Tag Archives: Business and Economy

That Tonnato Sauce

This Foodie Friday, I want to write about one of my favorite summer dishes, vitello tonnato. When I first had it at some fancy lunch many years ago, I thought it was something thought up by a clever chef. As it turns out, it isn’t a new dish at all. One can find it in the 130-year-old Italian cookbook Science In The Kitchen and the Art Of Eating by Pellegrino Artusi (it’s on page 271 of my edition).

The dish is veal, generally a shoulder or rump portion, that’s been boiled and thinly sliced. It’s topped by a sauce that’s basically a tuna and caper-infused mayonnaise. Trust me – it tastes a lot better than it sounds. The veal is really just a canvas for the sauce in my book.

I was pleasantly surprised when one of my friends emailed my a recipe for a vegetable plate of crudites that was served with a sauce that wasn’t called tonnato sauce but absolutely was the same as what one would put on the veal down to the capers and anchovies in the sauce. The chef described it as a “garlicky aioli bolstered with oil-packed tuna.” Uh, yes, please.

It got me thinking about special sauces since the tonnato sauce is clearly special to me. Every business needs a special sauce if it’s not going to be a commodity. If you’ve not done a competitive set analysis, that’s a great place to start to see how you’re different. Then ask yourself why you exist. What’s the problem you’re solving and why is your solution unique/better? Check your assumptions against what your customers and employees think. 

Is your sauce really yours? Can it be duplicated or is it unique and defensible? Back in the day, we used to call something that you marketed around a USP – Unique Selling Proposition but I think your secret sauce is more than that. It gets to the heart of what your business is, including the culture. It’s what makes you you!

You can put tonnato on sliced pork tenderloin, vegetables, and of course veal. I suspect it’s great on grilled foods – veggies and proteins. As I’m thinking about it, it’s not far from a Caesar Salad dressing but with tuna. You see? Once you have a secret sauce, you can’t really tell how far it will take you!

Leave a comment

Filed under Consulting, food

Not Delivering At All

If it’s Friday, the topic is food here on the screed. This week, it’s the food delivery services I suspect many of you have been using to support your favorite restaurants during the time we’re supposed to stay at home. Food delivery is not a new phenomenon. I know a lot of folks, myself included, who used it before all of this when they had nothing planned or bought for dinner and couldn’t bear the thought of pulling themselves together to go out.

What’s different with these services is that they’re third parties. One of my first jobs back in the day was as a food delivery guy (before I graduated to cook) for a local pizza place. Who hasn’t ordered Chinese food and had it delivered? But I worked for the pizza place and the kid making the Chinese food delivery was generally the owner’s son from the place I frequented. These services – Grubhub, Seamless, and others – are a relatively new business. For restaurants that didn’t do a large enough takeout business to hire a delivery person, they opened up new revenue streams. Of course, they come with a cost.

First, there is a human cost. These services pay very low wages and don’t make tipping mandatory (don’t be that guy – tip well, ok?). Then they charge exorbitant, often hidden fees to the restaurants. You might have read about one restaurant owner’s experience. In March, she got 93 orders through Grubhub, totaling to $6,626 in revenue. From that, GrubHub took $1,208 in commission, a $592 delivery fee, and $230 in processing fees, totaling to over 30% of the revenue. In an industry where margins are often low double digits, that’s not sustainable.

We could continue the discussion beginning with why restaurants don’t hire their own delivery people but the point I want to make today which might just apply to your business is about using third parties, especially third parties who end up owning the customer relationship. What is to stop Grubhub from promoting another restaurant to someone who is looking at your menu? Do a search on Yelp for a specific restaurant and you’ll usually see a couple of other promoted alternatives first in the listings. I don’t know what data the restaurant sees when an order comes in via one of these services but at a minimum someone else is privy to a portion of your customer base, their preferences, addresses, etc.

You might have heard of third-party cookies. Third-party cookies are created by domains other than the one you are visiting directly, hence the name third-party. They are used for cross-site tracking, retargeting, and ad-serving. They’re what makes it possible for you to see an Amazon ad for a product you just searched Amazon for on another, unrelated website. They’re going away, in part because of privacy concerns and, I believe, in part because marketers are waking up to the fact that having someone else own data that you help to generate so that they can sell it back to you as well as to your competition is silly.

Industries outsource all the time. Generally, this is because they don’t want to deal with solving a particular problem themselves for whatever reason and it becomes easier to let someone else deal with it. That’s often shortsighted, particularly when it ends up with someone else owning the customer relationship. After all, in business, that’s probably the most important relationship you have, right?

