Hotel companies are masters at maximizing revenue.  Specific measure like RevPAR (Revenue Per Available Room) help hotels benchmark their performance between properties.  Restaurants can benefit from similar thinking.  Cornell University’s Sheryl Kimes has done some excellent work with the Revenue Per Available Seat Hour measure.  In one study, she showed that a full service restaurant with a waiting list at the door was still only about 60% full due to tables that were mismatched with the number of people at the table.  An empty seat generates exactly $0 in revenue.  Obvious?  Huge implication to the way your hostess sees your business?  Absolutely.

Many restaurant owners are taking the rise in commodities like martyrs, feeling that their customers are extremely price sensitive. As a person who spent about a decade analyzing pricing and costs whose now left that part of the business to go back to being just a regular customer, I can vouch for the fact that restaurant executives are far too concerned about their price and not concerned enough about the other aspects of their business.  I’m not claiming that price is not important, but as a consumer, small differences in price are almost imperceptible.

I can recall being able to spot $0.25 and $0.50 differences in appetizers between competitors a few years ago.  As a consumer I’m much more concerned about the satisfaction level I have and that my total check isn’t outrageous.

From a bottom-line approach, restaurant owners can also look in other areas of their business to compensate.  Can a “greener” approach create cost savings in building maintenance and energy to offset reduced margin in the menu.  Could a softer economy trigger an opportunity to renegotiate your lease?

When it comes to building a menu item, I’d be surprised if there wasn’t more of a shift toward a dollar-margin mindset as opposed to the traditional X% of food cost that has been used by many.  By moving to a targeted dollar amount for margin on a plate, or in a meal, we move to a position where we’re managing traffic and throughput.

Demographics experts tell us that the shortage will continue for many years.  People will be harder to find and when you have them, they’ll be harder to keep.  But
what will make the difference is in the how.  How do you find people and how do you keep them.

For many of us, the generations born with a gameboy in their hand are still a bit of a mystery.  Research shows that their motivations are much different from the Boomers, Nexters and Gen X.  In fact, it’s easy to confuse their lifestyle centered attitude with laziness.  This isn’t the case.  They’re simply motivated by different carrots (sticks don’t work well in a tight labor market, as tempting as it can be).  Cool projects, skills that they can take with them, and flexible schedules combined with a vision of doing something worthwhile are all ways to attract and keep your younger employees.  As well, because of their heavy technological bias, they are well suited for helping some of the older and sometimes more technically challenged workers.  In return, those older employees can pass down their own skill set.

In a foodservice operation, the “cool projects” are sometimes not obvious, but involving your employees in your marketing, menu development and operational initiatives can be used to enhance any other personnel development projects.