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Archive | Restaurant Management and Operations

Find great resources and tips on restaurant management and operations topics like human resources, food safety, going green, and more.

Restaurant Management: Use Creative Compensation Strategies

Use compensation strategies that improve service and make employees happyAs if you didn’t have enough on your plate trying to keep your restaurant’s head above water this year, some in the food service industry are starting to talk more and more about changing some basic assumptions about employee compensation.

The traditional model has been to pay your kitchen by the hour depending on what they do, let waitstaff earn their living on tips, and maybe pay a hostess by the hour as well if you get too busy.  But as we’ve discussed here before, high turnover rates are a constant problem in restaurants.  You’re always going to have young people who are just “passing through” the restaurant industry as they look for the right time to start their careers, but in general managing and dealing with staff turnover takes up a lot of time and resources.

The worst part about turnover is that service suffers. And as any restaurateur will tell you, service probably suffers before that employee walks out the door.  Having employees who are not engaged in the long term interest of any company causes service and productivity to decline.

For these reasons some restaurants have begun to rethink their compensation plans. The best kind of compensation is the kind that motivates the employee to bring their priorities in line with the priorities and goals of the restaurant.  These strategies are different depending on whether you’re talking about Front of House or Back of House employees:

Front of House: Salary your waitstaff. Tips are so ingrained into the psyche of the restaurant industry that it feels weird to even suggest another compensation model.  And the initial knee-jerk reaction is to wonder how in the world a restaurant could afford the payroll for a salaried staff.  European restaurants have run with salaried servers for years.

The interesting thing about salaried servers is that their priorities completely change. When you are paid on tips, your two primary goals are to upsell customers to raise check averages and to turn tables over as quickly as possible.  Those two goals don’t really jibe with the restaurant’s goal of providing top-notch service every time that focuses on customer experience.

Salaried servers, on the other hand, feel no such pressure to turn and burn.  They are free to focus on maximizing customer experience every time, which means your pool of loyal, repeat customers will grow.  Typically a flat rate service charge is added to the bill that goes directly into payroll.  A smart restaurant owner would also include bonuses and incentives for salaried servers who are top sellers.

The best part about the salary method is that you enable and encourage career servers.  Turnover is almost non-existent because you provide a stable income for your employees.  The savings on new staff training and the ability to maintain a consistently high level of service can offset increased payroll costs.

Back of House: Share Profits. As you already know, the name of the game in your kitchen is efficiency.  The ideal kitchen doesn’t waste any food, uses minimal energy to prepare meals, and accomplishes all this so quickly that customers are never waiting.

In reality, that’s an almost impossible ideal to reach.  Your kitchen staff is paid an hourly wage, and they’re going to be paid that hourly wage whether they ruin an entire stock pot of the soup special or not.  Often their primary incentive isn’t the wage itself, which is probably nothing special, but the fear of losing their job.  Fear is a terrible incentive when it comes to encouraging maximum productivity and efficiency.

An excellent incentive to promote productivity and efficiency is profit sharing. Kitchen staff accumulate shares depending on how long they’ve worked for your restaurant.  Every quarter, a portion of the profits is divvied up among the kitchen staff depending upon how many shares they have.

I can imagine what you’re thinking: “First you want me to send my payroll costs through the roof with salaried servers and then you want me to share profits with my dishwashers????”Share profits and increase efficiency

Imagine the same scenario I brought up above: an employee accidentally ruins an entire stock pot of the daily soup special.  All the employees in your kitchen are paid by the hour.  They shrug their shoulders and start making another batch, which costs you time (paying staff to do the same work twice), resources (all those ingredients will have to be reordered sooner), and efficiency (the gas/electricity needed to prepare the soup all over again and the lost work the staff doing the work over again could have spent doing something else).

In a profit-sharing kitchen, the sous chef who’s been working in this kitchen for 10 years and makes a couple grand every time the profit sharing checks go out takes it upon himself to show the kid who makes the soup how to do it right the first time.  It’s in his interest to cut food costs whenever possible.  Line cooks turn off half the range during slow periods to save on utilities and everybody uses portion scales to make sure there’s no waste.

You’ll probably find that even after you pay out the kitchen staff, your profits still rise because of all the savings a truly efficient, well-trained kitchen produces.  And your turnover rate will plummet, saving you training time and quality control issues with inexperienced staff.  Who doesn’t want a job that pays out a bonus check 3 or 4 times a year?

