I was talking to a new restaurant owner not long ago, and he was very proud of the system that he had for finding the best deals from his food vendors. He explained how he talks to all of his vendors each week, has them submit bids, fills out a spreadsheet with updated pricing, and then splits up his purchases line-by-line. Based on the story that he told me, I can only imagine that it takes a few hours each week to find the best deals on all of the items that that restaurant needs to run: chicken, lettuce, etc. While the timing wasn't right to disagree, I do in fact disagree with his system.
I've worked for several large companies throughout my career, and all of them had one thing in common. They all worked with a couple hand-picked, and contracted vendors. You see, the companies that I worked for realized that it was best to review pricing once per year, and then pick the vendor with the best mix of service and price, and then get back to focusing on running our own business. A mentor of mine that I worked for years ago used to say, "You can't save yourself to profitability", and he was exactly right.
Let's say you are looking at paper costs and want to buy a cheaper disposable napkin. You could hunt around each week and find out which company has the best price in the market for napkins, but in the end you're still going to have to buy napkins. It's impossible to bring the cost to zero. And while you are hunting around, burning your time, and comparing costs, what are you really saving? It's quite possible that any cost savings that you uncovered were completely devoured in your time spent, or the fact that you needed to drive to pick-up the napkins instead of getting delivery. Not to mention the fact that while you were crunching numbers there may have been food quality issues, service issues, or worse that weren't addressed because you were looking at a computer screen.
There's another issue with this system too: none of those vendors that your squeezing are really giving you their best price. And since there isn't a contract between you and your vendor, there probably aren't any limits on what percentages the vendor can raise prices. This can become extremely costly when the market price spikes on a particular item like coffee, chicken, beef or bacon (as is expected to happen next year in 2013).
You really can't save yourself to profitability. You can only cut so much. I propose that a better strategy is to "shop" vendors once per year and then sign an agreement with whichever vendors you choose. Then get back to work on things that really do improve profitability like a smart marketing plan, excellent service, a quality product delivered consistently, and building strong relationships with your guests and your community.
Over the past few weeks I've seen and heard a bunch of advertising promoting "Small Business Saturday" on November 24th. The event, originally started by American Express in 2010, promotes shopping at brick and mortar small businesses in the local community, and was meant to offset the two other heavy promotional events of national retailers: Black Friday and Cyber Monday. The question I have is: shouldn't every day be "Small Business Saturday"?
I live in Sheridan, Indiana, a community of just 2,667 according to the last census. We have a lot of small businesses here, and I try to use them as much as possible. It's true that sometimes it's more expensive to shop in Sheridan, but if I want the convenience of driving four blocks to the grocery store for milk or eggs on a Saturday morning, then I need to support the local grocery that sells those items. Sure, I could get both the milk and the eggs for less, sometimes substantially less, if I go to the other grocery chains just a few miles away, but then eventually our little grocery would probably disappear.
I was in a meeting the other day with a small business person, and was stunned when he mentioned that he was using a well-known online company for the printing of business cards and letterhead. This person runs a local small business, but doesn't buy locally himself. When I asked "why" his answer was, "Too expensive". I think he's making a mistake.
It's obvious to me that if you want your local community to shop (or eat) at your establishment, then you need to return the favor. Now I'm not saying to ignore the cost of locally sold products; cost is always a factor. What I am saying is that it is vital to the success of any small business to support the community not only through philanthropy, but also through good old-fashioned commerce. "I'll shop at your store, if you shop at mine." The increased cost of buying locally will hopefully be offset by increased revenues from other local customers. And even if it doesn't completely off-set, a bit of community "good will" can never hurt either.
And while we are talking about it, I think that shopping local starts by joining the local chamber of commerce. Some businesses don't see how the chamber can benefit them, but it all comes down to one word, "relationships". That's what "Small Business Saturday" is really all about - starting and maintaining relationships. People do business with who they know and trust, and small businesses need to build those relationships to increase business and stay in business.
So...where do you get your business cards?
By now you've probably heard about, or read about, the review of Guy Fieri’s new restaurant on Times Square in New York, Guy’s American Kitchen & Bar. If you haven’t, check it out HERE, and then come back to read the rest of what I have to say.
The restaurant which has only been open for a few weeks was roasted in a review (if you want to call it that) by Pete Wells, New York Times dining critic. I haven’t been to the restaurant so I can’t speak as to the accuracy of the review, but I am a Christian and was raised by my parents to be respectful of others, so I do have a couple thoughts that I’d like to add to the national conversation. My first thought is “Really?” I can understand that the restaurant may not have met the expectations of the Mr. Wells, and apparently didn't do so on more than one occasion. However, what exactly makes Mr. Wells believe that his poor experiences justify a total cessation of respect for Mr. Fieri? Sure, he made headlines when he wrote the review, but at what cost? It certainly seems to me that Mr. Wells has shown us all that he isn't very professional, and certainly not very couth. It would also seem to me that either his parents failed to impress on him the need to show other people basic respect, or his parents are horrified at the fact that he turned away from the core family values upon which he was raised.
