Cafe | KRG Hospitality

April 22, 2022by David Klemt David Klemt No Comments

Código 1530 Pursuing Low-waste Initiatives

Código 1530 Pursuing Low-waste Initiatives

by David Klemt

Blue Weber agave plant in Tequila, Mexico

Tequila Código 1530 is making the upcycling of the agave they use a cornerstone of the brand’s sustainability efforts.

Some agave growers and tequila producers the plant as mulch, fertilizer, and biofuel. Bagasse, the fibrous material distillers separate from agave piñas, along with the leaves, is composted and used to fertilize agave fields.

While not common, some distillers will even take other producers’ agave bagasse and leaves to compost it.

However, Código 1530 is now doing even more with their agave.

Agave Sustainability

According to some in the spirits and hospitality industries, tequila may end vodka’s dominance in the US this year. Obviously, this would be the result of an increase in consumer demand.

Well, that necessitates an increase in production. So, it follows that agave growers have motivation to grow and harvest as much mature agave as possible.

However, it takes about eight years for some agave plants to mature. Others take more than ten years. For some rarer species, maturation takes twelve years or more.

Of course, production leads to waste. In simple terms, that’s the problem producers must solve.

One definition of “sustainability” is striking an ecological balance that preserves natural resources. For tequila production in particular, this means finding ways to meet consumer demand while harvesting agave reponsibly.

While composting and mulching is a great idea, Código 1530 sees the need to take things further.

More than Mulch

We’ve probably all been given at least one drink served with a paper straw. Unfortunately, that means most of us know how quickly that experience can become less than enjoyable.

Even some of the best-made paper straws can turn soggy long before a drink is finished. On the operator side, that’s not great for the guest experience, to say nothing of the costs associated with stocking paper straws.

However, some operators and their guests are willing to stick with paper straws to be sustainable. That’s admirable but there may be a better way, and it involves agave.

“We quickly realized that after harvesting agave to distill Código 1530 Tequila, the remaining agave was only being used as mulch to top our soil for future plants or burned as a fuel source,” explains George Strait. “We are still using some of the excess agave fiber as mulch, and now have begun producing straws and cups in a sustainable and eco-friendly manner.”

Strait, as some may know, is an investor in Código 1530. A lesser-known fact is that Strait graduated Texas State University (formerly known as Southwest Texas State University) with a degree in agriculture.

“This is a lifesaving program for sea life affected by plastic pollution,” says Strait of Código 1530’s new agave sustainability efforts.

Unlike paper straws, agave straws don’t get soggy or deform. Additionally, they can be thrown out in normal trash after use as they’re biodegradable.

However, this agave initiative doesn’t end with straws. Código 1530 is also making agave fiber cups, coffee cups, cocktail shakers, and shot glasses.

Tea-quila

To celebrate Earth Day and their sustainability efforts, Código 1530 has created the drink below.

Image: Amir Shafii, Código 1530

1.5 oz. Código 1530 Blanco
3 oz. Bergamot tea
0.75 oz. Lemon juice
0.5 oz. Lavender simple syrup
Lavender sprig to garnish

Housemade simple cuts down on the waste associated with producing and shipping bottles of syrup. To make the lavender simple syrup, bring one cup of water and one cup of sugar to a boil. Add ten sprigs of lavender while water and sugar are boiling, let cool, then strain. For this low-waste cocktail build, add all ingredients and ice to a shaker. Shake, then strain into a Collins glass with ice. Garnish with a sprig of lavender.

Image: BRUNO EMMANUELLE on Unsplash

April 20, 2022by David Klemt David Klemt No Comments

Chain Restaurants: Present & Future

Chain Restaurants: Present & Future

Technomic presented the state of chain restaurants, now and next, during Restaurant Leadership Conference 2022 in Scottsdale, Arizona.

Obviously, the entire hospitality industry is facing significant struggles. Rising costs, supply chain chaos, labor shortages and challenges, inflation… The past two-years-plus haven’t been easy.

