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

Restaurant Management Tips: Stay Safe With Alcohol Service Training

Smart Alcohol Serving TipsThe level of liability restaurant managers and owners face in alcohol related incidents can be shockingly high.  Protecting yourself, your staff, and your customers from dangerous alcohol related situations should be a top priority for your business.  And the best way to protect yourself is to make sure your staff is properly trained for alcohol service.  Some tips on how to train your staff:

Be aware of local and state laws.  More than likely you learned the local and state laws that apply to alcohol when you applied for your liquor license.  However, your staff may not be aware of these laws and there may have been changes or amendments since you applied for a license.  Make sure you take the time to educate yourself and your staff on all liquor laws that apply to your establishment.

Create a standardized alcohol service policy.  Set a standard policy and train your staff to follow this policy strictly.  While you will probably need to include some unique clauses for your particular situation, here are some good ideas on what to include:

Train staff to observe patron behavior and identify those who are becoming intoxicated.  Many establishments use a color coded system: green for little or no intoxication, yellow for becoming intoxicated, and red for time to cut off.

Mandate communication between staff, customers, and management.  Staff should know how to communicate your establishment’s alcohol policy to customers.  They should also be encouraged to notify managers of potential problems before they become situations.

Train staff to count drinks and know the difference between alcohol types.  Counting drinks helps avoid problems with patrons who do not exhibit an obvious change in behavior as they become intoxicated.  However, your staff should also know the alcohol content of what they’re serving.  Four domestic beers is very different from four long island ice teas, so make sure your staff knows the difference.

Also train staff to factor in time and food consumption when evaluating the intoxication of a customer.  Four drinks consumed over the course of four hours is much different than four drink consumed in half an hour.  Food, especially fatty or high protein foods, help slow the rate of alcohol absorption into the bloodstream, which in turn affects the likely intoxication level of the customer.  Encourage “yellow” intoxicated customers to eat and make sure appetizers or quickly prepared menu items are readily available to drinking customers

Implement strategies to avoid alcohol related situations.  A well trained staff with a clear set of guidelines to follow is the first and most important line of defense in helping you mitigate alcohol liability.  The second line of defense is the implementation of some key strategies that will help you avoid alcohol related problems.  Some examples:

Encourage parties to identify a designated driver and incentivize DD’s by offering free non-alcoholic beverages and appetizers.

Form a good relationship with a reputable cab company and advertise their number for free in your establishment.

Include local police when setting your alcohol service standards and use them as a resource for avoiding and handling alcohol related incidents in your establishment.Stop Alcohol Related Incidents

How to protect yourself if an incident does occur.  If an alcohol related incident does occur in your establishment, make sure you document as much as you can.  Record eyewitness accounts of what happened and what you and your staff did to control customer intoxication.  This documentation will prove to be worth its weight in gold if litigation arises as a result of an incident connected with your business.

Having clear strategies to control intoxication in your establishment is no longer an optional  policy.  Cases that have been settled in the past five years have shown that you are not only potentially liable for injury that occurs as a result of an alcohol related incident in your establishment but outside it as well, most notably in drunk driving cases.  Such litigation can ruin your business and your life, so taking precautions when serving alcohol is a vital part of operating in the food service industry.

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Boost Sales With A Free Meal

The Laguna Grill in Long Island, NY

The Laguna Grille in Long Island, NY

An increasing number of restaurateurs are looking to boost sagging sales with value-minded deals to lure customers back into their restaurants.  A particularly successful strategy has been employed by the Laguna Grille in Long Island, NY: a “Bailout Program,” which randomly awards free meals to a table per shift.

The ensuing buzz packed his two locations on a recent weekend and generated some great PR in the local press.  Not only do customers feel that you are commiserating with them about the hard economic times, free meal promos also build brand recognition and loyalty, which in turn can boost word-of-mouth marketing.

Denny’s Restaurants has embraced this hot marketing technique fully.  On Super Bowl Sunday the chain announced it would offer a free Grand Slam breakfast to customers from 6 a.m. to 2 p.m. on Tuesday, February 3.  Denny’s market share has been slipping in the face of intense competition from fast food chains like McDonald’s and Burger King and breakfast-only chains like IHOP.

The Denny’s gambit was a complete success.  2 million customers showed up for their free Grand Slam, and sales have ticked upward since the promotion.  It was so successful that Denny’s followed up recently with another promotion that gave away a Grand Slam for every one purchased.

There are many ways to creatively apply a free meal campaign to your own restaurant, whether you’re a small independent operator or a mid or large sized chain:

  • Encourage customers to sign up for your email list and randomly select a monthly winner from new signups to receive a free meal
  • Follow Laguna Grille’s example and randomly give away a free meal per shift
  • Give away a free entrée or appetizer in exchange for filling out an online or paper survey and providing an email address
  • Hold “happy hour” specials featuring a buy one, get one free entrée, appetizer, or drink
  • Have customers bring in a down economy related item like a pink slip, stimulus check, or foreclosure notice to receive a free meal

The best way to leverage a free meal offering is to gather some information from your customer while they take advantage of it.  The more you know about your customer, the better you can target them for repeat business in the future.  And the more you build your base, the more likely you are to survive hard times.

