Bar technology | KRG Hospitality

Guests enjoying an array of dishes at a restaurant

February 1, 2023by David Klemt David Klemt No Comments

4 Takeaways from Resy’s State of Dining

4 Takeaways from Resy’s State of Dining Report

by David Klemt

The State of Dining and What’s To Come in 2023 from Resy is an informative report that highlights several key developments to watch this year.

In fact, Resy’s report shines a light on ten trends and predictions for operators to consider. However, I’m going to address the four that stand out the most (to me).

For those who may be unfamiliar with Resy, the company is an online reservation platform. While Resy mostly serves major American cities, it does have a presence in Toronto, Canada, and London, UK.

Most importantly, the platform has a unique view of the industry. Resy looks at the industry through the lens of reservations, meaning they collect data concerning consumer behavior in real time.

So, let’s start with some compelling revelations based on reservation data. To view this report in its entirety, visit Resy via this link.

1. 5:00 PM

According to Resy, one reservation time is standing out from the rest. In comparison to 2019 and 2021, 5:00 PM reservations grew by two percent in 2022.

Now, two percent may seem like insignificant growth. However, given Resy’s reach and the platform’s number of active users, the opposite is true.

A two percent increase equates to hundreds of thousands of reservations.

Now, think about your restaurant or bar and consider your reservation distribution. Do you know which hour sees the most reservations? Not an assumption—do you have the data and therefore know the time?

If not, that’s information you need. Not only is this important for scheduling and controlling costs, it’s the benchmark you need to know if you have any chance of tracking change.

2. The Return of In-person Dining

This is one prediction that multiple industry (and even non-industry) publications are making for 2023. It’s the same for hospitality industry platforms: Companies see 2023 as the year restaurants and bars really come roaring back.

But when Resy makes this prediction, they’re using their reservation data to back it up.

First, last summer represents the single busiest season in the platform’s nine-year history. Second, a specific event, a dinner with chef-operator Massimo Bottura, sold out via Resy in a minute.

Third, October 2022. Why is this month worth pointing out in particular? By October, more Resy users had visited restaurants in 2022 than they had during the entirety of 2021.

Clearly, Resy expects this trend to continue and strengthen in 2023. Given their access to reservation data, this seems like a well-informed prediction.

3. Miami

In December of last year we checked out the best states in America for starting a business. Pennsylvania stood out to us for obvious reasons: our Northeastern office is in Philadelphia, with Kim Richardson at the helm.

Overall, Pennsylvania holds the number four spot on the Forbes list. For comparison, Florida slots in at number 45.

However, Miami appears to be an outlier for restaurant and bar entrepreneurs when it comes to Florida.

Per Resy, the restaurant footprint in Miami grew fourfold from 2017 to 2022. Moreover, Resy is seeing continuous growth in Miami. Going even further, this growth is coming from local and outside operators.

In fact, Resy describes South Florida as “white hot for high-profile sequels.” An operator has a top-tier concept? They’re likely to expand into Miami.

4. TikTok

Last week I addressed Datassential weighing in on photos versus videos. According to the F&B research firm, video is now dominating social media engagement.

And also last week, I explained the importance of discovery functionality. Operators who are considering adding a platform to their tech stack should consider whether it will help people discover their restaurant, bar, or hotel.

Resy is a platform that doesn’t just offer discoverability, it’s a core feature. So, when they say that TikTok appears to be a powerful discovery tool for restaurants and bars, that’s likely true.

Now, a poll Resy cites in their report reveals that traditional word of mouth is the top method of discovery. However, the same poll cites that TikTok is the top discovery platform for 43 percent of Gen Zers. Or, in other words, video, or digital word of mouth.

Should operators jump on TikTok? That’s something only individuals can determine is good for their business.

But if they’re courting Gen Z, well…they may need to add TikTok to their social media toolbox.

Image: Meredith Jenks for Resy

January 31, 2023by David Klemt David Klemt No Comments

Chief Marketing Officer Joins SevenRooms

Chief Marketing Officer Joins SevenRooms

by David Klemt

Just weeks after revealing a new partnership to start 2023, SevenRooms is now announcing their first-ever chief marketing officer.

Today, the guest retention platform takes another massive step in their march toward continuous growth. Josh Todd, former CMO of Mindbody, will serve as CMO of SevenRooms moving forward.

“Over the past year, I was able to get to know Joel and the SevenRooms team and see the differences they are making across the hospitality industry through data and insights,” says Todd. “Throughout my career, I have been passionate about deepening the human connections and experiences within the industries I’ve worked in, and I immediately recognized that SevenRooms truly embodies the operator-first mentality, making this a natural move for me. I’m honored to join the team and look forward to bringing my expertise and storytelling to the table.”

Todd’s appointment to CMO is yet another example of SevenRooms’ seemingly unstoppable growth. Each year, the platform strategizes, analyzes how their moves can benefit operators, and expands while streamlining.

It’s this growth that shows operators they’re here to serve the industry for the foreseeable future. And it’s this growth that should make operators confident about implementing SevenRooms in their tech stacks.

“As we head towards the next growth stage for SevenRooms, we are thrilled to welcome an experienced, proven leader in Josh to the team,” says Joel Montaniel, CEO and co-founder of SevenRooms. “Josh is a true full-stack marketer, highly analytical, and brings a strong point of view on what drives successful marketing organizations… With a background rooted in doing what’s best for operators and a true passion for bringing incredible experiences to life, we know his customer-centric approach will help propel us into the future.”

