restaurant edition!

Winter 2008
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e Makeover:
Restaurant Edition!
INSIDE
INSIDE selections
selections
•
• survival
survival solutions
solutions
•
• more
more hospitals
hospitals planning
planning food
food facility
facility facelifts
facelifts
•
• Nontraditional
Nontraditional venues
venues boost
boost brand
brand recognition
recognition
•
• growing
growing trend:
trend: theater-restaurant
theater-restaurant hybrids
hybrids
contents
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Winter 2008
Winter 2008
PROFIT
Survival Solutions
Adapting to new economic challenges will bring
new opportunities.
operations
More Hospitals Planning Food
Facility Facelifts
Looking to lure more customers, a growing number
of hospitals are planning facelifts or upgrades to
their foodservice operations.
feature
Extreme Makeover: Restaurant Edition
It’s all the rage on reality TV, from home décor
to hairstyles… why not your restaurant?
marketing
Nontraditional Venues Boost
Brand Recognition
Keep business running smoothly and current
customers happy.
trends
Growing Theater-Restaurant Hybrids
Target Dinner-and-a-Movie Dollars
Casual-dining offerings, in-seat service drive
concepts’ popularity.
For more information or to submit a story idea:
Progressive Group Alliance
7420 Ranco Road
Henrico, Virginia 23228
Design by:
Design and Print Services
804.261.4323
Visit our website: www.progressivegroupalliance.com
viewpoint
“
Elevating the level of customer service
you provide can attract more diners…
”
Yes, we seem to be bombarded with reality makeover shows on TV, but a makeover,
extreme or not, of your restaurant can prove to be a smart investment for the future of your
business. Taking on a major remodeling project may not be in your budget, especially in
this year of economic worries, but there are plenty of small things you can do that will still
yield big results.
Is it your menu that’s in need of a makeover? How about developing a locally inspired
dish or partnering with local sources for your meats, cheeses, bread or even beer. Your
revamped menu might suggest wine and beer pairings with meal selections. Following one
of the hot trends, expand your beverage program to include teas, smoothies, vitamin waters
or microbrews.
Maybe your concept is just in need of some slight tweaking or perhaps your presence
on the internet could be larger. Tech-driven ordering services continue to grow thanks to
convenient and innovative tools.
Going green isn’t going anywhere. You can join the movement by using low heat or low
voltage lighting and biodegradable takeout containers, plates, cups and cutlery.
No matter how small your makeover, be sure to keep in mind your goals for the project,
your budget, minimizing the intrusiveness to your guests and resolving any final details.
David Matthews
President & CEO
dmatthews@progressivegroupalliance.com
David has responsibility for the general direction of Progressive Group
Alliance. He is charged with building the teams, systems, and strategies
that help assure the growth and health of our Distributor, Supplier and
Associate partnerships.
winter squash casserole
Source: www.allrecipes.com
recipe
Prep Time: 15 Minutes • Cook Time: 45 Minutes
INGREDIENTS:
6 cups mashed winter squash
1/2 cup butter, melted
6 eggs, beaten
1 cup sugar
1/2 teaspoon salt
topping:
1 cup packed brown sugar
1/2 cup butter, softened
1/4 cup all-purpose flour
1/2 cup slivered almonds
DIRECTIONS:
1. In a large bowl, combine the first five ingredients.
Pour into an un-greased 13x9x2 baking dish.
2. Combine topping ingredients and crumble over
the top.
3. Bake uncovered at 350˚ F for 45 minutes or until
a knife inserted near the center comes out clean.
Yields: 12 servings
Winter 2008
1
PROFIT
T
he economic downturn we are experiencing is especially
hard on many restaurant operators. Therefore, in these
tough times, it is essential to change swiftly and adapt to
new economic challenges. As with any change, there
will be new opportunities waiting to be discovered.
Fortunately, everyone has to eat. However, most
people don’t have the time, knowledge or interest for preparing tasty, nutritious
meals for themselves.