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Should You Cut Costs In Payroll?

knifeMy recent post, “Missouri Legislature Debates Wage Cuts For Servers” sparked some debate about cutting payroll expenses in your restaurant.  Finding places to cut expenses as revenue falls is never an easy endeavor.  And since labor is almost definitely your number one expense, it’s easy to look there first when considering ways to save money.

There may definitely be some places where labor costs can be reduced, such as cutting back employee hours or eliminating underperforming staff.  All businesses look to their human resources department for cost cuts in tough times.  But be careful here, because cutting labor is a task best left to a scalpel rather than an axe.

That’s because the one thing you need now more than anything else is good customer service.  Actually, you need stellar customer service.  When consumers start cutting back, their expectations of service go up, and the only way to get them to spend at all is to take care of them in every way possible.

Your staff is the best tool you have to make sure every hungry customer that walks through your doors leaves satisfied and full.  If you start cutting back on staff to save money, you could start hurting your chances at increasing future revenue.  Overall morale goes down when people are let go because of hard times rather than performance.  And no matter what, customer service will suffer when you lose experienced staff.

Now is the time to focus on fulfilling the needs of your customers even better than before.  If some staff have been a drag on your operation, by all means cut them now.  But look for other ways to reduce costs before you start cutting quality staff.  Your best customers will appreciate the attention, and hopefully maintain their regular visits to your restaurant.  And new customers will be blown away by your commitment to quality service and hopefully come back, even if times are hard.

While Circuit City isn’t in the food service industry, a lesson can be drawn from their experience.  When sales started declining, Circuit City decided to cut staff as a way to reduce costs and boost profits.  It worked for a while.  But then customers stopped coming in altogether.  Circuit City’s rival Best Buy refused to cut back on customer service, and soon customers were flocking to their stores, not because Best Buy’s prices are better or because they have a better selection, but because Best Buy staff were always there to help.

Circuit City has since declared bankruptcy.  Best Buy may not be breaking any profit records, but they’re still in business, and their customers are happy.  Things could be a lot worse.

What do you think about this issue?  Leave a comment below!

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LEAN Act Gaining Popularity In Congress

The Labeling Education and Nutrition, or LEAN Act, is gaining sponsors and votes in the United States congress.  The legislation would create a national standard for labeling menu items across the entire food service industry.  Consumers overwhelmingly support menu labeling, with some polls showing a 75% majority in favor of nutrition information on menus.

The National Restaurant Association (NRA) and its offshoot, the Coalition For Responsible Nutrition Information (CRNI), support the LEAN Act and are lobbying congress for its passage.  As more and more municipalities and states have passed menu labeling laws, restaurateurs, and especially national chains, have recognized the need for a national standard that will eliminate the growing patchwork of local laws.

The biggest issue many restaurants have with menu labeling is the complicated and sometimes expensive process of analyzing the nutritional values of menu items.  Each ingredient must be separately assessed for its nutritional value, and even slight variations in portions can alter the numbers.

Traditionally, ingredients were analyzed in a laboratory, which usually translated into a lot of time and money to get each ingredient’s nutrition information.  Recently, some companies, like MenuCalc, have compiled databases of ingredient nutrition information from USDA labs, eliminating the need for expensive laboratory testing.

No matter what, menu labeling is coming, and restaurants are going to have to deal with that reality.  A vote on the LEAN Act is expected during this session of congress, and we could see a national standard for menu labeling by as early as next year.

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Missouri Legislature Debates Wage Cuts For Servers

In 2006, voters in the state of Missouri overwhelmingly passed Proposition B, an initiative that mandated a minimum wage increase for hourly workers.  Prop B passed with a 75% majority, and after some debate, Missouri decided that workers who receive an hourly wage plus tips were eligible for the pay increase.

Times have changed since 2006, to say the least.  The economic downturn has hit Missouri’s restaurant industry hard, and now the state’s restaurant association is backing a Republican bill to cap hourly wages for tip earners at $3.52, half the hourly minimum wage of $7.05.  A compromise amendment would cap the minimum wage after a planned increase this summer.

Neither servers nor restaurant owners are happy with the bill.  Servers say the cap is tantamount to a wage cut, something they can ill afford in a down economy.  And restaurant owners say their payroll expenses have skyrocketed since 2006, something they can ill afford in a down economy.

Interestingly, the catch in this whole debate is who would actually be affected by the passage of the bill. 

