Responding to COVID-19’s Impact on the Restaurant Supply Chain

by Bora Kang

The COVID-19 pandemic has proven to us all just how interconnected our food system is in the US if not, the world. The supply chain failure and the domino effect of its impact have been a wake-up call for even the veterans of the food industry. Nationwide outbreaks have forced manufacturers to shut down their plants, leading to disruptions in operations downstream in the supply chain (1). Restaurateurs who were eager to reopen their doors after lock-down only a few weeks ago are having to confront temporary product shortages and price inflation, vulnerable to spontaneous out of stock notices or unexpected shipment delays. Perhaps more unsettling is the uncertainty of it all. It’s just impossible to predict consumer behavior, especially when the pandemic is new to all of us.

So the question is: how do you respond? Here are the top three actionable steps we think will help operators overcome the supply chain crisis.

Multiple Sourcing and Backup

If you haven’t considered multiple sourcing before, now is the time. According to John Davie, CEO of Dining Alliance, “Restaurateurs who are reopening and asking what they should do regarding supply chain should prepare to engage smaller suppliers who have multiple sources of product” (2). This is because “as restaurants open fully, most distributors will experience some shortages. Restaurants wanting to make sure they have everything they need should have a few different channels to rely on, especially when it comes to specialty products” (2).

And research seems to agree. According to Costantino and Pellegrino’s study of choosing between single and multiple sourcing based on supplier default risk, single sourcing has the advantage of a strong partnership between buyer and suppliers while lowering purchase price, but this dependency between the two creates vulnerability and increased risk of supply interruption (3). Meanwhile, multiple sourcing allows operators to “reduce probability of bottlenecks due to insufficient production capacity to meet peak demand.” It has the advantage of allowing the operator to have alternative sources of materials in case of delivery stoppage by the supplier, as well as the flexibility and agility to react to unexpected events that could disrupt the supplier’s capacity (3).

Mahesh Rajasekharan, CEO of Cleo, a software company that provides wide ranging big data integration solutions between businesses and applications, suggests that companies become more agile in their efforts to connect with multiple suppliers for the same product (3). “If Supplier A has 50 cases of [a product] for $800, and Supplier B has 25 cases for $750, the buyer can purchase all 50 from Supplier A, and then source the rest from Supplier B based on prior buyer trends,” he wrote in Supply and Demand Chain Executive (SDCExec) Magazine. The key is to adopt a “holistic view of the supplier ecosystem. A company can find the best price at any point in time and refactor supplier integrations accordingly” (4).

You must consider the worst-case scenario and have backup plans in case your food-supply is unexpectedly compromised, especially for your priority products. According to Yerkes, Vice President of Business Development in Supply Chain at Consolidated Concepts in Boston, MA, operators should consider a wide range of options and communicate with your supplier for when a product cannot be delivered—for example, “if you don’t have this product can you do with another substitute?” (5). Other sources recommend using ready-made pre-cut items to save on labor, as well as shifting to different cuts of meat—for example, moving to ham which is more readily available in foodservice (2). We think the best operational strategy is establishing a contingency plan for the items you know you can’t do without, especially in dairy, meat where we’ve seen shortages; upscale restaurants may be struggling most because they require specialty products and are more specific (5).

Menu Changes and Flexibility

Menu changes have become a widely-adopted solution to a variety of supply issues facing operators. Akash Kapoor, CEO of Bay Area-based franchise Curry Up Now, is simplifying his menu by combining. “We used to garnish with four different microgreens, but now we’ve gotten rid of that,” said Kapoor in an interview with Berkeleyside News (6). “We’re back to a simple mix of cilantro, mint and chives. And whatever we use, we also use in some other way on the menu. It can’t just exist as a garnish. It has to have a purpose on the menu.”

In some ways, the COVID-19 crisis has created opportunities for restaurants to rethink and evolve their menu. “One thing we can do is just go back to being chefs, which I think is kind of cool,” said Kapoor (6). “You can just go to the market and do with what you’ve got.”

Like Kapoor, restaurateurs may be starting to think about shrinking down their menu and working with items that are not (yet) subject to volatility. According to Tim Hand and Bruce Reinstein from Kinetic12 Consulting, this kind of simplification “allows fewer moving parts and gives the restaurants the ability to be significantly more productive by requiring less labor, fewer deliveries, lower waste, and improved execution” (7).

Unfortunately, Yerkes says some changes will be difficult because operators are “emotionally tied down to their menus” (5). Differentiation in foodservice is what gives a restaurant its unique identity, and often what gives restaurants its competitive edge. Sometimes, an operator may believe that losing their specialty products and items that differentiates them from the competitors may also lose their competitive edge. “While this is true if you are not careful, the brands we work with are making changes very thoughtfully,” said Yerkes. “Slimming things down a bit and having alternative solutions will help [brands] survive. The reality is everyone has to adjust in some capacity but everyone is very focused on the guest’s experience still and that will get them far” (5).

Likewise, Hand and Reinstein support simplification over differentiation, saying that the former “eliminates some of the emotional decisions that create broad and complex menus that are too big for restaurants to execute profitability and consistently, and results in too many ingredients that only have one use” (7). In conclusion, differentiation “must now go hand in hand with simplification, efficiency, and profitability” (7).

Communication

All the working parts of the food industry, as we’ve experienced first-hand, are interconnected and interdependent. As such, communication and transparency is a necessary component of recovery.

The first step operators should take is communicating with their suppliers. According to Hand and Reinstein, operators should “reach out to their top suppliers for assistance on driving both front-of-house and back-of-house efficiencies. This can include streamlining the food preparation process through labor saving products, new equipment innovation, new order-taking technologies, supply chain simplification ideas and finding efficient no-touch solutions for self-serve condiment and beverage stations.” This streamlining process is necessary, as “[suppliers] must have a clear understanding of what each restaurant brand is focused on and support their operator partners with the types of products, insights and innovation that are necessary to help drive revenue while maintaining and improving efficiencies” (7).

