Synergy was quoted for this recent article published in the OC Business Journal.

 

Read the entire article here

Greetings!

This month, our hearts and prayers go out to the people of Japan and the trials they are continuing to endure. It’s hard not to imagine the devastation that would ensue if a catastrophe like that happened here on our shores.

As the industry has shown so many times before—most recently in the wake of 9/11 and Hurricane Katrina—restaurants can play a major role in bringing people together, helping to feed disaster workers and raise money.

Read below for more information, and remember that at the end of the day all we really have is our family, friends and community to help us.

To your success,

Dean and Danny

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The Rising Cost of Food and What to Do About It

By Jim Campbell

Most restaurateurs are very aware of the cost increases for key food commodities over the past nine months and are reminded of it with every delivery received at the back door.  As demand is clearly exceeding supply, unprecedented price increases for seafood, meat, poultry, grains, coffee, etc., are driving food inflation.

Seafood prices are being driven by the following:

• Conservation efforts
• Poor weather
• Ecological issues
• Economic recoveries, especially in Asia
• Farming issues, including rising feed prices and disease in the Chilean salmon industry

Beef and pork have seen rapid increases since mid-2010 which have been ignited by the volatile grain markets but primarily the corn market.  The historic highs seen for live cattle futures on March 11, 2011, is a reminder that this market borders on being out of control. While the poor corn harvest acted as the catalyst, there is no shortage of additional contributing factors:

• Lowest U.S. cattle inventories in half a century
• Sharp increases in foreign demand for U.S. pork and beef spurred by recovering economic conditions in Asia• Improving domestic economy
• Increased federal mandatory corn allocation to ethanol production
• Market speculation
• Political change and unrest in the Middle East, driving oil and gas prices

As the severity of the devastation from the 9.0 earthquake off the coast of Japan evolves, it will likely play a significant role in U.S. exports to Japan—one of the largest importers of both beef and pork and an important trading partner in general.  While the Japanese economy will take a large hit initially there will be significant economic activity required to restore Japan’s infrastructure and economy.  What exactly will happen and when will evolve over time, but the priority now is for the Japanese people to deal with the humanitarian issues facing them daily.

According to Len Steiner of Steiner Consulting Group in Manchester NH, the balance of 2011 will offer more of the same in terms of higher meat prices especially for pork and beef.  Steiner estimates prices increases for 2011 to be:

• 20% for live cattle
• 25% for hogs
• 10% for whole bird turkeys
• 3% for chicken/broilers

Steiner feels these markets may take some time to stabilize.  For example, he does not see significant rebuilding of the U.S. cattle herd to begin any sooner than 2012.  While the markets will be unable to sustain peak prices it is unlikely that we will return to pre-2008 price levels for beef and pork.

The market news for commodity foods is certainly not favorable or encouraging, but there are strategies and responses available to restaurateurs to limit the impact and neutralize in part the effects of these impending price increases.

• Menu price increases are always a part of the response to food inflation, but restaurateurs must remember they walk a fine line with their guests—ask any restaurateur how menu price increases impact customer traffic.
• There should be an ongoing relationship with your key suppliers.  Make a clear effort to develop a healthy business partnership.  You and your suppliers do have many common interests.
• Challenge all price increases from your suppliers.
• Remember and remind suppliers that commodity/raw ingredient cost increases in grains, livestock, coffee beans, etc., can make up as little as 20-35% of the final cost of the baked bread, steak, or ground coffee served in your restaurant.  Don’t allow market price increases to increase the margins of your suppliers.
• If you are in a position to negotiate fixed price agreements you should explore this option.
• If your operation is unable to enter into direct food contracts, speak to your suppliers and ask them to cover you under their agreements.  This can and should be a benefit of developing a strong business partnership.
• Monitor freight charges.
• Speak to your distributor and review your delivery frequency to see if you can reduce one delivery per week.
• Adjust portion sizes by reducing protein and increasing vegetables and grains where possible.
• Chicken will be far less impacted by cost increases compared to other meat and poultry products, so expand menu placement of it.
• Explore alternative beef and pork cuts.
• Revisit cost-control measures such as receiving practices, net weights, conservation and recycling measures, audit invoices, etc.
• Tap into your human resources and energize your employees by forming a “Kitchen” or “Culinary” task force.  Business owners and employees do have many common interests, and success is clearly one of them.

Restaurants that have a heavy focus on pork, beef, and seafood will be most affected by recent and projected food inflation.  There is, however, no escape: All restaurant types will feel the impact of food inflation to some degree over the balance of 2011.  The restaurant industry is just beginning to emerge from the worst recession in 70 years and now is faced with the most volatile, rapid,  and severe food inflation ever.  But the industry battled and survived the worst of the recession and most will find ways to remain profitable and survive the “food inflationary wars” of 2011.

