Diner | KRG Hospitality

An AI-generated image of three pint glasses filled with beer sitting on Canadian flag coasters on a picnic table, with a mountain, lake, and Canadian flag in the background

September 23, 2024by David Klemt David Klemt No Comments

Raise Your Glass to Canadian Beer Day

Raise Your Glass to Canadian Beer Day

by David Klemt

This is an AI-generated image, but I still want to visit and drink those beers.

Operators and their guests will raise their glasses and celebrate Canadian beer on October 9, also known as Canadian Beer Day.

This year represents the sixth-annual Canadian Beer Day. Beer Canada created the holiday, with first event launching in 2019.

Not only does this beer-centric holiday honor one of the world’s most-popular drinks, it’s a day to observe its impact on Canada. According to the Beer Canada website, which is an excellent resource that I recommend everyone visit, brewers in the country employ 21,000 Canadians directly.

Zoom out and that number jumps to nearly 150,000 Canadians overall. There are farmers, bartenders, retailers, truckers, designers, and many other people whose employment relies on beer production. Further, almost 90 percent of beer purchased in Canada is brewed locally.

Each year, Beer Canada crafts a theme to go along with Canadian Beer Day. This year, that theme celebrates the cultural significance of the nation’s beer culture.

As an American, I think I’m qualified to say that people have seemed more divided over the past decade than in recent memory. At least, that’s what we’re often being told in the US, Canada, and other countries.

But think about how powerful gathering in pubs and bars has been for breaking down barriers. Having a beer with a stranger and finding middle ground can lower temperatures, and go a long way toward healing communities.

We should all strive to get back to that simple, comforting practice.

“Local” Impact

I may date myself a bit here but I remember the first Canadian beer I ever tried. Growing up in the Midwest in America, it was common to have friends who visited or had family and friends in Canada.

One day in the Nineties, some friends of mine and I got into a lighthearted debate about beer. One of our friends, who had just come back from a trip to Canada, scoffed at our light American pilsners and lagers, stating that we were essentially drinking water.

Then, he opened a cooler and pulled out bottles of Moose Drool Brown Ale. Not long after that moment, I’d be introduced to Moosehead and Labatt.

I still think about that first sip of Moose Drool, particularly when a beer debate heats up. I’m just one person but Canadian beer has had an impact on little old American me.

Canadian Beer

Head to Montréal, Québec, and you can visit the Talon Vaults, the archaeological remains of Canada’s first commercial brewery.

This important bit of beer-brewing history dates back to the late 1660s, when La Brasseries du Roy was opened by Jean Talon in Québec City. However, beer brewing in Canada dates back to at least the 1620s.

In 1786, the legendary John Molson established the Molson Brewery, also in Québec City. I think we all know how significant the Molson story is to Canadian beer.

Today, there are more than 1,300 breweries operating and employing people across Canada. Most are located in Ontario, Québec, British Columbia, and Alberta. Although, there at least a single brewery in every province. For example, there’s one brewery in the Northwest Territories, and one in Nunavut.

Per Statista data, the Canadian beer industry generated $18.43 billion (US $13.6 billion) in 2023, with $7.8 billion (US $5.8 billion) coming from restaurants and bars.

Those are big numbers being put up by just 1,300 breweries.

Celebrate in Style

Along with having a beer and getting to know someone, a great beer and food pairing can improve your day.

So, I asked Nathen Dubé, our chef consultant at KRG Hospitality, for some of his favorite beer pairings. And, wow, did he deliver.

Check out his recommendations below, and consider using them for a Canadian Beer Day limited-time-offer menu.

Let’s start with his favorite personal pairing.

“One of my favorite beer and food pairings is a robust, malty, Canadian brown ale with a perfectly grilled bison burger topped with aged cheddar, caramelized onions, and a touch of maple bacon,” says Nathen. “The rich malt character of the brown ale complements the hearty, gamey flavor of the bison, while the subtle sweetness from the caramelized onions and bacon plays beautifully with the ale’s caramel notes. The cheddar adds a creamy, sharp contrast, making each bite and sip a delightfully balanced experience.”

Now, let’s jump into Nathen’s LTO suggestions. This Canadian Beer Day, he recommends crafting unique, gourmet poutines.

Traditional Poutine

Beer Pairing: Local Pale Ale

Description: Hand-cut fries topped with squeaky cheese curds and a rich beef gravy. The pale ale’s mild bitterness cuts through the gravy’s richness, while its effervescence balances the cheese’s creaminess.

Butter Chicken Poutine

Beer Pairing: Indian Pale Ale (IPA)

Description: Fries smothered in creamy, spiced butter chicken sauce, topped with fresh cilantro and a dollop of yogurt. The hoppy and citrusy notes of the IPA enhance the spices in the butter chicken, creating a vibrant and aromatic pairing.

Pulled Pork BBQ Poutine

Beer Pairing: Smoked Porter

Description: Crispy fries loaded with slow-cooked pulled pork, tangy BBQ sauce, and cheddar cheese. The smoked porter’s roasted malt flavors complement the smoky pork, while its subtle sweetness balances the BBQ sauce’s tang. This poutine can be—or rather should be—prepared and served individually. As a general, Nathen always thinks the darker the beer, the stronger the cheese. On the other flavor profile side, the lighter/fruitier beer, the lighter the cheese.

Be sure to add these tempting poutines to your LTO menu, and visit the Canadian Beer Day website to download their digital and social media assets. Cheers!

Image: Microsoft Designer

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A closeup photograph of four street tacos with meat, onions, and cilantro in soft corn tortillas

September 20, 2024by David Klemt David Klemt No Comments

National Taco Day Makes its Move

National Taco Day Makes its Move

by David Klemt

I call this a good start.

I don’t know how to break this to you, so I’m just going to say it: National Taco Day, one of the world’s most important holidays, has made a big move.

For the past 15 years, National Taco Day has been celebrated on October 4. That means that since its inception, the annual holiday that celebrates the taco has only fallen on a Taco Tuesday three times.

In fact, it didn’t even fall on Taco Tuesday until its third year, in 2011. National Taco Day didn’t repeat the feat again until 2016, and then 2022. Had the date remained the same in perpetuity, we wouldn’t get another National Taco Day on a Taco Tuesday until 2028 at the earliest.

Starting this year—in a week and a half, in fact—National Taco Day will fall on the first Tuesday in October.

I’m going to share my thought process after I first found out about this news.

How did I learn about this massive change? Via a post by Smirnoff. You see, National Taco Day and National Vodka Day have been linked since they each first launched in 2009.

View this post on Instagram

A post shared by Smirnoff (@smirnoff)

It seems that Smirnoff is none too pleased with this news, though they’ll reunite with National Taco Day in 2028.

My first reaction was “I can’t believe this is news,” for a few seconds. That evolved into “I can’t believe this took so long to resolve” rather quickly.

And then I told the KRG Hospitality team about this news.

Finally!

I’ve always thought “Why isn’t National Taco Day always on a Taco Tuesday?” when the holiday has come around.

Finally, someone has acted to rectify this oversight; Taco Bell appealed to National Day Calendar to change the date. It may seem to trivial for a fast-food giant (or anyone else, for that matter) to petition to have a holiday’s date changed when it isn’t a legal holiday.

However, according to a Taco Bell press release addressing this National Taco Day news, it’s rare that National Day Calendar makes such a change. The release goes on to quote Marlo Anderson, the founder of National Day Calendar, which launched in 2013.