However, there’s reason for operators and their leadership teams and staff to be optimistic. Additionally, independent and small-chain operators can learn from Technomic’s findings.

Challenges & Threats

Well, let’s take our medicine first, starting with the supply chain. In short, it’s bedlam.

Joe Pawlak (standing in for David Henkes) and Richard Shank of Technomic said as much during RLC 2022. Per their data, 35 percent of operators dropped at least one manufacturer between 2020 and 2021.

Whether because of rising costs, an inability to consistently deliver product, or other factors, operators had to adapt. Clearly, there’s a nasty trickle-down effect when an operator drops a supplier.

And then there’s inflation. Interestingly, Shank calls what we’re seeing currently as “existential inflation.” Relating to consumers, this means their confidence is shaken in terms of spending.

Of course, this type of consumer perception manifests in several ways. For example, some guests cut down on visits. Others will cut down on ordering, skipping appetizers and desserts. Perhaps they have one less beer, glass of wine, or cocktail.

Also, some guests “trade down.” Meaning, there are consumers who opt for casual restaurants rather than fine dining. Or, they’ll move from fast-casual to QSR.

Looking at the numbers, however, nearly 40 percent respondents to a Technomic survey say they’re visiting restaurants less. This makes sense, as 81 percent are concerned about how inflation will impact them personally.

On the operator side of inflation comes pricing. During Pawlak and Shank’s presentation, they used QSR dinner pricing as a real-world example.

According to Technomic, the tipping point for guest perception of good value is just $7. At only $10, consumers feel things are getting expensive.

As Pawlak and Shank pointed out, this is a problem. After all, the average price for dinner at a QSR is $10.08. That number may already be higher today.

Opportunities

Medicine taken, we can move to the good news.

First, Technomic predicts a strong Q3 this year. Additionally, they don’t expect double-digit year-over-year inflation.

In terms of labor, Technomic doesn’t expect costs to go down. However, they do anticipate that they’ll level off rather than rise.

Then there are the numbers. For the top 500 chains in the US in particular, 2021 was a “banner year,” according to Pawlak. On an aggregate basis, sales for the top 500 (McDonald’s is number one, for those wondering) are up 17.9 percent.

Also, every category of restaurant is performing better. The top 500 chains, for instance, are up 18 percent year-over-year. Midscale restaurants are up 38.5 percent. Casual is up 30.2 percent while fast is up 22.2 percent, QSRs are up 13.2 percent. As far as the biggest bump, fine dining is up 56.9 percent.

Looking at 2019 for obvious reasons, the industry was down 49.1 percent in sales in April 2020. However, the industry was down just about a single percentage point in February of this year compared to the same time in 2019.

So, how do we keep sales trending upward when facing inflation and other threats? Pawlak, Shank, and Technomic have some advice.

Operators, for instance, can implement the “balanced barbell” pricing strategy. In this model, high-value items drive business alongside premium offerings. In other words, don’t discount the entire menu just to entice guests to keep visiting.

Once guests get a taste for falling prices, they’ll consider the lower prices the standard. After that, any increase can be perceived as “too expensive.” Of course, discounting the whole menu also impacts guest perception of the brand negatively.

In addition, Technomic suggests offering higher net profit discount bundles, and implementing off-premise, large-party strategies.

Should Technomic’s predictions prove true, the industry may see an even stronger Q4 and start to 2023.

Image: Alex Haney on Unsplash

April 19, 2022by David Klemt David Klemt No Comments

Dining Room Tech on the Rise

Dining Room Tech on the Rise

by David Klemt

After years of restaurant technology adoption moving at a glacial pace, the industry now appears to be embracing innovations at light speed.

In fact, in just two short years some in the industry think it may be time to slow down. New tech can be exciting but jumping on every “innovation” is expensive, time consuming, and inefficient.

However, slowing down doesn’t equate to hitting the pause button.