Baby boomers, those born
from 1946 to 1964, are starting to
retire. For every two people retiring, only one new
one enters the labor force. It continues to be difficult
finding and retaining good employees. This will keep
pressure on paying
attractive wages to
retain experienced,
qualified and dediBy Chef Rudi Mitsche
cated people.
Furthermore, everything from bread and butter to nuts and
bolts will continuously increase in cost. There are many reasons for it: increased energy costs, supply and demand, crop/
resource shortages, transportation costs, inflation and others.
As a result, these increased costs need to be passed on to the
consumer to balance the added expenses. This, unfortunately,
will lead to spending pressures; therefore more customers will
trade down to the no-frill, fast casual, quick-service type of
restaurants.
As you read this, ask yourself: “Who is my customer and
what do they really want?”
Maximize on profitable menu items: Knowing what items
are popular and make money is utterly important.
The most beneficial thing to do is create more
variety, and price items appropriately.
At the same time, discontinue menu items
that don’t sell or don’t contribute to your
bottom line. Balancing food costs on
every item is crucial in order to stay
in business.
Daily specials: Work with your vendors
to identify value and discounted items
that allow you to maximize profits.
Furthermore, create exciting dishes at
a great value. To draw in customers and
stimulate sales, consider loss leaders.
Create a sampler appetizer platter
with a variety of signature items to
entice customers.
survival solutions
Here are some ideas to consider during these tough times.
Increase menu prices: To stay profitable, you have to pass on some
of the cost increases to your customers. This is difficult,
because consumers have a limited amount of additional
disposable income.
Increase takeout business: Create special to-go menus serving mul-
tiple or family-style meals at a reduced cost. Have a parking
space reserved for takeout order customers.
Serve sufficient portions: For some time, extra-large portion sizes
have meant great value. Many consumers are fighting the
battle of the bulge and obesity is an ongoing problem worldwide. Constantly increasing prices of raw materials will lead
the operator to rethink what are appropriate and sufficient
portion sizes to serve. The added benefit will be a lower
calorie, nutritionally-balanced meal.
Evaluate other expenses: All processes in an operation should be
evaluated as to what it takes in time, what the actual cost is
and the overall value to the profitability of your business.
Increase efficiency: Look at how performing other tasks may affect
other areas of the business, such as consistency, portion
control, labor costs, food costs, safety, sanitation and maintenance, energy costs, reduced cycle time, reduced employee
turnover, training costs, less waste/mistakes and increased
customer turnover.
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Winter 2008
Technology enhanced service: Some fast food operations and
restaurants on the mainland have resorted to customers
ordering from computer terminals or cellular phones via text
messaging. Likewise, processing a credit card at the moment
the check is presented can speed up service significantly.
Implementing the latest technology reduces miscommunication, as well as time for processing orders and payment.
Happy hour at 2 p.m.: Encourage and reward off-hour dining.
Why wait until 5 p.m. to start happy hour? Lunch business
is usually over by 2 p.m. Offer a limited menu of popular,
simple and profitable items at times when your establishment is not busy. People always have a need to get together
for meetings. Why not take advantage of it?
Boomer opportunities: Now in their prime income-generating
years, boomers are most likely to patronize restaurants.
When gasoline prices rise and younger customers cut back
on restaurant spending or scale down to lower-price eating
places, boomers are more inclined to stay closer to home but
still dine out.
Reward frequent diners & seniors 55 & older: Repeat business should
be rewarded through discounts and special customer recognition. Entice them to become repeat customers by giving
away a free soup, salad or dessert after they have placed
their order.
Round up menu prices: Round up from $0.75 to $0.79 and from
$0.95 to $0.99.
Delaying is expensive: The time to analyze your operation and
take the appropriate actions is now. If you need help,
there are a multitude of other actions you can take. We
are providing our customers with the appropriate solutions
for their business.