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More Hot Concepts to Watch

By Joan Lang

Last month when we released our 2011 guide of what’s hot in the quick casual market, we promised a follow-up on some next-wave concepts that have attracted our attention—either because of proven success, an engaging idea or even a promising relaunch of an established or older company—but didn’t make it into the first round. We’ll also look at other new concepts in future issues of this newsletter.

If you want to see the original report, go to our Facebook page and “like” us.

Blue Bottle Coffee Co.

Year Founded: 2002

Number of Units: 7

http://www.bluebottlecoffee.net

 

Starting with a pushcart location dispensing espresso at the Berkeley Farmers’ Market, Blue Bottle Coffee has grown to become a powerhouse brand in the realm of organic coffee micro-roasters, specializing in superpremium-quality single-origin and espresso and brewed coffee blends, as well as proprietary house blends for such restaurants as Chez Panisse. A new production facility, opened in 2009, houses a coffee bar, roaster, cupping room and kitchen, which produces coffee-friendly baked goods and other “treats.” Known for selling beans within 48 hours of roasting and making each cup of coffee by hand, Blue Bottle is also ramping up its food menu with such interesting, market-specific offerings as Biscotti Pizzetta and Popeyes (grilled bread with a fried egg in the middle). The company is branching out in New York City soon, which should strengthen its position even more.

Cafe Mezze Grill

Year Founded: 2006

Number of Units: 3

http://www.cavagrill.com

Cava’s mix-and-match Mediterranean menu is superbly on-trend: fresh, healthy, flavorful and totally customizable, and a quick-casual variant of a full-service Greek restaurant also called Cava. Customers pick a platform (full-size or mini pita, rice bowl, or salad), add a protein and toppings of their choice (including falafel, pork, lamb, beef or chicken and any number of vegetables such as feta, cucumbers, and cabbage salad, then flavor it up with such condiment options as cool tzatziki, hummus or spicy harissa). Extras like lentil soup, dips and chips, and warm pita round out the selection. Bowing to the current zeitgeist, meats are hormone- and anti-biotic-free; dips and spreads are all-natural; and bowls ; cups, cutlery, drink cups and napkins are all compostable. The inviting storefront digs are both industrial-sleek and warm, with plenty of reclaimed wood and common seating. There are three units in operation in the DC market, with more on the way soon, and Nation’s Restaurant News has posited that Cava has what it takes to be “the next Chipotle.”

Fazoli’s

Year Founded: 1988

Number of Units: More than 220

www.fazolis.com

This quick-casual Italian chain has been around for a while but has almost completely reinvented itself in the past few years. An ambitious “extreme makeover” program, launched in 2009, has resulted in a near-complete overhaul of the Italian menu—with dozens of new items and improved flavor for long-time favorites, including entrees and sandwiches that are now cooked fresh to order—as well as service upgrades (such as meals and unlimited breadsticks being delivered to the tables). There are also plans to revamp the majority of Fazoli’s existing units to an all-new, contemporary design that uses more vibrant colors and bold, fun photos and graphics to create a more high-energy, family-friendly dining environment. Traditional plates and silverware have replaced disposables. A trio of new, smaller-footprint prototypes will help franchisees achieve a better ROI, as well as entering such nontraditional settings as airports and colleges and university. Meanwhile, a new, full-menu location has recently opened in a Walmart store, the first of several planned.

 

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Giving Back

By Joan Lang

The unfolding recent events in Japan have brought into focus the role that restaurants can play in their own communities and the world at large. Not only is it the right thing to do, but it’s also good for business: According to Driving Traffic research from Chain Leader, 73% of restaurant chains support charitable organizations in order to increase their own customer counts.

Whether you choose to donate to charities personally or use your establishment as a larger platform for giving back is an intensely personal decision, not to mention a pragmatic one. But here are some thoughts:

1. Pick a Charity that Appeals to Your Customer Base. The Flatbread Company, which touts its natural pizzas made from local, sustainable ingredients and a community-based spirit in each of its 10 locations, hosts many locally minded benefits that appeal to its young, socially conscious and family-oriented base. In Portland, Maine, for instance, a regular program of Tuesday night events raise awareness and donate a portion of the night’s proceeds to such organizations as the Westbrook Animal Refuge League and the Cape Farm Alliance.