Dining room tech was a topic of discussion at the 2022 Restaurant Leadership Conference in Scottsdale, Arizona. The two speakers agree that our industry needs to ease off the tech throttle a bit.

However, they also feel that tech innovations in the restaurant space will continue at a faster rate than they did pre-pandemic.

Session host Raymond Howard, a co-founder of Ziosk, interviewed Chris DeFrain and Hernan Mujica about dining room tech. DeFrain is a CPA at Lehigh Valley Restaurant Group, which operators 21 Red Robin franchises throughout Pennsylvania. Mujica is CIO for Texas Roadhouse.

Red Robin

Industry professionals and consumers alike should be familiar with Ziosk. After all, Red Robin has been a client with tech company since August, 2012.

Anyone who has visited a Red Robin has certainly interacted with a Ziosk terminal.

According to DeFrain, there are some interesting consumer behaviors taking place in Red Robin dining rooms. When it comes to tech, guests appear satisfied to place orders for appetizers and desserts via Ziosk terminals.

As DeFrain sees it, the guest would rather not wait for a server for ordering those types of food items. However, guests do seem to prefer ordering entrees from a server.

That’s a positive in DeFrain’s opinion, as he believes that ordering must remain the domain of servers. While he contends that the tech-based ordering process needs streamlining, DeFrain doesn’t appear interested in taking it out of servers’ hands completely.

This makes sense; the server as an integral element of the guest experience. How can a casual dining restaurant build guest loyalty and deliver a memorable guest experience without an engaging front-of-house team?

Of course, dining room tech should do more than accept orders, summon a server, and offer tableside payments. Today, data is king. Powerful platforms collect as much useful data as possible.

To that end, DeFrain appreciates that Ziosk provides data Red Robin leadership teams can share with staff. For example, a server can be shown how much they’re making in tips during their shift.

Finally, DeFrain says that guest usage of Ziosk terminals is improving feedback and comments.

Texas Roadhouse

In comparison to Red Robin, Texas Roadhouse took longer to sign on with Ziosk. In part, interestingly, this was due to the redesign of the terminal itself.

Turns out, Texas Roadhouse waited for a Ziosk terminal that took up less space and looked better on the chain’s tables.

Per Mujica (and any Texas Roadhouse guest), the in-person experience is core to the brand. Therefore, dining room tech must be an enhancement, not a detriment.

Like Red Robin, the chain has no interest in adopting tech that replaces FoH staff.

Another consideration regarding dining room tech should be important to all operators: The tech must be user friendly. According to Mujica, restaurant guests are happy to embrace tech innovations—if it’s easy to use.

So, operators must be careful and deliberate when choosing their tech stack. Generally speaking, native tech users (Gen Z) will likely be much quicker to learn how to use a particular technology than a Baby Boomer or even Gen X counterpart.

As such, operators must know their guests in order to adopt tech that enhances rather than alienates.

Another reason Texas Roadhouse chose Ziosk, per Mujica, comes down to mobile pay. In short, the chain didn’t like the mobile pay guest experience.

In terms of the future, Mujica predicts that handheld, tableside ordering is the future of dining room tech.

Takeaway

Like Mujica says, operators have now seen what tech innovations can do for them. In short, there’s no turning back.

And I agree with Mujica and DeFrain: it’s likely (and necessary) that tech development will slow a bit moving forward. Honestly, we all need room to breathe, consider the innovations available currently, and decide what works best for a particular business.

Likewise, I agree that tech can’t be allowed to alter the service model. Technology shouldn’t be seen as a replacement for staff.

Interestingly, restaurateur David Chang addressed this very subject during a 2022 RLC conversation. In his opinion, tech won’t replace restaurant roles, it will streamline them. At most, said Chang, tech will replace small, repetitive tasks, such as the physical flipping of a burger.

In closing, when deciding on the tech stack, operators should consider the following: ease of use for guests, ease of use for staff, streamlining of operations, and cost.