The next thing that comes to my mind is “bully”. Schools all across the country have taken great efforts to teach children about the dangers of bullying. Mr. Wells, it seems to me, has just created a great case study for how bullies operate. Mr. Wells used his platform to make himself look better at the expense of others; in this case, Mr. Fieri. Had Mr. Fieri personally touched Mr. Well’s table on one of those visits, would Mr. Well’s have stated his critique face-to-face? I doubt it. People who bully others typically do so only when they have no real fear of reprisal. Bullies use their position of power, or their perceived position of power, to enhance their own personal self esteem. “Disappointment” is something else that I felt after reading Mr. Well’s supposed critique of Mr. Fieri’s restaurant. I was disappointed that the New York Times actually published the article as written. I’m not suggesting that the “review” not be genuine, but I am strongly suggesting that the New York Times should have had Mr. Wells re-write the “review” to reflect the level of professionalism that the Times is known for. Mr. Wells could have raised all of the same criticisms in a professional and respectful manner. In my opinion the Times certainly didn't benefit from the “review”; in fact it suffered some loss of credibility. And speaking of “credibility”, Mr. Wells has lost most of his in my opinion. I have over 25 years of experience in the hospitality business: hotels, restaurants and catering. I've had angry guests throw keys and desk clerks, scream at twenty-something servers, and use foul language at a high volume at the hostess stand because they couldn't get a table exactly when they wanted one even though they had no reservation. Surely I must not have realized “who they were”? Sure, we might have made a mistake or provided poor service in some of these instances, but a guest who loses complete sight of the fact that the employees in my establishment are HUMAN BEINGS doesn't motivate me to take their concerns too seriously. After all, if a guest can’t treat me and my staff with respect, I’m pretty sure I don’t need them to return. Don’t get me wrong; I do believe that the guest is always right. However, there is absolutely a line that can be crossed, and Mr. Wells crossed it. If I were Mr. Fieri, I wouldn't be too concerned with Mr. Well’s opinion on anything else going forward.
Someone sent me an email the other day with a good "food for thought" story. I don't know who originally wrote it, but I wanted to share it with you.
Imagine that you had won the following prize in a contest: Each morning your
bank would deposit $86,400.00 in your private account
for your use. However, this prize has rules, just as any game has certain rules .
The first rule would be: Everything that you didn't spend during
each day would be taken away from you. You may not simply
transfer money into some other account. You may only spend it.
Each morning upon awakening, the bank opens your account with
another $86,400.00 for that day.
The second rule is: The bank can end the game without warning;
at any time it can say, "that's it", the game is over!
The bank can close the account and you will not receive a new one.
What would you personally do?
You would buy anything and everything you wanted, right? Not only for
yourself, but for all people you love, right? Even for people you don't
know, because you couldn't possibly spend it all on yourself, right? You
would try to spend every cent, and use it all, right?
ACTUALLY This GAME is REALITY!
Each of us is in possession of such a magical bank.
We just can't seem to see it.
The MAGICAL BANK is TIME!
Each morning we awaken to receive 86,400 seconds as a gift of life, and when
we go to sleep at night, any remaining time is NOT credited to us. What we haven't lived
up that day is lost forever. Yesterday is gone forever.
Each morning the account is refilled, but the bank can dissolve your account
at any time....WITHOUT WARNING.
SO, what will YOU do with your 86,400 seconds? Those seconds are worth so much more
than the same amount in dollars.
Think about that, and always think of this: Enjoy every second of your life,
because time races by so much quicker than you think.
So how are you spending your 86,400 seconds? Who is controlling your 86,400 seconds, YOU or YOUR BUSINESS?
If it's YOUR BUSINESS, then we need to work together to make it YOU. It can be done.
I see it often. The owners of a failing restaurant can’t make a decision. Or worse yet; they are too stubborn to make a decision that makes sense. Or maybe they deny that there is a problem at all. I can see it clearly, and often their partners and friends can see it too.
There is the employee or manager who isn’t the right person for the job, or who just doesn’t do their job. Yet, ownership can’t seem to confront the person and find solutions.
There is the money gushing out the door due to theft, poor cost controls, poor accounting and a myriad of other reasons. Yet, ownership can’t seem to implement better accountability and security.
There is a better way of preparing a dish, or serving a table, or handling a customer complaint. Yet, ownership refuses to rock the boat and change “the way we’ve always done it”, or re-work a family recipe.