Continual Growth

In March 2021, SevenRooms appointed Pamela Martinez as the company’s chief financial officer.

By September of the same year, the platform had entered into a multi-year partnership with TheFork. This was significant news for operators throughout Europe and Australia. Additionally, this partnership illustrated how SevenRooms is pursuing global growth.

A month later, in October of 2021, the company formed a partnership with Olo. With this move, SevenRooms ensured clients who also use Olo were able to capture a key group’s data: off-premise customers. Using that information, profiles for those customers are created automatically. That means operators can learn more about—and effectively market to—customers who engage with them via online orders.

Then in December 2021, SevenRooms and ThinkFoodGroup—the hospitality company behind Chef José Andrés’ portfolio of restaurants—publicized their partnership. Interestingly, this partnership also saw ThinkFoodGroup joining SevenRooms in an advisory role.

To kick things off in 2022, the platform announced the hiring of a chief revenue officer, Brent-Stig Kraus.

Oh, and just weeks ago, to ring in 2023, SevenRooms entered into a partnership with Competitive Social Ventures.

Of course, not all of SevenRooms’ growth over the past few years involves crucial C-suite roles and entering into partnerships. While those moves benefit operators and our industry, there are other developments worth noting.

Along with hiring Martinez as CFO, the platform launched Direct Delivery in March 2021. This online ordering solution makes it easier for operators eliminate third-party fees; maintain control of the guest data they collect; and fulfill the guest desire to order from restaurants directly and effortlessly.

Image: Nick Fewings on Unsplash

Resy "Right this way" printed on wine key

January 27, 2023by David Klemt David Klemt No Comments

This is How Guests are Using Resy

This is How Guests are Using Resy

by David Klemt

Demand for in-person visits seems to be the big prediction of 2023, which means reservation platforms like Resy are crucial.

Of course, the value isn’t just the automation of reservations. Nor are these platforms just about simplifying waitlists.

Indeed, those are essentially the two functions such platforms must execute, and execute flawlessly. However, there’s more to modern reservation and waitlist platforms.

Today, guest-facing platforms should offer another feature to operators: discoverability.

This should go without saying but I’m going to address it anyway. With few exceptions, being discoverable is crucial for restaurants, bars, and hotels.

That means social media presence is crucial. Websites are still crucial. Operators ensuring they own their online review and travel site profiles is crucial.

In other words, if it’s online, has a search function, and makes recommendations to users, it’s crucial. It should also go without saying that operators need to meet potential guests where they are. And, again with few exceptions, they’re online.

As you may assume by now, Resy is a reservation platform that helps users discovers restaurants and bars. And if it’s helping guests discover these venues, it’s helping operators increase their reach and get discovered.

Reservation List Curation

The first feature I’m going to share is Climbing, which is what it sounds like.

When a tourist visits or someone moves to a new city, they tend to want to find their places. Which restaurants and bars will be their third spots, or the place they spend time between work and home?

Word of mouth is great, of course. But these days, reviews and comments are digital word of mouth. So, a curated list of “what’s hot” amongst restaurants in a given city is powerful for discoverability.

“Climbing on Resy is the only data-driven list powered by your reservations,” reads the Resy site. “Consider it a curated guide by locals, for locals.”

For ease of use, which is crucial for any platform, users can edit dates and party size within the Climbing tab.

The Hit List

Climbing isn’t the only list Resy curates on the platform. There’s also the Hit List.

This is a list Resy publishes each month for each major market in which they operate. It consists of ten venues that “should be on your radar.”

Using Philadelphia as an example, the city’s January Hit List per Resy is comprised of:

CO-OP Restaurant & Bar
Sor Ynez
City Winery
Condesa
Ocean Harbor
Fiore
Rittenhouse Grill
Forsythia
Second District Brewing
Vernick

The Hit List also includes the neighborhood or town where each recommendation is located. Again, not just discoverability but also ease of use.

Notify and More

Resy does more than just help people make reservations. There’s also the platform’s approach to waitlist management, Notify.

As the company describes it themselves, Notify is “a future waitlist.” Users can specify their date and time reference, and add themselves to a restaurant’s list.

On the operator side, they add the guest and an email or push notification is sent out. When a table that matches the waitlist user’s preferences opens up, they get an alert.

Users can also take advantage of Top Rated, New on Resy, and Book Tonight lists. Getting more granular, there are also other curated lists, such as:

Great Tasting Menus Under $125
Essential Cozy Locales
Splurge-worthy Dining
Where to Dine with a Crew
Date Night, Covered
Best Outdoor Dining

Additionally, Resy is in a partnership with American Express. So, eligible cardholders can use Global Dining Access by Resy for incredible experiences.

When considering their tech stack, platforms, and partnerships, operators need to consider an array of functions. More and more each day, discoverability is a function that needs to be top of mind.

Image: Resy

January 13, 2023by David Klemt David Klemt No Comments

We Ask ChatGPT About Robots and AI

We Ask ChatGPT About Robots and AI in Restaurants

by David Klemt

Earlier this week we had “a conversation” with ChatGPT, the now (in)famous chatbot from artificial intelligence research and development company OpenAI.

