaurant tech landscape doesn’t quite working for your business yet, just wait five minutes and you’re likely to find technology that does. One possible example is the recent partnership of Waitbusters and Postmates. Waitbusters started out as a tech company aiming at eliminating wait times at restaurants but it is now evolving in an effort to work with restaurants that don’t want to hire delivery drivers and also don’t want to pay the high fees charged by many third-party delivery providers. It has integrated its Digital Diner software platform with Postmates and allows operators to turn on the Postmates delivery function when they need it and turn it off when they don’t. This helps eliminate the costs of using an entire third-party delivery platform while giving operators access to off-premise options they may need.
At a time when restaurant finances are getting squeezed from many directions, do you know which budgetary battles are most important to fight? In other words, when you’re managing such expenses as labor, ingredients, rent and third-party delivery, does your balance sheet give you clear answers about how much each of those expenses is impacting your bottom line? It needs to, since your gut instinct may not be correct. Case in point: The results of a recent study by New School Center for New York City Affairs and the National Employment Law Project found that restaurants in New York City were more negatively impacted by rising occupancy costs and the fees charged by third-party delivery services than they were adversely affected by the near-doubling of the minimum wage paid to hourly employees in the past five years, Restaurant Business Online reports. The Fight for $15 wage battles of recent years had many operators concerned they would need to boost menu prices beyond what guests were willing to pay – and minimum wage escalation isn’t an insignificant expense for operators to be sure. But while New York isn’t like every market, the rising minimum wage in the city has had a smaller-than-expected impact in a diversity of regions, whether in Manhattan, Queens, Brooklyn or the Bronx. As the minimum wage has been ascending in geographical regions across the country for years, you may be able to protect your bottom line by focusing on negotiating more favorable terms with a third-party delivery company, adjusting your business model so you can occupy a smaller or different footprint, or getting a stronger handle on hidden back-of-house costs.
You’re likely using your restaurant’s internet connection to process orders, access customer data, monitor the functioning or your kitchen appliances, and communicate with employees, vendors and guests, among many other functions. If your connection suddenly fails, would you be able to operate your business? Using failover technology as a backup connection can help ensure your Internet connection is never interrupted. RocketBroadband is one company that works with restaurants to prevent internet blips. It also offers a mobile connectivity option that may suit restaurants running food trucks or stalls at offsite events where it’s necessary to process payments apart from the restaurant’s usual internet connection.
Foods such as cereals, rice, pasta and spices may seem benign when it comes to foodborne illness, but if these foods are cooled slowly without refrigeration, they can become prime targets for Bacillus cereus, a pathogen that forms heat-resistant spores and can lead to diarrhea or vomiting. The bacteria are found in soil and in foods that grow close to the ground. As the Food Safety Information Council reports, starchy vegetables, meat products, grain-based foods, sauces, puddings and spices are all culprits. While the spores Bacillus cereus produces are dormant, they can multiply when exposed to warmth and moisture. Cooking or reheating the food will not destroy the toxin, so to help prevent it, store cooked foods in shallow containers and refrigerate them promptly, don’t let frozen foods thaw at room temperature, and make sure any precooked foods are stored in the refrigerator for a maximum of two or three days.
When washing dishes or foodservice equipment, cleaning and sanitizing need to happen together – each on its own isn’t enough to protect your guests from pathogens. But even when sanitizer is used after cleaning, Statefoodsafety.com says it can fail to do its job or even spread germs if not used at the proper temperature and concentration for the appropriate amount of time. Chlorine, iodine and quaternary ammonium compound sanitizing solution all have different temperature requirements. If a sanitizer is mixed with water that’s not the right temperature, it may be less effective. Use test strips to check you are using the appropriate concentration of each sanitizer as it might be dangerous at the wrong proportions. Finally, let each sanitizer work for the required amount of time to make sure it’s effective.
If you offer delivery, take note of what Postmates is doing to improve the benefits package of gig workers. The company recently announced that it will now be offering such benefits as occupational accident insurance, health care, and free access to online college courses and professional certifications. At a time when employee development has become critical to minimizing the high turnover across the industry, these new benefits are something that may be worth considering if you’re considering a third-party delivery company or, particularly, if you manage your own in-house delivery team.