2. “Adopt” a Signature Charity. Being known as a supporter of a particular charity is good for business, and helps management and staff focus its energies. For ConAgra Foods, for instance, its childhood hunger. Savor Pittsburgh relies upon an alliance of local restaurants to raise money for the American Respiratory Alliance of Western Pennsylvania. Chik-fil-A sponsors Core Essentials, a “values education program” designed for grades K-5.

3. Tap into the Power of an Existing Charitable Network. That’s the premise behind nationwide organizations such as Share Our Strength and The Great American Dine Out, which allow participating restaurants to tap into a huge bank of marketing, event expertise and other resources.  The 118-unit Corner Bakery chain, responding to requests from its employees, became involved with The Great American Dine Out “no kid hungry” program in 2008, with a goal to raise $100,000 during the weeklong program in 2011. In addition, the bakery-café chain has introduced its own “Stay Local” program, encouraging guests to explore and rediscover summer fun in their own neighborhoods.

4. Remember that it doesn’t have to be Money. Many organizations incent their staffs to donate time, even giving employees extra time off to participate in charitable and community events.  Daffodil Restaurant, in San Francisco, encourages its staff to support, participate in and attend community events that express our company’s philosophy and global outlook, offering employees the day off to support a cause that is beneficial to the restaurant. Customers can also be incented, via scrip or coupons for food or meals when they join staff or work on their own for a sponsored charity.

5. Promote Your Activities. Naturally you will want to let the local newspaper and other community calendar organizations know about your charitable events and activities, as well as posting them proudly on your website. But social media has made it easier than ever to get your customers talking you up, via Facebook, Twitter, Groupon, You Tube and other outlets. A number of high-profile chefs has using Twitter to ask their followers to donate to the Red Cross for earthquake and tsunami relief, and daily-deal phenomenon Groupon is actively involved in fundraising efforts. There are even mobile apps like CauseWorld which allow customers to use geo-positioning technology to earn “karma points” for visiting member restaurants, and then donate those points to charities.

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Tip of the Month

By Joan Lang

Okay, so you want to get involved with a charity or host a benefit event. Local organizations like sports teams and animal shelters are always appropriate beneficiaries, and you can always poll employees and customers to find out what causes and charities are important to them. But if you want to go a little bigger and get involved with state, national or international charities, you’ll want to get more information and be able to vet them. Charity Navigator is a great resource, providing a searchable database with information on thousands of causes; efficacy and performance ratings (such as what percentage of the money raised actually gets to the cause); classifications by type of charity (i.e., environment of health); and other useful tools.

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By Joan Lang

You know what we mean. You have some menu items you’re so well-known for that customers literally won’t let you take them off the menu. On the other hand, your staff is sick of them, the overall share of sales is falling off, the food cost on some key ingredient has gone sky-high (or you can’t even get it any more), or maybe it’s just time for a change.

Short of sabotaging the thing by pouring sugar instead of salt into it, what’s a savvy operator to do?

• Change up the accompaniments. Like a suit that looks completely different with another tie, your signature dish can take on a whole other personality with different side dishes, garnishes or a sauce. Many places swap out seasonal ingredients anyway, so this can also help keep your menu more timely.

• Raise the price. Putting the item into another pricing category—within reason of course—could help wean fans off it. At the very least, you’ll get a more profitable recipe that will make it more worth your while.
• Continue to offer it as a special. Can you serve the dish every few weeks, or for a week out of any given month? You could even give regulars a call when it’s going to be on the menu (and here’s where it’s good to have a mailing list and/or informational database about your customers’ likes and dislikes).

• Institute a plats du jour program. Many restaurants—beyond French bistros—have a regular of nightly specials on rotation: fried chicken on Sundays, stuffed rainbow trout on Fridays, osso buco on Saturdays. What if your old favorites never die, but just go to live on the daily specials menu?

• Make it available off-menu. If possible, continue to make the dish if you’ve got the ingredients, and quietly let it be known to customers who ask about the item that you’ll still prepare it. And don’t forget to train your waitstaff on how to handle the situation.

With strategies like these, everyone can win.

Let us know how you handle the problem. We’d love to share your ideas with our other readers.

Plain and Simple Truth

Heard any of these popular sayings?
“Mineral water from the French Alps”
“Filtered naturally”
“Originated from protected springs”

Bottled water… it’s the trendy thing to do. At least the bottled water industry has taken advantage of it, becoming a $14.4 billion market. Pretty much everywhere you look, someone has a water bottle in hand, or is throwing one away, or buying one at a street vendor; never thinking of the bigger picture, the environment.

Heard any of these popular sayings?

