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SBA Releases RRF Guide and Forms

SBA Releases RRF Guide and Forms

by David Klemt

"This is the sign you've been looking for" white neon sign on brick wall

Operators in the United States are nearing the opening of the Restaurant Revitalization Fund application process.

The Small Business Administration’s RRF program guide and sample application are now available.

Let’s jump in!

RRF at a Glance

In simple terms, the RRF is the most targeted relief the industry in America has received since the pandemic took hold.

Eligible entities apply for a tax-free grant equal to the amount of a their pandemic-related revenue losses.

To calculate a grant amount, an applicant subtracts 2020 gross receipts from 2019 gross receipts. Applicants must deduct first-draw PPP and second-draw PPP loans, even if they’re paid back or forgiven. Any economic disaster loans—Economic Injury Disaster Loans, for example—are not RRF deductions.

Per the SBA, operators do not need to register for a System for Award Management (SAM.gov) account, meaning they no longer need to acquire a DUNS number.

RRF Eligibility

As the SBA’s RRF program guide states, eligible businesses A) must not be closed permanently, and B) are places where customers gather primarily to consume food or drink. Such entities include:

  • restaurants;
  • bars;
  • saloons;
  • lounges;
  • taverns;
  • food trucks, carts and stands;
  • snack and non-alcoholic beverage bars;
  • licensed facilities or premises of a beverage alcohol producer where the public may taste, sample, or purchase product; and
  • other similar places of business in which the public or patrons assemble for the primary purpose of being served food or drink.

However, that’s in no way the entire list of eligible businesses. Bakeries, breweries, microbreweries, brewpubs, taprooms, distilleries, wineries, and tasting rooms are eligible if they can provide documentation (which must accompany their application) that:

  • on-site sales to the public comprised at least 33% of gross receipts in 2019; or
  • original business model should have contemplated at least 33% of gross receipts in on-site sales to the public if they’ve yet to open or opened in 2020.

Interestingly, it’s possible for an inn to be eligible for the RRF. Such a business is subject to the same eligibility requirements as bakeries, breweries, etc.

Eligible Expenses

Businesses that receive an RRF grant may use the funds for eligible expenses during their covered period. That timeframe is the “period beginning on February 15, 2020 and ending on March 11, 2023.” Should the business close permanently, that period will end when the business permanently closes or on March 11, 2023, whichever occurs sooner.”

A grant recipient must return any funds to the Treasury if they’re unable to use for eligible expenses by the end of the covered period.

So, which expenses are eligible per the SBA for the RRF program? Below is a short list of eligible expenses:

  • Payroll costs (sick leave, costs for group health care, life, disability, vision, or dental benefits during periods of paid sick, medical, or family leave, and group health care, life, disability, vision, or dental insurance premiums).
  • Payments on any business mortgage obligation, both principal and interest (Note: Excludes any prepayment of principal on a mortgage obligation).
  • Business rent payments, including rent under a lease agreement (Note: Excludes any prepayment of rent).
  • Construction of outdoor seating.
  • Business supplies (including protective equipment and cleaning materials).

For the full list of eligible expenses and many more RRF details, please click here to download and view the entire SBA RRF program guide. To view the sample application and prepare for the process to begin, click here.

Disclaimer

This content is for informational purposes only, and should not be used as legal, tax, investment, financial, or other advice. This article does not constitute professional and/or financial advice, nor does any information constitute a comprehensive or complete statement of the matters discussed or the law. This information is of a general nature and does not address the circumstances of a specific individual or entity. The reader of this information alone assumes the sole responsibility of evaluating the merits and risks associated with the use of any information before making any decisions based on such information.

Image: Austin Chan on Unsplash 

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NRN Shares Inclusion Insights Report

NRN Shares Inclusion Insights Report

by David Klemt

Light bulb idea concept on wood background

Featuring insights from their 2021 Power List, an inclusion report from American trade publication Nation’s Restaurant News is now available.

Overall, NRN’s 2021 Power List consists of C-suite and executive heavy hitters from some of the most influential restaurant groups.

For example, Domino’s, Yum Brands, &pizza, and Momofuku Restaurant Group, are on this year’s list.

To compile their 2021 Power List: Leadership & Inclusion Insights report, NRN asked their power players to identify a team member who embody inclusivity.

Lessons Learned from 2020

NRN’s report is broken down into five sections; this is the first.