Consulting an expert helps, too. According to Yerkes, this is because “partners have a line of sight into what else is going on….we can offer multiple solutions because it wouldn’t be the first time we’d encountered similar issues” (5).

Another important consideration for operators is communicating to the staff about their supply status. For example, if your supply shortage prevents you from including certain items in the employee meals do they understand why? What about issues concerning reducing food waste? Having a transparent, honest relationship with your staff, suppliers and customers will help your business tremendously in the long run.

The food industry has been hit hard by the pandemic and operators may find themselves restless as restaurants reopen and they readjust to the new normal. The good news is that you don’t have to brave this alone. This pandemic has opened up new communication channels for people. “We may have our own agendas, but people have been genuinely helpful, trying to support each other in these times,” said Yerkes (5). “Free resources are being available. New webinars are popping up everywhere like LinkedIn, available to everyone.” She also added that “[these times] have “won me a lot of friends….The silver lining of this is good relationships.”

Conclusion

If the pandemic taught us anything it is that we cannot take anything for granted. “Nothing will surprise me at this stage of the game,” said Yerkes. “The resurgence of the virus is expected, making all this unstable” (5). While we do predict a “semi-permanent” impact on the shortage of sanitary items, such as face masks and vinyl gloves through the rest of 2020, the supply situation can change at any given time, and no strategy is guaranteed to work or fail.

Preparing your business for product shortages and future outbreaks is necessary for the recovery process. It will take some time for us to win back the consumer confidence around safety, and until then, you should consider multiple supplier options, be creative and nimble in your menu changes, and communicate with vendors, staff and your customers about what’s to come.

And remember, no change should compromise quality. The fundamentals still are what they’ve always been and the most resilient of us will find ways to win small victories, even if there have been losses along the way.

*Special thanks to Meredith Yerkes, Vice President of Business Development in Supply Chain at Consolidated Concepts in Boston, MA, for providing her expert insights

References:
(1) https://www.technomic.com/technomics-take/coronavirus-foodservice-view
(2) https://www.restaurant.org/articles/news/a-supply-chain-take-on-the-post-covid-19-world
(3)https://www.researchgate.net/publication/240167996_Choosing_Between_Single_and_Multiple_Sourcing_Based_on_Supplier_Default_Risk_A_Real_Options_Approach
(4) https://www.sdcexec.com/sourcing-procurement/article/21134023/cleo-the-covid19-supply-chain-impact-avoiding-the-bullwhip-effect
(5) Yerkes, Meredith. (2020, June 11). Telephone interview
(6) https://www.berkeleyside.com/2020/05/18/east-bay-restaurants-brace-for-instability-in-food-supply-chain
(7) https://www.fsrmagazine.com/expert-takes/simplification-covid-19-era-what-it-means-restaurants-and-suppliers

For more information on services provided by Goliath Consulting Group visit or website at goliathconsulting.com or contact us at getresults@goliathconsulting.com

Defining a Post-COVID19 Consumer: What Your Guests Will Look for When They Walk Through Your Doors

by Bora Kang

You’ve re-opened your restaurant, congratulations! But much has changed since you’ve last had dine-in guests; consumer spending behavior and eating habits have been reset. Other than your most loyal customers, there is no guarantee that your old guests will return to dine with you while social distancing and other public health recommendations remain in effect. So how will your restaurant appeal to your guests when they walk through your doors? We’ve come up with a short list of items that we think will be important to your guests based on available research.

A Safe Environment with a Touch of Convenience

First, we know that consumers will continue to regard safety and sanitation in high importance, possibly going towards 2021 (1). According to Philip Daus, partner with Simon-Kucher & Partners, a global strategy and marketing consulting firm, consumers are expected to “remain vigilant about staying safe and limiting potential exposure to COVID-19… (This) value driver will stick around for a long time, at least until mass vaccination has been rolled out” (1). This sentiment is illustrated in a recent survey conducted by Technomic, a research and consulting firm servicing the food and foodservice headquartered in Chicago, IL: about half of survey takers felt that they would be comfortable dining at restaurants that had at least a 6-ft distance between tables (2). An additional 25% said they would be comfortable with table 9-15ft apart.

We think restaurants should implement transparency and visibility to alleviate these fears. “It will not be sufficient to have the proper sanitation procedures in place,” said Daus (1). “Restaurants need to openly communicate their safety standards to their customers and make sure they are being perceived as a safe establishment.” For example, Datassential, a market research firm for the food industry in Chicago, IL, recommends that restaurants have a staff member to frequently wipe down high touchpoints (i.e. door handles, soda fountains, and condiment bottles, kiosks, tables, public restrooms) in plain view of their customers (3). It would also be helpful to give customers as many touchless/self-service options as possible, such as automatic doors, self-checkout or touchless pay. The latter would not only eliminate the need for your staff to constantly sanitize, but offer a touch of convenience that may not have been available for your customers before the pandemic that your guests are sure to appreciate.

With social distancing behaviors expected to last long term, we may see an upward trend in food delivery. McKinsey’s analysis of the Chinese consumer response during the COVID19 crisis revealed that consumers were more likely to spend more on food delivery, prepared goods and groceries than they did pre-pandemic (3). According to Datassential, “high-risk,” environments such as arenas, movie theaters, buffets, bars, cafeterias, and anywhere else one could be exposed to large crowds were likely to be affected most (4). A recent survey they conducted also found that 54% would most likely decrease their visits to sit-down restaurants (4). Delivery (particularly, self-delivery*) and curbside could be what keeps operators afloat during these trying times.

*more on self-delivery discussed in our previous blog articles

A Sensible, “Value-Driven” Menu

Next, restaurant-goers may be more selective with their spending and spending decisions after the pandemic. The economic downturn would have affected job security, especially those in the lower socioeconomic groups, people of color, women and the young (5) and consumers will seek value to compensate the loss of income and save money.