Talk to any restaurant operator and it’s likely to be the top challenge at work: labor and the difficulty of delivering great service in an environment of near-constant turnover. Joni Thomas Doolin, founder and chair of restaurant consultancy TDn2K, thinks a lot about this. Her firm publishes a quarterly workforce index, the latest of which indicated that at fast-casual and quick-service restaurants, vacancies at the back of house were near 80 percent. In that scenario, it’s difficult for a restaurant to do anything beyond keeping the doors open. So how can restaurants operate to change that? Thomas Doolin shared several strategies on a recent Restaurant Business podcast with Jonathan Maze. First, she advised, focus on creating an environment in which you can engage, retain and offer stability to your general managers. She said that across the industry, many brands have focused resources at the employee level while general-manager-level compensation and benefits have remained flat or even declined in the past decade. She cited research that found that in the restaurant industry in the U.S., 35 percent of general managers were engaged in their work, as compared to 61 percent of general managers across industries. Keep them interested by offering development – not training – that will help them handle more complex tasks and manage employees from multiple generations. You can also offer some flexibility – and that doesn’t necessarily mean fewer hours but it might mean allowing a person a couple of hours to catch his child’s baseball games each week. Brands are succeeding with other retention strategies too: Chick-fil-a employee retention remains high due, in part, to its policy that keeps stores closed on Sundays, giving employees a built-in day off. Others have shown they’re invested in the community. MOD Pizza, for example, has a history of hiring people with backgrounds of incarceration, homelessness, drug addiction and mental disability, then paying a higher wage and offering benefits such as a 401(k) – a stance that has kept employees engaged and turnover low while appealing to guests too.
Self-service kiosks remain an important vehicle for reaching and understanding consumers. Research from Tillster found that more than 65 percent of customers said they would visit a restaurant more often if it used self-service kiosks and 30 percent said they prefer to order via a kiosk instead of a cashier if the lines were of equal length. While kiosks have helped restaurant operators save on labor costs, watch for much more to come from them. As the CEO of the kiosk company TRAY told AgFunder, the value of kiosks in the years ahead will be more about taking customer personalization (and therefore service) to the next level. With a swipe of a credit card, a consumer will be able to pull up a personalized menu based on what is popular at the restaurant and what meals he has ordered at other restaurants.
Across the restaurant industry right now, profits range from 0 to 15 percent, according to Toast, and profits between 3 and 5 percent are most common. That doesn’t leave much wiggle room for making errors or adapting to industry changes such as the rising demand for off-premise dining. Operators have to be continuously creative when it comes to finding and mining sources of revenue, whether from new products, services or partnerships. (Note the current fervor around restaurant brands partnering with Beyond Meat, with Subway and Hardee’s being just two of the latest companies to tap into the meat substitute’s popularity.) Restaurant Nuts suggests operators consider options such as joint ventures – for example, partnerships with grocery stores to sell your products can help you promote a special offering while lowering your sales and marketing expenses. Or, as All Food Business suggests, you can partner with a corporation to offer expense accounts, business dinners, client programs or events that can generate income. You can align with a business or charity whose mission complements yours if it helps you to expand your audience, offer a special event you wouldn’t be able to offer on your own, or tap into resources (such as technology or delivery capabilities) that benefit both parties. Within your business, building out a catering menu can help you make the most of your food costs (and minimize waste) while serving lucrative off-premise and corporate customers. Depending on your business, there may also be opportunity to offer retail products like clothing or take-home versions of signature sauces that your restaurant is known for.
Want to win over customers? It’s not about having mouth-watering new specials or transforming your marketing strategy. It’s all about your operations. (At least that seems to be the trend based on recent performance results of a number of major brands.) As reported in Restaurant Business, brands including Dunkin’, McDonald’s, Starbucks and Wendy’s have prioritized operational changes over menu innovation in recent months. Wendy’s has focused on eliminating tasks and training employees to improve speed of service. McDonald’s continues to experiment with automation and has held competitions to find ways to serve guests faster. Dunkin’ has streamlined its menu and changed the layout of stores to improve flow of operations. As for Starbucks, third-quarter same-store sales increased 7 percent and store traffic increased 3 percent, due to what the company says is its focus on simplification – reducing the tasks that need to be completed in-house and shifting employees’ focus to guests. How can you simplify your operation – both with and without technology – to deliver better service?
Having a sustainable seafood strategy is becoming even more important: Mercury levels are increasing in some of the most popular fish in the American diet, according to a new study out of Harvard and published in the journal Nature. The research found that from the 1970s through the 2000s, methylmercury levels in Atlantic cod climbed 23 percent as a result of overfishing. The model used in the research also predicted mercury levels in Atlantic bluefin tuna would increase 56 percent between 1969 and the present as a result of higher seawater temperatures. Because overfishing and changing seawater temperatures are causing fish to alter their diets – often to include fish that are higher or lower in mercury content -- people who distribute and serve fish need to understand how environmental factors are impacting the food chain. (E.g. As Healthline notes, Atlantic cod had high levels of mercury until their main food source, herring, were overfished. Then as herring returned, mercury levels in cod increased again.) If you or your guests feel strongly about having tuna and cod on the menu, use suppliers that lobby for tighter regulations on fishing and make efforts to stop climate change and reduce pollution.