“For years, we’ve celebrated National Taco Day on October 4th, but it’s always felt like there was a bigger opportunity to align it with something even more special—Taco Tuesday,” said Anderson.

Interestingly, another fast food chain is credited with creating National Taco Day: Del Taco. Keeping the trivia going, “National” reportedly doesn’t actually pertain to any one country; it’s just what the holiday is called.

While this news is certainly another win for Taco Bell and their, well, obsession with Taco Tuesday (understandable, of course), it’s a win for everyone who loves tacos.

Operators need to pull out all the stops for October 1, the first of the newly revised National Taco Day celebrations. Task your kitchen team with creating LTO tacos, crafting a super-premium version of your signature taco if you have one, and ensuring there are vegetarian- and vegan-friendly options to appeal to every single taco-loving guest.

Let’s go all out!

Image: Jeswin Thomas on Unsplash

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An AI-generated image of a sci-fi deep fryer flying at hyperspeed through space

September 19, 2024by David Klemt David Klemt No Comments

Innovations in Deep Frying: New Tech

Innovations in Deep Frying: New Technologies

by Nathen Dubé

If you’re deep fryer can do this, you win. At what? Everything.

Deep frying has long been a cornerstone of culinary practices, delivering crispy and flavorful dishes that delight guests, and it’s ready for innovation.

Traditional frying methods can be inefficient, costly, and environmentally unfriendly. The evolution of deep frying technology in modern kitchens has focused on addressing these issues by enhancing efficiency, reducing oil usage, and promoting sustainability.

Let’s explore the latest innovations in deep frying, focusing on oil-conserving fryers and new technologies that are transforming the industry.

Oil-Conserving Fryers and Their Benefits

Oil-conserving fryers represent a significant advancement in kitchen technology. These modern fryers are designed to reduce oil usage and operational costs while maintaining high-quality frying standards.

By optimizing the use of oil, these fryers help restaurant operators lower their expenses and minimize waste, making them an attractive option for eco-conscious businesses, and those looking to improve their bottom line.

How These Fryers Reduce Oil Usage

Oil-conserving fryers achieve their efficiency through several mechanisms.

They often feature advanced filtration systems that keep the oil cleaner for longer periods, reducing the frequency of oil changes. Efficient oil circulation methods ensure that heat is distributed evenly, which not only improves cooking consistency but also extends the oil’s usable life.

Precise temperature controls prevent the oil from overheating and breaking down, further conserving this valuable resource.

Overview of Their Role in Modern Culinary Practices

In modern culinary practices, oil-conserving fryers play a crucial role in enhancing both operational efficiency and sustainability. They allow chefs to produce high-quality fried foods with less oil, reducing costs and environmental impact.

These fryers are particularly valuable in high-volume settings such as fast-food chains, casual dining establishments, and catering operations, where oil usage is typically high.

Key Features of Modern Fryers

Advanced Filtration Systems to Maintain Oil Quality

One of the standout features of modern oil-conserving fryers is their advanced filtration systems. These systems filter out food particles and debris continuously, keeping the oil clean and extending its life.

This not only reduces waste but also ensures that the food maintains a consistent taste and texture.

Efficient Oil Circulation Methods for Consistent Cooking

Efficient oil circulation is essential for consistent cooking. Modern fryers are designed to circulate oil evenly around the food, preventing hot spots and ensuring uniform cooking.

This technology helps achieve perfect results every time, whether frying chicken, French fries, or other popular items.

Temperature Controls for Precise Frying and Energy Efficiency

Precise temperature controls are another critical feature of modern fryers. These controls allow chefs to set and maintain the exact temperature needed for different foods, ensuring optimal cooking conditions.

By preventing overheating, these controls also enhance energy efficiency, and prolong the life of the oil.

New Technologies in Deep Frying

Introduction to Low-Oil Volume Fryers and Their Advantages

Low-oil volume fryers are a recent innovation designed to use significantly less oil than traditional fryers. These fryers maintain high performance while reducing the amount of oil required, leading to lower operational costs and less waste.

They are ideal for small to medium-sized establishments looking to improve their sustainability without compromising on food quality.

The Concept and Benefits of Pressure Frying

Pressure frying is another innovative technology that has gained popularity in commercial kitchens.

This method uses a sealed environment to cook food at higher pressures and temperatures, resulting in faster cooking times, and less oil absorption. Pressure frying not only produces crispier and juicier food but also enhances energy efficiency, and reduces oil consumption.

Smart Automation: Integration of Technology for Ease of Use and Consistency

Smart automation is revolutionizing the way commercial kitchens operate. Modern fryers equipped with smart technology can automate various aspects of the frying process, from maintaining oil quality to adjusting cooking times and temperatures.

These automated systems ensure consistency, reduce the margin for human error, and free up staff to focus on other tasks.

Health and Environmental Benefits

Reduced Oil Absorption in Food for Healthier Outcomes

Innovative frying technologies contribute to healthier food by reducing oil absorption. Low-oil volume and pressure fryers, in particular, produce fried foods that are less greasy, and lower in fat.

This health benefit is increasingly important as consumers become more health-conscious, and demand healthier menu options.

Decreased Waste Generation and Its Positive Environmental Impact

Reducing oil usage and waste generation has significant environmental benefits. By extending the life of frying oil and using less of it overall, oil-conserving fryers help decrease the volume of waste oil that needs disposal.

This reduction in waste contributes to a smaller environmental footprint, and supports more sustainable kitchen practices.

The Role of Innovative Fryers in Promoting Sustainable Cooking Practices

Innovative fryers are at the forefront of promoting sustainable cooking practices. By conserving resources and minimizing waste, these technologies align with the growing trend toward sustainability in the food industry.

Restaurants that adopt these practices can not only reduce their environmental impact but also appeal to environmentally conscious guests.

Insights on the Future of Frying Technologies and Industry Trends

The future of frying technologies looks promising, with ongoing innovations aimed at further improving efficiency and sustainability.

Industry trends indicate a continued focus on reducing environmental impact and enhancing food quality, with smart automation playing an increasingly important role.

Practical Tips for Choosing and Using Fryers

Key Considerations for Selecting the Right Fryer for Your Kitchen

Choosing the right fryer for your kitchen involves several considerations, including the volume of food you need to produce, the type of food you serve, and your budget.

It’s essential to evaluate the features and capabilities of different fryers to find one that meets your specific needs.

Best Practices for Maintaining Fryers to Extend Their Lifespan and Efficiency

Proper maintenance is crucial for extending the lifespan and efficiency of your fryer.

Cleaning and filtering the oil regularly, checking and calibrating temperature controls, and performing routine inspections are all vital practices. Following the manufacturer’s maintenance guidelines will help ensure optimal performance.

Importance of Staff Training to Maximize the Benefits of New Technologies

Staff training is essential to maximize the benefits of new frying technologies.

Ensure that your kitchen staff are well trained in operating and maintaining the equipment. Regular training sessions can keep staff updated on best practices and new features, helping to improve efficiency and food quality.

Conclusion

The advantages of oil-conserving fryers and new frying technologies are clear: these innovations offer significant cost savings, improved food quality, and enhanced sustainability.

Adopting these advanced solutions make it possible for restaurants to reduce their operational costs, minimize their environmental impact, and provide healthier menu options. As the industry continues to evolve, it’s crucial for restaurant owners and chefs to stay informed about the latest technologies, and invest in equipment that supports their business goals and values.

In conclusion, adopting innovative frying technologies is not just a trend but a smart business decision. The benefits of reduced oil usage, improved efficiency, and enhanced sustainability make these technologies a valuable addition to any commercial kitchen.