Chef Rudi Mitsche is the corporate chef of resource and research
for Y. Hata & Co. Ltd. He has worked as a chef around the world
and teaches food and beverage classes at the University of Hawaii at
Manoa’s School of Travel Industry Management and Kapiolani
Community College.
operations
Source: Nation’s Restaurant News, April 2008
A Growing Number
of HOSPITALS are
Planning Food Facility
Facelifts
L
ooking to lure more customers, a
growing number of hospitals are
planning facelifts or upgrades to
their foodservice operations, according
to a recent study by the National
Society for Healthcare Foodservice
Management.
The study, which was completed in
March, polled more than 270 HFMaffiliated healthcare food and nutrition
professionals as well as suppliers and
manufacturers. More than half of the
survey’s respondents said their facilities
were planning major construction or
remodeling projects within the next
two years. Of that number, 40 percent
said those capital improvement projects had been budgeted in
excess of $800,000 each.
In other findings, 37 percent of respondents said they
offered a room-service component for their patients. Of those
offering room service, 25 percent had implemented their
programs within the last year. Respondents also said room
service was a worthwhile investment, particularly in the areas
of patient care and customer satisfaction. Approximately 74
percent of those members who implemented room service
programs said their patient satisfaction scores had increased
and 81 percent said their satisfaction scores had gone up by
more than 10 percent.
The study also found that
operators at retail venues in
hospitals are putting greater
emphasis on keeping both staff
members and hospital visitors
happy.
Many noted that the use of
cashless payment systems, in
which customers pay for meals
with prepaid cards, keys or
online services, helped to boost
customer satisfaction. More than
half of the respondents offered
such systems.
“Expect to see more modern
facilities with a variety of
services and options focusing on making the customer
happy,” said Mary Angela Miller, current HFM president and
administrative director for Ohio State University Medical
Center in Columbus, Ohio.
The study also found that approximately two-thirds of
the operators surveyed were female. Sixty-one percent were
directors, 18 percent were managers and 11 percent were
administrative directors. More than 30 percent of operators
polled have been at their current jobs for more than 16 years.
Nearly 40 percent manage multiple sites and nearly 20 percent
manage multiple departments. More than 40 percent of
respondents earned between $80,000 and $100,000 per year.
winter 2008
3
feature
Source: Mary Ellen Hickey
I
t’s all the rage on reality TV: from home décor and hairstyles,
to wardrobes and waistlines… why not your restaurant?
A makeover in any form can breathe fresh energy into your
operation, customer base and employees… maybe even you! If
you’ve lost touch with the soul of your business, a transformation
– whether major or minor in scale – can fuse the connection once
again. Just about any makeover is a smart investment, not just in
the future value of your business, but in preserving customer interest and loyalty, keeping employer turnover at bay and bolstering
your own enthusiasm. If you are looking to sell the restaurant in a
few years, a makeover will widen the spectrum of buyers and help
command a higher price.
In this year of economic woes and declining sales, now may not
be the time to take on a major remodel of your interior or exterior,
which usually requires significant financing and closing down
operations. But there are plenty of other makeover projects that
can yield you “extreme” results.
Menu Makeover
Update your menu to match consumers’ continuing desire for
healthier, high fiber and organic meals. Replace or supplement
traditional pasta with whole grain, buckwheat and rice varieties,
which have greatly improved in flavor and texture. Retire ho-hum
iceberg and romaine with micro greens, mixed lettuces and those
from your own garden. Offer a signature condiment (chipotle
ketchup, dilled mustard mayonnaise), herbed olive oil or spicy
sea salt. Development a locally-inspired dish, such as the “Route
66” pizza (bbq sauce, grilled chicken, green chile) at Fratelli’s in
Flagstaff, Arizona. Partner with a local bakery to develop your
own house bread or with a local brewery for your own ale or root
beer. Add a few menu items for the growing leagues of Americans
who are vegan, gluten- or lactose-intolerant, who will bring in their
regular-menu friends and family. Try sourcing some meats, cheeses
and produce from local sources, which many diners are now
enthusiastic to try. Expand your beverage program to include new
tea blends, a signature smoothie, aqua frescas, energy and vitamin
waters, specialty cocktails and local microbrews. Many chains this
year are promoting popular “value” menus with several low-priced
options to counteract the struggling economy. Announce your menu
changes with a newly spruced-up menu design and on your website.