Reading through the insights in this section, you’ll find that agility and adaptability are crucial to navigating crises. That will come as no surprise to many.

However, what really strikes me are the words of Donnie Upshaw, SVP for people at Wingstop. Upshaw cites the importance of culture and core values:

“Our core values, known as ‘The Wingstop Way’—service-minded, authentic, entrepreneurial and fun—have been and will continue to be our guiding light through all seasons of our business.”

Those core values, along with Wingstop culture and a focus on retaining top talent, are keys to their successful navigating of the pandemic.

Accomplishments During a Pandemic

The pandemic has torn apart the hospitality industry and continues to do so. In America, we’re just now seeing specific relief targeting foodservice businesses.

Given the situation, just surviving the pandemic is an accomplishment.

Still, chain and independent operators are forging paths forward and inspiring others inside and outside of the industry.

Erika Palomar, COO of the Independent Restaurant Coalition, says the group “faced the darkest hours, together.”

Palomar continues: “They held fast to their commitment to change the most lives possible. This group has the remarkable ability to look beyond their door and inspire others to take action and make bold changes that will serve this industry and our society for the better.”

Importance of Leadership & Impact

The job of owners, operators, managers, and mentors is to lead. Doing so is one of the most effective tools for growing a business and retaining talent.

Adversity, of course, is one of the—if not the—greatest challenges to leadership.

Beth Scott, president of Fleming’s, says building trust is the first step in realizing the core of what it means to be a leader: inspiring and influencing, not commanding.

Jason Crain, CRO of Slutty Vegan, says, “Leading is dynamic and solution oriented.” Crain points to knowing when to implement different forms of leadership as a crucial element.

Further Insights

NRN’s report has two more categories, “Fostering Diversity & Inclusion” and “The Future of Foodservice.” There are insights from several more power players who drive the missions of inclusivity, diversity and equity.

We encourage you to follow this link and review the report for invaluable motivation and inspiration for your own business.

Image: Free-Photos from Pixabay

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Kitchen Showdown: Virtual vs. Ghost

Kitchen Showdown: Virtual vs. Ghost

by David Klemt

Person ordering Uber Eats

The lines between virtual and ghost kitchens are growing increasingly blurry as they rise in popularity.

The terms aren’t interchangeable—they’re separate concepts.

Let’s snap the two into focus so operators can decide for themselves which, if either, is for them.

Virtual Kitchen

A virtual kitchen or virtual restaurant supports a brick-and-mortar concept. This includes food trucks.

Standard process is as follows:

  • A concept in a certain category seeks to expand their menu options without diluting or otherwise damaging their brand.
  • They create new menu items and sometimes a new brand.
  • Their existing kitchen or kitchens create these new items, which are online- and delivery-only.

A virtual kitchen has a brick-and-mortar location in a technical sense, but the brand’s existence is essentially digital as far as consumers know.

Ghost Kitchen

These facilities are delivery-only and commonly produce virtual brands’ items, which is a possible source of the confusion surrounding ghost and virtual kitchens. A truly virtual brand is only available online, either via its own ordering site or a delivery app—it has no brick-and-mortar location of its own.

We’ve known since the Chicken Wars first started that chicken sells, apparently in all forms. Several virtual brands, largely focused on wings and sandwiches, are succeeding with the help of ghost kitchens.

However, ghost kitchens also rent themselves out to or otherwise enter into contracts with third-party concepts with brick-and-mortar locations of their own to produce their delivery menu items.

The explosive rise of delivery is driving investment in ghost kitchens (former Uber executive Travis Kalanick’s CloudKitchens is an excellent example). It’s also the reason that so many industry experts and speculators declare ghosts “the future of restaurants.”

Not the Same

This quick rundown should clarify the differences between virtual kitchens and ghosts. Their missions may be similar but their operations are not.

Image: Charles Deluvio on Unsplash

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House Passes $1.9B Covid Relief Bill, RRF

House Passes $1.9B Covid Relief Bill, RRF

by David Klemt

US Capitol Building Dome

The Senate version of the American Rescue Plan Act of 2021 is through the House, awaiting the signature of President Joe Biden.

Once the bill is signed by the president, it will be the law of the land.

That means our industry is finally receiving at least a portion of the relief it so desperately needs. After nearly a year of campaigning and fighting, the Restaurant Revitalization Fund (RRF) is a reality.