By prioritizing the integration of these advanced fryers, restaurants can achieve greater success, and contribute to a healthier and more sustainable food industry.

Image: Microsoft Designer

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The Tea Lounge inside the lobby of Capella Bangkok, number one on the 2024 World's 50 Best Hotels ranking

September 18, 2024by David Klemt David Klemt No Comments

The World’s 50 Best Hotels: 2024

World’s 50 Best Unveils the top Hotels of 2024

by David Klemt

The Tea Lounge inside the lobby of Capella Bangkok.

Announced yesterday at The World’s 50 Best Hotels ceremony in London, England, the best hotel in the world features 101 rooms, suites and villas.

In direct contrast to the manic, fast-paced city in which it’s located, Capella Bangkok is a serene oasis. Floor-to-ceiling windows provide panoramic, mesmerizing views of the Chao Phraya River, and allow sunlight to flood into their generous rooms.

Speaking of rooms, their smallest is more than 650 square feet; suites range from over 1,000 square feet to well over 2,000 square feet. Accommodations are more like luxury apartments than mere hotel rooms.

And for those discerning guests who demand only the absolute best? There are two stunning villas to choose from, one of which is the Presidential Villa.

I think we’ve all been curious what hotel, if any, would climb past Lake Como’s Passalacqua to claim the number-one spot. Would the property belong to a massive portfolio? Be a heritage property or a new build? How many keys would the hotel that claims the crown boast?

Will Passalacqua repeat their 2023 feat and hold the top spot for a second year?

We now have the answer to those questions. And we know that while Capella Bangkok will now sit upon the World’s 50 Best Hotels throne for at least the next 12 months, Passalacqua still claimed the number-two spot.

Of course, along with the Best Hotel in the World Award, the 2024 World’s 50 Best Hotels also revealed the best hotels in Africa, Asia, Europe, North America, Oceania, and South America. This year’s ceremony also featured three brand-new awards, which you’ll find below.

American Express Travel One to Watch Award

The Peninsula Istanbul (opened February 2023)

Ferrari Trento Most Admired Hotel Group Award

Aman

SevenRooms Icon Award

Sonia Cheng, CEO of Rosewood Hotels & Resorts

The World’s 50 Best Hotels 2024: 50 to 11

Kokomo Private Island (Yaukuve Levu Island, Fiji)
The Tasman (Hobart, Tasmania, Australia)
Hotel Esencia (Tulum, Quintana Roo, Mexico)
The Brando (French Polynesia)
The Connaught (London, England, UK)
Six Senses Zighy Bay (Dibba, Oman)
Singita Lodges – Kruger National Park (Kruger National Park, South Africa)
Suján Jawai (Rajasthan, India)
Hotel Castello di Reschio (Umbria, Italy)
Gleneagles Hotel (Auchterarder, Scotland)
Le Bristol (Paris, France)
Amangalla (Fort Galle, Sri Lanka)
Royal Mansour, Marrakech (Marrakech, Morocco)(No. 3 Gin Art of Hospitality Award)
Aman New York (New York, New York, USA)
Eden Rock – St. Barths (Saint Barthélemy)
Hotel Bel-Air (Los Angeles, California, USA)
Four Seasons at The Surf Club (Miami, Florida, USA)
Capella Singapore (Singapore)
Four Seasons Madrid (Madrid, Spain)
La Mamounia (Marrakech, Morocco)
The Carlyle (New York, New York, USA)
One&Only Mandarina (Puerto Vallarta, Jalisco, Mexico)
Mount Nelson (Cape Town, Western Cape, South Africa)(The Best Hotel in Africa)
Park Hyatt Kyoto (Kyoto, Japan)
The Siam (Bangkok, Thailand)
The Calile (Brisbane, Queensland, Australia)(The Best Hotel in Oceania)
Rosewood São Paulo (São Paulo, Brazil)(The Best Hotel in South America)
The Lana (Dubai, UAE)
Bulgari Tokyo (Tokyo, Japan)(Nikka Whiskey Best New Hotel Award)
Desa Potato Head (Bali, Indonesia)
Borgo Santandrea (Amalfi, Italy)
Four Seasons Firenze (Florence, Tuscany, Italy)
Maroma (Quintana Roo, Mexico)(Flor de Caña Eco Hotel Award)
Hotel du Cap-Eden-Roc (Antibes, France)
Chablé Yucatán (Chocholá, Yucatán, Mexico)(The Best Hotel in North America)
Hotêl de Crillon (Paris, France)
Four Seasons Bangkok at Chao Praya River (Bangkok, Thailand)
Raffles London at the OWO (London, England, UK)(Lavazza Highest New Entry Award)
Mandarin Oriental Bangkok (Bangkok, Thailand)
Claridge’s (London, England, UK)

The World’s 50 Best Hotels 2024: 10 to One

Nihi Sumba (Sumba Island, Indonesia)
Atlantis The Royal (Dubai, UAE)(The Highest Climber Award: Number 44 in 2023)
Soneva Fushi (Eydhafushi, Maldives)(The Lost Explorer Mezcal Best Beach Hotel Award)
Aman Tokyo (Tokyo, Japan)
Raffles Singapore (Singapore)
The Upper House (Hong Kong, People’s Republic of China)
Cheval Blanc (Paris, France)
Rosewood Hong Kong (Hong Kong, People’s Republic of China)
Passalacqua (Moltrasio, Como, Italy)(Carlo Alberto Best Boutique Hotel Award)(The Best Hotel in Europe)(Number 1 in 2023)
Capella Bangkok (Bangkok, Thailand)(The Best Hotel in the World)(The Best Hotel in Asia)

Congratulations to the team behind Capella Bangkok for earning the number-one spot on the second-annual World’s 50 Best Hotels list!

Main Image courtesy of The World’s 50 Best Hotels. Capella Bangkok image: PanoramicStudio

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An AI-generated image of an open hand "holding" gears that are hovering over the palm, illustrating the concept of systems

September 17, 2024by David Klemt David Klemt No Comments

The Modern Approach to Systems: Part 1

The Modern Approach to Systems: Part 1

by Doug Radkey

Must be a magician.

In the hospitality industry, where guest satisfaction and operational efficiencies are paramount, systematic strategies are essential for maintaining a high-level of excellence.

Whether you’re running a high-end cocktail bar, a fast-casual restaurant, or an elevated boutique hotel, the intricacies of daily operations demand a structured approach to ensure smooth functionality, and exceptional service delivery.

After walking through this approach recently with a client, I thought it would be a great opportunity to introduce you to two powerful methodologies that have transformed businesses worldwide: the Kaizen methodology, and Six Sigma strategies. We use both of these approaches with all our clients at KRG Hospitality because they offer comprehensive frameworks for achieving operational excellence through continuous improvement and efficiency.

Kaizen, with its focus on incremental changes and fostering a culture of constant innovation, and Six Sigma, with its emphasis on reducing variability and enhancing quality, provide invaluable tools for those in this industry.

By exploring their application in bars, restaurants, and hotels, I am going to highlight how these systematic strategies can elevate guest experiences, and create a culture of excellence that will help improve nearly every aspect of your business.

Understanding Kaizen

Kaizen is a Japanese term that translates to “change for the better,” or “continuous improvement.” It represents a philosophy that emphasizes small, incremental changes to processes, products, or services rather than large-scale transformations.

This approach fosters a culture of constant improvement, encouraging everyone in an organization to contribute to enhancing efficiency and quality.

