Welcome to our new series Industry Insight where local industry experts join us as blog contributors to share their wisdom and guidance to help our local business community thrive!
To kick off this series, Lauren Fernandez, CEO and Founder of Full Course, is joining us to provide tips and tricks for helping your restaurant succeed in the new year. Full Course is a restaurant development and investment firm which incubates and accelerates emerging fast casual restaurant brands. Full Course guides restaurant owners through a process of optimization, strategic growth planning and development, and supports investment for rapid expansion.
Fernandez also leads The Fernandez Company, a consulting firm working with government, investors and companies providing expert guidance in franchise programs, licensing opportunities and developing consumer product lines. She is a trusted brand consultant and legal advisor in the restaurant and hospitality industry, from start-ups to multinational companies.
How to Thrive during COVID: Add Revenue to Your Restaurant Now with These Five Tips
by Lauren Fernandez, CEO and Founder of Full Course
#1 MARKET TO MATCH THE NEW SALES MIX
The dining experience is no longer confined to the restaurant’s four walls where you control the entire customer experience.
The sales mix is now more equally weighted between dine-in, take-out, and delivery/third-party delivery.
Your customer now chooses which experience or mode they prefer. Each of these modes needs to communicate brand messaging, connect with the customer, and exceed expectations.
Brand touchpoints are reduced outside of dine-in, so customers pay as much attention to things like delivery packaging, loyalty rewards, and execution as they do to dine-in customer service.
Takeaway: The details are important in each customer experience, in every mode of delivering your food. Review your communication and marketing strategies, and their executions, to make sure you are delivering an on-brand experience across all modes.
#2 ALIGN YOUR MENU OFFERINGS WITH PROFITABILITY.
In these times, it is vital to stay efficient and lean while meeting customer demand.
The first step is taking the time to revisit and recalculate the profit margin on each major menu item. Second, assess each major menu item for consistent and current customer demand. Prioritize the high-demand, high-margin items on your in-house specials and delivery menus.
Embrace varying menus for their varying levels of profitability. In practice, this may mean slightly different menus for delivery or take-away versus dine-in. For example, fan favorite menu items don’t necessarily belong on third-party delivery service menus when the profit margin is 20% and you have to pay the delivery service 25%.
Takeaway: Revisit your current profit margins on major menu items, trim loss leaders off the menu and prioritize high-margin, high-demand menu items. Don’t miss the opportunity to increase your average ticket with sides, desserts, and upsells.
#3 HIGHLIGHT VALUE IN PRICING BUNDLES AND OFFERS.
Customers now prioritize value and consistency. They want the comforts of the goods and services that they are used to getting for a fair price,
It’s easy to see how value has become more important than ever during this time of economic uncertainty. Value now easily outweighs extensive variety in menus; the perception of value matters to customers. On the whole, it is more important to deliver both consistency and value, even if it means offering a limited menu.
Takeaway: Rethink your pricing strategy to highlight value while continuing to deliver consistently across all modes, whether dine-in or outside the four walls.
#4 GET A LOYALTY PROGRAM… AND USE IT.
Customer loyalty is king, successfully driving repeat sales during the pandemic. Your marketing should be focused on keeping customers rewarded, engaged, and ultimately … loyal.
Driving engagement and loyalty with existing customers will generate repeat business, and in the end, costs less per customer than new customer acquisition.
Personalization, even in the delivery mode, is the new normal. Develop systems and methods for knowing your customers and customizing their experience as much as possible. Rewards are an important tool to incentivize repeat business, and should align with your brand and customer demand.
Takeaway: While many loyalty programs exist, to be effective, they must be tied to all of your marketing efforts and used regularly. A good loyalty program captures data on customers, allows for personalization and customized messaging, and is desirable to customers.
#5 CONSIDER ADDING ALTERNATIVE REVENUE STREAMS.
Packaged goods are a phenomenal way to add revenue to restaurants, market a restaurant outside the four walls, and continually engage with loyal customers at home.
Whether your packaged goods are manufactured or packed on-site, food retail is an often-overlooked area of additional sales for restaurants.
Food retail products are remarkably easy to cross sell in the four walls of the restaurant and can add as much as 20% to the average ticket. In the case of take-out or delivery, they are very successful when bundled with an order or offered as a value add-on.
Takeaway: Consider creating a pre-packaged product line designed for to-go or take-away, make-at-home kits, or even start investigating a manufactured product to offer food retail to customers.
Get Expert Advice You Can Use Today!
We created Full Course to serve the restaurant community. Because times are still tough, now through May, we’re offering all of our live classes free!
Join us for a live seminar on how to add retail products to your restaurant. Too busy for another webinar? That’s okay! Get our free eBook Growing Your Restaurant Business Smartly with Product Development.