Datassential, in their “Money Matters” article released in April, found that 38% of consumers planned to get restaurant food less often; 23% find and use more coupons; 22% choose less expensive restaurants; 19% choose less expensive menu items (6). Technomic, too, found that coupons and promotions were significant restaurant drivers, especially popular among consumers with children under the age of 18 (55%) and consumers in the age range of 25-34 (54%) (2). What this data shows us is the shifting perception of consumers regarding their eating habits. Brands, quality, flavors and convenience will still matter, but their decisions will also be influenced by the price and value of a menu item. This is not to consumers will be less willing to pay, just that they will be “more deliberate as to where and how they will spend their money” (1).

In accordance with these changes, some operators are remodeling their menu so that they “make sense.” Restaurants will have to rethink how they will get their vendors to supply ingredients and whether they are cost-effective to serve. For example, The Spillover Restaurant in Miami is changing its menu to an appetizer-entree-dessert format, focusing more on salads, sandwiches and entrees (7). They will be removing the shareable dishes—to emphasize guest safety—and implementing the $12 lunch specials during the weekdays. As the restaurant owner remarked, “a customer may not casually choose a $15 burger in the future” (7).

Trust, a Human Element

According to Danny Klein, Director of Digital Content at Food News Media and contributor to QSR and FSR Magazine, “Trust will mean everything to restaurant customers after COVID-19” (8).  But you’ll have to earn it. The pandemic would have affected consumers more than just financially, and consumers who discover you through social media, as well as those who return to your establishment after lockdown will start to evaluate whether you truly care about their well-being. As we discussed earlier, transparency will be vital. Ask yourself these questions constantly: are you adhering to sanitation practices as posted? Are you producing quality food? Are the items offered in the menu in stock and fresh? Are the new contactless / touchless systems (self-checkout, touchless pay, for example) functional and convenient? Are your staff trained to use these new systems? Expect to be reliable and strive to be consistent. Customer loyalty will be valuable after the pandemic. Reliable consistency is how you will retain your guests.

While “trust,” as discussed above, comes from operators earning it through measurable results and transparency, it is also important to note how trust is also a human element built on emotions. Monica Ho, from Modern RestaurantManagement.com, recommends that businesses “lead with empathy,” focusing on connection and awareness (9). Many restaurants in the Atlanta area as well as other urban cities have actively participated in providing meals for food kitchens, for out of work restaurant employees and many frontline workers in the hospitals, while others have contributed to community issues by fighting hunger (10). Similarly, consumers have been very eager to support local restaurants and local food sources during lockdown, buying more take-out and ordering from local food suppliers to help small operators stay in business (8). It is this collaborative relationship that may have helped many small and local businesses navigate through the COVID-19 lockdowns.

Independents have been predicted to be most vulnerable to closures in this pandemic due to “minimal off-premise presence, limited digital capabilities, low emphasis on value-based menu items and because of their unfavorable economics (thin margins and poor access to capital) according to this McKinsey & Company research (11). Projected consumer spending for restaurants overall is also at a negative: people are expected to continue cooking at home and recovery is not expected to start early (11). Despite the odds, however, some restaurants have managed to thrive. Eric Rivera, owner of Addo Restaurant in Seattle, reported higher than last year’s sales and doubling of staff to 10 since the beginning of the month (12). His secret was systemic change: first, he shifted order to pick up and delivery only and sending his staff to make drop-offs rather than relying on third-party delivery. He also decided to continue to offer a new menu every day, ranging from simple $9 bowls to family style meals, such as a $45 pasta for two with a bottle of wine or a $105 Hawaiian feast for two. He’s also removed higher-end menu items and implemented a system where customers can “pay forward” the $9 bowls to a local homeless shelter (12). More details of this and his social media strategy can be read in the Wired article referenced here (12), but the key takeaway from Rivera’s success story is that a restaurant’s future outlook is not limited to what is defined by projections. The wonderful thing about trust is that it’s got a human element that cannot be predicted. Consumers are people, and these people will support and return to restaurants they trust and want to be associated with.

Conclusion

There is a big question mark over when the restaurant businesses will return to pre-COVID19 levels. The fact remains, there is a lot that remains unknown about future consumer behavior, as this pandemic is new to all of us. But studies have so far illustrated that nationwide spending has been gradually ticking upwards and that most businesses are expected to bounce back in 2021 (2). An article from Escoffier School of Culinary Arts even forecasted a positive outlook: that “extreme social distancing has created pent-up demand for social interaction. And once the economy opens up, customers will likely prioritize those businesses that have adapted the quickest to the new trends” (13).

It will be a difficult battle ahead, and every restaurant will be striving to regain what they’ve lost during the lockdown. It takes courage to transform and let go of your old business formula, and we’ll all have to proceed despite uncertainties. But like with all success stories, we think it’s the operators who are willing to learn and evolve with the time who will reap the benefits of tomorrow.

Reference:

For more information on services provided by Goliath Consulting Group visit our website at goliathconsulting.com or contact us at getresults@goliathconsulting.com

 

 

Menu Development and Business Planning Resources

In the last few months, we have all seen a historical change in how restaurants operate and how restaurants have adapted to the new business environment that is a result of the coronavirus pandemic. In response to the “new normal” and evolving response to Covid-19, the following two guides were developed to assist the restaurant operator in navigating the best way forward.

Goliath Consulting Business Plan Guide

This is a guide for restaurateurs to help mitigate the impact of the Covid-19 pandemic and maneuver their concept through the coming months. The next 18 months will be a challenge for every restaurant brand. The outline below will get you started on building a plan to optimize your business to keep your doors open and be prepared to capitalize on opportunities that will present themselves into 2021.

Goliath Consulting Menu Development Guide

Our new normal is developing in front of us. What your menu looked like a few months ago is most likely not the menu you will have this summer and going forward. The paradigm shift for restaurateurs is coming fast and menu changes started in March for many operators. As we move forward, menu strategies new and old will converge as we adapt to the right mix of price points, value, menu items and differentiation that will appeal to consumers.

This document is a guide to developing a competitive menu that will excite guests and allow you to grow your revenue.