Do you think these incentive programs will make your restaurant a more successful business?  Leave a comment below and let us know what you think!

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The Struggle Between Art and Efficiency

Restaurant Management Art & EfficiencyGreat Lakes pizza, on Chicago’s north side, has been getting A LOT of press lately.  The tiny pizzeria has only been around for a little over a year, but in that time the reputation of owners Nick Lessins and Lydia Esparza has catapulted Great Lakes into one of the hottest pizza joints in all of Chicago.

Their sudden fame hasn’t affected the artistic approach to pizza making that made Great Lakes famous in the first place.  Every single pie is hand crafted by Mr. Lessins.  All of their ingredients are sourced from premium, mostly organic suppliers.  The reviews by Chicago foodies range between glowing and ecstatic.

There’s just one problem.  On many nights, a lot of people who want Great Lakes pizza don’t get one, or they end up waiting a very long time for one.  This has resulted in profanity-laced reviews on sites like Yelp complaining that the lack of service at Great Lakes nullifies any great pizza, no matter how close to a work of art it is.

The owners seem to take it all in stride, and in pursuit of quality they haven’t sped up the service process at all.  Every pizza is still a work of art.  This raises an interesting conflict for the food service industry, and indeed for any business: where do you draw the line between art and efficiency?

Especially in food service, customer service is about half of the equation for success.  And while a beautifully prepared meal is the other cornerstone of your business, you can hardly afford to sacrifice service for the food.  Striking a balance between quality and efficiency is a necessary compromise if you want your business to grow.  Some people are satisfied just making a perfect pizza every time, and if that’s your disposition, then by all means follow the Great Lakes model.  I’m sure they’re making plenty of money, and I’m sure they will for some time to come, despite the bad reviews from unhappy customers on Yelp.

But for most businesses, the Great Lakes model just doesn’t cut it.  Let’s face it, we can’t all be artists.  That means you have to survive using other skills, including training and managing people to make your operation run more smoothly.  That doesn’t mean your food can’t be transcendent.  It merely means you know how to teach 5 people to make your pizzas, even if they don’t make them quite as perfectly as you.

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20 Restaurant Marketing Tips

Restaurant MarketingHere at The Back Burner we try to provide as many resources as possible for your success.  Over the past six months we have published a treasure trove of restaurant marketing tips that can help you get more butts in seats.  I don’t have to tell you that it’s been a tough year.  The good news is, if you’re still here, you’re obviously doing something right.

This is also the time to grab more customers.  Their favorite eatery might have recently gone out of business, or they’re looking for a place with good eats, good service, and above all, good value.  Now is your chance to shine.  And here are 20 marketing tips that will help you get more customers and remind your existing ones to come back and visit:

1.  Should Your Restaurant Have A Website? – In a word, YES!  Learn how to get your website up and running here.

2.  Use Twitter To Marker Your Restaurant (4 Strategies For Success) – Yeah, yeah, I’m sure you’re tired of hearing about Twitter, and if you haven’t signed up already, chances are pretty slim you will now.  But give this a read and make sure you really do want to pass this opportunity up.

3.  Email Marketing: 7 Tips For Restaurants – Email is one of the most effective marketing tools out there, and if you’re not using it to reach your customers, you’re missing out on one of the best Return On Investment (ROI) marketing strategies out there.

4.  Improve Restaurant Sales At Food Festivals – even though the summer food festival season is mostly over, it’s never too early to start planning for next year.  Learn the why and the how here.

5.  4 Steps To Managing Your Reputation Online – With the advent of social media and user generated content on the internet, people are talking about your restaurant somewhere.  While most of this chatter is probably positive, it only takes a couple disgruntled customers to ruin your online reputation.  Learn how to manage that reputation here.

6.  Restaurant Marketing Goes Hyperlocal – New apps for mobile devices break down restaurants and bars by the block.  Some urban eateries are taking advantage of this “hyperlocal” trend to advertise very specifically to customers in their neighborhood.

7.  Restaurant Promotion Gone Afoul: The Most expensive Free I’ve Ever Seen – In this guest post by Jaime Oikle, learn how a coupon scheme run by can actually hurt your bottom line.