The concept of Kaizen originated in post-war Japan, where it was developed as a response to the need for rapid industrial growth and efficiency. It gained widespread recognition and was popularized by Toyota’s production process, known as the Toyota Production System (TPS).

Toyota implemented Kaizen principles to streamline its manufacturing processes, reduce waste, and improve overall quality. Ultimately, this approach played a crucial role in establishing the company as a global leader in the automotive industry today.

The Core Principles of Kaizen

Focus on Incremental Changes and Continuous Improvement: Kaizen emphasizes making small, manageable changes regularly rather than waiting for major breakthroughs. This approach allows for the constant refinement and improvement of processes, leading to significant compounded gains over time. Seeking better ways to do things continuously helps organizations stay agile, and respond to changes in the market or industry quickly.
Emphasis on Teamwork and Employee Involvement: A key aspect of Kaizen is the active involvement of all employees, from top management to frontline workers. Everyone is encouraged to identify areas for improvement, and to contribute ideas. This inclusive approach fosters a sense of ownership and accountability, as employees at all levels feel empowered to make meaningful changes. Teamwork is essential in Kaizen, as collaboration and open communication enable the sharing of knowledge and best practices.
A Culture of Continuous Learning: Kaizen promotes a learning-oriented culture in which employees are encouraged to develop their skills and knowledge continuously. This focus on education and training helps create a workforce that is adaptable and capable of implementing improvements. By cultivating a mindset of curiosity and openness to new ideas, organizations can foster innovation, and sustain long-term growth.

The Plan-Do-Check-Act Cycle

The PDCA cycle, also known as the Deming Cycle, is a foundational tool in the Kaizen methodology. It provides a structured framework for implementing changes, and ensuring their effectiveness. The cycle consists of four stages:

- Plan: Identify an area for improvement, set objectives, and develop an action plan.
- Do: Implement the plan on a small scale, testing the proposed changes.
- Check: Evaluate the results of the implementation, comparing against objectives.
- Act: Based on the evaluation, make necessary adjustments, and standardize the successful changes. If the results are not satisfactory, revisit the Plan stage, and repeat the cycle.

The PDCA cycle is a continuous loop that encourages organizations to keep refining their processes, and strive for excellence continuously. It ensures that improvements are data-driven and based on careful analysis, reducing the risk of failure, and increasing the likelihood of sustainable success.

Applying Kaizen to the Industry

By fostering a culture of efficiency, teamwork, and guest-centricity, Kaizen helps bars, restaurants, and hotels enhance their operations, and deliver exceptional guest experiences.

Here, I explore how Kaizen can be applied, using three key areas as examples.

Kaizen in Bars

Streamlining Bar Layout and Workflow: In a bar setting, the layout and workflow are crucial for ensuring quick service, and minimizing wait times. Kaizen encourages a meticulous examination of the bar’s physical layout, from the positioning of glassware and bottles to the arrangement of mixing stations and garnishes. By optimizing these elements, bars can reduce the time taken to prepare and serve drinks, leading to faster service, and increased guest satisfaction. For example, organizing the bar setup to minimize the distance bartenders need to travel can enhance efficiency significantly.

Continuous Menu Optimization: Guest preferences and trends in the beverage industry are evolving constantly. Kaizen’s principle of continuous improvement can be applied to menu optimization, where bars review sales data and guest feedback regularly to refine their offerings. By identifying popular drinks and experimenting with new mixes, bars can keep their menus fresh and appealing. Additionally, removing underperforming items helps streamline inventory and reduce waste, contributing to overall cost efficiency.

Enhancing the Guest Experience: Kaizen emphasizes the importance of guest interaction in creating a memorable experience. Regular staff training is vital to ensure that bartenders and servers are skilled in both mixology and guest services. Training sessions can focus on refining communication skills, upselling techniques, and handling guest questions more effectively. By fostering a welcoming and engaging atmosphere, bars can enhance satisfaction, and encourage repeat business.

Kaizen in Restaurants

Implementing Lean Kitchen Practices: In restaurants, the kitchen is the heart of operations. Kaizen can be applied to implement lean kitchen practices that minimize waste, and improve efficiency. This includes optimizing food preparation processes, standardizing portion sizes, and ensuring proper inventory management. By reducing unnecessary steps and streamlining workflows, restaurants can decrease preparation times, reduce food waste, and, ultimately, lower their food costs.

Refining Service Protocols: Refining service protocols regularly is essential for maintaining high standards of guest service. Kaizen encourages continuous evaluation and improvement of service procedures, from seating arrangements to cleaning protocols to table service. Restaurants can identify bottlenecks in service delivery by analyzing guest flow and feedback, and make necessary adjustments. For instance, optimizing the sequence of service can increase table turnover rates, allowing restaurants to serve more guests during peak hours, and maximize revenue.

Encouraging Staff Participation: A core tenet of Kaizen is the involvement of all employees in the improvement process. In restaurants, this means encouraging staff to identify operational challenges and propose solutions. Restaurants can tap into a wealth of boots-on-the-ground insights by fostering an inclusive environment in which employees feel valued and heard. Regular pre-shift meetings, team meetings, and one-on-ones can be effective platforms for gathering feedback and implementing changes. This participatory approach not only enhances operational efficiency but also boosts employee morale and engagement.

Kaizen in Hotels

Optimizing Housekeeping Processes: Housekeeping is, of course, a crucial component of hotel operations, impacting guest satisfaction directly. Kaizen can be applied to optimize housekeeping processes, ensuring timely room turnovers, and maintaining high cleanliness standards. This involves standardizing cleaning procedures, scheduling, and the use of cleaning supplies. Hotels can reduce the time required to prepare rooms for new guests by implementing efficient practices, improving occupancy rates, check-in times, and guest experiences.

Improving Front Desk Operations: The front desk is still the first point of contact for guests at many hotels, and it plays a crucial role in shaping a guest’s first impressions. Kaizen encourages continuous improvement in front desk operations, focusing on streamlining check-in/check-out processes, managing guest inquiries, and handling reservations. By leveraging technology and training staff, hotels can reduce wait times, enhance service accuracy, and provide personalized experiences. For example, implementing mobile check-in options can expedite the process and cater to tech-savvy travelers while freeing up time for staff to spend with guests who are not so tech-savvy.

Fostering a Culture of Hospitality and Attentiveness: Beyond operational efficiency, Kaizen promotes a culture of hospitality, and attentiveness among hotel staff. This involves training employees to anticipate guest needs, provide courteous service, and handle special requests with care. Hotels can cultivate loyalty and encourage positive reviews by creating a welcoming environment, and exceeding guest expectations consistently. Regular feedback loops, such as guest satisfaction surveys, can help hotels identify areas for improvement, and ensure that staff remain committed to providing exceptional service.

Takeaway

The application of Kaizen in bars, restaurants, and hotels leads to enhanced efficiency, improved service quality, and increased satisfaction.

By focusing on continuous improvement and involving all employees in the process, your business can create a dynamic and responsive environment that adapts to changing guest needs and market conditions. This commitment to excellence not only drives operational success but also strengthens your brand reputation, and guest loyalty.

To keep this from being too long, I’ve broken this article into two parts. Look for part-two on developing Six Sigma, and how combining both Kaizen and Six Sigma can take your business to new heights.

Image: DALL-E

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September 16, 2024by David Klemt David Klemt No Comments

2024 Datassential 500: Guest Perception

2024 Datassential 500: Guest Perception

by David Klemt

Last week we took a look at the data-driven findings that identify, organize, and rank chain restaurants in the US, forming the Datassential 500.