For my first time interacting with this type of tool, I keep things simple. I attempt to phrase my questions correctly, focusing on the topic of AI and robots in hospitality.

Initially, I receive a response that probably isn’t much of a surprise. But as you’ll see, the chatbot highlights an item or two that aren’t always top of mind with this topic.

Below you’ll find ChatGPT’s responses to one request and two questions.

Please write 400 to 500 words about robots and artificial intelligence working in restaurants, from the perspective of robots and AI.

“Robots and artificial intelligence (AI) are becoming increasingly prevalent in the restaurant industry. This is in part due to the many benefits that these technologies can offer, such as increased efficiency, improved safety, and reduced labor costs. However, it is also important to consider the perspective of the robots and AI systems themselves, and how they are integrated into the restaurant workforce.

One of the main ways that robots and AI are used in restaurants is through automation of tasks that would otherwise be performed by human workers. For example, robots can be programmed to cook food, mix drinks, and serve customers. This can help to improve the efficiency of the restaurant, as robots are able to work faster and more accurately than humans. Additionally, robots can be designed to perform tasks that are dangerous or difficult for humans, such as handling hot oil or sharp knives. This can help to improve safety in the kitchen and other areas of the restaurant.

However, the use of robots and AI in restaurants also raises some important ethical and social issues. Some people may worry that robots will take jobs away from human workers, especially in an industry that already has high turnover rates. Additionally, there may be concerns about the social and emotional impact of having robots as a major presence in the workplace. For example, some people may find it uncomfortable or strange to interact with robots in a social setting, such as a restaurant.

The robots and AI perspective, they are programed to perform their task efficiently without any error. They don’t have any emotions or preferences hence they are not impacted by the same issues that human employees may face like fatigue, stress or burnout. They can work in any environment without needing breaks or vacation days, this can help reduce labor costs, as restaurants can operate with fewer employees. However, it also means that human workers may need to be trained in new skills that allow them to work alongside robots and AI systems.

In conclusion, the integration of robots and AI in the restaurant industry can provide many benefits, including increased efficiency and improved safety. However, it is important to consider the ethical and social implications of these technologies, and to ensure that they are implemented in a way that benefits both the restaurant and its employees. With proper planning and training, robots and AI can be an [sic] valuable asset to restaurant workforce.”

Can you explain to me, in 300 to 400 words, what the ethical implications are for restaurant, bar, and hotel operators using artificial intelligence and robots to complete tasks?

For the most part, ChatGPT repeats talking points from our first interaction. This is likely due to the phrasing of my question. Also, this chatbot is still in its “infancy.”

However, ChatGPT brings up a few new points, and expands on others.

“The use of artificial intelligence (AI) and robots in restaurants, bars, and hotels raises a number of ethical implications that should be considered by operators. One of the main concerns is the potential for these technologies to displace human workers. In an industry that already has high turnover rates and relatively low wages, the use of robots and AI could make it even more difficult for human workers to find and keep jobs. This could lead to increased unemployment, reduced income and work-life imbalance among the impacted employees.

Another ethical concern is the impact that these technologies may have on the customer experience. For example, some customers may find it unsettling or uncomfortable to interact with robots in a social setting, such as a restaurant or hotel. Additionally, customers may feel that the use of robots and AI detracts from the human element of the service experience, and could harm the overall reputation of the business. There may also be concerns about how the data collected by these systems is used and protected, raising question about data privacy and security.

Additionally, some concerns about the way these AI and robots are designed and how they make their decisions, there could be potential for bias, especially when the systems are provided with data that is not representative of the whole population. This could lead to unfair treatment of customers, employees and other stakeholders.

There are also concerns about how the maintenance and repair of these technologies are managed and who is responsible for any accidents or malfunctions that may occur. This is particularly important for safety critical tasks, such as cooking or cleaning. Operators need to ensure that the AI and robots are designed and maintained to the highest standards to prevent any harm to employees or customers.”

Are there risks that human designers and engineers will introduce bias to customer-facing artificial intelligence and robots?

Since ChatGPT mentions bias in response to my first question, I run with that train of thought.

Below is what the chatbot has to say about that topic as it relates to AI and robots.

“Yes, there is a risk that human designers and engineers may introduce bias into customer-facing artificial intelligence (AI) and robots. This can happen in a number of ways, including:

Data bias: If the AI system is trained on a dataset that is not representative of the population it will be serving, it may make decisions or predictions that are biased towards certain groups of people. For example, if an AI system used in a hotel is trained on data from primarily white and wealthy guests, it may have difficulty understanding and serving guests from other backgrounds.
Algorithm bias: The way an AI system is designed and the algorithms it uses can also introduce bias. For example, if an algorithm is designed to prioritize certain inputs over others, it may make decisions that are biased towards certain groups of people.
Human bias: Human bias can be introduced into AI systems through the decisions made by designers and engineers about what the system should do, how it should work and how it should interact with people. For example, if a designer and engineers decide that the robot should be more polite to older customers, it may be less polite to younger customers, or if the system is designed to recognize only certain languages, it may not be able to understand and serve customers who speak other languages.