8.  For All The Hype, Are Restaurants Really Using Social Media? – Everyone, including me, is telling restaurants to get into the social media game.  Are restaurants listening?  A new study suggests they aren’t.

9.  The Casa Bonita Secret To Being A Successful Restaurant – Good food, good service, and good prices all play a role in a restaurant’s success.  But being unique is probably the single most important factor in a restaurant’s success.

10.  Menu Pricing’s Theory Of Relativity – Every customer looks at price when selecting their meal.  Behavioral psychology also shows that value is decided based upon the prices around the item they select.  Learn how to set up your menu to make your customers believe they’re getting a great deal every time.

10 More Restaurant Marketing Tips Here

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California & Vermont Restaurants: Are You Compliant?

Lead Free Plumbing LegislationIf you’re in the food service industry in either California or Vermont, then this blog post is for you. New legislation in these two states changes the kind of faucets and pipe fittings that can be installed in restaurants and commercial kitchens starting early next year.  California Assembly Bill 1953 and Vermont Senate Bill S152 mandate all plumbing and fixtures that come into contact with water intended for human consumption through drinking or cooking must contain less than 0.25% lead by weight.

The new limit on the lead content of plumbing fixtures goes into effect January 1, 2010.  After that time, any new plumbing fixtures purchased in the states of California or Vermont must comply with the new lead limit.

Here’s the breakdown on how your restaurant will be affected:

You don’t have to replace existing fittings.  Whatever you’ve got now in your kitchen can stay until it needs to be replaced through normal wear and tear.  Just make sure that when you do buy new fittings, they comply with the 0.25% by weight lead limit and are properly certified.

Only plumbing fixtures that dispense water intended for human consumption must comply.  Hose reels, washdown stations, service sink faucets, and mop bucket sink faucets are exempt from the new standard.  Pantry, lavatory, hand sink, and pot filling faucets must all comply with these new standards, as well as pre-rinses.  Pipe fittings must also comply, so keep this in mind when you’re repairing an old faucet or installing a new one.  This includes faucet installation kits, foot pedals, and pre-rinse assemblies.

Fittings and fixtures that comply with 1953 and S152 must be certified by an independent third party organization.  Make sure the plumbing parts you buy are certified as containing less than 0.25% lead by weight.  These products will usually be stamped or labeled with a TSBCA0890compliance certification.

For restaurants in Vermont and California, coming into compliance with the new lead standard is as simple as purchasing properly certified plumbing fixtures and fittings after January 1, 2010.  Some manufacturers have products that are already compliant with the new standard, and several more are planning to offer compliant fixtures and fitting by January next year.

Find compliant plumbing fixtures here.

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Restaurant Management: No Training Budget? Spend Nothing But Time And Succeed

According to a new study by the Council of Hotel And Restaurant Trainers (CHART), 53% of the restaurants surveyed had cut back on their employee training budgets.  Only 19% increased their budget, with the rest remaining the same.  The study covered a wide variety of restaurants, from small independents to large national chains, with the largest number of respondents falling into the small to mid-sized regional category.

These numbers obviously reflect the lean economic reality in which everybody in the food service industry is operating presently.  Cuts are inevitable as revenues fall.  But how much is too much?  Where is the line between trimming back and damaging a key pillar in your business: professional, experienced service?

New employees get some pretty good training for the first 90 days after hire, according to the respondents to this survey.  After that, wait and kitchen staff receive very little or no training, while management tends to receive more.  No matter what the size of your restaurant is, ongoing training should be a cornerstone of your overall strategy.  Research shows that employees who are given regular career training and whose company philosophy revolves around a reputation for service are much more likely to stay longer and perform better, which attacks the biggest monster in restaurant staff: high employee turnover.

Okay, you say, I get it, employee training is important.  But I can’t afford it right now, so what should I do?  Well, as long as you are willing to take the time, staff training doesn’t necessarily have to cost a lot of money.  Sure, supplemental training materials and videos are more efficient, but when you need to cut back, canning expenses on training materials doesn’t have to spell the death of your training program.

Some ideas for training on the cheap:

Role play with employees.  Don’t take it the wrong way (and at least one person on your staff is going to snigger in the back every time you bring this up) but role playing customer service situations with your employees is a very effective way to train.  If you hold regular role playing sessions, the awkwardness will eventually wear off and very positive employee interactions will develop.