In this space, tech should never be embraced simply because it’s shiny and new. Not only is that costly in terms of investment, it can cost guest loyalty and visit frequency.

Image: Vishnu Mohanan on Unsplash

April 18, 2022by David Klemt David Klemt No Comments

This Simple Test Reveals Process Problems

This Simple Test Reveals Process Problems

by David Klemt

There’s an easy way to identify whether there are changes that need to be made to processes and practices that only requires observation and time.

Luckily, it doesn’t take much time, either. In less than a week, an operator can determine if there are issues relating to onboarding new hires.

This simple test was shared during the 2022 Restaurant Leadership Conference in Scottsdale.

Interviews are Just the Start

It should go without saying but here we go: The hiring process doesn’t end with the interview.

An operator or their leadership team found an amazing job candidate? Awesome! That’s no small feat these days.

However, that’s just the first step in hiring and building a rock star restaurant, bar or hotel team.

Step two is onboarding, step three is training, and step four is advancement.

For KRG Hospitality, onboarding goes far beyond filling out federal and state paperwork. There’s more to it than setting up direct deposit and getting a new hire on the schedule.

Rather, operators need to implement a fully developed onboarding process. The key word there is “process.”

True onboarding includes the review of an employee handbook and an introduction to the business. During this process new hires should become familiar with the brand’s history, vision, culture, mission, and core values.

By the end of this process, a new team member should understand what’s expected of them, both in their individual role and behaviorally. Additionally, they should be introduced to the entire team.

In reality, the onboarding process is the development of a professional relationship.

The Test

Technically, the actual test for operators is for them to have in-depth hiring, onboarding and training processes in place.

So, operators should take a moment to review whether they have those processes.

However, the test I’m talking about here relates to onboarding directly. It’s simple and it was shared during RLC 2022 by Jim Thompson, COO of Chicken Salad Chick.

The only requirement is a few days’ time and an observant operator and/or leadership team.

Let’s say a candidate nails the interview. In particular, their personality is perfect for the available role. As the the hospitality industry maxim goes, hire for personality, train for skills.

The new hire works their first shift but their personality doesn’t shine through. However, that could be first-day jitters. Unfortunately, that personality the leadership team hired for is nowhere to be seen during their next few shifts.

According to Thompson, if a new hire’s personality doesn’t shine through within four shifts, there’s likely a process and practices issue. The lack of personality is an indicator that the new team member doesn’t feel confident in their role.

The onboarding process—either too shallow or nonexistent—is a likely culprit. Operators can use this test, a simple four-shift observation of a new hire, to determine if there’s a problem.

Once identified, the operator and their leaders can put their heads together, review the issue, and implement effective, positive change.

Image: Caroline Attwood on Unsplash

United States Capitol Building dome in greyscale

April 7, 2022by David Klemt David Klemt No Comments

House Votes to Replenish RRF

House Votes to Replenish RRF

by David Klemt

Eleven months after the closure of the Restaurant Revitalization Fund application portal, Congress has voted on RRF replenishment.

Earlier today, the House voted “yes” on $42 billion for the RRF via the Relief for Restaurants and Other Hard Hit Small Businesses Act of 2022 (HR 3807).

To clarify, the intent is that funds go to original applicants who were left out when the portal closed.

Neither the $1.7 trillion Build Back Better Act nor the $1.5 trillion omnibus spending bill passed in March included the RRF Replenishment Act.

So, this news is obviously fantastic. However, it’s also long overdue.

We’ve waited nearly 11 months for movement on relief for our ravaged industry. In comparison to the hospitality industry, the legislative process often moves at a glacial pace.

For obvious reasons, the long delay in replenishing the RRF has been devastating.

Nearly a month ago, I wrote and published “Congress is Abandoning Us.” Some considered the article harsh, others agreed with what I wrote.

To be clear, I stand by what I said after ten months of inaction. However, I’m relieved—cautiously—that the House proved their support for our industry today.