Your point-of-sale system is the nerve center of your business – and now, depending on which system you use, it might help you aggregate third-party delivery orders with other restaurants. The restaurant tech company Ordermark, which offers a hardware and software package that funnels third-party delivery orders onto one dashboard, recently announced a partnership with Omnivore, which integrates POS systems. As a result, a restaurant using a POS system such as Oracle Micros, POSitouch, Brink, Dinerware, among others, can now aggregate orders with third-party delivery companies. The companies say the move will “address more than 85 percent of venues in North America to bring every delivery service to restaurants in any zip code, to cost-effectively add revenue and marketing reach to their online presence.”
If you feel like the rising costs of ingredients, labor and transport give you no choice but to raise prices at your restaurant, you might take comfort in knowing that across the country, brands are following through and raising prices -- and customers (so far) aren’t blinking. As the Wall Street Journal reported recently, Chipotle, which raised prices last year, experienced a 10 percent rise in sales largely as a result of bigger orders. Mondelez and McDonald’s have been experiencing similar results after boosting prices. While talk of a recession looms, U.S. consumer confidence is still at near-record highs since the recession, according to the Conference Board. If you need to raise prices in the coming months, find ways to make consumers feel it’s worth their while to pay you a visit. Link your price increases to discounts and other promotions, particularly for your most loyal guests. As Psychology Today reports, those deals tend lead to greater overall spending – an item regularly sold at a stable, discounted price will seem more valuable and worthwhile when the price is raised and a generous coupon is offered to offset it. Be strategic about the promotions you offer. As Toast advises, for a promotion to be most successful for your business, you should take time to understand your target customers and tailor promotions to what motivates them; address the business operational challenges you face (and which your point-of-sale system – not your gut -- will best help you identify); tap into local media, which can broaden awareness and interest well beyond the time frame of your promotion; and know your margins so you can bundle items that will lead guests to try higher-margin items on your menu (i.e. offering free fries with every milkshake purchase is better than simply giving away fries).
Long a trend setter in the delivery space, Domino’s is now going national with its use of e-bikes to boost delivery efficiency, according to a QSR Magazine report. The brand, which announced a partnership with e-bike company Rad Power Bikes recently, had been testing electric bikes in markets including Miami, New York and Houston and saw improvements in delivery and service as a result. As third-party aggregators vie for restaurant delivery customers, Domino’s has sustained its use of an in-house delivery team. While that can be a financially beneficial move for a large brand, the introduction of delivery via the Rad Power e-bikes, which have integrated motors that assist with pedaling up to speeds of 20 miles per hour, may enhance that efficiency further. Domino’s reports that there have been labor benefits from being able to hire candidates who don’t have a driver’s license but can use a bike, as well as team satisfaction benefits from workers who had been delivering via bike and can now get an extra boost when pedaling up hills with the help of a motor.
Did you know that one of the most common reasons restaurant employees leave a position is lack of training? According to research from Cake, for 62 percent of restaurant workers, not getting proper on-the-job guidance can influence their decision to move on. A recent survey of 2,000 restaurant employees by the scheduling software program 7shifts also found that 50 percent of respondents rated training as a 4 out of 5 on the scale of how impactful the factor was for restaurant employees on the job. Even if your staff does not feel that they need training, your training program is a sure-fire way to build their engagement and investment in your business. As Toast suggests, the first day of a new worker’s job is prime time to impart your restaurant’s values and demonstrate you care about the person’s role in the business, which helps build a person’s pride in (and dedication to) their work. If you devote 30 minutes at the start of the person’s shift to conduct training, you’ll set yourself apart from most restaurants. As you train the person in various responsibilities of the job, first explain why a task should be done in a certain way, explain how to complete the task, demonstrate the task, do the task together, and finally have the person complete the task alone to demonstrate his understanding of it. Provide a handbook of items that can be referenced later, like manager contact information and locations of cleaning supplies. Finally, appoint a mentor or point person who can answer questions that arise in the new employee’s first days and weeks on the job. It will build engagement for both employees and prevent the new person from making assumptions that could negatively impact your service to guests.
If you can raise your restaurant’s Yelp score by one star, it can lead to a revenue boost between 5 and 9 percent, according to a Harvard Business School study. At a time when reviews have that kind of power, it’s critical to stay on top if them. But when reviews can appear anywhere from Yelp to Google to Facebook to TripAdvisor and beyond, tracking and responding to all of your reviews can become a full-time job. Review management software platforms such as Yext can help operators centralize reviews from multiple platforms. As AdAge reported recently, operators using such systems can quickly identify (and fix) problems at a location and also respond quickly to reviews, which can influence how consumers feel about your brand.
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