Start a mentoring program.  Assign your top servers and kitchen staff to one new employee each.  Have the new employee do nothing more than follow the more experienced members of your staff around for a shift a month.  Not only will the new employees learn by example, they will form relationships with your best employees, which encourages retention and improves performance.

Cross train employees.  Train servers how to be hosts, hosts how to be servers, line cooks how to expo, etc.  The benefits of cross training are twofold: your staff will be able to fill gaps on busy nights or when you have no shows, and they will better understand how the restaurant operates as a whole, which usually means they will work better as a team.

Whether money’s tight or pouring in, simple, effective training techniques usually translate into one simple principle: taking time out and spending it with your employees.  There is a cost associated with taking time, but the benefits far outweigh this costs.  Done right, interactive training will form the solid backbone of your business and position you to succeed no matter what the economic climate is like.

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Why Your Restaurant Should Start Catering… And 4 Simple Steps To Start

Restaurants Should Start CateringIn a recent study by Technomic, 36% of consumers said they are doing their socializing at home more often than a year ago.  In addition, 40% said they’d like to entertain at home more often in the next year.

For a restaurant owner, those are some sobering numbers.  The corresponding 4% decline in restaurants nationwide over the last year tells you just how serious the situation is.  If your restaurant has made it this far, then hopefully the worst of it is behind you.  And now might be the perfect time to turn the crisis into an opportunity.

That’s because although consumers are staying home, they’re not necessarily wanting to cook at home.  That means you can find willing customers if you’re willing to venture out from the restaurant.  In fact, 53% of consumers said they bought prepared foods for the 4th of July 2009.  That reveals a market that’s available for what you do best: prepare great food.

Catering for small and mid-sized parties (10 – 100 people) is on a steep rise, and some restaurants have already started offering their services as a way to drum up business, even if those customers aren’t seated in the dining area.  So how can your restaurant get in the game?  Some ideas:

Get equipped. Don’t try to translate what you do in the kitchen of your restaurant so well into a foreign venue without the proper tools.  Catering requires some specialized equipment that allows you to be mobile and quick on your feet.  Don’t get into the catering game without investing in some good equipment first.

Specialize your menu. Stick to the items on your menu that are high margin and require minimal prep work.  Whatever your bread and butter entrees are, the ones you can whip up in your sleep, slap them on a special menu for catered events.  This keeps things nice and simple, especially when you’re starting out.

Try to reach known customers. If you have an email list or other way to market to customers you know haven’t been in for awhile, use it to advertise directly to the people who are probably staying home but like your restaurant.

You probably will want to try a few dry runs before you hit the big time with your new catering operation.  Maybe try catering your own family function or a similar low-stress event so you can work out the kinks.  That will ensure you’re making the best impression possible when you start.

If you choose your menu items carefully and back up some effective marketing with a well prepared mobile operation, your restaurant can stand to make some pretty good money in catering, which gives you another stream of revenue and a little more stability in the uncertain world of food service.

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Cash or Charge: Save Money AND Give Your Customer A Discount

Give Customers a Discount if They Pay With CashCredit cards have become the currency of choice in restaurants everywhere.  Many restaurateurs report 80% – 85% of their customers pull out plastic when it’s time to pay the bill.  For a long time now the conventional wisdom in food service goes like this: any way the customer wants to pay me I’ll take.

But credit card companies are good at charging for the convenience they provide.  Every time a card is swiped in any restaurant, a flat fee of 10 – 25 cents is charged to the restaurant outright, plus another 2% – 3% of the transaction’s value in fees.  Depending on how much business you do, those credit card fees add up to hundreds or thousands of dollars every month.

Of course, I’m not really telling you anything you don’t already know if you own or manage a restaurant.  What I do want to tell you is that some restaurateurs have figured out a way to pass some added value on to their customers and save some money on monthly transaction fees at the same time.  By offering as much as 20% off the bill to customers who pay with cash, some restaurants have turned the 80% ratio of plastic payers on its head: now 80% pay with cash and enjoy a discounted meal to boot.Cash is Better Than Transaction Fees!