 

For more information on services provided by Goliath Consulting Group visit or website at goliathconsulting.com or contact us at getresults@goliathconsulting.com

How to Grow Your Catering Business

by Bora Kang

Catering has grown significantly over the last few years thanks to the widespread demand for this one word: convenience. Whether they be for office parties, conferences, birthdays or weddings, catering profits from the promise of efficiency, safety and most importantly—safe of mind.

But as consumer spending on catering grows, so does the competition. And while a little competition never hurts, continuing investments in your catering program will be paramount to your business’s success. Here are four strategies you can use in your existing catering business to gain a competitive edge in the crowded catering landscape.

EXPLORE NEW CATERING VERTICALS

Exploring new catering verticals is key to expanding your catering business. You may be used to catering for corporate meetings, office parties, weddings or cocktail parties, but what about outdoor festivals, picnics and movie sets? You may even get client requests you’re not used to, like having to add a food truck or using non-traditional type venues you would have never thought of using (1). But that’s what makes it a perfect opportunity. Take some time to explore what you can achieve as a business. Stepping out of your comfort zone is never easy, but challenging yourself to take on new catering opportunities will set you apart from the competition and increase your business exposure. It will also provide a marketing platform where you can meet new people and gain new leads.

INVEST IN TECH

It can be stressful to manage a growing catering business without relying on technology. From venue information, menus, pack lists, hiring, timelines, etc., there will be logistical challenges in trying to keep track of every detail without a business management software. According to Daniel Smith, writer for QSR Magazine, “technology is playing a prominent and escalating role in catering. Those who can harness technological tools like online ordering and loyalty programs are better positioned to succeed ,,, minimizing friction for the end user” (2).

If organization is important to you, you may want to invest in a management/ catering software that can automate a large portion of your business. A good management software should be able to track your sales, managing your staff scheduling and most importantly, boost the overall efficiency of your business so that you can dedicate more time and energy into helping more clients, as explained in detail in this CaterEase article (3).

We also recommend that you start utilizing some of these catering/lunch service apps (if they are available in your area) to increase exposure and volume:

Fooda (4, 5)
• A workplace food program that brings in a different pop-up restaurant to serve as the office lunch vendor each day
• Works in dense urban areas and suburban surroundings
• Primarily geared toward employers that have more than 400 or 500 people in a location.
• Roughly 75 to 80 percent of the restaurants Fooda works with are local, independent restaurants and about 20 percent are chains.

Foodsby (6)
• Serves in 15 cities, see reference:
• Connects employees in office buildings with local restaurants.
• Requires restaurants handle deliveries
• These employees can pre-order a meal from a restaurant in the Foodsby network, which Foodsby then aggregates and sends the collected orders to the restaurants. Your restaurant would deliver these pre-ordered meals in one single delivery. It’s basically delivering mass meals to one location.
• Advantage: restaurants can plan their labor and production days in advance.
• Because Foodsby acts as a marketplace, with the restaurants handling their own deliveries, the fee is much less than traditional third-party delivery services.

Foodee (7, 8)
• Works exclusively with corporate clients. Orders are typically a minimum of $200, restaurants are given 24-hour advance notice, and orders are prepared during non-peak hours.
• Orders are placed by clients either online or through staff. Foodee confirms and passes the order to the restaurant, and the restaurant prepares the food by the indicated pickup time, where Foodee drivers will take, package and present to the clients, including catering set up and quality assurance. They also offer all serving utensils with compostable options.

TAKE ADVANTAGE OF TRENDS

We expect the Coronavirus pandemic to have changed catering trends significantly. In an interview with Mike O’Hanlon, head of catering partner business at ezCater, with FSR Magazine, orders on ezCater containing individually packaged menu items have more than doubled as the result of the Coronavirus pandemic (9). Likewise, home delivery of family meals and to-go orders have been added to the catering software company CaterZen so that operators could diversify their services and meet this new demand (10). This trend of individual servings and lunchbox type meals is expected to continue for the remainder of 2020, and catering businesses will surely benefit from taking advantage of this trend as catering orders are expected to recover slowly, at least as social distancing and small gatherings remain in effect.

INVEST IN SOCIAL MEDIA

It’s never been more important to market yourself online. According to Nation’s Restaurant News, strategic social media marketing ideas for restaurants can drive sales and increase foot traffic (11). Especially now because of the pandemic, “Consumers are afraid to go out, so they are likely canvassing their social media much more than usual,” said New York City-based Four Corners Communications President Drew Kerr in QSR Web (12). Izea, a social media content provider, even found that about 63% of consumers expected their usage of YouTube and Facebook to increase during the quarantine (12).

Managing your online presence will be key, so make sure you have the basics: a Google listing of your business, an updated website with an online menu and a Facebook page are musts. Get your business on Instagram and even Twitter and share with your audience regular updates on the catering business, testimonials, expert tips on event planning and more. (More ideas can be found in our earlier blog, “5 Steps To Do Social Media Right.”) Be sure to take advantage of trending hashtags, especially ones involving food-specific holidays such as these upcoming ones #nationalhamburgerday (May 28), #nationaldoughnutday (June 5), #nationalsushiday (June 18), etc.

Lastly, consider utilizing these media outlets to send out a compelling brand message. Now that the pandemic has upturned our daily routines, many are creating new habits and behaviors, even the kind of food they eat. A compelling message and awareness of your audiences’ needs and trends will help establish yourself and to draw in new customers for your business. Kate Finley, CEO of Belle Communication, a restaurant digital marketing company in Columbus, Ohio, recommends that you “humanize your brand” (12). Businesses should form local, community ties and build bonds; offer foods that give people a sense of comfort, safety and nostalgia (12). Your business can also address current concerns by posting updated sanitation policies online and communicating these messages to your audience to show that your business prioritizes guest safety above all else. As Finley stated, “Now, is the time for social listening and proactive engagement. Devote time to proactively connecting with consumers. Pay attention to what’s important to your audience right now.”

We hope this brief guideline helps you build a framework for your catering program to move forward. Are you interested in managing your catering program?

