Employees

by David Klemt David Klemt No Comments

Hiring Struggles? Engage These Age Groups

Hiring Struggles? Engage These Age Groups

by David Klemt

Chef plating greens on plates

Staff turnover rates are still above pre-pandemic levels and there’s no silver bullet solution. However, two companies have some helpful advice.

Both Service Management Group and Technomic shared their tips during Restaurant Leadership Conference. Interestingly, each company has a different approach to the current hospitality industry labor problem.

In short, both SMG and Technomic advise operators to engage with vastly different age groups. However, they each have information that supports their recommendations.

Service Management Group

Jennifer Grimes, senior vice president of client services for Service Management Group, co-presented a session with Jim Thompson, COO of Chicken Salad Chick.

SMG is a software-with-a-service platform that seeks to the employee, customer, and brand experience. One crucial element of the company’s mission is the reduction of staff turnover.

During the RLC session, Grimes shared several years of hospitality turnover rates:

  • 2017: 72%
  • 2018: 75%
  • 2019: 79%
  • 2020: 130%
  • 2021: 86%

First, some context. The general consensus is that the industry’s average turnover rate has been between 70 and 80 percent for close to a decade. However, in comparison to other industries—10 to 15 percent—that’s stratospherically high.

Secondly, the turnover rate has been on rise since before the pandemic. Per some sources, the rate jumped from 66 percent in 2014 to 72 percent in 2015, a trend that continues to this day.

For SMG, the age group operators should seek to engage—generally speaking, of course—is 25 to 34 years old. Per the SWaS platform, this group was the most engaged pre-pandemic.

One reason for SMG’s suggestion is that Boomers appear to opting out of the workforce.

During the presentation by Grimes and Thompson, the latter shared that Chicken Salad Chick predicts the 2022 turnover rate to be just slightly above the 2019 rate.

Technomic

Unsurprisingly, Technomic had some numbers to share during RLC 2022 in Scottsdale, Arizona.

Per data provided by Joe Pawlak and Richard Shank, 70 percent of operators are still struggling with labor. Recruiting, hiring, and retaining staff doesn’t appear to be getting any easier four months into 2022.

Technomic also pointed out that the US saw the lowest population growth in its history last year: 0.1 percent.

Additionally, almost 17 percent of the country’s population is now at least 65 years old. In 2019, 48 percent of people 55 or older retired. That number is now just over 50 percent for the same age group.

Nearly seven million American consumers turn 60 each year, while four million turn 70 or older.

Logically, one may assume that Technomic is saying a significant portion of the US population is leaving the workforce. So, it’s best to focus on the same age group as SMG recommends.

However, Technomic is recommending a different strategy. Per Pawlak and Shank, retirees (mostly ages 55 and up) tend to have valuable managerial skills and experience.

Obviously, those skills and all that experience can be of great benefit to operators and our industry.

Certainly, all groups should be engaged by operators seeking to recruit, hire, and develop their teams. So, as KRG Hospitality sees recruitment, operators should craft targeted, authentic messaging that appeals to each age group.

Image: Sebastian Coman Photography from Pexels

by David Klemt David Klemt No Comments

Leadership Facepalm, Part Two

Leadership Facepalm, Part Two

by David Klemt

Airplane email icon set against white brick wall

In a stunning example of tone-deafness and callousness, a franchisee executive sent an email that led to severe consequences.

And no, I’m not talking about the termination of the offending exec. That, in my opinion, was well deserved.

In this instance, the email has led to mass resignations and damage to a global restaurant chain’s reputation. What’s more, the negative impact to the brand’s reputation comes from consumers and employees.

Of course, I’m talking about the now-infamous Applebee’s “gas prices” email.

The Email: Labor

Let’s just jump right into the email, because…wow.

“Most of our employee base and potential employee base lives paycheck to paycheck,” writes the executive. “Any increase gas prices cuts into their disposable income.”

This could have been an excellent example of awareness and perhaps even empathy. In the context of this email, it’s appalling.

Why? Mainly because this executive appears to be celebrating the fact that Applebee’s employees, at least those who work for this franchisee, are barely earning a living wage.

“As inflation continues to climb and gas prices continue to go up, that means more hours employees will need to work to maintain their current level of living,” continues the author.

In this exec’s view, this franchisee is “no longer competing with the government when it comes to hiring.” He cites stimulus payments and boosted unemployment support have run out. Therefore, he reasons that people will be forced to return to the workforce.