Leave a comment

Filed under food, Huh?

Top Shelf

It’s Foodie Friday, and if we weren’t in the midst of a pandemic, I’d be heading to my favorite local watering hole late this afternoon to celebrate the end of another work week. Since that’s not possible at the moment with all the bars and restaurants closed, I’ll do my celebrating here. I’m not going to lie either – I generally don’t pour myself an end of day beverage only on Fridays. From what I can glean from many of my friends’ posts on social media, I’m not drinking alone either.

One of the local establishments – a high-end cocktail lounge – has been selling their house-made mixers and syrups to have some income during this time. Of course, we bought some, mostly to support them but also because if ever there was a time to upgrade the cocktail game, this would be it. The other day, we made a beverage using one of the syrups and it was delicious, so much better than our usual drink. It got me thinking about what we did differently and, as I thought about it, there was a business point as well.

First, we used a really good vodka as well as the syrup. There was a top-shelf liqueur called for and we didn’t try to get a less-expensive brand. The lemon juice was fresh too. Unlike many times, we actually measured the ingredients and put them in a shaker with lots of ice to get a proper chill. I don’t know about you, but most of the time, I’m not measuring my drink proportions. Yes, I know that a typical highball (liquor plus mixer) is supposed to be a 3 to 2 mixer to booze ratio. Once in awhile, I’m sure my concoctions achieve that but those times are probably the exception.

The business point? Only the best ingredients, better known as your team. It’s worth spending more on the best you can get. Second, measuring, better known as data. If you’re not measuring how do you know how you’re doing? How do you know what’s working? It’s not enough that the cash register rings (and worse when it doesn’t). What’s causing it to ring? Can it ring louder and more often? Measuring is how we know.

Finally, putting the best ingredients in an environment where they’ll shine – the stainless shaker filled with ice, a chilled glass – made a big difference. You need to do the same with your team. Give them the best chance to be their best. Is it harder now with people working remotely? Of course, but finding a way to build that environment is your job, isn’t it? I’ve always said that a manager’s job is to help his team to do their jobs, first and foremost.

Try this: make your usual beverage next time but get the best ingredients you can afford and measure them carefully. Freshly squeezed juice, ginger beer with real ginger, whatever. Put them in a nice, well-chilled glass. Let me know if it doesn’t taste a whole lot better, ok?

Leave a comment

Filed under Consulting, food, Helpful Hints

Having An Abundance Of Talent And Failing

Foodie Friday! I’ll caution you that there are some Top Chef spoilers ahead so if you’ve not watched last night’s Restaurant Wars episode, you might want to come back later. It’s no secret that I’m a huge fan of Top Chef and the pinnacle of every season is when the chefs divide into two teams for restaurant wars. Last night’s episode, which resulted in the elimination of one of the more talented chefs (who is also a fan-favorite) reminded me of a great business point.

As the chefs divided up into teams, it was very obvious that one team had four of the best chefs left in the competition. Several were James Beard Award winners, all have opened successful restaurants (several of them have multiple restaurants), and because this season is an All-Star competition, a few had advanced to the Top Chef finals in previous seasons. The other team had talent but if Vegas was setting a betting line on which team would win restaurant wars, there was no question which team would be the favorite.

When the smoke cleared and judgment had been rendered, the favorites lost and it wasn’t really close. The other team’s food was better executed, their service was more organized, and the menu was more inspired. All of that raises the point that talent alone isn’t the determining factor for success, which is our business point today.

What was evident watching the teams prepare their food was that the losing team was disorganized. They each knew what dishes they were making but other than the chef leading the team, none of them seemed to understand why the menu was the way it was nor how the flavors needed to complement one another. Teams that do well depend on an understanding of roles as well as tasks to avoid clashing, overlapping, or conflicting.

Chef Kevin, who was in charge of the team, designed a meal to be served family-style, with many dishes exiting the kitchen at once. While that works when you’re serving your own family, having to serve a full restaurant put an amazing amount of pressure on the kitchen, and not surprisingly, the service was incredibly slow. They needed to turn over tables in an hour but this style of service took longer and patrons were sitting for 90 minutes, which resulted in a backed-up restaurant. It’s nice to have a vision but had Kevin considered the team’s ability to execute his ambitious vision multiple times an hour, he might have altered his plan. That might have been the result of overconfidence, which often is a problem for the very talented. When you believe that you are unbeatable and that your successes will continue, you can get sloppy, lose concentration, or in the worst cases, slip into arrogance. Was there some of that last night? Just maybe.

