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Morning Briefing for pub, restaurant and food wervice operators

Fri 13th Dec 2019 - Friday Opinion
Subjects: Home cooking, the smart way to drive January footfall, and keeping it safe 
Authors: Glynn Davis, Sally Whelan and Malcolm Muir

Home cooking by Glynn Davis

Years ago I commissioned an artist to paint a portrait of me standing outside four of my favourite London pubs beside the people closest to me in my life. It seemed a good idea to create artwork for the walls of our new family home recording enjoyable times in a more personal format than framed photos and posters.

For those who like details, the pubs were The Guinea Grill in Mayfair (with my mother), The Jerusalem Tavern in Clerkenwell (with my wife), the Grave Maurice in Whitechapel (with my father), and The Nags Head in Knightsbridge (with the best man at my wedding). 

More recently I commissioned a local artist, who was doing a strip for the Beano and now contributes cartoons to Private Eye among other things, to draw the outside of my house. 

Many years before these artistic forays my parents had employed a local caterer to cook a lunch at home for family and friends as part of my 18th birthday celebrations. While we lounged around drinking (modest amounts), the chef and her assistant cooked a superb three-course meal and washed up before taking a bow and promptly leaving. I recall how enjoyable and effortless (for my mother) it all was.

What links these two seemingly unrelatable things is they are both perceived as costing an arm and a leg – but the reality couldn’t be further from the truth. Starting with the artist, he was pleased to have a series of pieces to work on to supplement income he received from part-time teaching and illustrating children’s books. Being an artist is tough financially and many take on commissions for a modest fee.

It’s a similar story when employing chefs. This isn’t simply the domain of private chefs catering for billionaires on yachts or actors and musicians on tour. In reality there are many great chefs and home cooks who would be more than willing and able to cook one-off meals in people’s homes for an acceptable fee.

Therefore I was interested to hear about the relaunch of EHO Chef, the online dining platform that links chefs with those looking to have a meal cooked in their own home. After stipulating the number of guests, budget per head, cuisine, and number of courses, the online algorithm displays the profiles of relevant chefs nearby. There are 700 chefs on the site, with about 200 active at any one time.

According to entrepreneur Tetsuro Hama, who set up EHO Chef and also runs Japanese restaurant So in Soho, the average spend per head is £40, which is certainly not immaterial but he points out food only typically accounts for 30% of the total cost of a meal in a restaurant and thereby suggests a significantly higher proportion of the EHO charge is going on the ingredients and the chef’s time rather than rent and rates.

From a customer perspective another upside is their meals don’t require travel time and associated costs, including babysitting, while all the alcohol can come from the diner’s own fridge and wine rack without restaurant mark-ups. 

In these troubled times such a platform could be seen as taking yet more share out of the restaurant industry and, while it undoubtedly adds another disruptive element into the mix, it might ultimately have more of a detrimental impact on the food delivery market. For those restaurants that struggle with quiet times, such platforms could also provide an additional revenue stream. 

While I no longer have wall space for artwork in my home, I’ve got plenty around my dining table for some decent chef-cooked meals.
Glynn Davis is a leading commentator on retail trends

The smart way to drive January footfall by Sally Whelan

January is a unique month in the industry with specific challenges but, equally, great opportunities. Hands up who has time at the moment to develop strategies to counter the “hangover” month and keep customers coming back following their festive indulgences? Some clever marketing has given operators campaigns to hang their hats on, including Veganuary, Dry January and Try January, and there are always the fail-safe discounts or meal deals customers have come to expect. However, there’s an art – and data-driven science – to maximising those opportunities to improve loyalty with existing customers and create relationships with new fans.

Our recent research revealed 30% is the magic “discount” number to drive diners through the doors in January. However, that discount must be presented in the right way and through the most appropriate channels or it could devalue your brand by attracting the wrong type of customer (who is only seeking a bargain and wouldn’t normally engage with your brand) or alienate guests because you have failed to educate team members on the purpose and potential of discounts.

Regarding the latter point, a colleague told me she signed up for a discount voucher for herself and a friend at a spa. The deal through Groupon included lunch but they were treated like second-class citizens, receiving the cold shoulder and being relegated to the darkest corner of the room. She was using the discount to trial the venue but, after that experience, will never return. If the spa operator had the foresight to speak to team members about embracing customers using discounts with a view to beginning or continuing a relationship that would benefit the business, my colleague would probably be a regular customer by now. A discount or meal deal can often be the hook that gets people through the door – but you should think about what your team can do and communicate during their experience to encourage return visits.   