Socially responsible, eco-friendly, go green, “reuse, recycle, reduce”

It’s a popular trend too, saving the environment. Plastic isn’t working, clearly, as so many of the water bottles find themselves in trashcans, rather than recycling bins. Landfills aren’t natural scenic views; it’s waste. So here’s the deal. Water is natural. The container it comes in should be too. Plain and simple. Boxed Water is Better.

Be the new trendsetter. Drink water from a box. It’s the cool thing to do.

By Joan Lang

BJ’s Restaurants, Five Guys, Panda Express… what do they have in common?

For one thing, Technomic’s recent Top 500 Chain Restaurant Report named these three among their Top 10 Fastest Growing Chains in 2010, racking up year-over-year sales gains of 20%, 13%, and 38%, respectively—remarkable at any time much less at the tail end of the worst recession in decades.

There’s more to it than that, however. Even though the 10 chains on the list range from the limited-menu hamburger specialist Five Guys to the full-service, beer-centric Yard House, and from mainstream ethnic concepts like Mexican (Chipotle) and Asian (Panda Express) to all-American wings (Buffalo Wild Wings), they share more than stellar growth. For instance:

• A Distinctive Point of View – Marketing types might call this the brand promise, but the tightly conceived concepts of chains like Five Guys (better-quality burgers and fries) and Noodles & Co. (“travel the world without leaving your table”) are a case study in successful restaurant development.  They take to heart the maxim that you have to be able to describe what you’re doing in a sentence or two in order for it to work.
• Social Consciousness – Many customers today want to know that they’re part of something that contributes to the greater good, not just good food. Chipotle’s much-touted “food with integrity” philosophy (naturally raised pork and beef, antibiotic-free chicken, locally raised produce when possible) and has put it on the forefront of ethical sourcing. Firehouse Subs, meanwhile, takes its firehouse heritage seriously, having created a registered nonprofit dedicated to better equip, educate and fund public safety measures.

• Something No One Else Has – There may be little new under the sun but there are certainly ways for restaurants to set their menu or service offerings apart. Yard House is a premium casual eatery known for its extensive menu, classic rock music, and the world’s largest selection of draft beer, with more than 250 taps (in fact, the concept takes its name from the three-foot-high glass that was handed up to stagecoach drivers during “rest stops.”) Panda Express units, many of which are located in supermarkets, provides a fresh, fast, budget-priced alternative to Chinese restaurant-fare, along with very convenient catering and party platter options.

• Menu Variety and Craveability –Consumer demand for variety, choice and quality has never been greater, charging restaurants to offer a wide selection of appealing food that will keep bringing them back. The menu at BJ’s Restaurant and Brewhouse is unusually comprehensive, running the gamut from pizza and burgers to such upscale items as Miso Salmon and ribs made with BJ’s own Jeremiah Red Ale. And Buffalo Wild Wings may specialize in wings but it also menus a robust selection of tenders, flatbreads, burgers, ribs, wraps and signature Buffalito’s sandwiches, as well as no fewer than 14 different sauces, from Sweet BBQ to better-be-ready Blazin.’

 

By Chelsea Benetz

 

Let’s first begin by defining the word memorable.  By definition memorable means, “worthy of remembering or unforgettable”.    Now to define the word experience, which means in this instance in specific, “a particular incident, feeling, etc., that a person has undergone”.  The question then becomes, the goal of every hospitality institution in the world, how can we create a “memorable guest experience”?  One that will drive the guest to tell their friends all about it and come back for more.  How can we, as the venue, ensure that this specific experience was better than all the rest and stands out above all others?

Every hospitality institution has their own way of empowering their employees to create this “memorable experience” for their guests.  It is typically an integral part of the company’s core values and even more importantly, their standards.  These expectations can range widely from encouraging employees to  memorize a guests name to recall by heart or offering each employee $100.00 a day to “treat” the guest to something special.

Yet what if they fail to get my name, and I don’t want dessert at the end of my meal?  How else can your employee ensure that I am leaving with an “unforgettable feeling”?

This answer lies within two things:  personality and true hospitality.

What is one thing that can make your guests experience different than all the others?  A personal touch. By empowering your employees the ability to let their own personality and styles shine through (strictly, in a professional manner, of course).   What is it that makes each employee unique?  Is it the way they greet the guest, is it the way they “quality check” them, or is it the way they drop the check?  Does your employee introduce themselves personally extending a proper greeting and instantly building trust in their newly formed relationship?  All this talk of “expressing personality” is not to say that employees should not follow company’s strict “steps of service” in fear of deterring from the brand standards.  It is only to encourage your employees to find creative and unique ways of letting them be themselves while following the guidelines!