The author further points to competitors increasing wages to recruit and retain employees. This, he figures, is untenable and some will have to close their doors. So, the labor pool will fill up and this franchisee will benefit.

The Email: Wages

Some of what I’ve laid out above is accurate. According to some estimates, about two-thirds of Americans live paycheck to paycheck.

Additionally, it’s accurate to state that some employees will seek more hours to combat the effects of rising costs. Further, yes, the labor market is turbulent and challenging.

And, unfortunately, some independent operators are facing incredibly difficult decisions. To recruit and retain, they’ll need to be competitive and raise their wages. To pay for that, they’ll need to raise prices, passing on rising costs to customers. In some instances, for some operators, that will prove unsustainable.

However, an executive in this industry shouldn’t be delighted about any of this. And they certainly shouldn’t see it as an opportunity to potentially pay employees even less.

You see, the author of this email suggests that the franchisee can bring in new workers “at a lower wage to decrease our labor (when able).”

He then recommends monitoring employee morale to ensure that the Applebee’s operated by this franchisee is their “employer of choice.”

For me, however, the most eyeroll-inducing line is this: “Most importantly, have the culture and environment that will attract people.”

Images of printouts of the email reveal that at least a handful of recipients agreed. “Great message Sir! [sic]” reads one response. Another paints the email as “Words of wisdom.”

Clearly, the culture and environment are unhealthy.

The Consequences

Before I proceed, know this: I’m not going to name the author. It’s not remotely difficult to find the author’s name if you feel the need.

However, I will name the franchisee that finally fired him. American Franchise Capital reportedly owns more than 120 Applebee’s and Taco Bell locations in nine states.

So, to be clear, this executive didn’t work for Applebee’s directly. In fact, Applebee’s has disavowed the former executive and the email.

In the interest of clarity, it’s possible the author worked for Apple Central LLC, owned by American Franchise Capital.

As far as fallout, it was swift. According to reports, consequences were realized immediately. A Kansas franchise manager was shown the emails, printed them out for staff to discover, and comped the meals of everyone at the location. Then, he quit and the staff walked out.

Per reporting, four other Applebee’s managers quit, as did several employees. The location remained closed for at least the following day.

If reports are accurate, Applebee’s lost five managers, nearly a dozen employees, and sales from a location for at least two days. That’s just the localized fallout.

Applebee’s, of course, is distancing the company from the former executive. However, that’s not going to stanch the reputational bleeding and turnover.

As we know, a significant percentage of consumers want to know their dollars and support are going to companies that align with their values. The same is true of employees; they want to work for companies with values they can get behind.

A Final Thought

This now-infamous email was sent March 9. Just two weeks later, it was circulated and went viral. The author, gleeful about being able to hire employees “at a lower wage,” was fired before the end of March.

I’ve seen several takes on this situation, and I’ve read some accompanying leadership advice. One in particular caught my attention.

Unfortunately, it’s not because I thought it was great advice: Be cautious about what you send via blast emails.

I’m not saying one shouldn’t be careful about what they send out in emails—that’s good advice. However, that’s not the lesson I’ve learned from this situation.

Personally, I see this as a lesson in emotional intelligence, relationship intelligence, brand culture, and work environment.

At least two companies, one with annual sales in the billions of dollars, another in the hundreds of millions, have had their reputations tarnished. The fault may not lie with Applebee’s but they’ll be dealing with the consequences regardless.

If an operator is going to learn anything about being cautious, it’s this: Be cautious when hiring those in leadership positions. Be cautious about those with whom you enter into partnerships. And be careful about how you view those who work for you.

If you aren’t seeing those who choose to work for you as people worthy of your respect, as human beings, your brand’s culture is poisoned.

Image: Daria Nepriakhina on Unsplash

by David Klemt David Klemt No Comments

Leadership Facepalm: Don’t Do This

Leadership Facepalm: Don’t Do This

by David Klemt

Close-up shot of person texting on phone in a restaurant

Here’s a hot take on the employer-employee dynamic: Don’t text staff at 3:00 in the morning demanding they come in on their day off.

In fact, let’s compress this piece of advice. Don’t text staff at 3:00 in the morning.

Really, I shouldn’t have to explain the myriad reasons that doing so isn’t acceptable. However, a post on Reddit shows that this topic needs addressing.

Are You Serious?

Yes, I’m using a Reddit post as an example of what not to do. And yes, I’m going to assume the post is legitimate for the purposes of education.