This annual report sorts the 500 top-performing chains by segment. Further, Datassential identifies the top chains by both number of units, and sales.

In doing so, the F&B intelligence agency uses hard numbers to determine numbers one through 500.

But what about guest perception? Unit and sales growth may appeal to board members, investors, executives, and other hospitality professionals, but what matters to the people their restaurants serve?

It’s doubtful that even the staunchest fans of a particular restaurant chain are aware of or, frankly, care about how many locations they operate. Nor are they likely all that concerned about their annual revenue, unless they’re an investor as well.

To get to the bottom of how the public perceives chain restaurants in the US, and what brands they rank at the top, Datassential looked at six key metrics.

Those metrics? Food quality, service, experience, affordability, value for dollar, and net promoter score.

While the results aren’t exactly shocking, they’re quite telling. A handful of US chains dominate the consumer-facing metrics. And for the most part, they’re not among the top ten of the 2024 Datassential 500.

Anyone interested in reading this year’s report can do so via this link. Alright, let’s check out how the public ranks US chain restaurants.

Perception Matters

To make the comparisons easier, the top 10 US restaurant chains by unit and by sales are below.

Top 10: Total Units

Subway
Starbucks
McDonald’s
Dunkin’
Taco Bell
Domino’s Pizza
Burger King
Pizza Hut
Wendy’s
Dairy Queen

Top 10: Total Sales

McDonald’s
Starbucks
Chick-fil-A
Taco Bell
Wendy’s
Dunkin’
Burger King
Chipotle
Subway
Domino’s Pizza

Guest Perception

Okay, so those are the top performers in the US, by the numbers. Units were counted, sales were analyzed.

Now, these are the brands that guests feel are at the very top, organized into six categories.

Food Quality

Texas Roadhouse
Chick-fil-A
Longhorn Steakhouse
Cheesecake Factory
Ruth’s Chris Steak House

Service

Chick-fil-A
Texas Roadhouse
Longhorn Steakhouse
Cheesecake Factory
In-N-Out Burger

Experience

Chick-fil-A
Ruth’s Chris Steak House
Texas Roadhouse
Maggiano’s Little Italy
In-N-Out Burger

Affordability

Little Caesars
Freshii
Papa Murphy’s
Cici’s Pizza
Pollo Tropical

Value for Dollar

Papa Murphy’s
Little Caesars
Cici’s Pizza
In-N-Out Burger
Del Taco

Net Promoter Score

To determine this ranking, survey participants were asked “How likely would you be to recommend this chain to friends and family?”

Chick-fil-A
Texas Roadhouse
In-N-Out Burger
Longhorn Steakhouse
Portillo’s Hot Dogs
Cheesecake Factory
The Capital Grille
Ruth’s Chris Steak House
Maggiano’s Little Italy
Topgolf

Subway and McDonald’s may dominate the list in terms of number of units and annual sales, but Chick-fil-A dominates in one key area. Word-of-mouth marketing still matters, undeniably, and, according to Datassential, most consumers perceive Chick-fil-A as the restaurant chain to recommend.

Followed by Texas Roadhouse and In-N-Out Burger, smaller brands are delivering on important operational elements. Consumers at large appear to favor these brands when it comes to stretching their dollars, along with how they perceive the quality of food, the level of service, and the overall dining experience.

Operators interested in scaling their business need to set aside ego and desire, and look at their business objectively. They need to ensure they’re nailing the fundamentals and have the right systems in place first.

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September 13, 2024by David Klemt David Klemt No Comments

The 2024 Datassential 500

How Does the 2024 Datassential 500 Shake Out?

by David Klemt

The annual Datassential 500 ranking is a valuable report that identifies industry leaders, the fastest growers, and segment performance.

Further, this yearly report shows the scale of restaurant business in the US. In a word, it’s gargantuan.

Looking at 2023 data, the top 500 chains in the US operated 238,152 units. And those 238,000-plus restaurants generated $417.13 billion in 2023.

For the former, that’s growth of 2.1 percent in comparison to 2022. And for the latter, the top 500 grew by 7.5 percent compared to last year.

Those numbers are from just 500 chains; the report doesn’t take into account other chains or independent operators. When we add all dining and drinking establishments in the US, the industry generated $1.09 trillion in 2023.

Again, the US restaurant business is a colossus.

Perhaps unsurprisingly, limited-service and quick-service restaurants are the top-performing segments by unit within the Datassential 500. In 2023, the LSR segment consisted of 212,469, and unit growth was up by 2.3 percent. The QSR segment reached 170,241, representing unit growth of 1.9 percent.

In fact, every segment but one saw unit growth in 2023. One may assume the segment that slipped was fine dining. That’s usually a safe bet, but the segment actually saw the most growth. It was midscale restaurants that suffered a bit of a blow, shrinking by 0.1 percent.

That means that LSRs, QSRs, full-service restaurants (FSRs), fast casual, casual dining, and fine dining all grew. Further, that growth ranged from 0.3 percent (FSR) to 4.6 percent (fine dining).

There are many more insights, so I encourage anyone interested to download the report for themselves.

Segment Shakedown

Before we jump into the top US chains, let’s take a look at how the categories break down.

Type of Cuisine

American: 88
Pizza: 70
Desserts & Snacks: 69
Sandwich: 47
Coffee: 47
Burger: 37
Mexican: 36
Salad & Healthy: 31
Southern: 24
Asian: 22
BBQ: 12
Steakhouse: 11
Italian: 9
Seafood: 9
Greek & Mediterranean: 9

Growth by Segment: Unit (LSR)

Salad/Healthy: +11.2%
Coffee: +5.9%
Other: +4.6%
Dessert/Snack: +4.3%
Mexican: +3.0%
Chicken: +2.9%
Pizza: +1.6%
Bakery-Cafe: +0.8%
Sandwich: -0.4%
Burger: -0.4%

As we can see, Salad/Healthy LSRs saw almost double the growth by unit than the next-largest segment, Coffee.

Further, Sandwich and Burger shrunk slightly.

Growth by Segment: Unit (FSR)

Regional/Ethnic: +7.6%
Sports Bar: +3.8%
Midscale: +0.3%
Seafood/Steak: +0.1%
Italian/Pizza: -0.9%
American: -2.0%

Regional and ethnic full-size restaurants saw the most growth. In fact, they grew by twice the amount of sports bars, and several times more than midscale FSRs.

Growth by Segment: Sales

Limited-Service Restaurant: $338.18 billion (+8.1%)
Quick-Service Restaurant: $263.48 billion (+8.0%)
Full-Service Restaurant: $78.95 billion (+5.0%)
Fast-Casual Restaurant: $74.70 billion (+8.6%)
Casual-Dining Restaurant: $55.57 billion (+4.8%)
Midscale Restaurant: $20.05 billion (+4.5%)
Fine-Dining Restaurant: $3.33 billion (+10.7%)

The good news is that every segment saw sales growth in 2022, with Fine Dining and Fast Casual experiencing the biggest increases.

Of course, that’s relative. Fine Dining generated just $3.33 billion in comparison to LSRs, which generated more than $338 billion.

Still, positive growth is always great to see.

Growth by Segment: Sales (LSR)

Salad/Healthy: +17.0%
Chicken: +11.9%
Dessert/Snack: +10.1%
Coffee: +9.8%
Other: +9.3%
Mexican: +9.1%
Burger: +7.5%
Sandwich: +7.2%
Bakery-Cafe: +1.8%
Pizza: +1.6%

Not only did Salad/Healthy lead the way in LSR unit growth in 2023, it’s the top performer in terms of sales.

