Doug Marranci – Atlanta Restaurant Exchange
Doug Marranci
According to statistics released by
the Federal Reserve, Personal Savings
in 2008 were nearly 5 times greater
than in 2005. As a percentage of income,
this figure doubled again
in January and February 2009.
At a recent food service seminar, the CFO of a major international food conglomerate stood in a room with hundreds of restaurant owners and in a brilliant presentation challenged that if a restaurant was not making money today, it is its own fault, and could not blame the economy.
Dollars are still going out in record numbers.
What has changed is where are these dollars going?
In the past several years there has been a shift in the way many
people are dining out.
10 years ago, if my parents went out to eat, they went to a nice
restaurant, ordered apps, entrees, deserts and wine with the meal.
You did not share entrees, or worse yet, split an entree. The format of dining out was set and you did not ask for anything special, or heaven forbid asking for a substitution.
I will skip the lengthy transition and fast forward to today’s
consumer. (however, I love to talk about it, so call me if you want to hear more…)
What has changed:
Let’s take Joe for example (not his real name). Joe was reared by
parents who both worked. With both parents working, Joe was on his own for meals most of the time.
This involved Fast Food, or Microwave food. Joe never learned how to cook. Now Joe is married to Sue (also, not her real name) Sue also has never learned to cook, being brought up with the convenience of fast food, microwave dinners and everyone’s favorite, a 99 cent box of macaroni and cheese.
Joe and Sue are fresh out of college and at 23 years old, they eat out almost 5 times each week. Joe and Sue will go into a restaurant on a special occasion and drink cocktails before dinner, maybe a bottle of wine with dinner, and a beer or another cocktail after dinner.
Joe wants to go into a restaurant and order two appetizers, which he splits with Sue, one entree, which he shares with Sue. On Tuesday, Joe wants to be able to go into his favorite restaurant wearing jeans and a t-shirt (ok, its a hundred dollar t shirt) and sit at the bar and have a beer and a hamburger and be left alone. Saturday is Sue’s Birthday, and they will dress up, go to the same restaurant and order wine, apps entrees and dessert- in the same restaurant.
Next week, for Granny’s birthday, they want to go to the same restaurant for a nice birthday party with Granny with a table of 10 (separate checks (you better be ready)) and orders will run the gamut from 1 beer for “seat 1” apps, entrees, desserts and wine for “seats 2 and 3” and everyone else will order things ranging from glasses of wine to five course meals.
Flexibility is the key.
I was invited to dinner at a restaurant with some friends. After meeting there and watching everyone have some apps, drinks and wine, i noticed that no one was eating a “traditional meal” (whatever “traditional” really means) This was a first for me. It was decided that we would go to a neighborhood watering hole for the rest of the evening. The checks were delivered. The check average was still nice, and the server smiled and received great tips. Everyone was happy. I was fascinated.
Years ago when I was working the floor, It was unheard of to go to a restaurant and “mix and match”.. Back then, no one had the nerve to ask the chef to split up orders of food (or you just brought an empty plate and maybe charged a “split charge”… Chefs ruled, and no one questioned their authority.
A new wave over the past few years (and I did this in my last restaurant) was that all of the servers had the authority to say “YES” to any special requests if they knew that we had the wherewithal to make it happen. There was a grocery store nearby, and we even accommodated extra special requests if we could send a utility person to the store.
Fast forward to today..
1. Thousands of choices of wines. (who can know all about them..) Many of today’s diners, instead of “choosing a wine” which the server kept bringing bottles to the table during the course of a meal, pick a bottle to have “with the meal”.
2. Cocktails, craft beers and glasses of wine will be served before,
during and after the meal. It is much more bearable to pay 5 dollars
for 4 cocktails than 35.00 for a bottle of wine. If they want the
wine, it will more likely be a glass.
3. Flexibility in ordering. Apps as entrees, entrees shared and split
among the table, people who join the table and only order drinks and no food, cocktails and glasses of wine during the meal (even if a bottle is present). Patterns in ordering food seem to no longer exist. With the advent of today’s POS systems, you can (and had better) split all checks, and be ready to split individual items
between guests.
Guests demand flexibility and choice. The successful restaurants have learned to increase the perception of value, and give people a choice to eat whatever they want (they have been doing this in Europe forever).. In Spain, most menus offer a Racion (full portion) or as Tapas (to share). Dining in the US has become THE entertainment for many people. Not dinner before a show or movie, many times the night in a restaurant IS the “Night Out”
The art of entertaining at home has dwindled with a newer generation of people who did not learn how to cook and entertain. If you cater to this market of young professionals or a “hip” crowd, the restaurants that are doing well, are either “Value Focused” or an extension of their own home, a place to do what you want, how you want it, and when you want it.
Are you going to be a success in your new venture? Make sure you throw out your pre-conceived notions of what people want, and go visit some of the restaurants that have a line out the door. You can bet that they have opened a restaurant that gives the people what they want, instead of giving them what the restaurant owner feels the need to give them.
There are institutions that have been in business for a long time, and there will always be anomalies, however this is the future of the restaurant business.
I am stuck in the generation between my parents, and young professionals of today. I will always remember my mom afraid to differ from the “Norm” (whatever she believed that was) and still feel a twinge of something when sit down at a table of 10 friends and order a beverage, calamari app, and dessert, because that is what I want at that particular moment..
Today’s consumers demand Value. With everything most people do today, they will be conscious of value.
Do you encourage this freedom of choice and present a “perceived” value?
Perception is Reality. Restaurant owners who step back and understand their customers “perception” will almost always be successful.
My last thought: Isn’t this the way it should have always been?
Doug Marranci
Atlanta Restaurant Exchange
1708 Peachtree ST NW
Suite 520
Atlanta Georgia 30309
www.AtlantaRex.com
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