Owners, operators, and members of leadership teams need to lead. Micromanaging, assuming staff is at their beck and call, and domineering behavior only lead to high turnover.

A high staff churn rate is costly, and not just financially. Yes, it costs thousands of dollars to replace a single member of staff. However, immediate financial costs shouldn’t be the only concern.

Churning through staff also damages a restaurant, bar, hotel, or owner’s reputation. Should they become known as a bad employer—word gets around quickly in this industry—and eventually an operator won’t be able to hire rock star talent.

Over time, they’ll only draw in workers that chase away their guests. After that, the operator will be closing the doors.

“You Need to Be a Team Player”

Interestingly, the Reddit post that’s inspiring this article isn’t brand new. The post in question is about six months old.

But these days, with the shift in the employee-employer dynamic that’s taking place, stories of “epic” or “savage” quitting garner attention.

Again, there are myriad reasons people are drawn to these stories. Rather than read through those, let’s take a look at this quitting story.

A bartender took to Reddit (again, I’m assuming this is a fact) to share texts from his (former) manager. The timestamp on the first text? 2:59 in the morning.

“I need you to come in from 11a-10p today,” starts the text. The reason? Only one bartender is on the schedule for an event that day.

In response, the bartender says, “No thank you,” stating it’s their day off. And then the manager makes a demand using a term that gets thrown around far too much when some people in a position of authority don’t get the response they want (in my opinion).

The bartender is told they need to be a “team player,” and that “it isn’t all about you.” On a positive note, the manager does then say “please” and asks the bartender to come in.

Putting their cards on the table, the bartender says they’ve had a few drinks and don’t want to work an eleven-hour shift with a hangover. Personally, I don’t think the manager was due that explanation but okay.

This doesn’t sit well with the manager, who now attempts to police the bartender’s personal time. According to the texts, the bartender needs “to stay ready for work.” This is apparently because “getting too drunk is not a good look if you can’t stay prepared.”

“Fed Up with You”

After a few more texts back and forth, the manager fast-tracks this situation’s escalation. The bartender is told that they’re going to talk about the bartender’s “attitude” when they “come in Sunday.”

Well, it’s highly unlikely that conversation ever took place. According to screengrabs of the texts, the bartender replies, “No we’re not.” They then proceed to remind the manager that “dozens” of places are hiring bartenders. They’re happy to go work for one of those businesses.

Unsurprisingly, the manager attempts to backpedal. They say that the bartender is making a rash decision “because you’re drunk” and will regret it the next day. That approach doesn’t work.

Now, there’s one sentence that suggests to me, if this situation is real, that the owner needs to address this manager. Or, if this manager is the owner of the business, that they need to work on developing leadership skills.

That line? “I’m fed up with you.”

Sure, they could mean they’re fed up with them in this instance. However, the line follows the bartender saying that their are several other places they can find work instead.

My interpretation is that at a minimum, these two have a problem with one another. Worst case, this manager isn’t doing the owner (or themselves) any favors with their “leadership” style.

Just…Don’t Do This

Please, please, please, don’t text or call staff at 3:00 in the morning. There are perhaps a tiny handful of reasons to ignore this advice. As I see it, those reasons all involve emergencies.

And no, being short-staffed for an event the following morning is not an emergency worthy of texting or calling an employee to cover a shift so late at night/early in the morning.

There are several leadership and scheduling solutions that can prevent this type of situation. In this particular instance, since the bartender was “fed up with” this manager, they were going to quit sooner or later.

Which brings me to my first point: Operators need to know what their leaders are doing. How are they treating staff? How does the staff perceive the leadership teams?

Secondly, how do the operator and other leaders perceive one another? Is everything running smoothly or is one “leader” not really leading?

And finally, scheduling technology. These days, there’s really no excuse for many kinds of scheduling problems. Several scheduling apps integrate well with popular restaurant, bar, and hotel POS systems.

For example, HotSchedules gives staff the ability to give away, swap, and pick up shifts. Another example is OpenSimSim, which provides an open shift invite feature. Staff can also set their profiles to auto-accept shifts as they become available.

7shifts and Schedulefly can also help fill shifts. And like HotSchedules and OpenSimSim, leaders can message groups and individuals, and vice versa.

Perhaps the biggest takeaway here is this: The maxim, “People don’t leave jobs, they leave managers,” is accurate. Leaders need to respect their team members and their personal time.