(“Now Grilling Organic Local Valley Poultry!”) The new menu might
make a point of suggesting pairings of wines and beers with meal
selections as a way of promoting beverage sales. According to the
National Restaurant Association’s 2008 industry forecast, the follow
trends remain hot: organic and local produce, alcoholic beverages,
teas and blending bolder ethnic flavors into traditional foods.
Concept Makeover
Sometimes a tired format with slipping profits needs refreshing
or tweaking. A small regional chain of seafood grills turned its
unprofitable units into a successful knock-off of Hooters with better
food that attracts the male “buddy bonding” market. Their fishing
lodge-themed décor was quickly converted to mountain hunting
cabin furnishings with a menu heavy with roasts, fancy franks
and skewered beef served by waitresses channeling Daisy Duke.
Elsewhere, restaurants are morphing into more family-friendly
themes with a “Kids’ Korner” (remove a booth and dedicate it to
toys and other diversions) and children’s menus that feature more
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Winter 2008
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t
exMak
Restau
than the usual nutritionallychallenged chicken fingers
and mac ‘n cheese. A former
basic pizzeria catering mostly
to take-out and delivery might
recast itself as an upscale, sitdown café that attracts business
lunches as well as families. An old-fashioned burger joint refreshes
its image with organic beef, whole grain buns, a fresh interior and
new name. Traditional Mexican or southwestern can be remade
into lighter, healthier version featuring healthier preparations, black
beans and seasonal produce. Quick-casual restaurants might add
a drive-through or walk-up window to better compete with quickservice chains. A breakfast and lunch spot can add a prolonged
weekend brunch with free newspapers. Even mega-chain Subway
is experimenting this year with the upscale “Subway Cafe”, featuring panini sandwiches, gelato and coffee drinks in a décor of brick
or wood-paneled walls and upholstered chairs.
Technology Makeover
If you haven’t made the leap to a presence on the internet, now’s
the time. Peruse your competition’s websites and discern what you
like and dislike. Beware of discounted graphic and web design
services – a well-designed website promotes your brand identity,
saying your business is classy and fresh, not cut-rate and shoddy.
If photography is used, make sure it is sharp, professional and
shows your atmosphere and food in the best light.
Internet-based reservation services like opentable.com are
becoming increasingly popular, and also provide detailed information and links to individual websites, plus incentive reward points
for the using the service.
Tech-driven ordering services continue to grow significantly,
mainly due to convenient, innovative tools. Earlier this year the
nation’s third largest pizza operator, Papa John’s, announced that
on-line ordering since its inception seven years ago has topped $1
billion, and is growing 50% annually. For some of its stores, on-line
orders make up to half of all sales. Domino’s even allows customers
to track their order on-line, from oven to delivery status. The latest
technology allows customers to place orders easily from Web-
e
m
e
rkeover:
urant Edition!
enabled mobile devices like Blackberries and text messaging
from cell phones.
Customers can order up to a month in advance and repeat
their most recent orders with just a click. Delis, burger joints,
and even full service venues are joining the trend by using thirdparty internet host services like gomobo.com and ordertalk.com
that are paid through transaction fees and a monthly retainer.
Online orders are sent directly to the kitchen, with no need for
employee handling, savings loads of time. Many outlets are finding
that per ticket, online orders are significantly higher than phone
orders because customers can take time to review the menu and
don’t worry if an employee will get a complicated order right.