Restaurant Revitalization Fund

Managed by the Small Business Administration properly, the RRF is a critical lifeline for small- and mid-sized operators.

The SBA will prioritize women- and veteran-owned and operated businesses for the first 21 days. Economically and socially disadvantaged businesses will also receive priority.

Maximum grant amounts are $5 million per individual restaurant or $10 million per restaurant group.

Eligible Expenses

Importantly, eligible expenses fall between February 15, 2020 through December 31, 2021.

Eligible expenses include but are not limited to:

  • payroll and benefits;
  • mortgage (no prepayment);
  • rent (no prepayment);
  • utilities, maintenance;
  • supplies (including PPE and cleaning materials);
  • food;
  • operational expenses;
  • covered supplier costs (as defined by the SBA under the PPP program); and
  • sick leave.

American Rescue Plan Provisions

Of course, the RRF is just a small portion of the American Rescue Plan. The bill includes many provisions for national Covid-19 testing and vaccine distribution.

States and local governments receive $20 billion to assist low-income households with rent, utility bills, and back rent. There’s an increase to benefits of 15 percent through September for those on food stamps.

Also, the Emergency Injury Disaster Loan (EIDL) program receives $15 billion, which will help small business owners.

The $300-per-week federal boost to unemployment benefits remains the same rather than climbing to $400 per week.

Crucially, the bill waives the first $10,200 of unemployment benefits from 2020. That amount rises to $20,400 for married couples. To receive the waiver, a household must have an adjusted gross income of $150,000. That AGI is the same for individual and combined households.

Individuals with an AGI of up to $75,000 will receive stimulus payments of $1,400. That amount phases out completely at $80,000 for individuals, $160,000 for couples.

What’s Next

The SBA is responsible creating and implementing the RRF application process.

For now, it’s wise for operators to calculate their grant amounts:

  • Open prior to 2019: 2019 revenue minus 2020 revenue minus PPP loans.
  • 2019 opening: Average of 2019 monthly revenues times 12 minus 2020 revenues.
  • 2020 opening: Eligible to receive funding equal to eligible expenses incurred.

Since the SBA is the agency overseeing the $28.5 billion RRF, it’s a good idea to monitor their site for pertinent dates, details and requirements.

Image: Joshua Sukoff on Unsplash

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Bacardi Predicts How We’ll Drink in 2021

Bacardi Predicts How We’ll Drink in 2021

by David Klemt

Bartender making a cocktail

What will alcohol consumption look like this year? Bacardi has answers.

In association with the Future Laboratory, Bacardi’s second-annual cocktail trends report—a well-sourced 25-page document—is available.

As is the case when we begin a new year, we’re being deluged with trend predictions and reports. I’d say the Bacardi 2021 Cocktail Trends Report goes deeper than most.

The report is organized into five macro trends identified by Bacardi Limited. Let’s get to it!

Reinventing the Bar

I’m not presenting Bacardi’s macro trends in order. Instead, I’m starting with the trend arguably most relevant to operators: bar reinvention.

Industry experts have been pointing to the ease of access to knowledge along with consumer interest in learning more about spirits and cocktails as an important trends for years now. It’s no longer a trend—it’s standard that guests are better informed.

Like other sources, Bacardi predicts guests will seek out more personalized experiences. They also predict guests will want to connect more with bartenders. However, the brand goes deeper in their report.

Bacardi thinks to-go cocktails, cocktail and meal kits, and e-commerce will become standard. Going a step further, the report posits that some venues will create cocktail menus that will change according to weekly inventory; sommeliers will add spirits knowledge to their skillset; and that guests will be eager to try drinks they’ve never had before.

Perhaps most importantly, Bacardi predicts bar culture will become more positive and inclusive, resulting in gender stereotypes—including those inherent to bottle design—will fall to the wayside.

Purpose and Transparency

According to a study conducted by IBM and the National Retail Federation and cited in Bacardi’s report, a massive 70 percent of American and Canadian consumers think it’s important that brands are eco-friend or sustainable.

Bacardi predicts sustainability, transparency, and the authentic embrace of social causes will be crucial this year and beyond.

In response to climate change, sustainability, eco-friendliness, and the zero-waste movement, Bacardi plans to wipe out 80 million plastic bottles with their new biodegradable bottle design, rolling out in 2023.