Image: Alex Ware on Unsplash

by David Klemt David Klemt No Comments

Adding Veterans to Your Team

Adding Veterans to Your Restaurant, Bar or Hotel Team

by David Klemt

Military combat helmet in digital camouflage

Do more this Veterans Day by encouraging those who have served to apply and interview for available positions on your team.

There are several benefits to providing job opportunities to veterans, regardless of the country (or countries) in which you operate.

Of course, there are dos and don’ts that come along with recruiting, hiring and working with veterans.

Benefits to Hiring Veterans

Before we begin, a caveat: Remember that veterans are individuals. “Veteran” is a label, a designation, a descriptor. In no way is one person who is a veteran interchangeable with another.

That said, there are some elements of military service that are similar to those of successful hospitality operations.

Teamwork, a strong work ethic, leadership skills, precision in tasks, achieving goals, consistency in results… When a restaurant, bar or hotel team is operating at its best, it can be said they work with military precision.

Generally speaking, veteran job candidates bring experience to the table that can benefit an operator greatly.

Additionally, it’s commonly said that hospitality leadership should hire for personality because they can train requisite skills. Speaking generally again, many veterans are so used to receiving specialized training that they’ll likely appreciate and respond quickly to yours.

If you want your business to operate with military precision, why wouldn’t you hire military personnel who fit well within your team?

Questions to Ask During Interviews

Obviously, there are definite dos and don’ts when it comes to discussing a veteran’s military experience.

As curious as you may be about some aspects of a veteran’s experience, questions shouldn’t be invasive or offensive.

Some examples of questions you should ask are:

  • “What did you do (in the Air Force, Army, Coast Guard, Marines, Navy, National Guard or Reserves)?”
  • “Why did you choose that branch of the military?”
  • “How long did you serve?”
  • “Do you come from a military family?”
  • “Where were you stationed during your career in the military? Did you visit any other countries?”
  • “Where was your favorite place you visited or lived?”
  • “How do you think your experience in the military will benefit you here?”

As you can see, nothing in those questions should make a veteran applicant uncomfortable.

Questions and Behaviors to Avoid

Speaking of discomfort, there are many questions that you should never ask a veteran. Not just during the interview process, but ever.

Also, if a veteran informs you they’re uncomfortable answering a question about their service, that should be respected.

Examples of questions and topics you should avoid are:

  • “Do you have PTSD (Posttraumatic Stress Disorder)?”
  • “Do you find it hard to get back to ‘real/regular’ life after being in the military?”
  • “Did you ever get shot/stabbed/bombed?”
  • “Did you ever kill anyone?”
  • “What’s the worst thing that ever happened to you while you served?”
  • Current military conflicts, particularly if you haven’t served in the military.
  • Referring to elements of work through military analogies.
  • Insulting branches of the military if you never served.

In short, treat veterans with the respect their deserve, as you should any other member of your staff. Veterans aren’t novelties or curiosities—they’re people.

For too long, veterans have faced undue scrutiny and undeserved stigmatization. It shouldn’t be difficult to turn that around when the solution is simple: Give veterans respect; treat them like  people since that’s precisely what they are; and provide equal opportunity.

Image: israel palacio on Unsplash

by David Klemt David Klemt No Comments

You’re Competing Against Chains for Labor

You’re Competing Against Chains for Labor

by David Klemt

Help sign outside business

Independent operators and local chains aren’t just competing with one another for staff, they’re up against global brands.

Unfortunately, that means competing against massive corporations that can offer higher wages and all manner of benefits.

However, smaller operations can still take steps to lure workers and fill open positions.

The Threat

In response to the labor shortage, many national and global chains are increasing hourly wages.

For example, Chipotle boosted wages for hourly workers to $15 per hour a few months back. Along with this boost in wages came a hike in menu prices: four percent across the board.

Earlier this year, McDonald’s also announced they would boost hourly pay. Hourly workers saw a boost of about ten percent. Of course, this chain also found itself dealing with increased supply costs. To offset a rise in costs of at least four percent, McDonald’s also boosted menu prices.

The latest to enter the labor fray is Starbucks. And like other chains, the corporation addressed the issue of hourly wages publicly.

Indeed, Starbucks’ announcement shares several details. First, staff who have worked for the company for a minimum of five years could see a pay raise of ten percent. Those who have been with the company for at least two years (but less than ten) could get a raise of five percent.