The discount-for-cash program has proven so successful in some cases that restaurants have been able to actually grow business, even in such a sluggish dining market.  If marketed cleverly, the discount program could work well for any independent restaurant.  Some ideas:

Offer an additional discount coupon.  Use email marketing to offer a coupon that gives your loyal customers an additional discount for paying with cash.  While you’ll be losing profit margin, you’ll be able to gauge how enthusiastic your most frequent customers are about the cash-for-discount program.  The discount will also get some bodies in some seats, where hopefully (with a little server encouragement) order an appetizer or a bottle of wine since they’re expecting a discount.

Offer the discount-for-cash on a specific night.  Take the slowest night of the week and turn it into discount night and then gauge how much that increases business.  This way you can roll out the discount program slowly and get a feel for how the numbers really add up in terms of increased business versus lost margin.

Make a special discount-for-cash menu of high margin items.  If you really want to mitigate your loss on the program but still want to market it to get some butts in seats, make a special menu comprised of the highest margin items on your menu.  That way you know you’ll still be making a little profit after the discount and you can push the entrees that are your favorite kind to sell.

Anybody who leverages a cash-for-discount program is bound to see a bump in business.  Figuring out how to leverage that bump and get the most out of the discount you offer is the real key to success.  No matter how you implement it, make sure you leverage this discount program as much as you can.  If you aren’t getting money from your customers because of the discount, at least get some information so that you can understand your customer better.

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Email Marketing: 7 Tips For Restaurants

In the marketing industry, email remains one of the most popular and most effective ways to reach customers.  In the restaurant industry, email marketing can be a great way to build customer loyalty and brand recognition.  It’s cheap, it’s easy, and it’s proven to bring customers in the door.  So why aren’t more restaurants using it?

If you have yet to market to your customers with email, here are some simple steps and best practices to maximize your campaign:

1. Ask your customers to sign up.  There’s no point in sending out an email if you don’t have anyone on your list.  There’s also no point if the people on your list don’t patronize your restaurant.  Tantalize your customers with deals and prizes to collect their email addresses.  For example, use a raffle to collect email addresses, or offer 10% off coupons in exchange for signing up through your restaurant’s website.

2. Don’t send emails unless it’s requested.  Sending unsolicited email is also known as SPAM, and we all know how annoying that is.  That’s why the best way to collect email addresses is to offer a little something in return and get your customer to volunteer their email address.  It’s also important to make sure your customers understand that they are signing up to receive emails.  Make it clear that they will be hearing from you in the future.

3. Offer something every time you send an email.  Every email marketing beginner thinks it’s a great idea to send out emails full of information about themselves and their business.  The hard truth is, however, that your customer really doesn’t want to be bothered reading an email about a restaurant.  What they do want know is when your happy hour is and what days you offer specials.  Don’t send an email unless you have something to offer.  Otherwise you’re just clogging up an already busy email inbox.

4. Track conversions.  Use coupon codes or some other system to track the success of your email marketing campaign.  Try different types of offers and see which ones have the highest conversion rate.  In other words, does a 10% off coupon on any meal over $25 work better than a buy one, get one free drink during happy hour deal?  The only way to know for sure is to get customers who heard about the deal through your email campaign to use a code when redeeming their discount.

5. Create a schedule and stick to it.  In general, you shouldn’t be sending out emails more than once a week, and twice a month is probably a better route.  No matter how frequently you decide to send out email, stick to the same schedule so that customers begin to expect your emails on the same day.  This will improve the chances that your email will be opened and read.

6. Use a proper email marketing system.  There are a variety of options out there: Feedblitz, MailChimp, ConstantContact, Emma.  These services usually charge you per email or per number of subscribers.  Choose one that works for you and pay the money for a proper system.  Don’t try to send emails out from your Hotmail account.  For one thing, it looks unprofessional.  For another, you will get labeled as spam sooner or later.  These email services also have great tracking functions that provide important information, like how many people opened your emails, how many clicked links in your emails, etc.No Spam In Your Email Marketing

7. Avoid spammy words and punctuation.  Words like free and buy now cause automatic spam filters to flag an incoming email message.  Punctuation like lots of exclamation marks and all capitalized letters will also set off the alarm.  Avoid these spammy looking words and punctuation in your emails like the plague.  For more info on avoiding spam filters, check out this blog post.