It is important for human designers and engineers to be aware of the potential for bias in AI systems, and to take steps to minimize it. This can be done by using diverse and representative data when training the AI system, being mindful of the potential for bias in the algorithms used, and involving stakeholders from diverse backgrounds in the design and testing process. Additionally, monitoring and audit the system performance regularly, and providing ways for users to provide feedback on the performance and make adjustments accordingly.

It is important to remember that this is an ongoing process and it requires continuous monitoring and adjustment as the data and environment changes. There is also a need for more research in the field of explainable AI, which would allow human designers and engineers to understand why the AI system is making certain decisions, which can help to identify and mitigate any biases that may have been introduced.”

Takeaways

Obviously, I don’t think ChatGPT “speaks” for the machines. And I don’t think the chatbot was attempting to convince me of anything. There’s nothing overtly nefarious afoot here—this was mainly an entertaining exercise with a newsworthy tool.

That said, I’m not entirely certain how I feel about my interaction with ChatGPT. On one hand, the answers in favor of AI and robots are what one expects: efficiency, speed, consistency, cost reductions, improvements to safety.

But what about what ChatGPT says about biases, programming, representation, and human interactions with tech? To alter a phrase, “Who watches the programmers?”

Hospitality is about the human element. It’s about service and the guest experience. Personally, I don’t think the world will be in a better place if we reduce human interaction.

Dropping baskets into hot oil? Slicing and dicing? Sure, send in the robots…maybe. Reducing the human element in the name of efficiency and profits? I don’t see a benefit worth the risks.

Image: Rock’n Roll Monkey on Unsplash

Tortilla with beans, cotija cheese and egg

January 10, 2023by David Klemt David Klemt No Comments

Canadian Trends 2023: Technomic

Canadian Trends 2023: Technomic

by David Klemt

Restaurant, bar, and hotel operators will find this year’s data-driven trend predictions from Technomic for 2023 insightful.

Interestingly but perhaps not surprisingly, some operators may be looking beyond North America for inspiration.

Per Technomic, Central and South American cuisines could influence menus in Canada this year. Other food trends that might take hold are “retro” health items, and all manner of pickled foods.

Of course, not every Canadian trend prediction involves F&B. According to Technomic, tech and the guest experience will play important roles.

To review last year’s Technomic predictions, click here. Now, let’s jump into Technomic’s 2023 predictions.

Guest Experience

Certainly, the guest experience should always be top of mind for operators, their leadership teams, and their staff.

In this instance, Technomic isn’t suggesting that the guest experience in general will be a trend. Obviously, with as important as it is to the success of any business, it’s a cornerstone.

Rather, Technomic predicts that guests will continue to feel the need to rein in their spending due to ricing costs and prices. However, the foodservice research firm also believes there’s still heavy desire for social interaction.

So, both those financial and social influences translate to the following: overdelivery.

Operators and their teams must ensure they position their brands well; make guests feel special every visit; and really dial in the guest experience. Specifically, Technomic suggests focusing on younger generations and menus with at least a couple specialty items that aren’t easy for a guest to replicate at home.

In other words, do whatever it takes to entice guests with memorable experience and quality menu items, and keep them coming back for more.

Technology

Multiple industry sources believe that 2023 is the Year of Tech for the hospitality industry. In particular, some sources believe that POS systems will receive significant attention from operators looking to upgrade.

Compellingly, Technomic sees the situation a bit differently. In particular, they’re suggesting that QR code menus may find themselves on the sidelines. Traditional menu, according to Technomic, will make their comeback this year.

Also making a (possible) resurgence? Per Technomic, in-person ordering for carryout and in-person dining.

As far as tech innovations that Technomic expects to take off this year, they see the following as standouts:

loyalty programs;
enhanced/upgraded cooking equipment;
automated inventory software/platforms; and
digital menu boards for back of house.

Culinary

As hinted at above, Central and South American cuisines are expected to take off in Canada, per Technomic.

The research firm provides specific—and delicious—examples:

Honduras: Baleadas tacos
Dominican Republic: Wasakaka sauce
El Salvador: Curtido slaw or relish
Peru: Aji amarillo and rocoto peppers
Bolivia: Saltenas, similar to empanadas

Another culinary trend Technomic predicts will perform well in Canada? Pickled everything.

Okay, maybe not everything. However, Technomic expects “pickling, fermenting, dehydrating and freeze-drying” to “increasingly pop up on menus.” The firm expects that operators will offer a wide range of “unusually pickled items outside of the typical veggies, including proteins and seeds.”

So, if you’re an operator reading this, it may be time to motivate your back-of-house staff to get creative with their pickling ideas.

Finally, pandemic-driven, health-based trend foods like turmeric and ginger may start to fade in popularity. Instead, predicts Technomic, items with “classic” health descriptors such as “natural,” “real,” “free,” “reduced,” and “lower” will get attention from guests looking to eat and drink healthier.

For your own copy of this Technomic report in its entirety, click here.

Image: Roman Odintsov on Pexels

January 6, 2023by krghospitality krghospitality No Comments

Dynamic Pricing or Dynamic Menus?

Dynamic Pricing or Dynamic Menus?

by Doug Radkey

A key phrase used throughout 2022 was “the new normal.” In 2023, a key term you will likely hear a lot is “dynamic pricing.”

What is dynamic pricing? It can get quite complex, but the global consulting company, McKinsey, defines dynamic pricing as “the (fully or partially) automated adjustment of prices.”

