Restaurants and Institutions

Thanks for the all the comments.  I wanted to make a couple of clarifications. I am not in favor of underpaying any of our employees. All of them should be making a fair wage and being treated with respect.  If you are not doing that, your labor (and service) issues are, or will be, larger and more difficult.

My bigger concerns with the Employee Free Choice Act (or Card Check) are not about wages, but about other issues, such as:

An increase in payroll costs without a corresponding increase in productivity. 

In fact, contracted work rules may decrease productivity.  Imagine the possibility of a kitchen that has to be staffed with the same number of employees on a slow Monday night as it is on a busy Saturday night. (Related to this is the likely reduction in total industry employment if labor costs rise more than productivity ...Read More

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Many of you know about the proposed "card check" legislation.  The bill, known as The Employee Free Choice Act, is anything but that.

In an effort to boost lagging union membership, organizers are going after foodservice. They are asking foodservice employees to contemplate why they do not make as much an hour as their co-workers in manufacturing.  The argument is that foodservice workers work as hard as people in manufacturing jobs, so why aren't they paid the same? 

Now, just think about the impact on your business if your average hourly wage rate was somewhere in excess of $18 per hour. Frightening enough?

If passed, this bill will allow Union representation in your restaurant if they can get a mere 50% of your worker...Read More

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There are two win-wins that seem to be foremost in my thoughts right now. 

The first is that my blog, as you can see, is now on R&I’s site.  I am looking forward to a long and enjoyable relationship with them as well as reaching more of the industry.

The second win-win, could--actually should--involve you and your restaurant(s). 

This second win-win is the Great American Dine Out this September 21st to 28th.

As an industry, we are supporting “Share our Strength,” a charitable organization that desires that no child in the U.S. go hungry. You can contribute a small percenta...Read More

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About a year ago, T.G.I. Friday's took a bold step and introduced a new menu line of smaller portions at a lower price. It was not without risk, including franchisee reaction, and the potential of lower check averages (which does not appear to have happened).

Kudos to them for taking the calculated risk, and they should enjoy the "first birthday" of the program. They "celebrated" by announcing it was becoming a permanent part of their menu.

In the last few decades, portion sizes increased as a way to show value. For a long while the formula worked; add another 50¢ worth of food, add $1.00 to the check and consumers' value scores and penny profit margins both increased.

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A few weeks ago, when the American's fleet was grounded, I got a mini lesson on the woes of the airline industry. I was in Orlando when their flights got cancelled. According to AA, the "grounding" was due to governmental compliance, and not a safety issue.  I bought a United ticket for another flight, with a transfer through Dulles, where, after boarding the regional jet and pushing back from the gate, we had not one, but two(!) mechanical delays. We sat for about 2.5 hours. Finally, that evening, I landed at Columbus airport, to observe the bankrupted Skybus fleet.

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During the past two weeks I had the opportunity to tour New Zealand's south island.   It was more than their famous beauty of their landscapes that exceeded my expectations.

On our second day there, we spent the night in a small town called Twizel.  Our Innkeeper host suggested a local restaurant called P...Read More

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A week or so ago, as I was sitting at the food court in the local airport, a brand new pizza outlet opened.  As the large sheet of plastic that covered the entire front of the new unit was pulled away, it was reminiscent of a theater curtain going up at the start of a play.  Behind the counter was the new crew. 

I walked over to be Customer Number One.   

The pizza was fine, but what really struck me was the amazing attitude of the crew— from the senior manager, to each and every crew member. They were so engaged, energetic and enthusiastic. 

Now, I know it had a lot to do with the excitement of the opening.  But is there any way that attitude and enthusiasm can be sustained?   Maybe that is the REAL challenge of our industry.

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Most of us have already heard about the beef recall at Hallmark/Westland Meat Packing.  As it relates to any potential medical issues, if there are any, the damage is already done. However, there is another potential wave of damages that may come from how much the media sensationalizes the story.  And there are certainly opportunities to do so if the media wants to take that route.

Over the years, I have done a fair amount of litigation support work identifying how adverse publicity on issues like this impact restaurant brands.  The more the media writes about the issue, the more and longer lasting the financial damage.  I hope hype does not take center stage.

So far, the consumer has retained faith in the U.S. food chain, but with each new incident, there is erosion of that faith.  Over time, if these types of issues continue, consumers ...Read More

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NIMBY is an all too familiar acronym for Not In My Back Yard.  Or more loosely translated, don't build it near me.

From my viewpoint, it seems that the restaurant industry has somehow become a focal point for local politicians.  Here are just a few examples:

• the L.A. ban on new QSR developments in a section of the city – to help fight obesity
• The proposed legislation in Mississippi to make it illegal for restaurants to sell food to people that are obese, and the most recent,
• Palm Beach has just passed legislation to prohibit the development of any "formula restaurants," which could be as little as a "chain" of only 3 units.

Avoiding, for the moment, the wisdom of these programs and the difficulty with clear definitions. I wonder how we, as an industry can get out of the penalty box be...Read More

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