**It is important to remember this at all times:  some guests do NOT want to have a memorable experience.  For instance, some rather order their meal, eat and leave, without too much server-guest interaction.  In these cases, the server must be sensitive to pick up on these signs and provide exactly that type of service…in turn, it will be just as memorable for the guest.

Lastly, and I hate to sound sappy, it is essential to get back to the true meaning of hospitality.  Hospitality defined is kindness for, and in, welcoming strangers.  It is intended to be a warm greeting: sincere and genuine through and through.  It is what humanity is based on: a kindness for strangers.

This mentality is easily forgotten on a daily basis in the general public as we cut people off in a line, or let the door close behind us without looking to see who follows.  If we, members of the hospitality industry, can not succeed in being professionals of hospitality, then we leave very little hope for the rest of them.

True hospitality is hard to teach.  For those destined to be in this industry, it’s almost a calling, similar to that of religious callings; both of which are akin to making friends with strangers and welcoming them into your home.

When this true hospitality is alive in a staff, the room will have a renewed sense of energy and memorable experiences will be created instantaneously without much effort.  The $100.00 a day stipend to ensure these memorable experiences sent down from a corporate office, will be things of the past or only needed for emergency salvaging.  Relationships will be built without trying and your guests will leave feeling part of something bigger than just another dinner out.

Empower your employees to imagine that they are their own boss.  That a job so small as being a server, can have quite a bigger impact.  It is all about the attitude, personality and true hospitality that they bring to the table, both literally and figuratively.

 

 

Recently we saw a menu that offered, among other things, Ciopino and Shitake & Artichoke Dumplings. Granted, even the correct spelling of shiitake mushroom is regrettable, and there are more egregious ways to misspell cioppino (it’s even been spotted phonetically: chapino), but that’s no excuse for misspellings in menu copy.

In our rush to engineer menus and find the paper that offers the best matrix of value and quality, we often overlook an important step: copyediting the document. Whether you use a dictionary, spell-check or an actual copyeditor, it should be a given that there are no errors in spelling or grammar on a menu.

It’s not just a matter of professionalism; in our self-appointed role of educating consumers about different cuts of meat, ethnic culinary traditions or where our food comes from, we also owe it to our patrons to spell things correctly.

And while we’ve got the bully pulpit, here are a few food terms that have become so widely misspelled as to almost have become institutionalized—or maybe they’re just pet peeves of ours.

• Mesculin (or even mescalin) Salad – You may have fiddled with something like this in college, but functioning members of adult society eat mesclun.
• Carmelized Onions – Sautéing sweet onions slowly to produce a Maillard Reaction is just too tasty a process not to acknowledge that they’re caramelized.
• Artesianal Cheese – That’s cheese made in a well, folks. The correct spelling (and pronunciation) is artisanal; just say “artisan” and add the a-l.*

So get out those blue pencils and use them on your menu, then use them again. Buy the Food Lover’s Companion, or check out any of the good online sources, including the one at Epicurious. Load up your computer with customized spelling specific to the beautiful language of food. And you should be showing your menu to as many other people as possible anyway; while you’re at it, show it someone who’s a little anal-retentive about words.

*Just to prove that you learn something new every day, spell-checking this article turned up the fact that artesanal, with an e, is also an acceptable spelling—albeit seldom seen.

According to the U.S. Department of Agriculture, U.S. food prices will jump 3 to 4 percent this year. Processing food is so expensive thanks in part to rising gasoline prices and rising foreign demand in U.S. agricultural commodities. In fact, prices of corn, wheat and soybeans, crops that are used in a vast amount of U.S. foods, are 88 percent, 76 percent and 37 percent respectively from last year.

This raises a big question for restaurants and their bottom line. How big will this impact the food service industry? It is certain that they will be faced with raising prices or compromising margins or some of both. Some restaurant chains and retail will have more staying power depending on long term contracts but ultimately somewhere in 2011 prices will have to go up and consumers will feel the pain.

In terms of types of restaurants that will see the biggest impact? Steakhouses will get hit hard as well as burger operations.  Chicken prices will rise but will be less affected and can recover supply faster.  Further, seafoods have also increased significantly so there will be no complete escape.

So what else can restaurant operators do to offset these costs? Restaurants can adjust portions, move to chicken and less expensive protein (replace filet with NY or NY with Top Sirloin or replace lobster with shrimp but restaurants cannot affect markets short of McDonalds cutting their portions or deleting items.  Overall, operators need to implement stringent cost controls.

 

Synergy’s supply chain management team is available for an initial consultation on implementing effective cost control strategies.