Category Archives: Helpful Hints

The Food Business Isn’t Just Food

It’s Foodie Friday and the topic today is business. I know: that’s pretty much the topic every day, but let me explain. I read an article on one of the restaurant sites I frequent that spurred a thought that goes beyond the restaurant business.

Photo by Helloquence

The piece was all about the financial statistics a good restaurateur needs to watch. I’m always surprised when a place with good food in a great location goes out of business but it seems to happen a lot. Sometimes it’s that the chef leaves and things slide downhill but more often than not it’s because the business part of the food business overtakes the food part of the food business.

One needs only to watch an episode or two of the show Restaurant Startup to see how a food business is not especially different from any other startup. I assume what I’m seeing on the show reflects the new restaurant world at large and today’s article confirms that belief. Many of the contestants have no clue about the first, and maybe the most important statistics any startup needs to grasp: Cost Of Goods Sold. In a restaurant, that’s food. In a service business, we usually call it cost of sales. In either case, it’s the cost of producing whatever it is you’re selling. You’d be surprised how many businesses don’t know this number.

That number is part of a bigger one called overhead, which includes rent, salaries, services such as accounting and legal, and things like keeping the bathroom clean (your restaurant has one; hopefully, so does your office). These numbers are critical because if you charge too little for what you provide you won’t be in business very long, and you can’t figure that out unless you know your monthly nut.

Once you have the Gross Profit (or Gross Income) number, you can subtract your expenses to get Net Income or Net Profit. Divide that by your sales and suddenly you have a profit margin. That’s something you can use to benchmark your results against other businesses of the same type. In the restaurant business, it’s generally not very big, which is all the more reason why a complete grasp of the numbers is critical. There isn’t a lot of room for error.

I spend a lot of time with my clients on their numbers. It’s not just so that they can present themselves well to potential investors either. Like your web traffic or any other piece of data, they can illuminate a lot and help you make critical decisions. Ignore them at your own peril.

By the way, I’m writing this as a sort of thank you to my late brother who was my CPA and who beat accounting into me many years ago. He passed 5 years ago next week and I miss his guidance and the clicking of his calculator every day.

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Filed under food, Helpful Hints, Consulting

This is a week for friends and family as we approach the Thanksgiving holiday. Most of what’s being advertised, based on my narrow sample of one, are cars and drugs. Admittedly, my viewing tends towards news and live sports with a smattering of public TV shows and other entertainment. I scroll through the commercials in the latter category but I can still get a sense of what’s being marketed.

Photo by +Simple on Unsplash

Why I raise this is that it seems to me to be a missed opportunity. As I initially stated, this is a week where friends and family gather, and when they’re not stuffing their faces or yelling at football, they talk. Among other things, I’m sure they talk about services they’ve used, places they’ve eaten, and prodcuts they’ve bought. It makes total sense that research shows that nearly three times as many people said content from friends and family influences their purchase decisions compared to content from celebrities. You can imagine how powerful it is when that “content” is delivered in person at Thanksgiving.

The research – The 2017 Consumer Content Report: Influence in the Digital Age, by Stakla – also found that

  • On average, people are able to identify if an image was created by a professional or brand vs. generated by a consumer, 70% of the time.
  • Consumers are three times more likely to say that content created by a consumer is authentic compared to content created by a brand
  • On average, 60% of consumers say content from a friend or family member influences their purchases decisions, while just 23% of consumers say content from celebrities influenced their purchasing decisions
  • People want to see content from people they know or that they can relate to.

I’m not suggesting that some brand co-opt Aunt Sally into being a hidden spokesperson nor that some product unleashes an army of Aunt Sallys into every table. I do think, however, that there is an opportunity around this time of year to focus your brand and your marketing so that you’re top of mind as the conversations are taking place. If sharing is caring, your customers need to care enough to do so and this is the best time of year for that to happen. What are you doing to help them with that?

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Filed under Helpful Hints, digital media

Digital Graffiti

Suppose you own a building and someone sprays a message on the facade. Maybe the message is as benign as just the “artist’s” tag or maybe it’s hate speech or maybe it’s as simple as pasting a sticker promoting some commercial venture. Whether you might find the message offensive or not, you probably wouldn’t hold the building’s owner responsible for the message unless you notified them that the message was there and they didn’t remove it. In NY, it’s illegal for landlords to leave graffiti up and the city will come and remove it for you at no cost. Of course, the city will also fine you once they’ve been told your building is hosting graffiti and you’re doing nothing about it.

English: Graffiti tag on train station buildin...