However, it doesn’t end there. Starbucks workers in the United States can take advantage of $200 referral bonuses. On average, Starbucks says hourly wages will range from $15 to $23 per hour, with an average of $17 per hour. The company expects these wage changes to be in place by Summer 2022.

Solutions

Of course, one doesn’t have to need revenue in the tens of millions or billions of dollars to compete for staff.

We’ve addressed this topic several times on the KRG Hospitality site. In particular, we’ve brought up increasing menu prices to support wage hikes. Specifically, we recommend borrowing from Chipotle and McDonald’s: Be transparent and explain why menu prices are going up.

Additionally, Bar Hacks guests like Chef Brian Duffy and Lynnette Marrero have spoken about this topic.

As Chef Duffy says during his second appearance, treating staff better is a big step toward reducing turnover. Word spreads among hospitality workers, and improved employer-employee relations is an excellent recruitment tool.

Another effective benefit? Flexible and improved scheduling which, of course, can be implemented easily via scheduling apps.

Mentorship is a powerful recruiting and retention tool. Both Chef Duffy and Marrero believe in the power of this benefit. They have decades of experience to pass on to staff that can help their careers.

Marrero also suggests implementing labor structures that corporations don’t offer. For instance, she suggests new operators are well positioned to offer earned equity, profit sharing, and co-op ownership structures.

Existing operators can also leverage Marrero’s ideas. However, they’ll need agreement from their investors if they have any.

Now that you know where labor threats are coming from, you can strategize and fight back. You may not have billions of dollars in the bank, but you’re nimble and can implement changes much more quickly. Listen to your staff and be open to making meaningful but reasonable concessions.

Image: Fernando Venzano on Unsplash

by David Klemt David Klemt No Comments

Incentive Economy: What are You Offering?

The Incentive Economy: What are You Offering?

by David Klemt

Chef's knife and honing rod crossed on cutting board

You know about the gig economy but are you familiar with the incentive economy?

It’s quite simple, and there are myriad ways for operators to engage with it. In fact, you likely already participate in the incentive economy in some way.

To put it succinctly, the incentive economy is all about the perks of a job beyond a paycheck.

The Old Ways are Out

On episode 53 of our Bar Hacks podcast, Chef Brian Duffy addresses the need for changes in our industry directly.

First, he tackles the lack of transparency in leadership by some operators. As Chef Duffy says, “That’s an old school way of doing it. That was an old school way, that was the Eighties.”

According to the chef, and we wholeheartedly agree, we now find ourselves in a “different phase” in the industry.

Then, Chef Duffy takes on how leadership in the industry treats staff.

One effective recruiting and hiring incentive Chef Duffy offers on the podcast deals with scheduling. None of his cooks close both nights of a weekend. He also posts schedules two weeks in advance so there are, A) no surprises, and B) if staff need to swap or drop, they have time to do so without impacting the business.

This simple scheduling incentive is attractive to new hires and existing staff. Why? Because working unpredictable, erratic hours is stressful.

“That ruins your life,” explains Chef Duffy.

If operators want to attract new hires, keep their team together, and reduce turnover, listening to staff about scheduling is crucial.

Things Need to Change

Chef Duffy shares a story on the podcast about his daughter and her experience working at a restaurant operated by a hospitality group.

No, he doesn’t name the group or the concept. The who isn’t the point here, it’s the what.

That what is how leadership bungled not only a scheduling issue but also how they botched Chef Duffy’s daughter’s two-week notice, her final shifts, and her final pay.

For more context, his daughter wasn’t a new hire who bailed after perceiving she had been treated poorly. She had worked at that restaurant for a year, there were ongoing issues, and she finally left.

As we all know, we’re down about a million jobs in this industry. That loss isn’t simply because of the pandemic. Our industry is undergoing a seismic cultural shift and we’re losing people who won’t return to hospitality.

Things need to change if we’re going to reverse this trend and strengthen the industry. KRG Hospitality president Doug Radkey addresses the change we need in his latest book, Hacking the New Normal. Chef Duffy addresses some of the necessary changes on our podcast as well.

“We can complain as much as we want, but we created it,” Chef Duffy says. “We as owners and operators and managers, we created what’s happening right now.”

Get Creative

The only limits to incentivizing your staff are your imagination, staying consistent with policies and procedures, being respectful of your staff and guests, and the law. Remain in those confines and get creative.

An incentive doesn’t need to be a grand gesture or prize. In many instances, something that makes a shift more fun and breaks up the monotony is enough to energize the staff.

