Non-chain restaurants are often family affairs and frequently – even with the best food – are the least profitable, poorest run category of business in the U.S. Why should you care? The strategic profitability of a restaurant can be a key indicator of the quality of the dining experience, not just the success of ownership. As a consumer, if you look for these ideas in action, you will find your favorite spots without much effort.
What to Look For (restaurant owners are you listening?)
Does the restaurant/bar have a beverage specialty: craft cocktails, fine whiskies, different styles of beer, quality/value wine list? If you don’t enjoy alcoholic beverages, you can stop reading now. If you do, stick with me here…
If beverage sales is not at least 1/3 of a sit-down restaurant’s sales, you can bet they won’t be in business long. In training for restaurant financial management, 50% of revenue is the recommendation. If there is one thing I am sure of, the best loyalty builder is a successful beverage program. Where I see the serious consumer passion coming from is – their preferred beverage category: whisky, wine, beer, and/or craft cocktails. Yes, the investment can be sizable, but can a restaurant afford not to?
A Successful Beverage Program
It is irrelevant which category(ies) are chosen, the clientele will eventually find the restaurant, with a minimum of invested marketing dollars.
Training, Training, Training… employees who find their passion in the category should be identified and have them lead staff. ALL servers should be trained to have some familiarity with the beverage specialty of the house. Encourage passionate clients with knowledge of the category and have staff funnel them back to the lead. Inventory choices have to be smart for this category of clientele. Find both brands/labels popularly known AND uncommon brands consumers can explore. Inventory should be strategic, with a good/better/best approach and there should be at least a few value items in each quality category. Local alcohol distribution laws should be investigated and multiple sources should be used, if possible: winery/brewery direct, distributor, auctions, overstock re-sellers and local producers. Each state usually has more than one type of alcohol resale license. Most – except the 100% liquor license (bar) – are more reasonable in cost. Licensing options may open purchasing to more channels, provide more buying power and selection. Unfortunately in my state for example, by law, restaurants & bars have very few choices.
Take a minute to look for these services and specialty inventories. Ask about their availability. Notice the difference, when you find it. Praise the positive and provide constructive feedback on the negative. It is in your best interest. In some ways, your involvement can be a key to the success of your favorite spot. AND… most importantly, vote with your dollars. Try to limit your entertainment budget to the businesses that provide this kind of experience. My wife and I do.
Main course food is a very low-profit sales category for sit-down restaurants. Without volume, focusing on this is not a winning business model. As a consumer, who wants to join the herd? From the food category – starters, appetizers, sides and desserts can drive profits AND seriously enrich the customer food experience. Look for super yummy looking and creative menu items here. It is evidence of a well-run restaurant, a smart chef and the beginning of a great dining experience. A chef has much more lee-way to be really creative with these items, without breaking the bank on cost and can add experimental flavors that might not be acceptable to a portion of their clientele. On the staff side, owners need to find foodies for servers and have the chef train them to recommend flavors and pairings, not just dishes. Servers need to upsell the appetizers, sides and desserts. If you have ever had a server suggest specific menu items due to the flavors… it can really add to the dining experience, especially if you enjoy pairing food flavors with beverages.