Tipping has become a fraught topic in recent years – both with staff and guests. Restaurants are continuing to find their footing with tipping and are testing approaches that feel as fair as possible to everyone, but that’s not an easy task. In a recent column for Restaurant Business, Jonathan Deutsch advises operators to approach tipping changes in three key ways: First, be thoughtful. Review past data to anticipate how a new tipping model would affect each position in the business. Also be inclusive. Involve all employees in the conversation and make them aware of when the changes will be taking place – it will help you gain their cooperation with your final decision. Finally, be prepared to stick with your decision for a while. Making adjustments more than once a year is likely to feel jarring for your staff. A survey conducted by the National Restaurant Association earlier this year found that 79 percent of operators are having difficulty hiring. Hospitality and foodservice labor turnover, which is about twice the national average, adds to the costs and strain of finding staff. Whether you’re currently short-staffed, or if you simply want to be more prepared and flexible when members of your team are ill, cross-training your team can help you. Employees who know how to perform multiple roles can flex with the shifting demands of your business, giving you better protection against absence and changes in the overall business environment. It allows you to redirect staff to other tasks if you happen to be over- or under-staffed during a shift. It can also encourage your team to be more engaged with their jobs if you’re offering them opportunities to develop new skills and varying their day-to-day responsibilities. While additional training can demand resources, you might offer rewards to team members who provide on-the-job coaching to less experienced staff, and if you’re already relying on automated tools to deliver training materials, you can expand their use to a larger group of staff. Who knows? Your cross-training efforts may help you to more quickly identify employees’ individual skills and find ways to use them in other parts of your business. We’ve been hearing it a lot this year: To generate traffic when consumers are hesitant to spend on restaurant meals, operators have to provide value – or at least the perception of it. But that doesn’t necessarily mean offering discounts. According to Kinetic12, a consulting firm that works with emerging brands and identifies trends, there are many ways in which an operator can provide “value”: You can offer premium ingredients – guests will be more willing to pay top dollar if you’re offering high-quality food and it feels that way. You can offer a couple of portion sizes, so guests can trade up or down (this can be more palatable to guests who might otherwise notice that their usual-size dish is suddenly costing them more). Price is still part of the equation and you may well have guests who are looking for more budget-friendly options right now, so consider lunch deals, value meals and other promotions to draw traffic and allow people to mind their budgets. The service and overall experience you provide will continue to mean a lot, so prioritize your staff’s interactions with guests and ensure your website and app are easy to navigate and communicate accurately about timing. Your consistent execution is important – guests need to feel like they know what to expect in terms of their overall experience with you. Even if you’re cutting corners right now – whether it be with ingredients, serving sizes, staffing or something else – that shouldn’t come through in the overall experience you provide. If guests feel they are suddenly getting much less value for their money, they won’t return. Finding even incremental ways to elevate your brand’s value can make your guests feel like your meals are a worthwhile purchase, regardless of what you’re having to charge. Restaurant aren't one-size-fits-all, so restaurant loyalty programs shouldn't be either. Yet many restaurants operate this way. If you're offering blanket rewards for different tiers of your program, or not allowing for some choice on the part of your guests, you may be leaving sales on the table. A guide from the guest engagement company Paytronix suggests some approaches restaurants should keep in mind to offer a program that most closely reflects their brand and the preferences of their guests. It asks you to consider five factors: First, think about how to best engage your guests. Conduct a survey so you understand what motivates them to come to your restaurant -- and what would drive them back to make incremental purchases over time. Second, build in the flexibility to run promotions that suit your brand. Do you want to build continued interest around a signature menu item or other unique aspect of your brand? Third, make it easy for your staff to use the program with guests -- to promote it, answer questions about it, and provide updates to account balances. Fourth, choose only the options that allow you to earn a financial return and plan clear steps to achieve it. Finally, capture key guest information that helps you segment offers. Your longtime guest with kids may well be interested in different offers than the newer guest who comes in once a month for happy hour -- and that should come through in their offers. In addition to providing an overview of the popular programs in use and how they can be customized, the Paytronix guide also includes a worksheet that can help you evaluate program options and determine which features best suit your needs. Just a few years ago, the 7 p.m. dinner slot was the most coveted for people looking to dine out. But the pandemic shifted the dinner hour earlier to between 5 and 6 p.m., and it has largely stayed there since. That’s according to a recent Associated Press interview with OpenTable CEO Debby Soo. She supposes that with many people continuing to work from home, consumers may be looking to take a break in the early evening to get out of the house and enjoy a meal. The shift in timing may also change people’s appetites for food and drink, potentially creating more of a gray area between happy hour and dinner. What does your guest data say about people’s preferences right now? Are there more people coming in at 5 p.m.? If so, are they more apt to order bar snacks, share a pizza with friends, get shareable entrees suitable for a family, or order individual entrees? Are they in a happy-hour mood and more likely to order drinks? Could you adjust your food and beverage menus to accommodate those preferences? If you’re not seeing clear patterns in ordering behavior, you might test some limited-time offers and then track how guests respond. The past few years have tested the will of many restaurant owners who managed to make it through the pandemic but have struggled with economic headwinds ever since. If you’re looking to sell your restaurant business, you’ll need to organize many of the same items mentioned above that can help you secure financing. But it’s also important to review the expenses you have accrued in the business and translate them into benefits that have value to a new owner. Robin Gagnon, cofounder and CEO of We Sell Restaurants, explained in a recent episode of the Restaurant Rockstars podcast that her role as a broker is basically the inverse of what a CPA does. Instead of looking for expenses to legally deduct, she’s identifying expenses that bring value to a restaurant business and can be added back in to boost the value of the operation to a buyer. While you might review your your tax returns and be disheartened if you see negative earnings, working with a broker can help you view that information through a different lens. By aggregating the seller’s discretionary earnings, or the amount of actual value you receive as an owner from such expenses as insurance, mobile phones, and employee bonuses and incentives, you can uncover the value that a buyer is gaining through the sale — value they might use themselves to free up cash and restructure the business. |
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