$55 Billion Lifeline

In its current form, the House bill would provide $42 billion. This is the amount believed to be enough to award grants to the original applicants from May of 2021.

Additionally, there’s another $13 billion for businesses in other hard-hit industries. So, the House bill provides a total of $55 billion in relief.

Per bill co-author Rep. Earl Blumenauer (D-OR), those who applied last year for the first (and only) round of RRF relief won’t have to re-apply.

Rep. Blumenauer reportedly told Nation’s Restaurant News that “[t]he independent restaurant is the foundation of a livable community.”

Continuing, Rep. Blumenauer told NRN, “We need to have these institutions to provide a foundation for our neighborhoods.”

As far as the source of the $55 billion, the money is supposed to come from funds recovered from 2020 and 2021 pandemic relief programs. This includes billions of dollars stolen through fraudulent relief program claims.

In an effort to combat further fraud and show the public that the funds are indeed going to the correct recipients, the SBA will be required to be transparent about its process.

As it stands, grant recipients will need to spend the funds on eligible uses by March 11, 2023.

Bittersweet

While this is huge news for our industry, it’s somewhat difficult to let go of my frustration fully. The RRF portal opened May 3, 2021. It closed just 21 days later, shutting out an estimated 177,000 grant applicants.

In June of last year, Sens. Kyrsten Sinema (D-AZ) and Roger Wicker (R-MS), and Reps. Earl Blumenauer (D-PA) and Brian Fitzpatrick (R-PA) introduced a bill to replenish the RRF.

That was followed in July by the ENTREE Act, introduced by Rep. Blaine Luetkemeyer (R-MO).

Then, in August, Sen. Rand Paul (R-KY) objected to a unanimous consent motion to fund the RRF. Essentially, after that occurred, it was crickets.

As stated above, when the Build Back Better Act was passed in November, relief for our industry was nowhere to be found.

Given all of this, and the fact that the bill must now go before senators for debate and a vote, I find myself still uneasy about the fate of the RRF.

We often say hope isn’t a strategy. However, I hope our senators do the right thing and pass the relief our industry so desperately needs and deserves.

Image: Joshua Sukoff on Unsplash

White Russian cocktail made with Mr. Black Coffee Liqueur

March 4, 2022by David Klemt David Klemt No Comments

7 Coffee Liqueurs You Need to Know

7 Coffee Liqueurs You Need to Know

by David Klemt

Whether you and your bar team are making Espresso Martinis, riffing on classics or creating something new, consider these coffee liqueurs.

National Espresso Martini Day takes place on Tuesday, March 15. Leading up to this bar holiday, the cocktail is experiencing yet another resurgence.

In fact, this cocktail more than any other seems to maintain an enviable rate of “surging back” in popularity. Maybe it’s time to just admit that it’s a modern classic people love to hate…but still order and enjoy.

Below are seven coffee liqueurs that shine in an Espresso Martini, Old Fashioned, Negroni, Irish Coffee, or any number of rich, flavorful cocktails. Cheers!

Mr. Black

Most of the reviews out there place Mr. Black at the top when it comes to coffee liqueurs. Once you’ve sipped it neat, you understand why. The coffee flavor is outstanding, and that should come as no surprise. After all, Mr. Black is crafted in Australia, a country with a rich coffee culture.

Additionally, Mr. Black occasionally releases special batches. In the past, the brand has produced Single Origin Ethiopia, Single Origin Colombia, and collaborations with WhistlePig and St. Ali Coffee Roasters. They also have a coffee amaro available.

Grind Espresso Shot

You really can’t go wrong making an Espresso Martini with an espresso liqueur. Grind Espresso Shot gives Mr. Black a run for their money in the coffee liqueur showdown.

This blend of Caribbean rum, espresso, coffee, and coffee extract that shines in just about any cocktail.

Kahlúa

As the saying goes, respect your elders. Kahlúa is a coffee liqueur that dates back to 1936 and there’s a reason the brand is still so visible.