Pointing to a statistic from ZypMedia—that 36 percent of consumers plan to keep buying from local businesses post-pandemic—Bacardi predicts hyperlocality will grow stronger in 2021. Operators who source more local items, including beverage alcohol, will likely find more support from consumers.

Mindful Drinking

Per a Bacardi survey, 22 percent of consumers across the globe are drinking alcohol less. More than half (55 percent) of “mindful drinkers” are drinking low-ABV options.

Bacardi predicts low- and no-ABV drinks to perform well this year. Spritzes, for example, is on the rise as a bar culture in its own right.

Per Bacardi, zero-proof spirits are getting the most attention of any other category, worldwide.

Mindful drinking is also affecting how spirits are made. Consumers, more conscious of their health because of the pandemic, are showing a preference for beverages free of artificial ingredients. Furthermore, Bacardi expects consumers to seek out drinks that have health-boosting benefits.

The report, as an example, cites a Global Wellness Institute finding that in 2019 alone, “U.S. sales of ginger rose by 94%, while turmeric and garlic sales were up by 68% and 62%.” Today’s consumer is seeking out functional cocktail ingredients.

Drinking by the Numbers

Bacardi’s report puts all the brand’s cards on the table. Operators looking to program or reprogram their menus will find this information helpful.

Consider the info below for delivery and to-go drinks since Nielsen finds that 40 percent of US consumers are interested in make-at-home cocktail kits, 37 percent are interested in pre-made bottled cocktails, and 37 percent are interested in grab-and-go cocktails.

Flavor and Experience: Extreme heat (chilies), Super-sweet, Sour, Bitter, Smoked

Experiences: Pleasure, Nostalgia, Escapism, Quality over quantity, Light-hearted drinks, Flavor-filled indulgences

Most Popular Cocktails, Globally (Descending Order): Low-ABV, Other spritzes, Negroni, Classic cocktails with a twist, G&T (including riffs), Non-alcohol, Whiskey Highball, Espresso Martini, Old Fashioned, Vermouth cocktails

Premiumization Opportunities: Gin, Rum, Tequila

Top 5 Spirits (by Interest): Gin, Mezcal, Tequila, Vermouth, Bitter/Amaro Liqueurs

Top 5 RTDs in North America: Vodka Soda and flavors, Margarita, Moscow Mule, Low-ABV, G&T

Click here to read the report in its entirety.

Image: Helena Lopes on Unsplash

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I Tried the Mask Made for & by Hospitality

I Tried the Mask Made for & by Hospitality

by David Klemt

Wearing a mask is part of everyday life, particularly for hospitality industry professionals.

DCBL Masks was designed by hospitality professionals for the hospitality industry, born out of their reverence for the workers putting themselves at risk so the communities they serve can retain a semblance of their normal lives.

Their first mask, the X-1, is intended to provide solutions to the problems presented by other face coverings.

Thoughtful Design

One problem with the standard masks and face coverings we’ve grown accustomed to is their tendency to muffle voices. One of the driving design elements behind the DCBL X-1 is the projection of the wearer’s voice.

The X-1 is a three-piece mask and its second layer is what sets it apart from others. The middle layer is sound-enhancing, sculpted foam that allows the wearer’s voice to carry. No more going hoarse from yelling, no more (or less, at least) repeating oneself, no more guests leaning in or stepping closer to hear what’s being said (hopefully).

That second layer is also intended to improve breathability. The inside layer’s design provides an air pocket for similar breathing functionality. It’s also made of natural bamboo so it’s soft, moisture-wicking and cooling, and it receives an antimicrobial treatment.

The X-1’s outer layer is polyester and resists dust and moisture while also protecting against UV rays. There are two flexible “suspension” systems, one for the nose and one to seal the bottom of the mask. Straps are Spandex, ear loops are adjustable, and there’s a clasp system so the wearer can choose how to secure the mask to their head.

Designed by Industry Pros

DCBL is the brainchild of industry veterans Michael Tipps and Homan Taghdiri. Tipps and Taghdiri are the co-founders of both DCBL Masks and Invictus Hospitality, a consulting agency headquartered in Los Angeles.

Tipps boasts over two decades’ experience in hospitality. He got his start in South Florida and has worked every front-of-house position. His journey through hospitality helped him gain perspective regarding the challenges inherent to the industry, and he eventually co-founded Invictus.

Taghdiri worked in hospitaity for 13 years before becoming a licensed attorney in California. He has worked every position in the industry. While he no longer studies law, when he did, he specialized in real estate, business and the hospitality industry.