Green Makeover
Green is here to stay. You can join the party now or later. You
can focus on altruistic motives like lowering your carbon footprint,
or economic reasons like lower energy bills. Start with the easiest
and most cost-efficient changes. Low-voltage and low-heat lighting, biodegradable plates, cups, cutlery and takeout containers,
low-flow rinse nozzles and toilets. Recycling, waste reduction and
energy efficiency practices. Menus and napkins made from 100%
recycled paper. Occupancy sensors in restrooms, offices and store
rooms. Purchasing wind energy offsets. Build up to energy saving
appliances, driving hybrid delivery vehicles and furniture made
from reclaimed wood. Consider eco-friendly design innovations in
flooring, trim, furniture, window treatments and paint made from
renewal sources or free of toxic materials. A mechanical-electricalplumbing engineering firm specializing in restaurants is worth
consulting for major overhauls of kitchen equipment and will often
pay for itself in reduced energy bills and tax credits. The cost of an
array of roof-top solar panels for hot water or electricity generation can often be largely offset by federal and state tax credits and
utility rebates.
For more information, go to the Green Restaurant Association’s
website at dinegreen.com or the NRA’s new green initiative at
conserve.restaurant.org. For eco-friendly upgrades and construction, confer with the U.S. Green Building Council regarding its
Leadership in Energy and Environmental Design certification at
usgbc.org.
Marketing Makeover
Tired of the same stale marketing strategies? Brainstorm with your
staff – who knows your customers better than they do? Offer $100
incentives for the most creative ideas… a Mom’s Club Koffee
Klatch with snacks for toddlers to pick-up those slow mid-morning
hours… a Hound Happy Hour on the deck, featuring complimentary dog treats and water bowls… a tea tasting to introduce trendy
new flavors. Look for free ways to publicize such events, like press
releases to local arts & entertainment publications. If you’ve just
completed an interior, exterior, green, concept or menu makeover,
consider an “open house” event to introduce it to your customers
and media. Tie your marketing message to current events - if you
have managed to avoid hiking menu prices, be sure to tout “same
great deal for over six years!” Fort Lauderdale-based Pizza
Fusion promotes its eco-friendly emphasis with the tag line,
“Saving the earth, one pizza at a time”. They market the message
further by offering a Kids Organic class one Saturday a month,
where kids make their own organic pizza and tour the fleet of
hybrid delivery cars. Consumers love freebies, especially in a poor
economy; scores of big chains have been offering free samples of
ice cream, coffee, desserts, appetizers as a way of reaching new
customers. They are often paired with charity events. Independents
have also been successful using electronic email marketing through
their own databases or using a third-party service such as Fishbowl
(at fishbowl.com) and Emma (myemma.com) which can promote
seasonal dishes, offer discount incentives and make special offers
for customers’ birthdays, anniversaries, etc. Additionally these
services can capture loads of data regarding customer behavior,
ordering, visitation, etc.
Moniker Makeover
The conclusion of your makeover may mean it’s time for a name
change. Fresh look, fresh name. Consider one that plays off the
old name, so customers are intrigued but comforted. “Nancy’s”
might become “Nancy’s Cafe”. “Jack’s Wayside Diner” might
become “The Wayside Grill”. It may be helpful for a while to
include phrasing like “formerly loved as Jack’s Wayside Diner”,
or “same management, same great food” on advertising and menus.
No matter what type of makeover you are pursuing, keep these
guidelines in mind:
• Planning & Research – Use your network of industry
colleagues, local restaurant association and chamber of commerce to check out others who have done something similar.
State your goals for the project along with detailed timelines
and assignment of responsibility to various key players.
Schedule the project for your slower months.
• Budget & Financing – A detailed budget is a must, with room
built in for problems and changes – both in time and dollars.
But also be wary of expending too much that won’t be recouped
in increased sales, future cost savings or in the future sale of
your business.
• Minimizing the Mess – If your makeover or remodel is intrusive to guests in anyway (a parking lot detour, an incomplete
website), be sure to apologize, ask for patience, and consider
an incentive. Keep staff well informed.