There is a major food code violation in the kitchen and the inspector has written it on the report for the last three inspections. Yet, ownership is more worried about a dollar, than the health or life of a child, or a senior, or a cancer patient.
There is a hard decision to be made, or a decision that really isn't a decision at all. Maybe "it’s just the right thing to do”. Yet, ownership continues to push back due to money, or anger at the government, or a general disbelief that they need help.
There is a time that all businesses need outside help, or a new perspective, or non-biased input. Sometimes the truth hurts. Yet, ownership doesn’t feel that they need help, or can’t afford it.
There is a cost associated with indecision, stubbornness and denial.
There is a restaurant for sale. Cheap.
Everyone has something that they could improve upon in their life. I know that I could be better about turning off my computer at the end of the day, and just enjoying family time. I know that my wife could improve by not putting my chef's knives in the dishwasher time and time again. My daughter could study more, and text less. My son could be less forgetful. My Mother could stop worrying so much. Politicians in Washington could...well that's a blog for another day. But here are five things that I think almost all restaurants could improve upon starting today that would have an immediate positive effect on business.
1. Improve your curb appeal. Is your sign fully lit? Did someone empty their car's ashtray in your parking lot? Are the flowers in the planters alive? Is your sign fully lit? Before a guest even enters your building they have started to get a first impression about what to expect. If it's bad enough, they might just get back in to their car and leave.
2. Clean your restrooms. The restroom lets you know what a restaurant's cleanliness habits are. If the bathroom isn't clean what does the kitchen look like? While you're at it, fill the soap and paper towel dispensers, and get rid of the nasty smell. Nothing ruins my appetite like a poorly-kept restroom.
3. Clean, clean, clean. I'm not just talking about the basics such as cleaning your bathrooms, vacuuming the floor, or cleaning the windows. I'm talking about cleaning the bottom of the sugar caddies, and making sure the squeeze bottles of ketchup and mustard don't have dried gunk on them. The edges of the tabletops, and the bottom side where someone has deposited their chewing gum should also get some love. And, when is the last time the seats in the booths were removed and cleaned?
4. Hire good people and train them. Your staff represents you, and sometimes they might not represent you well. Individuals who don't perform quality work should be held accountable. Everyone needs training on the menu and menu item ingredients, how to address a table, and how to respond to a complaint or concern. When someone tells your staff that they are a first-time diner, your staff know how important it is to make a good impression. And when asked for their opinion as to "what's good", the answer shouldn't be "everything".
5. Touch tables. It seems to be a lost art unless I'm paying $40+ for an entree. Why don't managers take the time to touch tables and inquire as to how the dining experience is going? The cost of this seemingly rare practice is nothing, and the impact can be great! Just because a restaurant is "casual" doesn't mean that the manager or chef shouldn't be able to say "hello". And once they do touch a table, they need to respond appropriately to a guest's complaint and make things right instead of making excuses.
If any of these issues applies to your restaurant, you need to stop what you're doing and take action NOW. You'll be surprised at how just improving on the points above will improve your restaurant's image, and improve your business overall.
Champaign, Illinois lost a successful eatery in March of 2011. Mia Za’s Italian-themed restaurant was destroyed when a fire swept through the historic building that was home to the establishment. But the loss of Mia Za’s was short, and what seemed at first to be a disaster, ended up being a fabulous opportunity for a fresh start.
Bruce Hink, Mia Za’s owner recreated the restaurant from the ground up – literally. He redesigned the décor, changed menu items and added new ones, and embraced technology. Now, one year later, diners of the new Mia Za’s can influence the music being played by using their smart phones. Big-screen monitors display art instead of using conventional artwork, and diners can even submit art to be displayed. And there is a monitor at the entrance so that you can look up menu items that may be unfamiliar to you, and you can view those items and learn more about them. And for all of us who occasionally find our laptops and phone batteries dead, Mia Za’s is happy to lend us a charger to use while we dine.
But as cool as all of the new technology is, this story isn't really about the technology. This story is about a fresh start. It’s about rethinking and reworking a concept, and challenging the established ideas, beliefs and habits. It’s about changing with the times.
You don’t have to wait for your business to burn to the ground in order to have a fresh start, and I’m certainly not suggesting you get the ball rolling by starting the fire yourself. What I am suggesting is that you look closely and think about what could be different. Could you refresh your menu? Could you redecorate a bit? Can you find ways to embrace technology? How about new uniforms for your staff? There are a lot of things that can be done to refresh a concept without changing the concept outright and they don’t have to be huge or drastic.
If you’re not sure where to start, maybe it’s time to ask your customers. Better yet, invite some people in the community who aren’t your customers and ask them what they think, or invite a consultant to take a look and make recommendations. You don’t have to wait for disaster to strike to get a fresh start. You can start tomorrow on your own terms.