“I want my staff, I want my front-of-house staff, to know what my sales goal is for the day,” says Chef Duffy. “And then I want to run a contest with that.”

One of the chef’s favorite contests is simple and highly motivating: Follow the Twenty.

Chef Duffy puts a twenty-dollar bill into play against a particular item or menu category. For example, either a specific dessert or any dessert.

Whenever a team member sells a dessert, they get the $20 that’s in play. If a different person sells another dessert, they get the twenty. Follow the Twenty incentivizes the first person to sell more of an item to hang onto the money, and the game motivates the rest of the staff to outperform their coworker to get the prize.

The last member of staff to sell a dessert that shift or day keeps the money.

Offering another creative incentive he’s seen, Chef Duffy shares that there’s a restaurant out there offering a free tattoo to kitchen staff that stays for at least 30 days. Will some staff leave after they get their tattoo? Possibly. Hiring wisely, implementing training policies and procedures, treating staff with respect, making scheduling easier and more flexible, ensuring clear communication is embedded in the fabric of your brand’s culture, and offering further incentives can prevent that turnover.

Offer Ongoing Education

“We live in an incentive world now,” says Chef Duffy. Explaining that he doesn’t operate large kitchens, large bars, or employ large teams, he admits he can only do so much in terms of incentives.

However, his approach to incentivizing staff to stay starts with this example of true leadership: “The one thing I can do is treat my employees well.”

With decades of experience in the industry, Chef Duffy’s knowledge is something he can offer his staff. A big believer in education, passing down information that can enrich team members’ careers and lives is an incredibly valuable incentive.

During a recent training session with a very young kitchen staff, the chef started with the very basics of education.

“Hey, guys, here’s a knife. This is a knife,” he said to the kitchen staff. “There’s seven different parts to a knife. Here’s the most powerful part, here’s the most precise part. This is how you hold it, this is what we do…”

Just reading that, it may seem like Chef Duffy was being condescending. That’s not the case. He wants to share as much of what he’s learned over the years to pass on his collected knowledge.

“I want people to feel as if they’re gaining something from me and the knowledge that I have rather than, ‘Go cut those onions and I’m gonna yell at you if you do it the wrong way,'” says Chef Duff.

Make Meaningful Change Today

Making impactful change can feel overwhelming. Let’s face it, it’s easier to just stay the course. But these days, staying the course can cost you your staff, then your guests, and then your business.

One way to start making change is to look inward at yourself, and at your leadership team.

Are your staff gaining anything from you beyond a job and paycheck? Is your leadership team mentoring and incentivizing staff? Are you, your leaders, and your team happy at work?

If the answer to those questions is “no,” do what’s reasonable to improve your brand’s work culture.

As Chef Duffy says, “The whole dynamic of it has to change and we have to take better care of our employees.”

Image: Steve Raubenstine from Pixabay

by David Klemt David Klemt No Comments

What’s a Marketing Fund?

What’s a Marketing Fund?

by David Klemt

Vintage cash register in black and white

Do you know what a “marketing fund” is?

Moreover, if you know what I’m talking about, do your managers and staff have access to it?

A marketing fund—not your marketing budget—is a useful tool that can solve guest experience issues quickly.

What it Is

Both Doug Radkey and I mentioned marketing funds last week.

First, I brought it up in my article about communication and staff empowerment. Next, Doug included the marketing fund on last week’s Bar Hacks bonus episode, titled “Empowerment.” There, he shared the story that inspired my article.

Simply put, a marketing fund is a bit of cash kept on hand for use in a variety of situations.

Some people call it petty cash. Others refer to it as an “emergency” fund. We call it a marketing fund.

Whatever you choose to call it, it’s a small amount of cash most accessible by a manager or, often times, a bartender.

How to Use It

Operators will have to decide on the amount set aside; how often to replenish it; and who has access to the marketing fund.

For some, $40 may be feasible. Others may find that setting aside $200 for the week may work best.

In most cases, a register behind the bar serves as the marketing fund’s home. A manager or bartender knows where it is and can find it quickly.

Now, you’re likely noticing the word “quickly” is coming up a lot in reference to the marketing fund. That’s the point—quick, smooth problem solving.

So, come up with your rules and expectations regarding the marketing fund. Communicate those expectations. Then empower specific team members each shift to access it.

Of course, this requires trust in the team, their integrity, and their sense of what is and isn’t reasonable.