Not only does the brand claim it takes seven years to produce a bottle of Kahlúa, their range is deep is flavorful. The current lineup consists of more than just the original Kahlúa expression. There’s also Blonde Roast Style, Vanilla, Mint Mocha, Chili Chocolate, Salted Caramel, and Especial currently.

Jägermeister Cold Brew

We can argue back and forth about whether Jägermeister is a schnapps or an amaro. Either way, it serves as a fantastic base for a rich coffee liqueur.

Jägermeister Cold Brew blends the original herbal liqueur with arabica coffee and a touch of cacao. There’s a Dark Matter coffee available produced by washing Guatemalan coffee beans in Jägermeister’s coffee liqueur.

Caffè Borghetti

Who among us is unfamiliar with Fratelli Branca’s products? From Fernet-Branca and Brancamenta, to Antica Formula, Punt e Mes, and Carpano, it’s difficult to imagine a bar that doesn’t have at least one Branca product in their inventory.

So, when it comes to coffee liqueur, you can’t really go wrong with another of Fratelli Branca’s bottles: Caffè Borghetti. Sweet and imbued with the rich taste of Italian espresso, this is a liqueur that deserves a place behind your bar.

Flor de Caña Spresso

Produced in Nicaragua, is not just a highly sought-after and awarded rum, Flor de Caña is also the world’s first spirit to be fair trade and carbon neutral certified.

Their coffee liqueur, Flor de Caña Spresso, is made with the producer’s 7 Year Gran Reserva rum expression. You guests will know their enjoying a premium rum-based liqueur that’s sustainably and responsibly crafted.

Jameson Cold Brew

Combine world-famous Jameson Irish whiskey with arabica coffee beans from Brazil and Colombia and you get Jameson Cold Brew.

Not only do you get intense coffee aroma and flavor, you’ll also discover notes of toasted oak. So, your guests won’t have to worry that the coffee overpowers the whiskey or vice versa.

And c’mon—if you’re going to make an Irish Coffee, why not do it with a liqueur crafted with Irish whiskey? Interestingly, Jameson Cold Brew also pairs well with cream soda or cola.

Image: YesMore Content on Unsplash

February 15, 2022by David Klemt David Klemt No Comments

The Cocktail that Won’t Die

The Cocktail that Won’t Die (Hint: It’s not the Zombie)

With Cafe Au Lait Day coming up toward the end of this week, let’s revisit a coffee cocktail that seems to see a resurgence every year.

When it comes to this drink, it seems to experience massive popularity for several weeks. Then, people seem to get sick of hearing about (and making) it.

From there, its popularity seems to fade, waiting for guests and bartenders to revive it once more.

And no, I’m not talking about the Zombie or a Corpse Reviver. I’m talking about the Espresso Martini.

Resilient, Revered, Reviled

Of course the Espresso Martini isn’t the only cocktail that can cause a bartender’s eyes to roll toward the back of their skull completely.

The Mojito, layered shots and cocktails, the infamous AMF, the Vodka Martini regularly find themselves on most-hated cocktail lists.

However, with its resurgence in 2021, the Espresso Martini is once again getting attention. Obviously, not all of it is positive.

While the origins of this drink are debatable, it sprang from the mind of a bartender in the ’80s. The caffeinated cocktail saw a spike in popularity in the ’90s. And at various points throughout the 2000s, people have “brought it back.”

Looking back at just the last few years, the Espresso Martini was woken from its slumber in 2018. Then, it rose like a phoenix in 2019. And last year it saw yet another surge.

So, is it a trendy cocktail? A mainstream drink? Are bartenders “bringing it back” every year or two now to rickroll the industry?

Or is this just a tasty cocktail that appeals to a wide range of guests, a modern classic that deserves its place on menus? Perhaps it doesn’t deserve all the hate it receives.

Why the Hate?

Of course, it’s possible that some of the hate aimed toward the Espresso Martini is clickbait fodder that won’t die. Maybe people just expect to find it on most-reviled lists, and it’s no more complex than that.