Bad communication can often lie at the root of why talented teams fail but that seemed OK in the kitchen. However, the front of house staff wasn’t properly briefed because Kevin wasn’t thinking about that task and never told the chef whose job it was to do the briefing to stop what they were doing and get to the front of the house. It’s never enough to have a great plan. Without great execution, you’re lost.

I wouldn’t say the better team won. I’d say the team that executed better won. Their vision was more simple, their product was innovative, and most importantly, they maximized the talent they had. It’s something to think about as you’re working with your team, right?

Leave a comment

Filed under Consulting, food

Pivoting From Cocktails To Cleaning

Happy Foodie Friday! This week our food-themed screed takes us to the land of alcohol, a place that I have a feeling many of you have visited several times over the last few weeks as a scenic detour in your home confinement. Like many of you, part of my very limited activities over the last little bit has been the often quixotic search for hand sanitizer and toilet paper. The good news is that toilet paper seems to be much easier to find of late while sanitizer remains elusive.

There are many small distilleries near where I live which make everything from vodka to rum to moonshine (hey, it is the South!). Many of them have converted their processes over to produce hand sanitizer which is after all, alcohol-based. One place nearby is selling their sanitizer by the gallon at prices which are reasonable, thereby doing both their shareholders and our community a service. Why the shareholders? Because many of their customers, along with those of their competitors, happen to be restaurants and bars, which are closed except for carry-out. Booze sales are confined to beer and wine in the carry-out world for the most part. That’s our thinking point today.

These businesses have managed to pivot from making one in-demand product to another. This pandemic has caused many other businesses to rethink how they do things as well and to make some changes. For example, I represent a number of companies that run after-school programs. With no school (and no gatherings allowed), most of them have pivoted to providing those programs online. When things calm down, they’ll return to their old model but most indicate they’ll keep the new, online model as well since it seems to be working quite well.

Another example. Companies are cutting down on non-essential costs.  They are reallocating their budget from physical in-person processes such as travel, conventions, etc. into digital or virtual tactics. If your primary sales channel is trade shows, are you ready to pivot to some other model since consumers might be wary of large gatherings such as home shows and business buyers may not be allowed to travel to whatever conventions remain?

Has online commerce been an afterthought for your business? My guess is that many brick and mortar firms are rethinking how they approach digital. Yes, all retail sales have dropped. Consumers are restricting their purchasing to essentials, understandably. But it won’t be this way forever. As CNBC quoted one analyst,

“Major retailers who sell goods outside of apparel and furniture – two of the hardest-hit categories – will likely weather the downturn, along with many direct-to-consumer brands that were doing well before the pandemic. Instead of bulldozing the entire retail market, the pandemic is more likely to accelerate the decline of the “boring middle of retail,” such as Sears, J.C. Penney, Macy’s and Kohl’s.”

Those are companies that didn’t invest in the online space before and who can’t keep up with the big guys or the specialty online brands. They can’t pivot.

Being able to pivot is going to be critical as the new world emerges. Can you turn your booze into sanitizer without missing a beat or will you have to rip the whole business down and start over?

Leave a comment

Filed under food, Helpful Hints, What's Going On

A Whole New World

The thing you hear often these days is some expression to get back to “normal.” The truth be told, those days are gone for good, I’m afraid and I’m not sure that it’s a bad thing in many ways. I’ve been thinking a lot about what the “new” normal looks like because as I’m talking to folks about franchises, some of the businesses that I would have recommended a few months ago are suddenly not as attractive as they were then. Others have emerged as having even more potential.

I want to share some thoughts with you today mostly to get you thinking about what the new normal is for your business. The first thing you’ve probably noticed, maybe because it’s affected you directly, is how many people are working from home. Business meetings take place virtually. I’ve seen a number of professional conferences rescheduled from some hotel ballroom to a virtual meeting place.

What will this do to the real-estate business? If you’re leasing 10,000 square feet of office space now but find you’re being just as productive with the staff working remotely, can that 10,000 become just enough space for a few offices and a conference room? Maybe investing in secure networking is a better use of funds. Some 60% report being either as productive or even more productive than they were working from the office according to a recent study and once the economy reopens, 24% say they’d like to work either entirely or more from home compared to how they worked before,

What will this do to the convention business, at least in the near term? Yes, there is huge value in the face time and spontaneous meetings conventions provide, but I’m not sure people will want to travel. Business travelers are the highest-profit customers airlines and hotels have. Between executives not needing to travel as much and vacation travelers being scared to, what happens to the travel business?