The most important thing to remember when it comes to email marketing is to experiment.  Best practices only take you so far.  Every restaurant is different, and every one has a different type of customer.  The email marketing campaign strategy you employ for your restaurant will be different from every other one, and the best way to optimize it is to try different types of offers and presentations until you find the one that gets the most customers in the door.  This is also why tracking is so important.  If you can’t tell if you’re having a busy Tuesday night by chance or because of last week’s email, then you can’t improve and refine your campaigns.

When used properly, email marketing can be one of the most cost effective ways to bring customers back to your restaurant again and again.  A little time, a little testing, and a lot of experimenting can turn email into one of your top advertising moneymakers.

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4 Things You Can Learn From Restaurant Chains

4 Hot Restaurant TrendsBig operators like Chili’s, Applebees, The Cheesecake Factory, and others are always looking for ways to improve taste and customer experience while increasing efficiency.  These companies spend a lot of money every year in research and development, and studying the trends that come out of the big chain restaurant’s R&D can be very informative.

Here are four trends on the rise in the food service industry:

1.  Maximizing ingredients. Inventory control is vital to managing what is typically the second largest monthly expense for any restaurant: food.  The more inventory you have, the harder it is to control, and that is the idea behind using the same ingredients in multiple menu items.  That makes purchasing, regulating temperature, and managing First In First Out (FIFO) practices much, much easier.

2. Diversifying menus. Culinary fusion has long been the norm in fine dining, and now this trend has gone mainstream.  American diners have been exposed to a much more diverse range of ethnic foods than ever before, and restaurant chains are bringing in new and exotic flavors and styles because their customers are much more familiar with the world’s cuisine.Jumping on the Gastropub Bandwagon

3. Jumping on the gastropub bandwagon. The success over the past two decades of “gastropubs,” or beer pubs that also serve high quality menu items, has grabbed the attention of menu developers for large chains.  It’s also changed customer expectations when they see a menu.  Potatoes, meat, and other standard pub fare isn’t good enough anymore, and many chains have responded by offering an increasingly diverse and higher quality menu selection.

4. Sweet & Spicy and Sweet & Salty. Adding a kick to new menu items has become a popular trend as chefs expand the flavor horizons of their guests with unique combinations.  Contrasting flavor combinations give simple menu items like salads or appetizers a fresh tasting kick.

These trends seem to reveal a food service industry that reflecting the times in which we live: unprecedented globalization and cultural integration has opened the palates of the average American diner, and if a restaurant can bring fresh takes and flavors to classic dishes, that’s a recipe for success.  Of course, figuring out how to do that while managing to keep inventory under strict control is how you make money here.  Finding that balance is any restaurateur’s challenge, and mastering it is the key.

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How To Grow Sales With A Commercial Bar Blender

A Commercial Bar BlenderSummer heat has a way of putting your customers in the mood for cool, refreshing drinks.  You already have the standards covered: cold beer, ice tea, and maybe even margaritas or daiquiris, but are you really satisfying your customer’s demand for great cold drinks?

Mixology is the study and development of cocktails, and it has become an increasingly popular field in the restaurant industry in recent years.  The reason for this is very simple: just like a hit special or entree can bring customers in the door, so can a hit drink, especially if it’s something new or takes a new twist on an old favorite.

Old standbys like margaritas, mojitos, and daiquiris are great, but if you take the time to develop an exciting summer specialty drink menu, you’ll find that customers will be enticed to order.  For example, take 1 part margarita, 1 part sangria, and a healthy scoop of ice and create something your customers have never tried but they’re sure they’ll like.

Exotic and fun new drinks can also create some summer buzz for your restaurant.  Use seasonal fruits and interesting liquor pairings to create blended drinks that really turn heads.  And, of course, not all your specialty drinks have to be alcoholic.  Again, seasonal fruits can make an excellent dessert drink for the kids or blend them with an energy drink for a great pick-me-up.  The possibilities are endless.

Of course, the key to your success when it comes to cool summer drinks is a good commercial bar blender or drink mixer.  Bar blenders can handle high volumes of drinks that require ice, which really is a key ingredient for any summer drink menu.  Drink mixers can’t mix ice, but they can handle large amounts of softer ingredients like ice cream, fruits, etc.

Investing in a quality commercial bar blender is exactly that: an investment with a bit of up-front cost.  But nothing advertises your business like some buzz over a popular specialty drink, and once you’ve got those customers in the door and having a good time, the sales will take care of themselves, as will your investment.

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