When to Use It

Again, this is about what’s reasonable and acceptable to an individual operation.

Will buying a round ease tensions and put a guest’s experience back on a positive track? Use the marketing fund.

Is there a promo that’s going wrong for a guest that a manager can solve with cash (a gift card problem, for example)? Access the marketing fund.

Will running across the street to grab an item solve a guest problem? The marketing fund can help.

This works for several reasons:

  • Staff can solve a guest’s issue quickly. This eases tensions and improves the guest experience.
  • Guest-facing or other issues can be solved smoothly. In some instances, the guest won’t even catch on that there’s really a problem.
  • Marketing fund transactions are traceable.
  • The marketing fund holds the operator and staff accountable. Are issues consistently arising during certain shifts or with specific team members? Something needs addressing.

The marketing fund is a practical, useful tool. Its use is trackable and ensures accountability. Consider implementing this fund today.

Image: Evergreens and Dandelions on Unsplash

by David Klemt David Klemt No Comments

10 Words that Exemplify Leadership

10 Words that Exemplify Leadership

by David Klemt

Level Up neon sign in white and yellow

During episode 50 of the Bar Hacks podcast, Travis Tober sums up restaurant and bar leadership in just ten words.

In fact, this seemingly “small” sentence explains leadership and buy-in for essentially every type of business.

Let’s take a look at what Tober, co-owner of Nickel City and owner Old Pal, says that resonates with me.

10 Important Words

So, what does Tober say during his first appearance on Bar Hacks that embodies leadership?

The following, about his general manager:

“He knows the brand just as good as I do.”

How do those words exemplify leadership and buy-in? For several reasons:

  • They illustrate transparency from the owners.
  • Those words show trust.
  • The ten words put buy-in and mentorship on display.
  • They show that the GM possesses a sense of ownership of the brand.
  • The brand is obviously defined clearly.

Buy-in is Crucial

As an entrepreneur, consider what you’re asking of the people who work for you. You’re expecting others to help you achieve your dream.

So, why would they take their role in your business seriously rather than only seeing it as a paycheck? The answer is simple: buy-in.

Staff want to feel as though they’re a part of something—they don’t want to work just to pay bills.

As difficult as it may be, an operator needs to trust the people they hire.

Why would you want them on your team—and you need to build a team, not just have employees—if you don’t trust them? Filling roles just to have bodies in the building is a losing strategy, labor shortage or not.

In addition to trust, there needs to be brand indoctrination. Every employee should be a brand evangelist for you and your business.

One of the most powerful recruiting and marketing resources at your disposal is your team. People they encounter should want to spend time and money at your business because of your team. They should want to work for you after observing your team at work and out and about.

If that’s not happening, something is wrong. Your team doesn’t trust you; doesn’t feel as though you trust them; doesn’t feel empowered; or doesn’t believe they’re really a part of your brand and business.

So, ask yourself a simple question: Can my GM, management team, and staff say they know my brand as well as I do?

Listen to episode 50 of Bar Hacks with Travis Tober on Spotify, Apple Podcasts, or wherever you listen to podcasts.

Image: Damir Kopezhanov on Unsplash

by David Klemt David Klemt No Comments

Why Communication and Empowerment Matter

Why Communication and Empowerment Matter

by David Klemt

Employees at front desk in hotel lobby

To truly embody the spirit of hospitality, internal communication and empowering staff must be part of your operation’s culture.

A situation KRG Hospitality president Doug Radkey found himself in recently could have been resolved quickly and smoothly.

However, it’s clear the staff lacked communication from the top. Nor did they have the ability to solve problems as they arose.

Let’s dive in.

Guest Experience

First, I’m not going to reveal where this incident took place. In fact, I’m not even going to provide the location.

Second, the problem arose at the front desk of a hotel. A well-staffed front desk—there were four team members working.

The issue was fairly minor but impacted the guest experience.

So, Doug and Jennifer Radkey booked a hotel over the weekend. They made their decision in part because of an available package. Among the perks of the package was a $50 gift card for a nearby restaurant.

Stopping by the desk on the way up to their room, Doug asked for the gift card. The desk clerk he asked had no idea what he was talking about.

In fact, none of the four front desk clerks knew about the promotion. Doug pulled up the hotel’s website and promotion on his phone, and showed the clerks.

Doing so jogged one clerk’s memory. However, details were still mostly unknown. There was no manager on duty and the staff searched through drawers looking for the restaurant gift cards.