As I sit down to write this, I’m exhausted. I’ve been putting off a huge home project that has needed to be done for years…painting my front porch. Now keep in mind that the porch isn’t just any old porch. It’s about eight feet deep and 35 feet wide with lots of balusters and railings, and a very high ceiling. It’s a classic old house with a classic old porch.
The first thing that I needed to do, before I could even think about a fresh coat of paint, was to wash everything off. So, out came the pressure washer. And while I was pressure washing for five hours, I had plenty of time to think. And, it occurred to me that I was enjoying my time.
I was enjoying an unseasonably nice day, listening to the somehow-calming drone of the pressure washer, and thinking about HHC and the success that I’ve achieved. I was also thinking about how nice it is to not let my job consume my life. Don’t get me wrong, I’m passionate about what I do, but everyone needs some down time. Everyone needs to work to live, not live to work. Everyone needs balance.
I was thinking too about how a few of my past colleagues were probably sitting in a restaurant or café somewhere working on a laptop. Or, maybe they were sitting in an airport waiting for their next flight. Or, maybe they were in the air struggling with limited legroom, reading a SkyMall catalog, and snacking on a tiny bag of some sort of in-flight treat. Regardless of exactly what they were doing, I felt a bit sorry for them.
I’ve been there. I’ve missed ball games, school concerts, holidays, family reunions, church and all sorts of other events. I’ve taken opportunities that required me to be away from home for long stretches of time. And even though it’s not realistic to not miss anything, there were definitely a lot of events that I shouldn’t have missed. I should have realized sooner that life requires balance, and that I can be great at what I do, and be a success without selling my soul to my career or feeling guilty about taking time off. In fact, I should have realized that downtime actually helps me be more motivated and effective when I am working.
And that’s how I got here. That’s how HHC came to be. I decided that I didn’t want to transfer to another state again, or rack up half a million frequent flyer miles, or miss another ball game. That’s how I got balance. And I hope that as I continue to build HHC, I can have a long, balance-filled life helping others achieve balance too.
We all experience failure in our lives. There are loves that are lost, contracts that aren’t awarded, products that don’t sell, goals we don’t reach, and businesses that fail. Ultimately though, it’s how we handle these failures that define us.
For example, American auto manufacturers have had a tough go of it over the past several years. GM and Chrysler’s businesses failed and required government bailouts. Ford didn’t require a bailout, but still had huge problems of its own. Journalist Bryce Hoffman, in his new book, American Icon: Alan Mulally and the Fight to Save Ford Motor Company, talks about how Ford avoided bailouts, dealt with its failures, and was placed on a positive course for the future.
So what is one of the secrets to Mulally’s leadership as CEO of Ford? Simply put, it was maintaining a positive attitude.
Mulally, though facing possible failure, is described as always being upbeat, and being the first one to get over bad news. He maintained a positive attitude every day, and kept smiling, even though there wasn’t a lot to smile about. His positive attitude set the standard for others, and he was able to encourage everyone to work together, rather than succumb to failure. Mulally was, and still is, a leader that the employees of Ford believe in, and his attitude promotes success.
So, what kind of leader are you? Do you keep a positive attitude each day when presented with bad news or possible failure? Is your attitude one that you can be proud of? Does your behavior motivate your employees to succeed?
When faced with bad news or possible failure, remember that if you aren’t part of the solution, you are very possibly part of the problem.
It would be almost impossible for someone to not know about the trend toward locally sourced foods. We see independent and chain grocery stores, restaurants, and hotels all making major efforts to support local farming. Public school districts are on board too, working hard to source more meats and produce from local vendors and farms. In big cities, community gardens and food co-op’s are springing up, and people are finding space in their own back yards to plant at least a small garden. I personally participate too by planting a garden each year in my own backyard. I even expanded my garden last year by adding a new growing bed. But, with all that said, I’d like to suggest that we all take this trend one step further.
Why not try to do everything locally?
I use a local company to print my stationary and business cards. I use a local, independent CPA firm to do my taxes. I participate in my local Chamber of Commerce, and in the events sponsored by other local chambers, and I try to patronize local member businesses. When I meet someone for coffee or lunch I always try to go to a locally owned and operated business instead of a chain with headquarters out of the State. So, why do I do this? Because, I want those businesses to use me!
Using local businesses performs two functions. First, it keeps money in the local area and strengthens the local economy in general. Second, it builds relationships between me, my business and the businesses that I use. And any business owner will tell you that relationships are what make a company successful. People and businesses buy from others with whom they have a favorable relationship. It’s not always about cost. In fact, many times local businesses can provide products or services that the non-local businesses can’t. And, most important of all, local and independent businesses are more likely to appreciate your business!
So the next time you need to buy something, print something, or contract out a professional service, remember to keep it local. You’ll be happy you did!