However, it’s possible that the Espresso Martini has earned a bit of the negativity thrown at it. When it makes any list, the ingredients themselves and build time are cited as reasons why bartenders dislike it.

According to these lists, bartenders also dislike having to shake hot espresso. Still others, supposedly, are offended that coffee flavor dominates and covers up the vodka, Kahlúa, Tia Maria, or other coffee liqueur.

Moreover, the Espresso Martini isn’t really a Martini: there’s no vermouth, no gin. So, it’s possible the negativity emanates from that technicality.

At any rate, you may want to dial in your Espresso Martini for Cafe Au Lait Day (Thursday, February 17).

No, there’s no milk in a traditional Espresso Martini build. But, as I stated just a moment ago, there’s no vermouth or gin in this cocktail either. Why not play fast and loose with yet another technicality on this bar holiday?

Image: Drew Beamer on Unsplash

LikeMeat plant-based burgers in skillet with onions

January 31, 2022by David Klemt David Klemt No Comments

Plant-based Performance is Nuanced

Plant-based Performance is Nuanced

by David Klemt

The World Resources Institute is making the case that the success of plant-based products on-premise will require menu changes.

In particular, changes need to be made menu item descriptions. Drilling down even further, the language we use in descriptions is crucial to performance.

Simply put, just offering recognizable plant-based brands and their products isn’t enough.

Speaking to Guests

When it comes to plant-based food items, there are multiple consumer segments to consider.

For example, there are those who are all-in on plant-based. Targeting this group is easy—promote the fact that you have the products they want.

There’s also the previous group’s counterpart: uninterested in these food items. It’s likely you’re simply never going to convince them to even try plant-based menu items.

Of course, there are the consumers in between. If succeeding with plant-based menu items will translate to more guests engaging with your business, increasing traffic and revenue, speaks to your brand in an authentic way, and matters to the community you serve, these are the guests you need to win over.

But as stated above, simply putting Impossible, Beyond, LikeMeat, or other brands on your menu likely isn’t enough. This is something some fast-casual brands are experiencing. Plant-based performance, as evidence and anecdotes appears to show, is nuanced.

Announcing plant-based alternatives seems to result in a quick rise in sales. However, that initial interest doesn’t appear to last long. And when sales slow an operator either finds themselves sitting on stock, lowering prices, or both.

Again, if succeeding with plant-based items is good for your brand, you’ll need to do some work.

Language Matters

The World Resources Institute (WRI) addressed this topic last week via video presentation. Titled “Messaging that Works: Engaging Diners in Climate Action,” the nearly hour-long video states that language matters for plant-based buy-in.

A study conducted by the WRI found that “nudging” guests with the right messaging boosted plant-based sales. The institute tested ten “framing themes” with ten associated themes.

Two types of messages “came out on top by a long way,” according to presentation host Edwina Hughes:

Small change, big impact
Joining a movement

Per the WRI’s study, those two themes resulted in around double the demand for plant-based items as other themes.

The first theme speaks to a person’s personal agency, or their actions and the impact they can have on their own lives.

Joining a movement relates to social norms. In particular, suggesting something is a movement tells someone that there are like-minded people already engaged with this concept, product, lifestyle, etc.

Putting this to Use

Menu descriptions, table talkers, POS messaging, and social media can all play a role. Again, this is only if this is important to your brand and guests. If plant-based menu items aren’t authentic to your business, the “Small change, big impact” messaging may not be of interest to you.

For operators who want to succeed with plant-based items, the WRI presentation suggests a “nudge.” In relation to the first theme from above, the process would be:

Personal empowerment statement: A person can have a positive impact on the environment.
Easily attainable action: Substitute one meat-based meal for a plant-based one.
Easily understood personal outcome: A positive result that can come from their purchase.