• Finish Up – Resolve to complete all final straggling details
while you still have momentum.
winter 2008
5
marketing
Source: NRN, Marketing Matters Newsletter, February 2008
I
f restaurateurs are wondering
whether there is growth in
nontraditional venues, they
should take a glimpse at Subway,
because the sandwich giant can be
found everywhere — from athletic
facilities to truck stops to the True
Bethel Church in Buffalo, N.Y.
“People have been clever,”
noted Elizabeth Rolfe, director of
new business development for the
Milford, Conn.-based company
whose units are100-percent
franchise-owned. “I love it that
people have looked and [they] saw
where there was an opportunity
where people were there and saw
[that] this could work.”
Nontraditional locations,
which include everything from
hospitals to department stores to
bus and train stations, offer new
opportunities to restaurant players
across the spectrum, restaurateurs
said. First and foremost, these
unique venues help to expand a restaurant’s brand. In
addition, because of the extreme amount of foot traffic at these
busy locations, such as airports, the venues often pull in a
company’s best per-unit sales figures.
Nontraditional “has become more and more of our focus
because of the active lifestyle of folks,” Prasifka said. “In
the foodservice industry, they always say location, location,
location. There is such an opportunity… to place our brands
in nontraditional venues, like airports, train stations, sporting
arenas, etc.”
Nontraditional locations not only can be extremely lucrative
on the revenue side, but also they often cost less to open
because the menu and footprint are smaller. While a traditional
location can cost upwards of $150,000 to build, Prasifka said,
starting up a nontraditional unit can range from $30,000 to
$150,000.
Brand Power
While the nontraditional restaurant concept is not new,
there is more of a demand for known brands in these locations
today, some industry experts said.
“If [foodservice operators] can put a brand in there, they
can use it as a drawing card to bring other people in there,”
said Subway’s Rolfe.
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Winter 2008
Added Prasifka: “Consumers
typically gravitate toward
quality brands because of the
consistency they get.”
The preference for different
restaurant brands has changed
over time, said Mike Brandon,
director of brand development
for Compass Group, The
Americas. Companies such
as Compass PLC, a major
international food and support
services company, and
HMSHost Corp. frequently
control the foodservice
operations at such nontraditional
venues as airports and stadiums.
An Adjustment
While venturing into
nontraditional locations can be
profitable, it is not as easy as it
initially may sound.
Restaurants frequently have
to modify the menu offerings to
make the concept work at a smaller site. The key to success is
maximizing every inch of space.
“You can’t think it’s going to work anywhere,” Hill said.
Cinnabon, which has 350 franchised locations in North
America, including 90 nontraditional venues, has learned some
hard lessons about nontraditional locations, Hill said. For
example, the chain has found that sales are lower on college
campuses compared with airports because of the lack of new
consumers. Bakeries, unlike restaurants, typically do not lure
people back every day, according to Hill.
“We need a great deal of foot traffic, but it has to be
new foot traffic,” he said. “It’s got to be new people coming
through.”
The company is working on initiatives to help increase
business at colleges, he said. It also is relaunching its “mini
indulgences” line of pastries to cater to those consumers that
might want smaller bite-sized treats, Hill added.
Going forward, Focus Brands Inc., which owns Cinnabon,
also hopes to piggyback Cinnabon onto other brands, like
Schlotzsky’s and Moe’s Southwest Grill, on college campuses.
The importance of maintaining brand identity in a smaller
nontraditional space cannot be overstated, he said.
“You have to maximize square inches, not square feet, but
you don’t want to lose your brand identity,” Hill said.
health
Source: NRN, Beverage Trends Newsletter, April 2008
Bottled Water
Top 10 Beverages by Number
of Incremental Servings
Remains Big with
Health-Conscious Guests
W
hile environmental concerns, the slowing economy
and bad press all have taken a toll on bottled-water
servings at restaurants, the well of opportunity for the highprofit product is not dry, according to the NPD Group.