The term is not entirely new to hospitality. Hotels and the overall travel industry have used modules of the pricing model for years. But for restaurants and even bars, yes, it is something new.

It is also a model getting a lot of attention of late, which begs the following question: Why?

As the bar and restaurant industry recovers from the effects of the pandemic, a dynamic pricing model that optimizes revenue opportunities may seem quite attractive. After all, our industry is looking to rejuvenate its sales to pre-pandemic levels.

Essentially, a dynamic pricing model within this industry would work like this: increase prices when demand is up (peak periods), decrease prices to draw guests in when demand is down (off-peak times).

But should this be a model that disrupts the industry in 2023 and into 2024?

While I am all for a little disruption, the industry needs to tread carefully through this potential transition to dynamic pricing (or perhaps just around the phrase itself) that’s based on demand levels.

Guest Experiences

We all know (or should know) that we do not sell a product. What we sell is an experience.

If we can create a positive, memorable guest experience first and foremost, the revenue will follow.

While hotels and travel, as examples, have boasted “positive financial results” over the years through their different approaches to dynamic pricing (while still trying to focus on the end-user guest experience), independent bar and restaurant brands must be careful not to create a hostile brand perception.

Why? Because many consumers view changing prices based solely on levels of demand as being unfair.

Being unfair will certainly create a negative guest experience and/or brand perception. The hotel and airline industries have been able to navigate this perception successfully by offering alternatives. For example, different rooms and amenities or less convenient flight times at different price points. Essentially, companies in lodging and travel provide options and flexibility before customers make the choice to spend.

What about rideshare and surge pricing as another example? Many of you reading this have likely been burned by surge pricing as a consumer, which can be by definition a form of dynamic pricing.

Have you ever tried to book a rideshare during peak periods in a major market? What would normally be a $20 ride is suddenly $40 to $60 (or more) because of their dynamic pricing model.

What did I do in this situation during a recent business trip? I walked another 25 feet up to the cab staging area of the airport and got my ride for $25.

The end results? I had a negative customer experience with the rideshare company, first and foremost. Additionally, that negative experience drove me to the competition. The key here is I was given a choice.

Now let’s switch that scenario to a restaurant.

The Restaurant Scenario

You book a table at your favorite restaurant and order that incredible steak dinner you always enjoy. But instead of it being $50 like you have grown accustomed to, it is now $75 or more. How are you as a consumer going to feel about this new price just because you visited your favorite spot during a “peak period” on a Saturday night? Were you given a choice before the spend?

Of course, this can work in the opposite direction: ordering a meal during a non-peak time and getting it for a cheaper price, thereby getting a discount.

But should we be confusing our customers based on their chosen, convenient time to visit your restaurant or bar? Should you also focus on “discounting” to drive people to your business?

I have even seen recommendations for offering an increased price for peak period but using what was the previous regular price during the non-peak times, labeling the normal price a “discount.”

Should we be framing our regular priced menu options as a discount just so we can charge and make more during a peak period? Is this being fair and ethical to your loyal customers? Should we be going down this road?

With this model (and the phrase “dynamic pricing”), which is based on demand, it is very easy to see how you can quickly confuse or alienate your loyal guests. Unless the industry in its entirety migrates over to this demand-driven model, a similar scenario as outlined above can play out for you and your guests.

Without extremely strong but transparent communication systems in place (which will be a challenge in itself), it is safe to assume that they will likely visit another restaurant up the street and/or provide negative feedback because they feel your pricing model is confusing or unfair.

Dynamic Menus

The phrase that is much more simplified and will be more easily embraced by both operators and guests is “dynamic menu.”

So, what’s the difference?

While it is still by definition “the (fully or partially) automated adjustment of prices,” it is not based on demand throughout the day. Rather, pricing is based on simple supply chain and operational cost adjustments.

According to the National Restaurant Association:

95 percent of restaurants have recently had significant supply delays or shortages of key food items; and
75 percent of restaurants have had to change their menu because of supply chain issues.

With a more dynamic menu, you can adjust pricing to suit those changes accordingly, through the lens of real-time ingredient cost, labor costs, productivity levels, and even the availability of certain menu items.

This simply means that the incredible steak dinner a guest has always enjoyed at your place is perhaps now $53 instead of $50 because the price of beef went up the past week or month. This ensures that as an operator, you will have a minimal gap between your theoretical and actual food costs.

Again, this should work both ways, meaning if the price of beef has gone down, so too should the price.

This means that your guests are paying an accurate value for each item, based on your intended sales mix and contributions, without a loss in margin on your end or negative experience on the guest end.

This means that everything on your menu is “market price” or MP. Where have we seen that before…?

Market Price

We all know restaurant menus will commonly deduct a price and replace it with the term “market price” (often abbreviated to “MP”). This means the price of the menu item depends on the market price of the ingredients, and the price is available upon request. It has been used for years for seafood in particular—most notably lobsters and oysters—in many restaurants.

Therefore, this pricing model is not entirely new. So, why should it stop at just high-priced seafood?

The reason many operators would use the abbreviated MP was because they did not want to reprint menus every single day as the prices fluctuated greatly.

