By Larry and Adam Mogelonsky
First it was the initial COVID-19 disruptions and the knock-on effects of inflationary money printing. Now it’s the war in Ukraine and the next round of lockdowns in China affecting shipping out of Shanghai, Shenzhen or Ningbo. And then there are all the forces preventing your restaurants from properly staffing up. Such macroeconomic supply shocks will continue to plague your F&B operations for the rest of the year and (our prediction at least) for the better half of the decade ahead.
How do you adjust? There are steps you must take in the immediate term to maintain profitability but, importantly, these can serve as powerful lessons for any further disruptions. It isn’t just a matter of reacting to what’s beyond your control but incorporating these moves into a core game plan so that you are ready to pivot when unpredictable future events unfold. As such, here are ten minor adjustments you can make to help streamline your operations for the rest of this summer and beyond.
1. Simplify by reducing your menu items. Analyze your POS data to determine not only bestsellers, which should be obvious, but seasonality trends as well. Remember to rank your selections not only by unit volume but also by ingredients cost and labor complexity. Moreover, many good POS providers offer analytics modules on a low SaaS cost to help you perform this assessment.
2. Add a daily special. Or add a weekly special depending on ingredient availability. Ensure that it is an easygoing one for your kitchen staff and has a good margin. A well-priced pasta special comes to mind, and there are many ways to deliver this beyond spaghetti and a meat ragu. The combination of digital menus with a modern POS can let you better automate any market-priced items, like fish, so that minimal labor is required.
3. Order pre-prepared vegetables and fruits that reduce kitchen labor. Here is a case where you are scarifying variable costs for ones that are fixed. I know of several hotel restaurateurs that just cannot get the labor they need in their market, with this being a lifesaving option.
4. Offer free or discounted parking. People simply love the word ‘free’. True, this has nothing to do with the cost structure of your menu planning, but it will help with the sticker price shock that may come to some diners.
5. Consider family-style service. Get your waitstaff to offer diners the option of dishes served family-style. Better yet, advise guests that all dishes come this way, which encourages sharing. This may lead to greater sales as often appetizers may be eliminated as costs go up. Now there is an option to share one or two.
6. Consider prix fixe menus. A very successful restaurant here posts their menu for the upcoming two weeks (or a shorter breadth of time if resources allow) on their website. While this will not work in all hotel settings, where diners are more transient, if made enticing a set menu should deliver improved costs.
7. Charge for bread service. In rebuttal to the previous note on parking, nothing is truly free. The days of putting down a basket of bread without charging for it are over. This has been common practice for quite some time at numerous European restaurants and now is the appropriate time to follow the old continent’s prudence. If you are still reluctant to consider this option, amp up your bread service and give it a special name, then you can rationalize the charge.
8. Stop supersizing. Portion control is a management issue and well within your control. For reference, in economics and packaged goods the concept here is called shrinkflation, and it happens all the time. Photograph every plate and post prints in the kitchen. Provide training and a detailed rationale. Your kitchen staff will understand.
9. Buy smaller plates. Much of portion control is psychological. This may sound odd, but we’ve attended tradeshows where suppliers showed custom plates that held a burger, fries and a few condiments. This ensured that the kitchen controlled their costs simply by ensuring they could not load more on the plate. Likewise from the guest’s perspective, the same portion on a smaller plate appears satisfactory while on a larger one it may seem insufficient.
10 Reduce the number of extras that come with each main. Think about the last time you went to a steakhouse and asked what the chosen cut came with. The response, a plate! Do you really need to have fries and a salad included with a burger? Do you need to include a medley of vegetables and potatoes with the main? Classical culinary training may teach that a proper plate has a protein, starch and vegetable, but inflationary times call for inflationary measures.
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Editor’s note: To discuss business challenges or speaking engagements please contact Larry or Adam directly.