Goliath Consulting Group, headquartered in Norcross, Georgia offers a dynamic array of business development solutions, tailored to meet the needs of each individual client – in addition to a full suite of knowledge and tools that help make restaurants more profitable, including strategic planning, menu development, project management, new restaurant development, branding, marketing, franchising, equipment, technology, evaluations, outsourcing, and more. The company also has a management division that manages full-service restaurants. Goliath Consulting enjoys a ten-year track record of creating client success among local, regional and multi-unit national restaurant chains.

Goliath Consulting Group is actively involved in the Foodservice Consultants Society International and is an allied partner of the Georgia Restaurant Association.

Reference:

(1) https://www.caterease.com/manage-fast-growth-within-catering-business/
(2) https://www.qsrmagazine.com/restaurant-operations/why-its-critical-perfect-your-restaurants-catering
(3) https://www.caterease.com/manage-fast-growth-within-catering-business/
(4) https://www.fooda.com/restaurant-partners
(5) https://www.chicagotribune.com/business/ct-fooda-orazio-buzza-exec-qa-0702-biz-20170628-story.html
(6) https://foodondemandnews.com/06142018/foodsby-brings-lunch-to-suburbia-on-the-cheap/
(7) https://www.food.ee/blog/why-foodee-parnerships-work/
(8) https://www.food.ee/how-it-works/
(9) https://www.fsrmagazine.com/leader-insights/restaurant-catering-coronavirus-age
(10) https://www.fsrmagazine.com/content/catering-software-company-helps-brands-combat-coronavirus-crisis
(11) https://www.nrn.com/technology/how-social-media-can-impact-foot-traffic
(12) https://www.qsrweb.com/articles/is-your-restaurant-speaking-the-covid-19-era-customers-language/

Catering for Restaurants

Important points to consider before starting a catering program

Off-premise catering is undoubtedly a compelling business opportunity for restaurant owners. Aside from boosting revenue, catering can boost business during slow performing times, reduce excess food waste, allow for menu changes, and helps to increase employee retention as they gain new skills and varied tasks that challenges and keeps them busy (1). Catering also gives businesses brand exposure and valuable marketing opportunities. Instead of waiting for customers to walk through their doors, businesses can bring its brand to the customers in a catering environment (2). As for profit, the percentage is largely variable dependent upon the business model, size, and marketing strategies, but high-end caterers have boasted impressive sales—a pretax profit of over 25% (3). But on average these numbers are much more modest.

For example, Catersource magazine reported 7 to 8 % as the average pretax profit in the full-service restaurant industry (3). Nevertheless, we think it is a good time for caterers as recent studies have made clear the growing demand and popularity for catering. Chicago-based foodservice research firm Datassential, for example, reported that consumer spending on catering was capturing growth that is on par, if not beyond, that of other restaurant categories (2). A more recent research from Technomic reported that business catering brought in $22 billion in 2018, with catering expecting to grow 5.6% annually through 2019 (4). As Gene Lee, the CEO of Olive Garden parent Darden Restaurants said in an interview with RestaurantBusinessOnline.com, “(Catering) makes a lot more sense for us to market and pursue than running around delivering $10 entrees at this point in time” considering that the average order for a large-party delivery catering in Olive Garden is $300 (5).

With that said, there are several factors restaurants must consider before starting a catering program for their restaurant. While it may seem like a big opportunity, off-premise catering is also a lot of work—requiring your time and energy for adding necessary staff, purchasing delivery vehicles, acquiring needed equipment, and paying for miscellaneous expenses that come with the service (2). It is therefore imperative that when starting out, restauranteurs tread slowly and carefully. A successful catering service may take years of adapting and fine-tuning before it is perfected. The personnel, storage capacity and vehicles are dimensions that can be added to the business as volume increases (2).

Possibly the most overlooked element in operating g a successful catering program is good organization. An absence of organization, according to catering experts Maulik Suthar and Nishin Sura, creates a huge time strain and causes simple tasks to take up an unnecessary amount of your day (6). Imagine being too late or too early to the venue because you did not factor in delivery timing, underestimating the amount of food or bringing incorrect food due to miscommunication.  Making your guests impatient and uncomfortable is the last thing you want to establish a good impression of your brand. We recommend that you set up a system in place that will allow you to keep track of venue information, menus, pack lists, hiring, timelines and more.

Alternatively, you can invest in a catering software to do this for you. First, find a catering software that can help you organize more catering orders. Basically, a catering software manages business functions for the catering, event planning and banquet management industries, and you start by compare product reviews and features here (7). We recommend that you find one where the invoicing is automated, such as Gather (8) or Total Party Planner (9). BEO (Banquet Event Order) binders, used by event professionals and venue managers to outline all the details on a particular event, such as food and beverage orders, A/V requirements, room info, decor, signed receipts, staffing and more, are also all managed digitally thanks to software like these (10). Other good features to have are integrated/shared team calendar, task management, communication tracking (for proposal or invoice re-reads or reviews), 3rd Party Integrations from excel spreadsheets, credit card payment processing and business insights.

Next, you should assemble your catering team. Having a point person who is dedicated to directing catering, to oversee operation of the catering business and handle with employee training, customer concerns and safety compliance, is a must because it helps catering operations to run more smoothly (5, 12). You’ll also need to cross-train some of your employees so that they can serve as backup staff for your catering service, as catering programs often require irregular staff scheduling and flexibility to handle catering orders that vary in size and complexity (13, 14). Having employees who can multi-task or who can work on a flexible schedule can help. You can also hire a catering salesperson, someone that who will manage business and customer relationships by sales calls, networking, advertising, and social media.

Other questions business owners should ask and answer before you start catering is whether your business has the right equipment, storage capacity and the delivery logistics in place. According to Aaron Hoffman, CEO and co-founder of DeliverThat, a third-party delivery service provider in restaurant catering delivery and setup, how restaurants implement their catering delivery strategies have changed much in these recent years due to growing popularity of third-party delivery (15). According to his article, restaurant owners who implement a hybrid approach to delivery—using both self-managed fleets and third-party delivery providers—have shown the highest customer and employee satisfaction rates. For example, a small fleet of delivery drivers and branded vehicles will cover a few daily runs while third-party providers will handle the most of restaurants’ catering deliveries or overflow on days with higher volume. “The hybrid approach also works well for brands that handle large catering volumes, see seasonal fluctuations, or have VIP clients that prefer one delivery channel over another” (15).