Again, the good news is that the Datassential 500 saw LSR sales growth across the board.

Growth by Segment: Sales (FSR)

Regional/Ethnic: +10.2%
Seafood/Steak: +6.7%
Midscale: +5.2%
Italian/Pizza: +4.2%
American: +3.8%
Sports Bar: +3.2%

As far as FSR performance, every segment experienced growth, with Regional/Ethnic leading the charge.

The Top 5(00)

So, which US chains are at the top? Well, an accurate answer depends on segment, number of units, and sales.

Oh, and it also depends on whether we’re talking about which chains Datassential have identified as industry leaders, and which are the fastest growers.

Industry Leaders

According to Datassential, the top five US chains by number of stores are Subway (20,133), Starbucks (16,346), McDonald’s (13,449), Dunkin’ (9,580), and Taco Bell (7,405).

However, that ranking changes a bit when we look at through the lens of sales. In that case, the top five are McDonald’s ($52.91 billion), Starbucks ($29.98 billion), Chick-fil-A ($21.58 billion), Taco Bell ($13.95 billion), and Wendy’s ($12.29 billion).

Those are the industry stalwarts. How do the fastest-growing US chains stack up?

Fastest Growers

Looking at unit growth over the span of one year, the top performers in the US are 7 Brew (+373.7 percent), The Peach Cobbler Factory (+358.3 percent), Hangry Joe’s Hot Chicken (+281.8 percent), KPOT Korean BBQ & Hot Pot (+275.0 percent), and Foxtail Coffee Co (+176.2 percent).

Switching gears to sales growth over a single year, Hangry Joe’s Hot Chicken led the way, growing by more than 500 percent. Hangry Joe’s is followed by The Peach Cobbler Factory (+332.5% percent), Nick The Greek (+304.7 percent), 7 Brew (+267.3 percent), and Pizza King Inc (+264.7 percent).

However, Datassential gets more granular in their 2024 report, breaking down the top five across multiple segments.

Top Ranked By Unit (Overall)

Top 5: Quick Service

Subway
McDonald’s
Dunkin’
Taco Bell
Domino’s Pizza

Top 5: Fast Casual

Starbucks
Chipotle
Panera Bread
Wingstop
Tropical Smoothie Cafe

Top 5: Midscale

Waffle House
IHOP
Denny’s
Cracker Barrel
First Watch

Top 5: Casual & Fine Dining

Applebee’s
Buffalo Wild Wings
Chili’s
Olive Garden
Outback

Top Ranked By Unit (Growth)

Top 5: Quick Service

7 Brew
The Peach Cobbler Factory
Foxtail Coffee Co
Cupbop
Swig

Top 5: Fast Casual

Hangry Joes Hot Chicken
Just Love Coffee Cafe
The Great Greek Mediterranean Grill
Nautical Bowls
Ellianos Coffee Co

Top 5: Midscale

Snooze Restaurant
Eggs Up Grill
Kura Sushi Bar
Another Broken Egg Cafe
Maple Street Biscuit Co.

Top 5: Casual & Fine Dining

KPOT Korean BBQ & Hot Pot
Topgolf
The Juicy Crab
Jinya Ramen Bar
Hopdoddy Burger Bar

There are many more insights to be had, so please consider downloading your own copy of the 2024 Datassential 500 report here.

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September 12, 2024by David Klemt David Klemt No Comments

How do You Measure Success?

How do You Measure Success?

by David Klemt

That’s a lot of pens…and possibly paintbrushes.

When you take a moment to reflect on your business, what does success mean to you, and what steps are you taking to achieve it?

One obvious measure of success, of course, is monetary. Whether you operate a bar, restaurant, cafe, lounge, nightclub, hotel or other hospitality business, this is a stressful business. Why subject yourself and your team to the hardships hospitality throws at us if there are no financial rewards?

To many, a successful business is one that operates a profit. One that provides the entire team with not just enough money to get by but to thrive and experience financial freedom.

I like to think that most—the vast majority would be nice—operators want the people who believe in their vision enough to work with them to achieve it to make more than just a living wage.

Speaking of buy-in from others, finding people eager to work for them is a measure of success to some operators.

Others find success in achieving accolades. If we were to look at these operators and those who measure success financially, there would surely be an overlap in a Venn diagram.

Operators who find awards, invitations to share their stories, and opportunities to speak and educate others find the validation of their vision to mean they’re successful.

There’s absolutely nothing wrong with measuring success by profits and awards earned. After all, a hospitality business won’t be a business for long if it operates in the red, or people are unaware it exists.

But what about considering how your business makes you feel?

For Your Condsideration

Yes, I’m going to talk about feelings. Our industry is too challenging to pretend money is the only thing that matters. And we simply can’t keep ignoring the topic of mental health and the toll the hospitality industry can take on a person.

So, let’s take a moment to consider some key questions.

Is just the thought of your business accompanied by positive or negative feelings? When it’s time to head into your restaurant, bar or hotel, are you happy and excited? Or does the thought fill you with stress, or worse yet, dread?

I’m speaking on balance, of course. Stress is inescapable. New operator? Stress. A year or two in? Stress. Veteran operator? Stress.

On the whole, however, do you feel satisfied with what you’ve built, and what you’re operating? When you consider your business and brand, are you proud?

Satisfaction, Happiness, and Pride

I was reading a profile on Hotel Management a few days ago that I’m still thinking about.

Speaking of the brand and success, Red Roof Inn president Zack Gharib says, “To me, [ultimately], the measurement is, how are we making the people feel who are invested in us most—our employees, our franchisees, our communities, our guests? If there’s a sense of satisfaction and happiness and pride to be part of [the brand], then we have achieved success.”

Again, there’s nothing wrong with measuring the success of your business in financial terms. When we’re working with a client to bring their vision to life we’re laser focused on long-term financial viability.

However, leading your business toward becoming a brand you’re proud of and happy to operate should also be a consideration.

Picture operating your business so well that your team is proud to work for you. Imagine how you’d feel if the people you serve feel pride having your business in the community.

This business is too challenging to allow it to drain you psychologically, physically, and financially. If you’ve lost control of parts of your business or lost sight of your vision, it’s time to stabilize. Should you feel that you want to build your brand into something bigger, it’s time to consider scaling it. If you’re not proud to tell people about your business, you need a shift in mindset.

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September 11, 2024by David Klemt David Klemt No Comments

Balancing Menu Creativity with Preferences

Menu Design: Balancing Creativity and Guest Preferences

by Nathen Dubé

Note: AI-generated image.

A menu is not just a list of dishes; it’s a strategic tool that influences guest choices, enhances the dining experience, and maximizes sales.

Therefore, a well-designed menu is a crucial component of a restaurant’s success.

Come along with me and we’ll explore the principles of effective menu design, balancing creativity with guest preferences, and the role of menu psychology in driving decisions.

Key Principles of Effective Menu Design

Layout and Structure

The foundation of a great menu lies in its layout and structure. Organizing menu items logically—grouping appetizers, mains, desserts, and beverages into distinct sections—guides guests through their dining journey.

This structure helps in creating a seamless experience where guests can find what they are looking for easily. Subsections like “vegetarian,” “seafood,” or “grilled” can further refine the selection process.

Logical organization not only aids in navigation but also enhances the overall dining experience by reducing decision fatigue.

Item Placement

Item placement on the menu can have a significant impact on what guests decide to order.