DCBL’s Mission

There are three main goals DCBL seeks to achieve: Protection, projection, and connection. I’ve explained how they achieve the first two goals.

If the first goal isn’t realized, goals two and three don’t matter. If DCBL whiffs on the second goal, the third is unachievable. The X-1 seeks to make conversation easier when wearing masks so people can feel more connected. Being separated by masks, distance, barriers, and staying at home is detrimental to us all. The DCBL X-1 addresses that issue.

As the DCBL website says, “Staying safe and making a living shouldn’t be as challenging as it has been.” I feel the brand accomplishes their deceptively simple goals.

Impressions

First things first, I didn’t receive my X-1 in exchange for this post or any monetary compensation. I was genuinely curious about the mask and placed an order for two.

My masks arrived in a black bubble mailer, making them seem a little cooler from the start. They were each sealed in their own packet with an insert that explained the three layers, different methods for securing the X-1, machine washing instructions, and more.

DCBL X-1 mask packaging

In my experience, the mask felt soft and comfortable before even putting it on. The X-1 feels like a well-constructed, high-quality mask.

DCBL X-1 Mask

I have to say, I dig the interior layer. Not only is it soft and comfortable, the design detail is a nice departure from the white, black or pale blue to which we’ve all become accustomed:

Inside layer of DCBL X-1 face mask

It’s comfortable on my face and it allows me to speak comfortably, clearly and loudly no extra effort. I wore mine around my place and while writing this article. The ear loops are comfortable for me but the X-1 can be worn easily with an ear loop extension or toward the top of the head with the clasp system.

My glasses did fog slightly at first, but that became a non-issue after I adjusted the nose bridge suspension area.

Other people’s mileage may very, of course, but I feel that the mask delivers on DCBL’s mission statement: Be Heard.

To learn more and order the X-1, click here. connect with DCBL on Instagram and Facebook. Contact hello@dcblmasks.com for wholesale orders.

Disclaimer: The DCBL X-1 is not a medical-grade mask and is not intended as a replacement for medical-grade equipment or other recommended measures to stop the community spread of any viruses.

Images taken by author.

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On the Menu for 2021: The RESTAURANTS Act

On the Menu for 2021: The RESTAURANTS Act

by David Klemt

Much like restaurants themselves, the RESTAURANTS Act has faced multiple starts and stops.

The bill received huge bipartisan support in 2020, landing dozens upon dozens of co-sponsors.

However, that widespread support didn’t materialize into any actual progress—the bill was never signed into law. That must change now.

A Long Road

It’s February 2021. The House and Senate must work together to provide the targeted relief of the Real Economic Support That Acknowledges Unique Restaurant Assistance Needed to Survive (RESTAURANTS) Act.

The RESTAURANTS Act was first introduced to the House of Representatives on June 15, 2020. The bill was eventually included in the revised Heroes Act, which was passed by the House on October 1, 2020 on a vote of 214 to 207.

Unfortunately, that bill was “dead on arrival” and didn’t receive a vote on the Senate floor. A $900 billion stimulus package was negotiated in December of 2020 but the RESTAURANTS Act wasn’t included in it.

It has been more than long enough—it’s beyond time for action.

Where are We Now?

Throughout all of this, from inception to current status, the Independent Restaurant Coalition (IRC) has never faltered in their campaign to ensure this industry receives the targeted relief it so desperately needs.

It’s wise given how the number of times we’ve been let down by our elected officials to be guarded and cautiously optimistic about the RESTAURANTS Act finally being signed into law this month.

On February 5, Senators Roger Wicker (R-MS) and Kyrsten Sinema (D-AZ), and Representatives Earl Blumenauer (D-OR) and Brian Fitzpatrick (R-PA) formally (re)introduced the RESTAURANTS Act to the 117th Congress.

What’s in the Bill?

In its current form, the RESTAURANTS Act:

  • establishes a $120 billion relief fund for foodservice and drinking establishments;
  • makes groups that operate up to 20 units eligible for relief from that fund;
  • provides operators access to grants of up to $10 million for eligible expenses; and
  • makes the grants retroactive to February 15, 2020 and ends them eight months after the legislation is signed into law.