As we move towards digitally savvy restaurant operations, implementing integrated technology and menus, we can begin to find alternatives and ensure that we are actively pricing our menus accordingly based on the market (and overhead costs) to strengthen top- and bottom-line results.

Knowledge is Power

To make a dynamic menu work, whether you’re a QSR, sports bar, casual-dining or fine-dining concept, or any other category of bar or restaurant, you need to know your target customers, provide a targeted menu, and know your numbers (the data).

Curating and engineering a menu should be a simplified process. To be honest, this should have been streamlined prior to the pandemic.

Your menu should be developed based on data, consumer sentiment, regional ingredients, regional suppliers, and local talent within the confines of the overall concept. Food and beverage programs should be developed with thought, care, speed, precision, execution, and last-but-not-least: consistent profits in mind.

Keeping menus “small” (10 to 12 or even 15 items at maximum) will be the new threshold of a successful, more profitable operation. This size of menu will allow bars and kitchens to operate more efficiently; keep inventory costs both low and controlled; control training and labor costs; and provide guests with the most flavorful and exciting items that they truly want.

Be Nimble

You also want to provide menu flexibility by continually reviewing your supply chain. Maintaining a strong personal relationship with your suppliers is imperative. You must also review your costs and inventory on a daily and weekly basis to make dynamic menus work.

To keep inventory, purchase orders, and potential waste to a minimum, it will be crucial that you to ensure your menu is small but innovative. The only way to accomplish this is through effective data management.

However, the new challenge for many independent brands is making data timely, relevant, digestible, and actionable for operators and their leadership teams. The ability to collect, interpret, and effectively react to key datapoints is going to be crucial for anyone who wants to implement a dynamic menu, and for moving forward in general.

At the end of the day, profiting from a dynamic menu is all about making decisions based on accurate cost and productivity data. Of course, there’s only one way to obtain data: embrace technology and create strategic clarity around it.

The Tech Stack

The key to successfully implementing a dynamic menu is integrating a stack of technology that provides real-time data and trend reports.

From point-of-sale software and reports to accounting software, inventory and recipe management software, and invoice management software or a suite that includes all of the above that’s integrated and working together, you can obtain real-time data to adjust your pricing based on real-time ingredient and productivity costs on a daily or weekly basis.

You want seamless movement of data from front- to back-of-house that will position you to make decisions and have a more complete picture of inventory stock levels, costs, and ordering needs, plus itemized sales, contribution margins, and productivity levels.

In Summary

While we must find ways to be innovative, potentially price-gouging our guests during peak periods and discounting during slow periods is not the way for this industry to recuperate and build loyal customers.

Building a strong brand through the creation of memorable experiences and by building connection with your community along with strategic planning, effective marketing, the elements of culture, and efficient operations, you can build sustainable revenue and profit channels.

By following a more dynamic menu approach within your operations, you can still maintain transparency with your guests with less challenging communication methods, remain a fair and well-respected brand within your community, and improve your margins by three to five percent or more with the right people and systems in place.

That sounds like a pretty good deal to me. The question here remains: Are you Team Dynamic Pricing or Team Dynamic Menus?

Image: Joe Neric on Unsplash

December 6, 2022by David Klemt David Klemt No Comments

SevenRooms and CSV form Partnership

SevenRooms and Competitive Social Ventures form Partnership

by David Klemt

Guest experience and retention platform SevenRooms will kick off 2023 with a partnership with Competitive Social Ventures.

This new partnership is yet another example of SevenRooms’ continuous growth. For technology in general and our industry in particular, this is excellent news.

Consider how long it has taken, up until recently, for hospitality to embrace tech innovations. Navigating tech solutions can be daunting. Equally intimidating can be the cost of implementing new tech in a restaurant, bar, or hotel.

Watching a tech platform continue to innovate and grow, therefore, is good news for operators and their teams.

SevenRooms traces their founding to 2011. In comparison, many “solutions” never escape the vaporware stage, existing only on paper. With more than a decade of operation under its belt, SevenRooms is established and positioned for longevity.

In other words, the platform is worthy of operator consideration and investment. We make no secret of our preference for SevenRooms at KRG Hospitality. Unless they prove we should think otherwise, the platform is our favorite tech-based guest retention solution.

Beyond functionality, ease of use, and effectiveness, the company’s continuous growth motivates our support. Look at how SevenRooms grew in 2021 alone:

The platform also started 2022 with the hiring of a chief revenue officer, Brent-Stig Kraus.

Social Entertainment

With its headquarters in Alpharetta, Georgia, Competitive Social Ventures blends sports, socializing, and entertainment.

In fact, the company refers to the brands it has brought to market as “competitive socializing entertainment concepts.”

Last year, CSV brought Fairway Social Alpharetta and Roaring Social Alpharetta to market. The former focuses on sports simulators. Roaring Social, on the other hand, delivers a speakeasy experience combined with bowling.

Arriving in 2023, the real estate holding company plans to launch Pickle & Social concepts throughout the Metro Atlanta. As the name suggests, the concept features indoor and outdoor pickleball courts. Guests will also have access to table tennis. And like Fairway Social and Roaring Social, Pickle & Social will feature live music and an elevated F&B experience.

CSV already makes use of SevenRooms’ reservation and guest data management tools. Going into 2023, this partnership will evolve into review aggregation, marketing automation, and table waitlist management. The latter makes it easier for any concept to handle walk-ins as painlessly as possible.