The “Golden Triangle” concept suggests that guests’ eyes typically first gravitate to the center, then the top right, and finally, the top left of the menu. Placing high-margin items in these areas can drive sales.

Additionally, highlighting signature dishes and specials in these prime spots can make them more appealing. Strategic placement is essential for maximizing the visibility of certain items, encouraging guests to order the dishes that are most profitable or unique.

Readability

A menu should be easy to read and visually appealing. Choosing appropriate fonts and sizes ensures that the text is legible in various lighting conditions.

A key factor to bear in mind is maintaining clear spacing between items to prevent the menu from looking cluttered and overwhelming.

Ensuring the clarity and ease of reading is vital; if a guest struggles to read the menu, it detracts from their dining experience. Effective readability involves the thoughtful selection of fonts, sizes, and spacing to create a harmonious and inviting look.

Balancing Creativity and Guest Preferences

Creative Culinary Expression

A menu is an opportunity to showcase the chef’s creativity and culinary expertise. Innovative dishes that use unique ingredients or cooking techniques can set a restaurant apart from its competitors.

Creativity is crucial for developing a distinctive culinary identity, and offering guests an exciting and memorable dining experience.

However, it’s important to balance creativity with dishes that guests are familiar with and enjoy. Balancing innovation with tradition ensures that while the menu offers new and novel experiences, it also provides comfort and familiarity.

Popular Guest Preferences

To appeal to a broad audience, a menu should include a mix of creative dishes and popular favorites. Including familiar dishes alongside innovative options can cater to a wider audience, making everyone feel welcomed and valued.

Additionally, considering dietary restrictions and preferences is crucial. Offering vegetarian, vegan, gluten-free, and allergen-friendly options ensures that all guests can find something they love. Addressing dietary needs and preferences not only broadens the guest base but also demonstrates the restaurant’s commitment to inclusivity and guest satisfaction.

Market Trends

Staying updated with current culinary trends helps keep the menu fresh and exciting.

For instance, trends such as plant-based diets, sustainability, and ethnic fusion can attract trend-conscious diners. Incorporating these trends into the menu shows that the restaurant is contemporary and aware of its guests’ evolving tastes.

Aligning the menu with market trends can create a buzz and draw attention to the restaurant, enhancing its reputation as a forward-thinking and dynamic establishment.

The Role of Menu Psychology

Influencing Guest Choices

Menu psychology involves using strategic design and phrasing to influence what guests order.

Some effective techniques include strategic pricing methods like decoy pricing. This approach involves placing a high-priced item next to a mid-priced item to make the latter seem more reasonable. Another tactic is charm pricing, an approach that uses prices that end in “.99” to make them appear more attractive.

These subtle cues can guide guest decisions and encourage them to choose certain dishes. Understanding menu psychology allows restaurants to steer guests subtly towards higher-margin items without being overtly pushy.

Maximizing Sales

Highlighting profitable dishes with visual cues, such as boxes, borders, or bold text, can draw attention to these items. Descriptive language that evokes the senses can make dishes sound more appealing, and entice guests to try them.

For example, describing a dish as “succulent, slow-roasted pork with a caramelized apple glaze” creates a vivid image, and stimulates appetite.

Effective use of menu psychology can boost sales significantly, and enhance the dining experience by making the menu more engaging and enticing.

Enhancing Appeal with Descriptive Language and Visuals

Descriptive Language

Using evocative and sensory words to describe dishes can enhance their appeal. Highlighting unique ingredients, preparation methods, and the origin of the dish creates a story that resonates with guests.

Descriptive language adds depth and dimension to the menu, transforming it from a simple list of dishes into a narrative that engages the guest’s imagination. Phrases like “handcrafted,” “locally sourced,” and “artisanal” add a touch of sophistication and quality, making dishes sound more attractive and special.

Visuals

Including high-quality images or illustrations of key dishes can boost their appeal significantly. Visuals help guests imagine the dish, and can trigger an emotional response

A well-designed menu with complementary color schemes and design elements reinforces the restaurant’s theme, and creates a cohesive brand identity.

The use of appealing visuals can stimulate appetite, and make the decision-making process more enjoyable for guests, enhancing their overall dining experience.

Examples of Innovative Menus

Case Studies of Successful Menus

Analyzing menus from renowned restaurants provides valuable insights into successful design choices.

For instance, The French Laundry in California uses a minimalist menu design that emphasizes simplicity and elegance, allowing the focus to remain on the high-quality ingredients and sophisticated dishes.

Similarly, Nobu’s menu balances innovative Japanese-Peruvian fusion dishes with classic favorites, catering to a diverse clientele.

These examples illustrate how thoughtful menu design can enhance the dining experience, and create a distinctive brand identity.

Insights from Industry Experts

Menu design professionals and restaurateurs offer valuable best practices. Experts suggest evaluating and adapting the menu continuously to meet changing guest preferences and market trends.

Updating the menu regularly not only keeps it interesting for repeat guests but also allows for the introduction of seasonal ingredients and new culinary innovations.

Industry insights highlight the importance of flexibility and responsiveness in menu design, ensuring that the restaurant remains relevant and competitive.

Conclusion

A thoughtfully designed menu is a powerful tool in the restaurant industry. It balances creativity with guest preferences, uses psychology to influence choices, and enhances appeal through descriptive language and visuals.

Investing in effective menu design can enhance the dining experience, drive guest satisfaction, and boost sales. For restaurateurs, it’s an essential aspect of creating a successful and memorable dining establishment.

By understanding and implementing these principles, restaurant owners can craft menus that not only reflect their culinary vision but also resonate with their target audience, ensuring a winning formula for success.

A well-designed menu can transform the dining experience, making it more engaging, enjoyable, and, ultimately, profitable for the restaurant.

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September 10, 2024by David Klemt David Klemt No Comments

Modern Day Revenue Management for Hotels

Modern Day Revenue Management for Hotels

by Doug Radkey

Note: Image generated by artificial intelligence.

The landscape of hotel revenue management has evolved significantly in recent years, driven by both tech advancements and changing consumer behaviors.

With this in mind, I think now would be a good time to explore these current trends, tools, and strategies in hotel revenue management.

Below, I outline the importance of data analytics, dynamic pricing, and AI in maximizing revenue today, and as we move forward in this industry.

The Evolution of Revenue Management

In the early days of the hotel industry, revenue management was a relatively straightforward affair.

While the overall concept of revenue management originated in the airline industry in the 1980s, it was later adapted by hotels. Traditional practices relied primarily on static pricing models, where room rates were set based on the season, room type, and booking lead time. Rates were adjusted infrequently (often just a few times per year), and they were influenced mainly by historical data documented internally, and the intuition of revenue managers.

Hotels used simple tools such as spreadsheets and reservation logs to track bookings and manage their inventory. The focus was on achieving high occupancy rates rather than maximizing revenue per available room (RevPAR) and the other key metrics that we follow today.

Discounts and promotions were applied sporadically, without a deep understanding of market segments or consumer behavior, to help drive revenue during off-season periods. Group rates and corporate contracts were negotiated based on fixed rates, with little consideration for fluctuating market conditions.

From Static Pricing to Dynamic, Data-Driven Strategies

The transition from those early days to modern revenue management practices began in the late 1990s and early 2000s, driven by tech advancements and increased competition in the accommodation space.

The advent of online travel agencies (OTAs), real-time booking systems, and sophisticated data analytic tools transformed how hotels approached their pricing and inventory management.

So, what’s the modern approach?