New provisions in the February 2021 RESTAURANTS Act include:

  • updates to the award calculation based on annual loss from calendar year 2020 instead of quarterly;
  • grant eligibility for new restaurants that opened after January 1, 2020;
  • paid sick leave as an eligible expense for employees, with a bonus amount to cover the cost of voluntarily providing ten days of sick leave to employees;
  • providing the Department of the Treasury the discretion to help reduce waste, fraud, and abuse;
  • imposing reporting obligations on the Department of the Treasury to share who gets loans and demographic information about recipients; and
  • ensuring that restaurants can use both the Employee Retention Tax Credit and the RESTAURANTS Act grant program, provided they are not used for the same expenses.

What’s Next?

We must all act to give the RESTAURANTS Act the best chance of becoming law. We have been patient for long enough.

We must let our representatives know we expect them to pledge their support for this bill formally.

The IRC provides several methods for ensuring our representatives understand they need to co-sponsor and pass the RESTAURANTS Act:

  1. Email your representatives and ask them for their co-sponsorship.
  2. Call your representatives directly and tell them why restaurants and bars need the RESTAURANTS Act to be voted on, passed, and signed into law. This is the number to dial: (202) 224-3121. The IRC has provided talking points here.
  3. Share the graphic below on your social channels and encourage your followers to also contact their representatives and ask them to co-sponsor the RESTAURANTS Act. Use the following caption when posting: It’s official: the RESTAURANTS Act of 2021 is on the menu in both chambers of Congress. Call your representatives today and tell them that independent restaurants, bars, and workers can’t wait any longer for direct relief: 202-224-3121 #SaveRestaurants

All of that will take less than 20 minutes. That’s not a lot of time to help finally get this industry the support and relief it needs.

The RESTAURANTS Act is needed to prevent more permanent restaurant and bar closures, and to revitalize the industry. The road to recovery is a long one and getting this bill signed into law is a major step forward.

Please email and call your representatives. Please share the post and caption above on your social media. Please help save the restaurants, bars, and millions of people they employ.

Image:

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National Restaurant Association Opposes Elimination of Tip Credit

National Restaurant Association Opposes Elimination of Tip Credit

by David Klemt

Citing a 600-percent increase in labor costs, the National Restaurant Association opposes the elimination of the tip credit.

An email sent out yesterday by NRA executive vice president of public affairs, Sean Kennedy, stated that doing away with the credit would present “an impossible challenge to restaurant owners” to remain open.

The email also opposes boosting the national minimum wage to $15 per hour.

Not every operation would see labor costs potentially skyrocket to untenable levels but wage changes could see restaurants, bars and other businesses in some states hit the cited 600-percent increase. If the majority of restaurant operators saw sales decline last month, as a previous NRA report said operators predicted, and that trend continues, the association’s standpoint could be proven right.

While the NRA continues its support for making the RESTAURANTS Act part of any new stimulus relief bill, the association has made their positions on the matter of a minimum wage hike and elimination of the tip credit clear:

“But now is not the time to insert wage changes–a hike in the minimum wage and elimination of the tip credit–to a stimulus bill. Tipped servers generally earn between $19-$25 dollars per hour, and this plan would punish these workers who use restaurant jobs to make a better life for themselves.”

The NRA appears concerned that the Biden administration’s efforts to quickly get Congress to pass a Covid-19 relief bill are short-sighted and will end up hurting tipped workers and the hospitality industry overall.

According to the message sent out yesterday, the majority of tipped workers across the country have, historically, opposed efforts to eliminate the tip credit. Per the NRA, tipped workers earn between $19 to $25 per hour when the tip credit remains intact.

Instead, the NRA prefers the next stimulus relief bill–there are currently two competing bills, one for $1.9 trillion plan and a GOP counterplan with a price tag of around $600 billion–to go with the Senate version of the RESTAURANTS Act.

If you agree with the NRA’s concerns, click here to take action.

Image: Mathieu Turle on Unsplash

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KRG Hospitality Expands Team with Director of Business Development

KRG Hospitality Expands Team with Director of Business Development

by KRG Hospitality – 12/1/2020

December 1, 2020, Burlington, Ontario, Canada–KRG Hospitality, a strategic and creative hospitality consulting agency, today announces the addition of industry veteran and journalist David Klemt to the team. Mr. Klemt will take on the role of Director of Business Development at KRG Hospitality.

Before joining KRG Hospitality, Mr. Klemt gained decades of experience in hospitality working in multiple roles. He kicked off his career as a host at an international chain restaurant, worked as a server at restaurants big and small, became a bartender, co-founded a nightlife-specific valet company, and moved into nightlife marketing and promotions.

