Tag Archives: Food industry

May 8, 2020 · 2:43 pm

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?

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May 1, 2020 · 3:51 pm

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?

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April 17, 2020 · 3:04 pm

We’re Trucked

Believe it or not, it’s Foodie Friday again (I know, you can’t keep track of what day it is). Obviously, we’re not dining out here and I’m pretty sure you’re not either. We are, however, bringing in for from some of our regular haunts in an effort to support them during this difficult time. In a couple of cases, the restaurants are moving closer to us by rolling out their food trucks into various places nearby.

Food trucks are one of the businesses I represent along with dozens of other food franchises. I can tell you that the cost to open and operate one of these beasts is significantly less than for almost any other type of food place. I haven’t pulled any of the Franchise Disclosure Documents to check out the operating and earnings claims for trucks vs. brick and mortar but I’m thinking that the trucks probably have better margins.

Margins in the restaurant industry are notoriously small. While you might expect your margin in any other type of business to be north of 25%, in the restaurant world they run 3–9%. Not much room for error and definitely no room for the type of catastrophic business environment in which they’re trying to operate. Having a truck to roll out, either in lieu of or in addition to operating the brick and mortar joint for takeout might just be a lifesaver.

I could spend the rest of today’s screed talking about why the margins are so bad and what can be done about it. The two-word solution is “charge more” but I’ll leave that for another post. What I want us to think about today is how we can “food truck” our businesses. How can we find some other way to operate, maybe even in a more efficient, consumer-friendly manner once we get to whatever the new “normal” will be?  How will you calm your customers’ frayed nerves? How does your business have to change to mirror the changes in society, media consumption, supply-chain and each of the other factors and constituencies that make up your enterprise?

I find I’m spending more time talking to people about businesses that can operate out of the home.  I also remind them that no matter what business they’re evaluating, the process will take time. 2 months for a non-retail business and maybe as long as 5 months if you’re outfitting a store/salon/restaurant etc. The time to be planning and beginning the process is now. Borrowed money is cheap, there will be a glut of real estate, and you want to be ready when the new normal eventuates.

So how are you food-trucking your business?

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