When it comes to the movement theme, operators can use the following nudge, provided by the WRI as an example during their presentation:

“Ninety percent of Americans [size and/or relevance of group] making the change to eat less meat [group’s behavior] choose plant-based dishes that have less impact [call to action].”

Plant-based menu items aren’t really a trend anymore, but they’re also not quite mainstream. If they’re going to perform stronger in the QSR and other segments, they’ll need better messaging.

Additional Takeaway

The lessons learned from WRI’s presentation aren’t limited to the performance of plant-based menu items. Nudges can work for all manner of products in all types of concepts.

When you look at your menu with a truly critical eye, ask yourself:

Does it have attention-grabbing descriptions?
Do the descriptions accurately describe the items?
Would you be swayed by your descriptions?
Are there any calls to action?

If you can’t answer yes to most or all of those, your menu would likely benefit from revisions.

Your menu isn’t just a catalogue of food, drinks, and prices. Rather, it’s a powerful sales and marketing tool. Take the time to leverage it accordingly.

Image: LikeMeat on Unsplash

Man in empty restaurant and bar in Ottawa, Ontario, Canada

April 29, 2021by David Klemt David Klemt No Comments

Canadian Hospitality Needs Real Help

Canadian Hospitality Needs Real Help

by David Klemt

Restaurants, bars and other foodservice establishments throughout Canada need specific relief to survive, replace lost jobs, and return to profitability.

The seemingly endless and severe provincial restrictions is putting far too much strain on a struggling industry.

Yes, there are some federal provisions in place. No, they’re not enough.

Relief Efforts

Currently, the federal budget promises extensions for wage and rent subsidies. Those subsidies would extend to September 25, 2021.

However, most Canadians, per a Restaurants Canada survey, agree that the industry needs more help.

If additional industry-specific relief faces significant delays or doesn’t come at all, operators, employees, and their families will suffer.

No wonder, then, that 90 percent of Canadians (according to the Restaurants Canada survey) feel restaurants and bars need federal support to remain in business and continue paying staff.

Support Proposals

Of the approximately 98,000 foodservice establishments throughout Canada, about 10,000 are out of business. As of last month, 319,000 lost foodservice jobs had yet to be filled.

No other industry in Canada is facing such startling numbers. Add to that the fact that the industry contributes to four percent of Canada’s GDP, restaurants are the first employers for most Canadians, women comprise nearly 60 percent of the restaurant workforce, and visible minorities comprise over 30 percent of ownership and labor, and the situation grows even starker.

Clearly, industry-specific relief is necessary.

Restaurants Canada is campaigning for the following measures:

Extend the wage and rent subsidies through April 2022.
Develop subsidy requirements that more closely match the dire reality the industry continues to face.
Implement an employee retention and retraining credit to defray Covid-19 protocol costs.
Partial forgiveness for all government-backed loans.
Removal of merchant fees from the tax portion of restaurant bills.
Restore the meals and expenses to 100 percent on a temporary basis.
Develop and implement a culinary tourism incentive for the 2020 and 2021 tax years, using New Brunswick as a model.
Implement a rebate program that provides government reimbursement of $15 per person, per meal.
Freeze the Excise Act, including Excise Act 2021.

Act Now

It took more than a year but the industry and its supporters in America helped bring about meaningful change for restaurants, bars, and other hospitality venues.

The same can be done in Canada, and time is of the essence.

For example, the Restaurant Revival Working Group is a good start for effecting change. The group consists of government and industry representatives.

Click here to review the list of Restaurant Revival Working Group members, particularly those in government, so you can contact them.

Image: Tyler Farmer on Unsplash

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

April 19, 2021by krghospitality krghospitality No Comments

SBA Releases RRF Guide and Forms

SBA Releases RRF Guide and Forms

by David Klemt

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

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

Let’s jump in!

RRF at a Glance

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

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

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

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

RRF Eligibility

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

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

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

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

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

Eligible Expenses

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

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

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

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

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

Disclaimer

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

Image: Austin Chan on Unsplash