For the past 15 years, Mr. Klemt has reported on the industry as a hospitality business journalist. He held the title of editor for Nightclub & Bar’s digital publication for five years. Mr. Klemt founded hospitality news and resources site Hospitality Villains earlier this year after losing his editing job due to the Covid-19 pandemic.

“We’re entering a new era of hospitality brought on by the Covid-19 pandemic and an industry-wide reckoning with the old way of doing business that forced operators to accept single-digit profit margins,” said Mr. Klemt. “I’m excited and eager to help hospitality professionals thrive as the industry undergoes its next evolution. KRG Hospitality is a driven, dynamic and creative solutions-based agency that aligns with my values and passion for this industry.”

In his role as Director of Business Development at KRG Hospitality, Mr. Klemt will be responsible for developing the agency’s partner network, hosting the Bar Hacks podcast, writing informative articles, publishing expert contributors, and overseeing KRG Hospitality’s social media platforms.

About KRG Hospitality

KRG Hospitality is a storied brand with a proven track record. The agency has delivered exceptional and award-winning concepts throughout a variety of markets found within Canada, the United States, and abroad over the past decade. KRG Hospitality provides a clear framework tailored to each client, writing detailed strategic plans; creating award-winning concepts; facilitating start-up projects; finding gaps in existing strategies; developing solutions to known problems; identifying opportunities for growth; and inspiring others through unique seminars, workshops, and on-going coaching methods. Currently, KRG Hospitality operates in Toronto, Calgary, Vancouver, Las Vegas, Nashville, Orlando, Philadelphia, and the Eastern Caribbean. Visit KRGHospitality.com to learn more.

Image: Alex Knight on Unsplash

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Hotel F&B in a Post-Pandemic Landscape

Hotel Food & Beverage in a Post-Pandemic Landscape

By Doug Radkey – 07/22/2020

Nearly all of our favorite and most popular travel destinations around the world have been impacted by the Covid-19 pandemic, resulting in a horrendous financial loss for hotels, resorts, and the entire hospitality industry alike.

Research by the American Hotel & Lodging Institution suggests that hotel recovery to pre-COVID-19 levels could take until the year 2023—or perhaps even later with the expected ‘long-term’ loss of business travel and international leisure travellers.

Sadly, many properties have not survived and will not be opening their doors again. Some of those who rely on international travel see little benefit in resuming service while many borders remain closed. And those who are ready to reopen face a very different business environment to the one they were once accustomed to.

There are numerous strategies and alterations to consider moving forward for the operation of a hotel property post-pandemic; but one area that can help properties to regain their guests’ trust plus revenue and profits is that of the food & beverage program.

The Opportunity

For years, one could rely on a hotels restaurant and bar for a steady supply of traditional fare. Hotel food wasn’t necessarily an after-thought, but menus lacked (and in some cases continue to lack) inspiration.

However, in today’s global hotel market; both pre-covid and post-pandemic, a cities best and most innovative and creative food & beverage menu could be found in a hotels restaurant and bar.

But it is not longer just about the food. Hotels obviously have their chef(s) – but moving forward they must also consider a ‘director of mixology’ – even for smaller boutique properties.

Consider for a moment, instead of creating cocktails to match the food menu, doing it the other way around and starting with the beverages. You may be surprised by the results.

This is a secret to a successful, high-profit full-sensory on-premise (and off-premise) program.

While there is significant social and economic changes expected (post-pandemic), there will be a growing and potential multi-billion dollar opportunity for hotels to better cater to guests through their food & beverage options – if the venue can weather the current storm.

As the population regains their confidence to book a hotel stay, guests who visit for either business or leisure may be reluctant to travel to too many spots around town due an ongoing fear that it may not be 100% safe to do so.

Furthermore, many (potential) guests will find their finances dramatically affected by the economic downturn which is now inevitable throughout most of the world, and this will also lead to demand for more affordable cuisine and experiences.

Therefore, a food & beverage program with multiple revenue streams including a balance in pricing found within a trusted hotel that provides a consideration towards a full sensory experience for multiple day-parts is critically important.

Hyper-Local Programming

Hotels today must increasingly try to attract local residents partly because today’s visitors increasingly want to eat where the locals hang out and secondly – because that noted business & leisure travel is expected to be slow for the next 12-18 months.