Most importantly, the partnership with SevenRooms empowers CSV to pursue their growth plans. While the growth of SevenRooms is impressive and confidence-inspiring, their commitment to client growth is the real story here.

When choosing their tech stack, operators need to know the relationship is mutually beneficial. In fact, they need to be confident that each platform is here for long-term success.

In fact, operators should look at every relationship through this lens: Is every partner working to help you grow?

Image: Ben Hershey on Unsplash

November 9, 2022by krghospitality krghospitality No Comments

2023: Year of the POS Systems?

2023: Year of the POS Systems?

by David Klemt

Image from SpotOn press release

According to SpotOn, the industry could be in for a tech revolution next year as independent operators pursue more powerful POS solutions.

The results of a survey conducted by the cloud-based POS platform are rather revealing. In an effort to better understand where the industry is heading, SpotOn surveyed 300 independent and small-chain restaurant operators.

Both full-service and limited-service (LSR) concept operators participated in this SpotOn survey. Intended to identify the challenges operators face currently, the results reveal much more.

Below, the picture these survey results paint for the industry.

Legacy vs. Innovation

This isn’t the first time I’ve stated the following: Our industry hasn’t been the fastest to implement new technology.

However, we did appear to turn that around in 2021. Now, heading into 2023, our industry may be pursuing cutting-edge tech solutions even more fervently. Today’s guest expects more tech, and your team likely wants access to more modern tech that makes their jobs easier.

Per SpotOn’s survey, 81 percent of independent operators still use so-called “legacy” POS systems. These are “traditional” systems from companies that have been around for quite some time.

It’s not difficult to understand why the vast majority of independent operators continue using legacy systems:

Investing in a new platform requires expenditures of money and time.
Introducing a new POS platform requires staff training.
Staff need to grow adept at using the new system.
It can be daunting to research the available platforms and implementing change.

So, independent and small-chain operators have a choice to make: Stick with the familiar or invest in the future. Change can not only be intimidating, it can be expensive.

However, it seems that most operators are ready to throw comfort to the wayside and embrace innovation.

State-of-the-art Benefits

Should the SpotOn survey prove to be accurate snapshot of the industry, 75 percent of operators will implement new tech next year. According to SpotOn, this is largely in response to growing labor challenges, such as scheduling and retention.

The restaurant, bar, nightclub, and food truck platform found that operators are spending as much as 20 hours per week on administrative tasks. State-of-the-art POS systems can slash those hours by:

streamlining operations;
making scheduling simpler;
calculating tips and payout for payroll; and
managing overtime, an increasingly common task.

More modern POS platforms can automate labor management tasks, saving operators time, money, and frustration. Automation and streamlining give operators something invaluable: time.

In particular, innovative and helpful tech solutions provide an operator with time to focus on growing their business. When weighing whether to keep a familiar but less feature-rich POS system or invest in a modern platform that seamlessly integrates many solutions, ask yourself a couple important questions:

What’s my time worth?
What am I focusing on every day?
Am I growing my business or stagnating?
Is my current POS system helping or hindering my team?
Does my POS system streamline and automate any tasks?

Image: SpotOn

October 18, 2022by David Klemt David Klemt No Comments

Your Guests are Likely Ready for More Tech

Your Guests are Likely Ready for More Tech

by David Klemt

After the past few years of innovation and implementation in our industry, guests are probably ready to use even more technology.

Driven in large part by operator adaptation to ever-changing restrictions in 2020 and 2021, guest-facing tech is far more prevalent than ever. This is particularly true in the quick-service restaurant space.

Of course, tech has certainly become a crucial operational component in the full-service space as well. However, operators many FSR operators find themselves walking a fine between tech innovation and providing personalized service.

Restaurants Canada addresses QSR and FSR tech implementation in their 2022 Foodservice Facts report. Click here for your own copy of the report.

QSR vs FSR Implementation

One benefit of updating a given operation’s tech stack is automation. After all, more tasks handled automatically via tech solutions means a reduction in labor costs.

In theory, removing mundane tasks from front-of-house team members should equate to guests receiving more personalized service. Equally as impactful: Many guests would rather have more control over their visit in the names of convenience and speed.

A couple of examples are placing orders and paying via tablet or other table-side device. For some guests, this is more convenient than the traditional method.

As stated above, QSRs have been quick to embrace and implement tech innovations. And according to a Restaurants Canada survey, nearly three-quarters of QSR operators will wade deeper into tech waters within the next two years. Almost half—49 percent—of QSR survey respondents “probably will” increase their usage of technology by April 2024; a quarter “definitely will.”

On the FSR side, operators are a bit more cautious in their approach to their tech stacks. Of these survey respondents, 37 percent will probably adopt more tech within the next two years, while 15 percent say they “definitely will” do so.

Per Restaurants Canada, the three main concerns of operators relating to implementing more tech are:

cost;
guest acceptance; and
people being able to relate to the equipment (which to me seems directly tied to guest acceptance).

However, FSR operators have also indicated another concern: the perception from guests that tech innovations are leading to a loss of personalized service. So, individual operators must decide not just what tech solutions to embrace but how they may impact the guest experience in negative ways.

