Restaurant Reality 2.0
Published on Monday, 02 May 2016
Written by Amelia Levin, Contributing Editor
A 40-year veteran of the restaurant industry, Chris Tripoli, principal of A’La Carte Foodservice Consulting Group based in Houston, has provided management advisory consulting to foodservice operators in all sectors of the industry. Here Tripoli shares his thoughts on the top issues and trends facing primarily multiunit and independent restaurants this year.
FE&S: In your view, what is the top challenge facing operators today?
Chris Tripoli Principal, A’LaCarte Foodservice Consulting Group
CT: There are some significant operational concerns facing all restaurants, whether they are the small, independently owned concept or the well-established, multiunit chain operator. We all have to be smarter, and operate on a smaller, faster level. All operators seem to be focused on one major mission: how to get more production out of a smaller space. But I don’t mean just cooking food faster. There are more concerns, like, how can we train managers smarter? How can we operate more efficiently? How are we managing our brand and marketing? How do we get our messages out to consumers faster?
FE&S: We’re hearing more about value these days, and that consumers find value in better quality food and beverage. How are you helping operators reengineer their menus to serve better food and perhaps draw in more revenue?
CT: Restaurants are realizing there is always room to be better, and they must be better because competition is fierce. We are having great success working with people to restudy their market niche and offer better quality. In the past, developing the menu was all about how we can lower food costs. But now it’s about keeping the customer happy and how we can build revenues and increase profits through more sales because we can’t constantly save our way to profitability. Both fast-casual and full-service restaurants are looking for ways to be more inventive and create more flavor. They’re using local foods, fresh-baked breads and sourcing hormone- and antibiotic-free meats. Even with coffee — if you’re not using a really good local roaster and don’t put their name on the menu, you’re leaving money on the table. These things are slightly pricier, but customers want this value. It’s all about capturing your customers’ wants and needs and making them love you.
FE&S: What’s your view on social media and online technology?
CT: The National Restaurant Association came out with some stats in 2015 that showed 41 percent of consumers between the ages of 18 and 34 years old choose limited-service restaurants (and 33 percent choose table-service restaurants) based on their use and the availability of technology. That’s a pretty wide age group that crosses a lot of buying patterns, from young, single diners dining alone to a couple in their thirties out for a date night or others dining in groups or their with families, including children. That means, to grab a bigger piece of the pie, operators are more and more challenged with having to manage technology in their concept. They often have to balance tech advances with customers who are using technology but are also looking for face-to-face service. Social media is not just about having a Facebook or Twitter page or great website. That’s the price of admission. If we’re not improving our phone apps and experimenting with technology in the kitchen, or considering online ordering or iPads at the table to review wine lists or to pay, we’re not doing enough. Diners — especially younger diners — value and expect to see more technology in and around restaurants, whether it’s being able to decide where to go ahead of time and how to get there or being able to order and/or pay online.
FE&S: What are some technological advances operators might be able to take advantage of to improve their efficiencies and production like you mentioned earlier?
CT: Some types of technology advancements that are very helpful for restaurants are actually not in front of the guest. Nowadays, we can use the cloud to learn about our labor, costs and consumer behaviors. We can use apps on our phone to read registers or send a text to the manager with regards to concerns about staff performance or even dishes.
FE&S: How does cloud-based technology help with labor and customer feedback?
CT: Years ago, managers had to wait until the daily sales report was completed and log books were filled out, and then you talked to your staff after the fact, or during specific shift meetings later in the week. Now, if we have issues during shift we can see, learn about and correct the problem as it happens. For example, some check minders allow customers to log instantaneous surveys when signing a credit card receipt. Before you leave the table, if there was a problem with the food or service that would inhibit you from coming back to the restaurant, you can share that information. And when you hit send, that could be a text that goes directly to the manager or owner or other supervisor. The manager will then know at 8:15 p.m. that there seems to be a trend among customers that they waited too long to be seated. This will alert the manager to a problem at the host desk, or with pagers, or if customers were given the wrong wait times. And the problem can be corrected in the middle of a shift. This all goes back to the challenge operators face about having to react faster. We can’t afford to wait a few days to learn about a cold fish dish, poor service or slowing sales.
FE&S: We’re hearing more about minimum wage battles, changing tipping policies and more. What are your views regarding labor issues in the industry?
CT: We’re in a time now where everything about staff is being rethought, such as how many staff members to hire, how to better cross-train staff, how much to pay them. One significant labor issue has to do with salary exemption and overtime pay. With the federal government debating whether or not to raise the minimum weekly working hours for overtime pay exemption, restaurants with lower labor budgets might be in trouble because they might have assistant managers or kitchen managers whose salaries will need to be redefined, or could be faced with raises or have to reward overtime pay. So consultants are watching that issue very closely.
FE&S: On the heels of restaurateur Danny Meyer’s no-tipping policy, what is your view on the current debate over whether to include tipping or not in restaurants?
CT: Many are stressing that there should be greater equality between the front and back of the house — how can we make earnings more equal and create a better team culture by taking away tipping? The answers are not clear. In some cases, the customer might appreciate not having to do the math and worry about tipping. But many customers like tipping because it gives them a sense of control and the option to reward good service. They know they can compliment the server — or not — through the tip. For the operator, there is another mathematic issue — if you want to set an average wage for servers you need to determine how much percentage of the revenue they are earning through tips and give that to them as a wage, but still have enough money left over to raise wages for back-of-the-house staff. So then restaurants are faced with having to raise menu prices but still feel like they’re giving guests a sense of value since they don’t have to tip.
FE&S: How do you see restaurants responding to the minimum wage debate?
CT: Many restaurants are still grappling with this issue. They always ask me, ‘What are we going to do about rising minimum wages?’” My answer to them is we can’t control what legislature is going to do in the next few years regarding minimum wages. So let’s do a better job with the things we can control, such as improving efficiencies and labor, marketing better and faster, leveraging technology and improving the quality of our food.
FE&S: Amidst all this, are there things restaurants can do to improve their company culture?
CT: Restaurants have to develop a much better culture of service so employees feel like there is a sense of belonging, as it’s especially difficult for them to be able to find great people and then keep them. The challenge becomes, how do we get them to choose to stay with us rather than leave the industry? How do we allow them to have input in company conversations and decisions and make them feel like they belong, like their views are valued? As a result, we’re changing the way we think about training — it’s less about one-time training and more about establishing a continuing education program where the longer staff members stay with the company, the more they learn and the more valuable their experience becomes.
FE&S: How do these labor and technology issues relate to equipment?
CT: The fact that most restaurants these days would like to keep people longer and pay them more means we have to determine how we can operate more efficiently with less space and fewer people. Equipment choices should and are being made not just for utility or energy savings, which are important, but also to help improve labor efficiencies so operators can do more with less and afford to pay staff more. Maybe we don’t need seven people to run a kitchen; with state-of-the-art kitchen equipment, maybe we can run a kitchen with five people instead. The other factor in this is design: we are rethinking the way we set up and design kitchens in order to improve efficiencies and save space and labor. For example, why do we need separate pantry and dessert stations or separate grill and broiler stations? Why can’t we cross-train staff to do both? How can we leverage technology to help staff do both? We’re at a point now where we’re rethinking how we design cook lines.