After about ten minutes of searching, Doug said he and Jennifer were headed up to their room to get ready for dinner. They’d be down in an hour for the card (hopefully).

A Resolution, Kind Of

True to their word, Doug and Jennifer returned to the front desk for the gift card.

Miraculously, the front desk clerks had found one. (However, Doug thinks one of the team members ran over to the restaurant, bought a card, and brought it back to the hotel.)

One more note: A housekeeping team member had overheard the incident at the front desk as it was unraveling. She chimed in to suggest the front desk just knock $50 off the hotel stay or give Doug and Jennifer $50 cash to take to dinner.

Instead, as I just explained, the front desk clerks got their hands on a gift card.

But let’s look at what wrong here:

  • The guest encountered a service issue and waited more than ten minutes for any sort of resolution.
  • That resolution didn’t come for more than an hour.
  • It’s clear the staff received insufficient notice and details about the promotion.
  • The staff was also most likely not empowered to provide quick resolutions to guest problems.

Doug’s incident could have been resolved quickly and smoothly through communication and staff empowerment.

Communication

Clearly, communication is key for any business to operate smoothly. That’s not limited in any way to hotels or hospitality—all businesses in all industries need to value communication.

In fact, clear communication is a foundational value. Communicating clearly needs to be part of every operator’s core values and ingrained in their brand’s culture.

If there’s a promotion, if there’s a special, if there’s anything “unique” happening at a hotel, restaurant, bar, entertainment venue, etc., the staff needs to know.

Operators should email the details to staff members. Managers should share the details of a promotion or special during shift meetings. Staff should know how to enter promotions into the POS.

It’s doubtful that Doug would’ve encountered this gift card issue if clear communication was an important element of the hotel’s culture.

The front desk clerks would’ve known about it, and likely would’ve handed over the gift card upon check-in. Barring that, they would’ve known where to find the cards quickly and easily so they could’ve handed one out upon request for those guests who booked a room via the promotion.

Empowerment

There’s a second element of this particular guest experience equation: empowerment.

Had the front desk staff been empowered to correct mistakes as quickly as they may arise, it’s possible Doug would never have noticed there was an issue.

As difficult as it may be, operators and managers need to trust their staff. If that’s not happening, there are deeper issues at play that must be addressed and corrected.

If this hotel staff—remember, four clerks deep—were accustomed to adapting and resolving problems on the fly, that would’ve been evident.

This article wouldn’t exist because Doug wouldn’t have had a memorable negative guest experience to share with me.

Up to a reasonable point, guest-facing staff need to be empowered to solve problems quickly. It’s up to individual operators to decide what’s reasonable.

Upset guests don’t like encountering issues, obviously. Do you know what they really don’t like? Having to repeat themselves or watch staff flounder to reach a satisfactory resolution.

An empowered staff can assess a situation, target the problem, and resolve it without involving anyone else. And they can do so quickly and smoothly.

A Better Resolution

How could this issue have been resolved faster, accounting for the poor communication regarding the promotion? A daily or weekly “marketing fund.”

Some operators set aside an amount of cash for bartenders or other front-of-house staff to use at their discretion to solve problems. When that marketing fund is accessed, it’s reported and management can review the who, how much, and why at the end of the night.

In this case, $50 could have been handed over and accounted for with a, “I’m so sorry, we seem to be out of gift cards at the moment, this offer has been so popular,” and Doug would’ve only had a slight inkling of an issue.

Again, there were four front desk clerks present when this happened. Three didn’t know about the promotion. One clerk had a foggy idea about the promotion.

This wasn’t a staffing issue, nor was it a pandemic issue. And 19 months in, as harsh as this may seem, the pandemic can’t be the fallback excuse for every issue that comes up.

The following day, a manager learned of the incident upon Doug and Jennifer checking out the next day. He apologized and knocked $50 off their stay.

That wouldn’t have been necessary had leadership communicated about the promotion clearly. It certainly wouldn’t have been a painful incident had the staff felt empowered to make impactful guest experience decisions.

Today, commit to reviewing your operation’s communication. In all honesty, is it clear? Can it be improved? Have there been issues lately that could’ve been avoided if clear communication was part of your brand’s culture?

Once you’ve reviewed communication, as yourself if your staff feels empowered to solve guest issues quickly and reasonably. If not, that must change as soon as possible.

Image: Rodrigo Salomón Cañas from Pixabay

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