Guest Expectations

When Restaurants Canada looked into tech in the restaurant space, they didn’t just focus on operators. The restaurant industry advocacy organization also surveyed consumers.

Perhaps unsurprisingly, the 18 to 34 age group appears to be the most eager to embrace new tech in restaurants. However, they’re not that far ahead of the 35 to 54 group. Interestingly, the 55-plus demographic is less tech-resistant in at least one area than one may assume.

Let’s take a look at Restaurant Canada’s survey results, broken down by tech solution.

Order and pay via tablet at FSR: 18 to 34 (55%), 35 to 54 (54%), 55+ (41%)
Place an order for food that’s prepared by automated method, either robots or other systems: 18 to 34 (27%), 35 to 54 (17%), 55+ (11%)
Order food that’s delivered on-premises by an automated system or a robot: 18 to 34 (32%), 35 to 54 (28%), 55+ (18%)
Place an order through a ghost or virtual kitchen: 18 to 34 (34%), 35 to 54 (26%), 55+ (13%)
Order food that’s then delivered off-premises via robot or self-driving car: 18 to 34 (36%), 35 to 54 (29%), 55+ (19%)

Considerations

Looking at the above data, most guests are already comfortable placing orders and paying through a tablet. Interestingly, the age group people think of as most tech-averse seem to be open to the idea of robots preparing and delivering their orders.

The keys to implementing tech solutions are deceptively simple: initial costs, subscription costs, maintenance fees, ease of use by staff, and ease of use by guests.

With inflation driving costs up, operators are likely most concerned with what it will cost to add to or upgrade their tech stacks. However, there may be a significant reduction in labor costs that justifies the initial costs. Additionally, some solutions can be leased rather than purchased up front.

But the comfort levels of guests must also receive careful consideration. If a solution is going to alienate or drive away a significant portion of guests, it’s likely not worth the time and cost of implementing it.

Your guests likely want more tech in your restaurant, but it has to be the right tech. Solutions need to deliver convenience and speed without failing to deliver on hospitality.

Image: Harrison Broadbent on Unsplash

August 25, 2022by David Klemt David Klemt No Comments

Date Night Desires and Dealbreakers

Date Night Desires and Dealbreakers

by David Klemt

Focusing on date night, guest experience and retention tech platform SevenRooms is sharing their latest data-driven report.

Their “Date Night Diner Report” is another successful collaboration with YouGov. Previous reports from this partnership include:

One of the reasons we at KRG Hospitality appreciate and recommend SevenRooms is their dedication to data. The platform’s commitment to sharing the data they collect to the benefit of operators is impressive.

“A resurgence of the American date night is here, and these date night diners are flipping the script on what that experience should look and feel like,” says Allison Page, co-founder and chief product officer at SevenRooms.

So, operators who want to succeed with date night should review this new report. In fact, all operators would be wise to read this report. After all, it addresses reservations, waitlists, walk-ins, and much more.

Released today, this brand-new report can be downloaded here. Read the press release here.

Date Night Details

A lot has changed over the past two-plus years. What hasn’t changed are the two most popular date nights in the US: Friday and Saturday.

Both Friday and Saturday night are preferred by 26 percent of the 763 survey respondents who go on dates. In total, SevenRooms and YouGov surveyed 1,153 individuals.

Generally speaking, these dates are return visits. People who go on dates tend to make reservations at restaurants they’ve dined at previously.

However, 46 percent of such guests are open to reserving a table at a restaurant they haven’t visited before. And speaking of those tables reservations, 53 percent are for two people.

Looking at two major populations, tables for two are the most popular reservations. In New York, they account for 50 percent of reservations. That number increases to 56 percent in Los Angeles.

Interestingly, however, is this bit of date: 53 percent of Americans don’t make reservations for date night. Rather, they’re walk-in guests, meaning they’ll likely become waitlist guests.

Date Night Desires

So, now operators know that the majority of today’s date-night reservations are for two. That doesn’t mean setting aside two-tops and side-by-side seats at the bar is enough for success.

No, there are also guest expectations to consider. SevenRooms identifies the following as the top date-night desires:

A complimentary cocktail or dessert. (33 percent)
Ability to earn extra rewards (24 percent), highlighting the value of loyalty programs.
Incentives that encourage repeat date-night visits. (23 percent)

Furthermore, personalization continues to be a key factor in the dining decision. One-third of guests consider the ability to personalize their dining experience more important than factors such as menu variety or receiving their order quickly.

Date Night Dealbreakers

Of course, if there are desires there are also dealbreakers.

According to SevenRooms, the following are the dealbreakers operators must avoid:

People on a date receiving their meals at different times. In this case, more than ten to 15 minutes apart. (45 percent)
The restaurant being so loud the guests on their date can’t hold a conversation. (43 percent)
A restaurant not having the menu items the guests were looking forward to ordering. (31 percent)
Being sat too close to another table. (31 percent)
Sitting next to a table speaking “too loudly.” (26 percent)
The restaurant being so crowded that a guest can’t find their date. (24 percent)

How important is it to avoid these dealbreakers? Well, the survey respondents say they won’t return to a restaurant if they experience any of them.

To read the full report, click here. And to learn more about SevenRooms, listen to Bar Hacks episode 24, featuring SevenRooms CEO Joel Montaniel.

Image: Dmitri Nesteruk on Unsplash