Data-Driven Decision Making: The incorporation of advanced data analytics revolutionized revenue management. Hotels began leveraging large datasets from various sources, such as reservation systems, customer relationship management (CRM) software, and market intelligence platforms. This data-driven approach enabled more accurate forecasting, segmentation, and pricing strategies. Revenue managers could now analyze booking patterns, guest preferences, and demand fluctuations to make informed decisions.
Dynamic Pricing Models: Dynamic pricing involves adjusting room rates continuously based on real-time market demand, competitor pricing, and other external factors. This approach allows hotels to maximize revenue by selling the right room to the right guest at the right time and price. Dynamic pricing models consider various data points, including booking pace, market trends, weather, and special events, to optimize their recommended rates.
Automation and Real-Time Adjustments: Modern revenue management systems (RMS) introduced automation, allowing hotels to implement real-time rate adjustments. These systems use algorithms and machine learning to analyze data and update rates across all distribution channels automatically. This automation minimizes manual errors, and ensures consistent pricing across platforms, enhancing the hotel’s ability to respond to market changes quickly.
Focus on Total Revenue Management: While traditional revenue management focused primarily on room revenue, modern practices embrace a more holistic view known as total revenue management. This approach considers all revenue streams, including food and beverage, spa services, and other on-property offerings. By optimizing pricing and promotions across all areas, hotels can now maximize total revenue and profitability.

The Importance of Data Analytics

Data analytics involves the systematic analysis of data to uncover patterns, correlations, and trends that inform strategic decisions.

Sounds fairly important, right? In the hospitality industry, data analytics helps you understand market dynamics, predict demand, and tailor your hotel’s offering to meet guest needs. This level of analysis is paramount for developing effective revenue management strategies that maximize profitability.

One of the primary functions of data analytics in hotel revenue management is demand forecasting. By analyzing historical booking data, seasonal trends, and external factors such as local events, weather, or economic conditions, hotels can predict future demand accurately. This forecasting through data analytics enables hotels to adjust room rates more dynamically, optimize inventory allocation more efficiently, and implement targeted marketing campaigns that drive results.

Modern analytics platforms have revolutionized hotel revenue management by providing sophisticated tools for data analysis, strategic planning, and dynamic pricing. Atomize RMS stands out as a prime example of an advanced analytics tool that leverages data-driven decision-making to optimize hotel performance through dynamic pricing. This cloud-based revenue management system (RMS) uses sophisticated algorithms and machine learning to provide real-time pricing recommendations, as well as market insights.

Atomize enables hotels to make informed decisions based on real-time market conditions and predictive analytics by leveraging machine learning and big data. This data-driven approach leads to more precise pricing strategies, optimized inventory management, and improved profitability.

Moreover, the system’s ability to automate and streamline revenue management processes reduces the risk of human error, and frees up time for hotel staff to focus on other critical aspects of operations, such as providing a memorable guest experience, and elevating service quality.

The Role of Artificial Intelligence (AI)

Artificial Intelligence (AI) has further revolutionized the field of revenue management in the hotel industry, offering advanced capabilities that enhance both efficiency and profitability. Another AI-powered RMS provider is Duetto Cloud’s Game Changer, designed to analyze large datasets, identify patterns, and make real-time decisions.

One of the key capabilities of an AI-powered RMS is the automated pricing optimization. The system monitors market conditions continuously and adjusts room rates based on real-time data, with limited rules in the back-end. This dynamic pricing approach allows hotels to capitalize on fluctuations in demand, ensuring that they are charging the optimal rate at any given time.

These accurate forecasts can enable hotels to plan more effectively, manage inventory, and allocate resources more efficiently.

For example, AI can help predict when a hotel is likely to experience high demand and adjust staffing levels accordingly, ensuring optimal service quality. Additionally, accurate forecasting helps in identifying potential periods of low occupancy, allowing hotels to implement targeted marketing campaigns and promotional offers to boost bookings.

Beyond pricing and forecasting, AI-powered RMS can also enhance the guest experience through personalization. By analyzing guest data such as booking history, preferences, and feedback, AI systems can tailor offers and recommendations to individual guests.

For instance, an advanced RMS can identify a guest’s preference for specific room types, amenities, or dining options and use this information to provide personalized packages or upsell relevant services.

As AI technology continues to evolve, its role in revenue management is expected to grow, offering even more sophisticated capabilities and insights for hotels. Embracing AI-powered RMS now is going to be essential for hotel operators who are looking to compete and win in today’s fast-paced and data-driven market.

Integrating Revenue Management with Other Hotel Operations

As mentioned above, modern hotel revenue management is moving away from the siloed approach of focusing solely on room-based revenue. Increasingly, that outdated method is being replaced by a more holistic perspective that encompasses the entire guest experience.

This shift necessitates cross-department collaboration, aligning revenue management with sales, marketing, and operations to create cohesive strategies that optimize total revenue. Integrating efforts across departments means hotels can enhance their revenue streams and also provide a seamless and enriching experience for their guests.

To maximize total revenue, hotels must look beyond room revenue to optimize ancillary revenue streams, such as food and beverage (F&B), spa services, events, and so much more. This approach, known as total revenue management (TRM), involves a comprehensive strategy that considers all aspects of the guest experience.

For example, coordinating F&B with revenue management ensures that the on-property restaurant reservations and event bookings align with the hotel’s overall occupancy and pricing strategies.

The obvious and ultimate goal of cross-department collaboration is to enhance the guest journey and experience. Aligning efforts across revenue management, sales, marketing, and operations ensures hotels can create a seamless and personalized experience for their guests.

This can include personalized room amenities, customized dining options, and exclusive access to hotel facilities. Engaging with guests before, during, and after their stay through targeted communications and personalized offers can further enhance their experience and encourage repeat visits.

Looking Ahead

As you can see, modern hotel revenue management has become an intelligent discipline driven by data analytics, dynamic pricing, and artificial intelligence (AI). These elements are really becoming a non-negotiable for optimizing revenue, enhancing guest experiences, and maintaining a competitive edge.

Data analytics provides deep insights into market trends, guest behaviors, and demand patterns, enabling more accurate forecasting and strategic decision-making. Dynamic pricing, powered by real-time data and AI, allows hotel operators to adjust room rates fluidly, maximizing revenue by responding to market conditions.

AI further enhances revenue management through advanced capabilities such as predictive analytics and personalized guest services, all of which streamline operations and improve efficiency when integrated with other departments within your hotel.

Looking ahead, the future of hotel revenue management promises exciting innovations and trends. As AI and machine learning technologies continue to advance, we can expect even more precise forecasting models, and highly personalized guest experiences. The integration of big data from diverse sources, including social media, online reviews, and IoT devices, will provide richer datasets for analysis, leading to more nuanced insights and strategic opportunities.

Additionally, the increasing importance of TRM and revenue per available guest (RevPAG) will encourage hotels to optimize not just room revenue but also ancillary streams such as dining, spa services, events, and more.

Move Forward Today

For hotel operators like yourself, you must embrace and invest in advanced analytics tools, AI-powered RMS, and dynamic pricing strategies.

Adopting a data-driven approach will position you to better understand your hotel’s market, anticipate demand fluctuations, and tailor your offering to meet guest expectations.

This proactive stance will not only drive revenue growth but also enhance your brand equity.

Stay ahead of the curve and adopt cutting-edge technologies and strategies to navigate the complexities of the modern market and ensure long-term success. Now is the time to invest in the future, leverage the power of data and AI, and lead your hotel to new heights of profitability and excellence.

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