In our research, more than two-thirds (68%) of diners said they would return in January to a pub or restaurant they visited in December if it was a “good experience”. Make the most of the increase in footfall now and provide vouchers for January to encourage return visits. Make sure you train and motivate your teams to understand and communicate the discount details and gauge which camp their January guests are in – healthy, Veganuary, Try or Dry – so they can make relevant recommendations.

Customers can help you test new healthy and vegan menu options – almost half of diners seek healthier options at the beginning of the year – and provide feedback so they feel they’ve contributed and are part of your brand. Encourage them to sign up to the newsletter to see if their favourite dish becomes a regular on the menu and, while you’re at it, tell them about the free glass of prosecco they get for their anniversary or birthday if they join and book for the occasion. Alternatively, introduce some of the fantastic non-alcoholic or low-alcohol options in a “dry” or “dry-ish” tasting experience.

Ideally, January should be the continuation of a broader strategy to gather data and insights on your customers so you know what menu items they like, what dietary restrictions or preferences they may have and when they plan to celebrate birthdays or anniversaries. This can help inform a personalised marketing approach that will target the right consumer at the right time through the best channel and with the right message. Knowing and understanding your customer, communicating effectively, and creating great food and drink experiences will help you build those mutually beneficial relationships that grow your brand.
Sally Whelan is founding director of guest experience management expert HGEM

Keeping it safe by Malcolm Muir

According to YouGov statistics hospitality staff turnover is at a record 30%, double the UK average, which creates greater risk of teams being inadequately staffed and trained when handling takings or falling prey to fraud and theft. Couple that with the fact restaurants, bars and cafes rely on cash takings and the risk of loss on the shop floor becomes considerable. So why doesn’t anyone in the sector want to talk about it? 

It’s not a case of if but when a hospitality business will incur financial loss due to error or theft. At Venners we’ve completed thousands of observation audits that note the details of about 100 rounds of drink sales on each occasion. Losses occurred in every single hospitality site. The losses were due to a number of factors, including mistakes, poor revenue capture and theft. Indeed, during the past 12 months we’ve already observed more than 10,000 drink transactions. Our findings uncovered significant revenue loss, with almost two-fifths (39%) attributable to theft and almost half (46%) caused by human error.

The most frequent type of loss is down to general fraud, which can include food and drink consumed by on-duty staff. Many operators rightly allow teams to help themselves during a shift but too often the amounts aren’t specified. Similarly, drinks and staff discounts can be easily passed to friends and family. Customer promotions can also be more of a hindrance than a help as they frequently cause server error and lead to lost profits. If operators don’t adequately explain offers to staff, the misuse of promotions can see the exercise backfire on the till.

Who’s most at risk?
Wherever opportunities arise through flaws in procedure, theft is swift to follow. For example, nightclubs provide an environment ripe for theft and error due to the fast-paced environment, lively guests and dark corners. Surprisingly, the hotel lounge service is just as susceptible. We found table service provided in lounges often means staff ring in orders away from guests and prying eyes.
What can operators do?
Here are ten simple steps to minimise risks:

Training is paramount to avoid server error: This should also apply when someone takes leave of absence. A thorough handover should be undertaken to ensure nothing is missed.

Don’t rely on receipts: Simply asking staff to ensure receipts are produced doesn’t always stop theft. Some staff members don’t always print receipts and not every customer wants a piece of paper every time they’re served.

Make the till visible to customers: This is an easy check to make. We’ve seen many instances of fraud occurring when a till display is broken, turned away from the customer or obscured by menus.
Talk among yourselves: Talking to fellow operators might reveal someone or a company that’s a serial fraudster.

Managers must talk to teams: Staff need to be made aware when poor results occur and understand theft affects the whole business.
Accurate records are important: Every till action, payment and shortage should be recorded.
Check procedures regularly: Operators should carry out site visits at odd times. There can be large losses on Sunday afternoons when there’s a lack of on-site management and higher numbers of off-duty staff, resulting in families taking advantage of discounts.

Spot-checks: On the supplier side, operators should conduct random spot-checks to scrutinise deliveries more closely. Staff will always say they check each delivery on arrival but, in practice, this isn’t always the case.

Keep staff happy and motivated: Build loyalty and trust that, in turn, could reduce theft and increase the likelihood a whistle-blower will call time on fraudulent activity.

Consider a regular external audit: Using an outsider removes the tendency for internal reviewers to presume “he would never do that” or “she always checks that”. Presumptions can be wrong. It’s impossible to know every staff member’s personal circumstances and pressures can cause people to act out of character.
What happens next?
If an operator suspects they’ve been a victim of staff fraud or mistakes they can use their business data to check for suspicious activity. See who has the most “no sale” records and provide extra training. Operators might also consider changing shift patterns or reassigning tasks to highlight anomalies.
Malcolm Muir is consultancy director at Venners

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