(Photo credit: Wikipedia)

You might be wondering what this has to do with your business since you probably don’t own a building. In my mind, the same principle applies when users post links to content on a particular platform or when a news site reports on content hosted elsewhere and links to it. This very notion is at the center of a lawsuit filed by Playboy against Boing Boing. The latter posted a story about someone aggregating all of the Playboy centerfolds. As  Techdirt reported:

it’s a blog post titled “Every Playboy Playmate Centerfold Ever.” There’s a very short paragraph that reads:

Some wonderful person uploaded scans of every Playboy Playmate centerfold to imgur. It’s an amazing collection, whether your interests are prurient or lofty. Kind of amazing to see how our standards of hotness, and the art of commercial erotic photography, have changed over time.

Boing Boing then linked to the images and a video, both of which were off-site (on Imgur and YouTube, respectively). Playboy is suing for copyright infringement even though it’s pretty obvious that Boing Boing didn’t create or host any of the material. They merely reported on it (fair use, kids). I’ll let the lawyers decide if this is what’s known as a SLAPP action (designed to intimidate and be costly) or whether it has any merit, but it’s not unique. Web hosting companies have been sued for hosting pirate sites that stream copyrighted material.

You might know that under the Digital Millennium Copyright Act (DMCA), Internet service providers (ISPs) may not be liable for copyright infringement from copyrighted material passing through their systems if they take certain steps to police infringement on their site(s). There are some requirements for you to claim this protection, but generally, if you didn’t post it and take it down when you’re told about it, you’re fine. It’s the equivalent of digital graffiti in NYC. Clean up the eyesore when you’re told about it and you’re not penalized.

I can pretty much guarantee that your business has a website. It might have a public-facing comments section or some other place where consumers can post things. You need to monitor and moderate it, and if you’re notified that someone is posting digital graffiti – whether it’s infringing materials or worse – you need to take action. Yes, fair use and the DCMA can protect you up to a point but ultimately you want all of your digital presences to reflect well on you and your brand. Being covered in graffiti doesn’t get you there, does it?

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Filed under digital media, Helpful Hints

Bad Coaching

Most of us seek advice of some sort. It can be as simple as reading product reviews before we make a purchase or a restaurant reservation or as complicated as hiring a business advisor or a life coach. It’s information that adds to our own opinions as we make decisions, and one of the most important life skills is figuring out what’s good information and what’s not.

I thought of this while I watched this video from the European Tour. It’s 4 minutes of that tour’s golf professionals giving advice to a series of amateurs. The advice ranges from the nutty to the idiotic and every one of the amateurs follows it to the best of their ability. It’s silly stuff, ranging from stretching your eyeballs as part of your warm-up to piling grass on the ball to swinging blindfolded to throwing the club.

Here is the thing that resonated: the amateurs hung on every word of this bogus advice because it came from credible sources, tour pros. It reminded me of several clients I’ve had who had been given demonstrably wrong information from consultants or companies that positioned themselves as experts. Unlike the golf example, this wasn’t done as a joke and it did have negative consequences for my clients.

So here are a few things to think about. First, do your due diligence. Make sure the person giving you advice is qualified to do so. Not that there aren’t smart young people, but it’s less likely that a person with two or three years of business experience will have the broad perspective of someone with twenty or thirty years.

Next, avoid generic solutions. Good advice is tailored to the recipient. Golf pros who give the same lessons to everyone are generally horrible teachers. Your business is as personal as your golf swing, and any advice you get must be tailored to you.

If your advisor talks a lot more than he or she listens, dump them. In the video, some of the amateurs question the “tip” they’ve been given but the pro keeps chattering away, ignoring the questions.

I think that’s all good advice!

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Filed under Helpful Hints, Consulting

Business Tourists

When I worked in Manhattan a long time ago, one thing that regularly made me crazy was tourists. They weren’t hard to spot. They weren’t moving along with the general flow of pedestrian traffic. In fact, they often weren’t moving at all as they stopped to gawk at the big buildings or waited until the light turned green before crossing a street that had no traffic.

At holiday time, it was worse. Not only did they stare at the decorations but there were LOTS more of them. They had to have the photo of the Rockefeller Center tree while the rest of us had to BE SOMEWHERE.

It’s become worse with the advent of smartphones. Now, it’s not just the tourists that walk around without purpose. One is constantly bumping into people. We used to have an expression at the NHL: don’t skate with your head down. It meant one should pay attention to the surroundings to avoid nasty collisions. Smartphone users inevitably walk with their heads’ down.

I see that Honolulu, another tourist mecca, has passed a law that will fine you up to $35 if you’re caught staring at your phone when crossing the street. Get caught a second time and it’ll cost you up to $75. Nailed a third time and the fine is $99. Of course, by then you’re probably in a hospital, having been hit by a car. Still, there is a business lesson in this.