Whether it is simply dropping off the goods or offering more extensive services like buffets or a full dining service, catering is an excellent opportunity for your restaurant to draw in more vertical revenue streams. We hope that these considerations should give you a foundation you need to start your business, but the most important advice for a successful catering program is presenting a professional service that is organized, timely and executes on its promises.

References:

  1. https://www.caterease.com/boost-revenue-adding-catering-restaurant/
  2. https://www.fsrmagazine.com/fsr/events/right-way-cash-restaurant-catering
  3. https://www.catersource.com/business-operations/what%E2%80%99s-fair-profit-margin-caterer
  4. https://www.technomic.com/
  5. https://www.restaurantbusinessonline.com/operations/catering-strategy-key-driving-premise-dollars
  6. https://www.fsrmagazine.com/expert-takes/3-strategies-running-successful-catering-business
  7. https://www.capterra.com/catering-software/
  8. https://www.gatherhere.com/
  9. https://totalpartyplanner.com/catering-software/
  10. https://www.gatherhere.com/blog/gather-makes-beo-binders-obsolete-heres/
  11. https://www.catersource.com/business-operations/how-hire-great-salesperson
  12. https://www.catersource.com/restaurants/four-steps-building-successful-premises-catering-operation
  13. https://www.ezcater.com/lunchrush/restaurant/catering-feed-hospitality-training-chaz-patrick-podcast/
  14. https://www.restaurant-hospitality.com/food-trends/6-smart-tips-deliver-successful-catering-program
  15. https://www.qsrmagazine.com/outside-insights/how-hybrid-approach-eases-catering-delivery-challenges

 

Interested in setting up a catering program for your restaurant?

Goliath Consulting Group with headquarters in Norcross, Georgia offers a dynamic array of business development solutions, tailored to meet the needs of each individual client – in addition to a full suite of knowledge and tools that help make restaurants more profitable, including strategic planning, menu development, project management, new restaurant development, branding, marketing, franchising, equipment, technology, evaluations, outsourcing, and more. The company also has a management division that manages full-service restaurants. Goliath Consulting enjoys a ten-year track record of creating client success among local, regional and multi-unit national restaurant chains.

Get our latest update on menu development at www.restaurantsrise.com/resources

Goliath Consulting Group is actively involved in the Foodservice Consultants Society International and is an allied partner of the Georgia Restaurant Association.

Contact: getresults@goliathconsulting.com

Future of Food Delivery

How will restaurants deliver after COVID-19?

The coronavirus crisis has challenged restaurants to rethink the way they deal with food delivery for good. Larger franchises have offered free delivery (McDonalds, Applebee’s, IHOP, Panera Bread, Wingstop and Chipotle Mexican Grill, among many others) to accommodate decreasing on-premise sales (1). Meanwhile, smaller restaurants had to turn to third-party delivery services like Doordash, UberEats, Grubhub to deliver food to their customers. The topic of switching to self, or in-house delivery has been a widely-debated issue among independents these past couple of years, and it will most definitely be a hot topic as restaurants begin to open their doors again. So where is food delivery headed post-COVID-19?

In our previous blog article, we briefly touched on the various advantages of third party delivery services, like how outsourcing delivery to a third-party service has an advantage of allowing smaller, local restaurants to get started quickly (2). By partnering up with these big companies, restaurants have been allowed to take advantage of the software and support they offer and use these popular apps as a marketing tool—a way to attract new customers and gain brand recognition (3). Even larger brands, like that of the sub/sandwich franchise Jersey Mikes, relied on third-party delivery as a way of managing within its capacity (4).

However, the main issue with these third-party services have been their exorbitant fees, often ranging from 25 to 30 percent of sales (4). Other complaints have been unreliable delivery time and unsatisfactory food temperatures upon arrival (5). A report by the US Foods even found that 1 in 4 food delivery drivers admit to eating the food they were supposed to deliver (5). These issues collectively have made the shift to self-delivery so appealing.

The food delivery marketplace has exploded in the recent weeks due to the COVID-19 shutdown. Portillo, a Chicago-style comfort food restaurant in Illinois, for example, reported a 90% delivery sales increase through its third-party delivery since shutdown and 60% delivery increase through its website and mobile app (1). But for restaurant owners who had to rely solely on third-party delivery, this jump in food delivery has not entirely been welcome, driving them to look for alternative delivery measures despite some third-delivery services suspending some fees to accommodate for the crisis (6).

Having your own in-house delivery service allows you to have more control over your staff and drivers, reduce transit time and give you options to give better customer service (7). Having the same drivers deliver to your customers also come with perks of building long term driver-customer relationships.

Just as the third-party delivery model has its pros and cons, so does in-house delivery. While in-house delivery models are great in that you get more control and own the transaction from beginning to end, an in-house delivery route would require you to pay upfront costs to hire drivers to deliver your food (7). It also means you’d have to hire, train and pay new staff for this job including paying for insurance and vehicle expenses. For restaurants that have enough volume to keep their drivers busy the expenses will be worthwhile, but for up and coming restaurants that are in the process of building a customer base, self-marketing will be key whether it be by word of mouth, online listings or by keeping an active social media presence.

The good news is that in the long run, restaurants who have self-delivery services can expect higher returns (16, 17). As more restaurants fight back third-party delivery fees and lack of control, we could be seeing a lot more restaurants adopt self-delivery in the near future.

So, in summary:

Third Party Delivery

  • Pros:
    • Doubles as advertisement that increases exposure of your restaurant.
    • Provided drivers/ No training required
  • Cons:
    • High Fees
    • No control over the delivery time
    • No control over the condition of the food once it leaves your restaurant

Self/ In-House Delivery

  • Pros:
    • More control over your profit margin/transaction fees
    • More control over your driver
    • You can offer faster delivery
    • Offer better customer service
    • Allows you to build driver-customer relationships
  • Cons:
    • You’ll need to hire, train and pay your driver
    • Not recommended for low volume restaurants
    • You have to actively promote on social media to make up for the marketing

 

Interested in setting up self-delivery?