“While the growth has slowed for bottled water, it’s still
very important to [consumers],” Riggs said.
NPD, a Port Washington, N.Y.-based research firm,
reported that until last year bottled water had been flowing
like, well, water, at restaurants since 2003. But in 2007 growth
in bottled-water servings slowed significantly, dipping from
double- to single-digit increases. Last summer, growth in
bottled-water servings turned negative for the first time ever.
Riggs attributes slowed growth in bottled-water servings to
concerns about waste and the energy-related costs of shipping
imported water, a growing belief that bottled water is no better
than tap water, proposed tax increases on the product, and
growing cost-consciousness among consumers.
Yet despite trickling growth, last year bottled water
still ranked as one of the top three beverages in terms of
incremental-servings growth. In the year ended December
2007, there were 134 million more servings of bottled water
than in 2006, a 5-percent increase. Only iced tea and specialty
coffee performed better.
The slowed but continuing growth of bottled water is tied
to more points of distribution, including more chain operators
adding it to their menus, experts said. Quick service, which
accounts for more than 80 percent of the bottled-water market
in commercial foodservice, is driving the growth. In the year
ended December 2007, there were roughly 2.2 billion servings
of bottled water at quick-service operations, up 6 percent
from 2006.
While other segments account for just a fraction of the
bottled-water market, some innovative table-service operators
are trying to tap the revenue stream by offering “housebottled” waters. For example, at Grace in Los Angeles and
BLD in New York chef-restaurateur Neal Fraser has been
serving tap water that that has been filtered through a complex
reverse-osmosis system. For customers who prefer sparkling
1
2
3
4
5
Iced Tea
6
Specialty Coffee
7
Bottled Water
8
Frozen Slushy Soft Drink
9
Smoothies
10
Hot Chocolate
Hot Tea
Traditional Coffee
Juice
Alcoholic Beverages
Source: The NPD Group, year ended Dec. 2007
water, the restaurant also has the ability to add carbonation.
Industry experts anticipate that servings of bottled water
will continue to grow in all restaurant segments.
Though all types of consumers drink bottled water,
consumption of the beverage is closely tied to consumers who
want “healthy” beverages, NPD found. Consumers who went
to a restaurant for a “healthy” occasion drank more bottled
water than those who were not motivated by health.
The time of day when bottled water is purchased hints
at consumers’ desire to have convenient beverages on hand,
NPD found.
“[Many consumers are] purchasing two beverages a lot
of times… getting coffee and grabbing a bottle of water for
sometime later in the day,” Riggs said. “That’s something
operators could market to.”
Consumers also want more variety in bottled water, NPD
found. Since multiple flavor and container options helped
drive iced-tea sales in 2007, operators should consider taking
a similar approach to bottled water, Riggs said.
Offering new bottle sizes and environmentally friendly
packaging could help to boost sales, NPD found. A few years
ago several major quick-service chains that switched from mini
cardboard milk cartons to single-serve, resealable plastic milk
jugs saw sales of the beverage skyrocket.
While beverages such as bottled water can be good revenue
generators, they have to be watched closely as they may be
products that consumers cut back on when their wallets
really get squeezed, Riggs said.
“Operators may need to re-think pricing strategy when
it comes to bottled water,” she said. “Why pay $2 from a
restaurant when [you] can buy a case from retail for $4?”
At the same time operators should be wary of over-thinking
their approach to bottled water, said Bill Marvin, a foodservice
consultant known as the “Restaurant Doctor.”
“Anything you do ought to have a story behind it… where
it came from, characteristics,” Marvin said of how to best
market bottled water. “You want things [on your menu]
with talking power.”
winter 2008
7
trends
Source: Nation’s Restaurant News, June 2007
Growing TheaterRestaurant Hybrids
Target Dinner-anda-Movie Dollars:
W
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hile recruiting more chain restaurant executives into
their operations, high-profile cineplexes are taking a
larger slice of the dinner-and-a-movie entertainment dollar by
offering first-run films and casual-dining amenities that include
in-seat meal service.