It’s way too easy to conduct business with your head down, fixated on what you’re doing while ignoring your surroundings. Heck, many places encourage it, as employees sit in front of computers wearing headphones. That’s a worry (how are people to interact?) but the big concern is ignoring the changing market or new opportunities that emerge. No, we can’t go chasing every shiny new object, but we do need to be aware that they’re out there so we can evaluate if they present a new opportunity or just a distraction. When we’re locked in – whether to a computer screen or a smartphone or to our own internal goings-on – we’re business tourists, out of sync with the pace of business and unaware of our surroundings. Head’s up!

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Filed under Reality checks, Helpful Hints, Consulting

Getting Social

You might think that after a decade or more of social media as a legitimate channel through which marketers can engage consumers we’d be doing a decent job of it. Unfortunately, I don’t think that’s true for the bulk of the marketing world. In the interest of improving both results and the quality of the messages with which we’re all deluged, here are a few things I’ve found to be helpful when engaging in social media marketing.

First, research has shown that the vast majority of brands today invest most of their paid social media budgets into brand awareness marketing. I get that the sales cycle has to begin with lead generation and that begins with awareness, but if you’re spending all of your budgets on the news feed and not enough on conversion, retention, and service than you’re doomed to massive churn rates and ultimate failure.

Next, ask yourself how engaging you really are. The news feed, whether Facebook, Instagram, or elsewhere, is a place where consumers go to interact with their friends and to be entertained. It’s also becoming a primary news channel for many. Nobody is there to interact with you. Let me repeat that. Nobody is there to be sold to; they are there to be entertained. Are you doing that or are you the guy at the cocktail party who keeps asking all the guests if they have car insurance because that’s what he sells?

Whatever messages you’re sending out, how are you deciding about targeting? The holy grail of marketing is the right message to the right person at exactly the right time. It’s extremely tailored. If you’re buying big, untargeted audiences (Men, Women 18-34, People living in Maryland), you’re using a wrench as a hammer. It’s a misuse of a tool.

Finally, are you being you? Has your brand created a distinctive personality or is it all corporate ad speak? People don’t want to engage with robots so don’t sound like one. Be real and listen a lot more than you speak. Let your customers guide your marketing. Don’t respond to a question just with a “that’s on the FAQ page of our website.” Use it as the basis for your next blog post which then goes through the social channels.

I’m a fan of social media marketing even as I recognize that it’s full of landmines. You don’t want to be the company that “goes viral” for the wrong reasons (DiGiorno, Red Lobster, and many others) due to some social media faux pas. You want to be unique, interesting, relevant, inspiring, authentic, and entertaining while staying focused on your target audience and your own goals. Doable?

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Filed under Consulting, digital media, Helpful Hints

Techniques, Not Recipes

It’s finally Foodie Friday again and something I cooked last week sparked a thought. I was trying to find a recipe for a dish I liked and found several versions, each slightly different. The one thing that they had in common, however, was how they were prepared. The process of pulling the dish together was nearly identical in every example. Each used a few common terms to represent techniques: saute, fold, and others.

A cook sautees onions and peppers.

(Photo credit: Wikipedia)

This reminded me of a very basic thing I heard a long time ago: it’s learning techniques that matter, not learning recipes. One of the world’s culinary masters, Jacques Pepin, wrote a book decades ago called “La Technique” which is an encyclopedic look at everything from boning out a leg of lamb to making garnishes out of fruit. As a cook, learning technique is what frees you up to explore food and create your version of anything. It’s a process that never ends, by the way. Despite my years in the kitchen, I’ve only learned to sous vide and to use a pressure cooker in the last couple of years. Both techniques have become skills I use on a regular basis now.

Of course, this thinking doesn’t just apply to cooking. If you play a musical instrument, you’re probably aware that you spend an inordinate amount of time learning everything from how to hold the thing, the proper fingerings to produce certain notes, and what notes are in which scales. As a guitar player, I learned patterns, bends, and hammers as well. Once you understood what each of those techniques produces, you were freed up to make music: YOUR music.

Business isn’t any different. The problem, however, is that many folks don’t take the time to understand that they must learn technique before they can make their own music or create their own food. They try to produce the recipes that make for success in business without having the skills required. Without those techniques, the results will take far longer, if they’re achieved at all. Moreover, it’s nearly impossible for them to make their own music.

Which techniques? Analyzing, communicating, synthesizing, negotiating, budgeting, and presenting are good places to start. There is another dozen I could add to the list, but You get the point. In the office or in the kitchen, having an understanding of the basic techniques which underpin business or cooking, respectively, is a critical element in your success. Otherwise, just trying to duplicate someone else’s recipe will be the best you can do, and even that might be a long slog. Make sense?

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Filed under food, Helpful Hints, Thinking Aloud