The food & beverage programs and experiences must shape guests’ understanding of the hyper-local region by supporting local farms, vendors, & culture.

Hotels today and moving in a post-pandemic landscape must promote strong relationships & partnerships with local farmers and producers and introduce their products & flavors to guests in delicious and sometimes, surprising ways.

It is anticipated that hotel guests will expect venues to rely less on imported goods while using more locally-produced items within a 75 mile (100 km) radius due to support local initiatives, the need to embrace the local culture, current (and future) supply chain restrictions, and simply more robust, fresh flavors.

Buffet Pivots

Remember waking up at a hotel and strolling down to the lobby for the breakfast buffet? Sadly, that will be just a memory for most moving forward. It’s likely no secret that it will be a long time before buffets come back. Even with sneeze guards, hotels must (temporarily) shift to à-la-carte menus, made-to-order options, and individually packaged grab-and-go items.

The buffet concept (for breakfast and other day-parts) could also opt to switch to cafeteria-style model instead of self-serve stations (with physical distancing measures in place). Even hotel restaurants with self-serve beverage stations, breakfast bars, salad bars, and a toppings bar will likely need to eliminate these self-serve stations in order to comply with guidelines from both a government point of view and guest sentiment point of view.

These “serving stations” could be individually prepared & plated in real-time by staff from behind the counter which likely means more labor – but providing a safe experience which will win guests over – providing opportunity for further awareness, revenue & profits.

Off-Premise Revenue

Many hoteliers and hotel brands around the world have begun to shift their food & beverage operations amid the pandemic, catering to locals by launching both takeout and curbside pickup options.

With the introduction of this new revenue channel, it is anticipated that it will stick around for quite some time.

Hotel F&B programs must also offer access to more premium grab & go options and also meal-kits. Whether for a day out exploring the city (remember they may be hesitant to stop in a restaurant they don’t know), or on the way to a business meeting, hotels are uniquely positioned to meet guest needs by leveraging their full-service kitchens to supply pre-made meals, snacks, and even F&B experience kits.

Micro-Experiences

From mid-scale to luxury, some hotel brands are taking the resurgence of “at-home” dining to the next level by creating unique F&B packages for micro-groups at the hotel itself.

As an add-on at booking, guests for example can upgrade to a private dining package that includes customized tastings, cooking tutorials, wine pairings, and cocktail making – all in a private space.

For some hotel & resort properties, the often abundance of outdoor space can also provide ample opportunity for seasonal or year-round food & beverage experiences. Picture open-fire kitchens, bar pavilions, and an atmosphere complete with comfortable seating, temperature control systems, and (hopefully) impeccable views for couples, families, and small group gatherings.

Technology Stack

There are a lot of ways technology will enhance hotel operations and experiences moving forward, both in and outside the food & beverage department.

Inside the kitchen, remodels are expected to happen over the next 1-3 years to adhere to the quick-service demand, the demand for the noted new experiences, and the potential lack of qualified staff. This means more self-cooking oven stations, simplified processes, smaller footprints, and smart kitchen technology.

A high level of convenience and contactless service will also be critical on the consumer side, when it comes to on-premise (F&B) room service.

One way to ensure a frictionless experience is through the use of technology.

Approximately one in four hotel guests surveyed by the American Hotel & Lodging Institute, think it’s important for hotels to have 24-hour room service. They want the option to have incredible food and beverage, no matter the time of day.

Post-pandemic, this will still hold true but the service sequence needs to change so that it includes the use of technology and contact-less service, both in the hotel restaurant(s) and in-room. The data shows that one in five guests also want the convenience of ordering with technology – via the hotels app on their phone or even through the TV in their room.

The order can then be packaged & delivered to the outside of the room, to their table in the restaurant, or by having a technology-driven “pick-up locker” in the lobby with mobile phone use to access the food delivered via the hotels kitchen or any third-party delivery partners.

And when it comes to customizing mini bars, 14 percent of guests would choose a hotel where the mini bar is personalized to snack and drink preferences based on the historic data from previous stays or allergies. While some argue the mini-bar is done due to the pandemic – we think hotels just need to personalize it and then make it a point of sanitation between stays.

Quick summary; hotel food & beverage programs must continuously react, adapt, and execute as consumer demand and sentiment fluctuates; both short-term and long-term while providing both unique one-of-a-kind experiences and brand activations.

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