Goliath Consulting Group with headquarters in Norcross, Georgia offers a dynamic array of business development solutions, tailored to meet the needs of each individual client – in addition to a full suite of knowledge and tools that help make restaurants more profitable, including strategic planning, menu development, project management, new restaurant development, branding, marketing, franchising, equipment, technology, evaluations, outsourcing, and more. The company also has a management division that manages full-service restaurants. Goliath Consulting enjoys a ten-year track record of creating client success among local, regional and multi-unit national restaurant chains.

Goliath Consulting Group is actively involved in the Foodservice Consultants Society International and is an allied partner of the Georgia Restaurant Association.

Contact: getresults@goliathconsulting.com

Reference:

  1. https://www.restaurantbusinessonline.com/operations/why-coronavirus-shutdown-will-upend-delivery-services-good
  2. https://www.qsrmagazine.com/sponsored/how-third-party-delivery-helps-brands-drive-sales-growth
  3. https://www.qsrmagazine.com/restaurant-operations/house-versus-third-party-delivery-debate-rages
  4. https://www.qsrmagazine.com/reports/delivery-dilemma-rages-restaurants
  5. https://www.qsrmagazine.com/ordering/delivery-question-whats-happening-my-food
  6. https://www.restaurant-hospitality.com/delivery-takeout-solutions/what-third-party-delivery-marketplaces-are-doing-and-not-doing
  7. https://www.qsrmagazine.com/fast-casual/house-or-third-party-delivery-whats-better

A NEW TIME FOR OLD FASHIONED LEADERSHIP

Guest post by Robert Marshall – Organizational Health Consultant @ CSR

A guide for establishing a critical connection to your teams and employees

I hope this finds you well considering the unprecedented disruption of our personal lives and the negative effect it has had on the economy of this country. That we have collectively endured these last few months is a credit to our resilience. The one thing we know, is that companies are going to come out of this better and stronger or worse and weaker. But certainly not the same. How we lead during this time will determine our fate and long-term impact of this short-term disruption to our business and our lives.

Working capital is tight. Companies will return to regular operations soon with a philosophy of cautious austerity. While some have already adjusted to working with fewer people, others have fought to stay intact and keep their people in place. Whether future measures include a thinning of the workforce or are simply new policies designed to run leaner in the aftermath, chances are good that employee morale will be the big loser.

But what if there was a way to energize your workplace? What if there is a way to show your employees that you truly value them in a time where most have been shaken to the core? What if you had the opportunity to not only weather this storm but also reset the company culture. You can dramatically differentiate your workplace from your competitors by developing a “Branded” people program now.

Your employees need to know that they are valued. When you as management, operate from a place of caring and COMPASSION, this will be recognized. Your company will reap the rewards with increased productivity, improved morale, and individual loyalty. Brand your program, “People First”. This is your competitive differentiator! The way your people see you and the company, interested in their welfare, will re-engage them, and cement the foundation of your plan. Investing in the future of your company this way, will bring added credibility and allow you to maintain and/or ramp up your expectations with a positive response. The only way 2020 can be salvaged into something positive is if your employees are properly taken care of now.

Invest in the individual and watch their value as an employee grow. Make it about them. The way they function better as individuals, with a heightened sense of self-awareness, will make them better team members as they strive to achieve the team goals. More than ever, we “need them” on the team. A targeted, personal people program will address individual needs for the greater good of your entire organization and long-term health of the organization. We can do this now or miss the opportunity and pick up what is sure to be the more expensive pieces later.

This Is How Your Small Business Ultimately Survives COVID-19

Guest post by Elena Stewart

The COVID-19 pandemic has affected people and businesses alike all over the world. As a result, those that have been classified as “non-essential” are forced to pause their operations. For many small businesses, this can spell devastation. However, there are ways you can keep your business afloat during this difficult time. After all, modern technology has made available countless tools and resources to keep people working remotely, which, in turn, can give your business a fighting chance to survive. We’ve put together some links to help you with the task.

Improve Your Workspace
Creating a clutter-free and work-friendly space will do wonders for your productivity.

● Find space for your home office setup.
● Look into affordable carpeting options for a cleaner, more professional look.
Declutter your workspace to inspire productivity.

Work Effectively
Leveraging the many resources and tools made available by technology will keep your business going without a hitch.

● Make use of solid collaboration techniques to keep your remote team productive.
● Think of pandemic-friendly ways to advertise your business.
Manage your team effectively while social distancing.
● Choose the best video conferencing tools to stay connected.

Get Adequate Help
Just because you’re operating remotely doesn’t mean you need to do it all on your own.

● Support freelancers by hiring on freelance platforms.
● Leverage online job sites to hire expert help when you need them, from a big commerce developer to marketing professionals and more.

Suffice it to say, there’s no need for your lifeblood — that is, your small business — to languish and move closer to failure as the whole world tries to recover from this pandemic. Instead, embrace the paradigm shift into remote work and operations, and maybe also learn a new thing or two along the way. Ultimately, that’s how your business succeeds through COVID-19.

Photo via Pexels.com

Pay It Forward with Give Care Initiative

Using CARES Act Stimulus Money to Support Medical Personnel, Front Line Workers and the Unemployed

 

#Givecare is being used to promote the donation of CARES Act stimulus money to charities that impact those people out of work and the people on the front lines of the battle against coronavirus.

Charities to support include food banks, organizations buying PPE/supplies/food for medical workers, funds supporting restaurants and restaurant workers and a host of other organizations that are focused on helping those in need.

Join us in getting the word out to #givecare and our message of paying it forward.