“We think it’s the future of the movie business,” said Jeffrey
P. Benson, president and chief executive of the nine-unit
Movie Tavern Partners LP, based in Dallas. “For as long as
there have been movies, people have talked about dinner and
a movie.” Similar developments have been growing elsewhere
nationwide.
Regal Entertainment Group of Knoxville, Tenn., operator
of the Regal, United Artist and Edwards movie theater chains,
has formed a joint venture with Texas entrepreneur Terrell
Braly to open cinema-restaurant Cinebarres, starting in
Asheville, N.C.
Cobb Theatres of Birmingham, Ala., and Taubman
Centers Inc. have partnered to create the theater chain’s
first “boutique” dining-theater venue, at the Dolphin Mall
in Miami. The 20,000-square-foot cineplex has five digital
screens and offers assigned luxury seating as well as a tapasstyle in-theater menu, with wine and cocktails, for dining
before or after screenings. Each of the five theaters has 75
to 125 seats instead of the typical 200 to 300, and will be
restricted to patrons over age 21. The leather seats, each with
a handmade wood table-armrest that folds up for “sofa-like”
comfort, are to be arranged stadium style but will offer six
feet between rows rather than the traditional 48 inches.
Brian Schultz, founder, co-owner and president of Studio
Movie Grill, which has four units in the Dallas area and one
in Houston, said food quality has improved at such theaters.
“In the past it was frozen food, draft beer and chips,”
Schultz said. “It was low-end, low-quality. Now we’ll
serve 1,500 made-to-order fresh meals in a one-and-a-halfhour period.”
Several factors have led to the recent boom in cinemaeateries.
“In the late ‘90s, movie studios started going with these
ultrawide releases,” Benson explained. “From a studio
perspective, it’s about selling tickets and putting butts in seats.
8
Winter 2008
That’s how they make their money.
A cinema grill has about half the seats of a typical
movie theater, so we were not that popular with the studios.”
But with movie fans’ growing appetite for theaterrestaurant hybrids, such operations are getting first-run
movies, which have spurred the market for more such
developments.
Shopping-center developers are seeking the cinema-eateries
because of their older audience demographic and the theaters’
ability to fit into smaller spaces with fewer seats per square
foot, which affects the amount of parking slots needed in such
developments.
Operationally, a cinema-eatery poses special challenges.
“It has intricacies well beyond a regular theater,” Benson
said. “you are serving 1,000 to 1,500 in the dark. Everybody
shows up at once. Theater chains don’t know how to run
restaurants. They recognize the fact that they are good at
serving popcorn and soda pop, but [not] at serving food.”
Technology and service systems have been honed over
the past three years, including three-minute turn-around on
responding to patrons’ service calls.
“I have a call button between every two chairs in the
theater,” Benson said. “Anyone can hit the call button and take
care of problems and orders. It’s like paging a flight attendant
on an airplane. The technology is helping us to be able to
service all these patrons in the dark on a Friday night.”
Servers place all orders through hand-held devices that
include credit card swipers.
“It’s very much a casual-dining-type menu,” Benson said.
“There are 63 items plus desserts, including steaks, pasta, egg
rolls and pizzas. It’s a very much a down-the middle, casualdining menu.”
Top sellers are chicken fingers, burgers and pizzas, he said.
However, “your labor costs are extremely high,” Benson
added, explaining that conventional snack bars in theaters
typically have per-transaction labor costs of only 75 cents.
“You do make it up on the food side,” Benson said,
indicating that Movie Taverns’ meal tabs generally run about
$10 to $15 per person.
Customers wanting to save time are driving much of the
popularity of the cinema-eateries, he explained.
For a movie that is two hours and 45 minutes long,” Benson
said. “If you wait at a restaurant, eat and then race to a theater,
you could easily spend six hours.”
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