Each May, I look forward to attending the National Restaurant Association (NRA) Show – the largest food show in the Western Hemisphere with 60,000 attendees – which takes place in Chicago.
The show gives our friends in the restaurant industry the opportunity to seek the latest and greatest food innovations, gain access to buyers who represent 40+ foodservice industry segments, assess the latest restaurant-related technologies available and, basically, examine new ways to market to customers. It gives an agency guy like me the opportunity to have a completely immersive experience and inevitably gets my gears turning as to how the agency team can drive our clients’ business growth.
As I walked the exhibit halls this year, explored the specialty pavilions and attended the educational seminars, the question on everybody’s lips was ”Where did my sales go?” While the percentage drop certainly varied, virtually everyone’s business was off. Casual dining, fine dining, family dining or QSR – every restaurateur seemed to be bellyaching about sales, with exception to those in the Fast Casual segment, who managed to move the needle in the right direction.
The rough winter obviously contributed to the sales issue, adding insult to the injury of an already sluggish economy that’s causing more and more customers to simply stay home. And yet, despite the gloomy outlook amongst restaurant owners and managers, the NRA is still forecasting the restaurant industry’s 2014 sales to be $683 Billion – almost a 2% increase over 2013.
A 2% increase sounds encouraging, and “up is up” as they say in the restaurant biz. But the individuals at the show just didn’t seem to share that sanguine point of view. In full candor, I shared that same pessimism until I attended a couple of the educational seminars at the show that were particularly helpful, and left me somewhat heartened. They provided and highlighted clear steps struggling restaurants can take to turn things around. Below are a few key takeaways that may prove helpful certainly if you are in the restaurant biz, but can also help in other businesses:
Seminar 1: “Marketing Strategies for Your Restaurant Brand”
Chris Tomasso, Chief Marketing Officer of First Watch Restaurants, mentioned that too many restaurant owners and managers feel there are a million different ways to drive sales. He said they lose sight of the fact that there are millions of “tactics” that can help assist with sales, but there are only three real ways sales are actually generated. And they are the basic three that have been around forever:
- Trial: You must put butts in seats… period. How? You have to you know who your customer is and know where to reach them.
- Check Average: Increasing your check average is a sure-fire way to build your sales and potentially incentivize staff. Providing staff incentives or contests to up-sell menu items will almost always guarantee a positive shift in sales (and potentially a positive shift in attitude for your employees).
- Frequency: Once you get the trial, ensuring that those customers come as frequently as possible is critical. Creating loyalty with customers via good service, great tasting food or an actual loyalty program is the best way to drive frequency.
Seminar 2: “Execution: The 5 Reasons Some Teams Outperform Others Doing the Exact Same Work”
Jim Sullivan, renowned restaurant industry consultant, led this session examining the key strategies restaurant owners use to get consistent results improving sales, productivity, service, marketing and cost controls. He focused on the importance of execution and that it fails on the restaurant level if:
- You’re not focused – Poor clarity and preparation will ensure the inability to execute
- Your process is broken – Weak process will lead to confusion, frustration and failure
- You react and don’t plan – Reaction to what others do isn’t a plan
- You treat the symptoms and not the root cause – Kill the main problem or it will only continue and grow
- You provide habitual inconsistency – Subjecting your customers to huge swings in quality, supervision and energy is a customer killer
- There are no consequences for failing to execute – People need to be held accountable…period
- You focus on the urgent, not the important – Constantly putting out fires, you can’t focus on the bigger picture items.
All in all, my trip to the NRA Show this year proved to me once again that there is tremendous value in walking in your clients’ shoes and taking the time to deeply understand operations issues as well as marketing issues.
- National Restaurant Association: 2014 Restaurant Industry Forecast
- Jim Sullivan, CEO Sullivision.com: 7 Big Challenges and How to Overcome Them in 2013