 From  www.facebook.com/givecarenow

you can help

With stimulus checks coming to most Americans, we are proud to promote the #givecare initiative.  For many, these stimulus checks will serve as a lifeline to make ends meet and put food on families’ tables during a time of need. For those with continued employment, who do not need the stimulus checks to keep their lights on and mortgages paid, we ask that you join us in donating to food banks and other charities that will support those out of work and also our first responders and medical personnel  dedicated to taking care of our communities.

Americans have a tenured history of supporting one another.  Multiple studies demonstrated during the recession of 2008, the ratio of Americans’ charitable donations to income remained consistent.  In September 2001, tip jars across the service industry were willfully replaced with collections for the first responders and victims. Recent data shows that around 20% of people with means plan to donate their stimulus checks. This is our tradition, and these are the values that make us a great nation.

This is an opportunity to redirect several billion dollars in stimulus checks to those most in need. Please join us in promoting #givecare and help make a difference.

 

Reference: 

NY Times: https://www.nytimes.com/article/coronavirus-stimulus-package-questions-answers.html

CARES Act Stimulus Payments

How large will the payments be?  Most adults will get $1,200, although some would get less. For every qualifying child age 16 or under, the payment will be an additional $500.

How many payments will there be?  Just one. Future bills could order up additional payments, though.

How do I know if I will get the full amount? It depends on your income. Single adults with Social Security numbers who have an adjusted gross income of $75,000 or less will get the full amount. Married couples with no children earning $150,000 or less will receive a total of $2,400. And taxpayers filing as head of household would get the full payment if they earned $112,500 or less.

Above those income figures, the payment decreases until it stops altogether for single people earning $99,000 or married people who have no children and earn $198,000. According to the Senate Finance Committee, a family with two children will no longer be eligible for any payments if its income surpassed $218,000.

Here’s good information on who will be donating this stimulus checks from FSR Magazine:

https://www.fsrmagazine.com/consumer-trends/restaurants-biggest-threat-market-share-today-its-not-other-restaurants?utm_source=fs_insider&utm_medium=email&utm_campaign=20200409

 

GEORGIA UNEMPLOYMENT CLAIMS – EMPLOYER BEST PRACTICES AND FAQ

By Colin Kopel

Filing for Georgia Unemployment Insurance (UI) can be a complicated process leading to multiple questions from both the employer and the employee.  This frustration of filing claims is magnified during the coronavirus pandemic due to the mass influx of claims overloading the GA DOL’s capabilities.  From long wait times via phone and the website servers continuously slowing down or crashing, I received multiple requests for filing assistance and answers to questions.  Most of the issues with the process are individual business specific.

If you have any questions, need assistance deciphering the process, or inquiries after filing claims, reach out to Colin.Kopel@GoliathConsulting.com.

Do I need to file a claim for my employees, or do they file a claim for themselves?
This is contingent upon your plans during the current crisis.  If you are temporarily laying your staff off and have the full intention of rehiring the staff, you will file on their behalf.  This is called a Partial Claim.  The employer is responsible to file each week the employee is out of work. It is not important which day of the week you choose to file for your employees, but it is important you file on the same day every week.  Filing a day early can result in the system rejecting your claims and filing a day late can lead to a delay in your staff receiving their benefits.

If you are permanently laying your staff off, they will file on their own behalf.  This is only recommended if you do not plan on reopening or you plan on reopening at a reduced capacity.

How do I file Partial Claims for my employees?
You will need access to the DOL UI Employer Portal.  If you do not remember your established login credentials, follow the “Reset” links below the login screen.  If you need to establish access for the first time, select “Establish Administrator Access.”  If you do not have a pin number, check the corresponding box and answer the security questions.  In the event your security answers are not working, call the DOL and speak with an operator.  They will verify the correct information over the phone so you can login.

Once your administrator access is setup, click “File Employer Filed Claims (Partial Claims)” link and download the template.  The DOL created a user-friendly YouTube tutorial you can find here.  It is critical your inputted data on the template mirrors the acceptable formatting rules or the site will reject it.  Once complete, upload your template.  The automated system will determine if there are any errors in the template and guide you through any changes needed.

What happens after I file a Partial Claim?  
After the DOL accepts the uploaded template, your claim is complete.  Remember, you must refile every week on the same day for your staff to continue receiving benefits.  The DOL will mail a letter to your listed business address listing each employee you filed for and their weekly benefit.  Your employees will receive further instructions from the DOL on collecting their benefits.  Remember: The DOL is currently using reported income from 2019 to calculate the weekly benefit amount.

What if my employee was turned down for UI or received below the maximum $365/week?
Once the DOL has a benefit determination for an employee, it is the employee’s responsibility to correspond with the DOL if a correction is needed.  Most of the issues reported to me involve lack of income during the 2019-time frame.  The DOL allows employees to dispute the reported wages via submitting earnings reports to the email listed on their determination letter for additional periods of time.  As an employer, you should send the earnings reports to the employee, but the burden of submitting it and contesting the amount currently falls on the employee.

Do recently hired employees qualify for Partial UI?
Yes.  Any employee on your payroll with hours effected by the coronavirus qualify for Partial Unemployment.

Most of the questions regarding Partial Unemployment are business specific.  If you have any questions on filing for your employees or need assistance with the filing process, reach out to me at Colin.Kopel@GoliathConsulting.com

Supporting Documents

COVID-19-Individual-FAQs (1)

PartialClaimFileUploadInstructions

Next Steps for Employers Filing Partials (1)

____________________________________________________________________________________________

About Goliath Consulting Group
Goliath Consulting Group with headquarters in Norcross, Georgia offers a dynamic array of business development solutions, tailored to meet the needs of each individual client – in addition to a full suite of knowledge and tools that help make restaurants more profitable, including strategic planning, menu development, project management, new restaurant development, branding, marketing, franchising, equipment, technology, evaluations, outsourcing, and more. The company also has a management division that manages full-service restaurants. Goliath Consulting enjoys a ten-year track record of creating client success among local, regional and multi-unit national restaurant chains.

Goliath Consulting Group is actively involved in the Foodservice Consultants Society International and is an allied partner of the Georgia Restaurant Association.

Contact: getresults@goliathconsulting.com

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