I worked in sports for many years. I’ve seen where some organizations are talking about revamping arena and stadium seating to spread their customers out. Of course, this will reduce capacity quite a bit. What does that do to the economics of those sports (I’m looking at you, NHL) and entertainment shows (concerts, etc.) that are heavily dependant on ticket sales? Seating capacity is an issue for restaurants and bars too. How do movie theaters stay in business with reduced capacity and with an audience that’s now learned to enjoy the theater experience at home?

We need to be thinking about supply chain disruption. Does manufacturing come back here? Are new factories built with social distancing in mind? Does this accelerate the trend to automation since robots can’t catch a virus (well, at least not of the non-digital kind)? We also suddenly are aware that our economy rests squarely on the people who seem to be paid inversely to their importance. Nurses, truck drivers, meat cutters, and others on the front lines are compensated far below the worth that has become evident to us all over the last few months. How does this enter into the conversation when the time comes?

Those are just a few things that have popped into my brain while this disaster goes on. What do I say to folks I’m working with, many of whom have been forced to rethink their employment or who have chosen to? In a nutshell, I think these businesses are worth a strong look:

  • Senior care – people were already wanting to stay in their own homes as they age and the issues in senior group quarters during this have accelerated the trend;
  • Cleaning, both residential and commercial. Self-explanatory
  • Education – both afterschool programs and tutoring. People always spend on their kids and more schooling is going to take place online and at home. Traditional programs in the Arts, STEM, and other areas will be hurt, I believe, and parents will seek them elsewhere.
  • Pets – I can’t tell you how many people have acquired new pets during this time. It also seems all of a sudden that everyone I know is posting something about their pet. Pet supplies, pet boarding, and pet grooming. Dog training too, maybe, if the new puppy we have is any indication (the other 2 dogs don’t seem to be fans yet).

Those are a few of my thoughts. There are a number of other business sectors that look promising in the new world but the important thing is that we recognize that things have changed, probably forever. Have you thought about how that affects you and your business? Is it time for you to change as well?

 

Leave a comment

Filed under Franchises, Thinking Aloud, What's Going On

I’ll Have The Hot Dog Sandwich

Foodie Friday (at least I think it is!). Today we will deal with one of the most urgent food questions ever asked: is a hot dog a sandwich. If you ask The Google, you’ll get 120,000,000 results and I’m sure you have your own answer.

Of course, I have my own opinion but let’s think about a few of the factors that many people consider as they ponder this. First, there is a seam factor. To some, if the seam that separates one piece of bread from another isn’t open on all sides, the food in question is not a sandwich. Of course, in my mind, I wonder if that disqualifies many subs (a.k.a. heroes, hoagies, grinders, and such) from being sandwiches. Subway and Blimpie sell what they call sandwiches but they’re usually closed on one side. Obviously, a hot dog bun is usually not sliced all the way through and to some by the seam factor cannot be a sandwich.

Then there are those who say if it was a sandwich it would be called a sandwich. No vendor of tubular meat has ever said they’re selling sandwiches. They’re selling hot dogs, dammit. As The National Hot Dog and Sausage Council ask rhetorically, Does ESPN broadcast sandwich eating contests?

Then again, historians point out that when the hot dog was first created in the late 1800s, it was referred to as a “Coney Island Sandwich” or “Frankfurter sandwich.”  Why someone would consider a lobster roll a sandwich but a hot dog not a sandwich when both are served on the same bun is beyond me.

There is a business point here, no matter where you come out on this issue. If you ask this question, you see just how eager people are to argue. You probably get that reaction in business a fair amount of the time as well when you ask certain questions. Have you ever noticed just how certain they are in their opinions as they offer them up? The hot dog/sandwich question can get people thinking about things such as seams and types of bread that they might not contemplate. That’s the sort of thinking that each of us needs to do with most business questions. Often, while the answers may seem obvious, further contemplation and including additional factors and constituencies into our calculus can change where we come out on an issue. We probably don’t do that often enough.

Oddly enough, most people I know have strong opinions about the identity of a hot dog as a sandwich. It’s hard to get them to change their mind on the matter. Me? I think by definition it is a sandwich but feel free to change my mind. As with most things in and out of business these days, I’m open to factual information that can do that. Are you?

Leave a comment

Filed under food, Helpful Hints, Thinking Aloud