The average server earns $10 – $15 an hour in tips, which means most if not all of their hourly wage goes to taxes, regardless of whether their wage is capped or is raised slightly.  And this bill would not change a Prop B clause that requires restaurant owners to pay their servers the $7.05 minimum wage if they don’t make at least that in a given week.

So servers who claim they’re taking a pay cut aren’t really getting hit that hard since the vast majority of what they make is in tips.  And they’re guaranteed a minimum wage if tips aren’t sufficient.

At the same time, restaurant owners who claim they can’t afford the current wage are not going to get the wage cut they were looking for.  At best, wages will be capped at their current levels, which does nothing to help restaurateurs who blame the current wages and the recession for their problems.

That means Missouri restaurant owners are going to have to look elsewhere to cut costs and increase revenues.  And in the end, looking to cut costs in staff first is probably not the best option on the table.  After all, wait and kitchen staff are what make every restaurant tick, and in the long run, well paid staff means better sales and reduced turnover, both of which translate into more profits.

Perhaps it’s time for restaurateurs in Missouri to look at other operational costs and see how they can streamline their business before they start putting a lot of energy, money, and time towards targeting their payroll.

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Gordon Ramsay: The Restaurant Black Widow

Celebrity chef Gordon Ramsay’sshow Ramsay’s Kitchen Nightmares USA has been a huge hit, garnering thousands of American viewers and elevating the chef’s celebrity even further.

Unfortunately, the restaurants he’s supposed to be helping are dropping like flies in the wake of his black widow touch.  The show’s premise is to bring Ramsay’s expertise and creativity into a struggling restaurant and turn the place around.

But it was revealed recently that over half the restaurants that have appeared on the show have since gone out of business.

Some owners and managers complain that Ramsay’s management style, which includes making everything fresh every day and using high-end product and ingredients, created a standard too expensive to maintain in a down economy coupled with rising food costs.

Other victims of the show are less diplomatic, calling Ramsay a jerk who thinks he can impose his lofty standards on any restaurant.  Some are even suspicious it doesn’t really matter to him whether a restaurant on the show makes it or not, as long as ratings remain high, which they have through multiple seasons in the U.S. and the U.K.

Perhaps the most important lesson to take away from the Ramsay “kiss of death” is that every restaurant is different, and managers and owners have to account for the many divergent factors that make up the success of any establishment.

Of course, the ideal situation is to be able to attain Ramsay-style high standards and still make a profit, but any restaurateur will tell you that the situation on the ground is hardly ever ideal.  Instead, being highly adaptive, creative, and flexible are the traits that will eventually spell success in the food service industry.

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The Golden Gate Restaurant Association Denied By Supreme Court

The U.S. Supreme CourtThe Golden Gate Restaurant Association (GGRA) petitioned the Supreme Court recently to prevent the city of San Francisco from enacting legislation that would require employers to pay a fee to provide health coverage for their workers.

On Monday, the Supreme Court refused a temporary stay on the San Francisco legislation.  All businesses in the city with 20 or more employees would have to meet the new requirements.

The law in San Francisco was originally passed in 2006, but has since been held up by a successful court challenge by the GGRA.  A federal appeals court decided the law could be enacted temporarily last year, and now the GGRA is appealing to the U.S. Supreme Court for an emergency injunction to prevent the law from going into effect this year.

Similar legislation in New Jersey and Maryland were struck down by other Federal appeals courts, setting up a conflict in the lower courts that usually means the Supreme Court will weigh in.

However, it is also noted that the Court does not like to get involved in current national policy issues, and the Obama administration’s lofty health care goals for this year could prevent the Supreme Court from weighing in on the San Francisco petition.

The $1.17 to $1.76 per hour per employee healthcare fee has been decried by business owners in the Bay Area as putting an undue burden on business.  Business owners also claim the law violates a federal act that prevents local government from enacting separate pension and benefit plans from national ones.

San Francisco lawmakers counter that healthcare for the city is a necessary, progressive service that benefits everyone.  They also say the hourly fee can be applied in multiple ways, including towards a company’s health premiums, the city’s Healthy San Francisco program, or employee health accounts.

The question of how universal health coverage will affect business in the United States is only now heating up as progressive policies are being considered at all levels of government in the U.S.

Will universal health care wreck business and entrepreneurship?  Or will it create a progressive, egalitarian society for the 21st century?  Somewhere in between?  Weigh in with your opinion below!

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The Economics Of Free

Should everything be free in the new economy???

Should everything be free in the new economy???

Google has profoundly affected the way business is done the world over.  Besides becoming a frequently used verb (meaning “to search”) in multiple languages, the internet search and advertising giant became an international success on a business model that has never been attempted before.

Google offers its primary service, internet search, for free.  Ten years ago, when Google started, offering anything for free was unheard of, unless you were hocking towels on an infomercial.  Google’s success has shown that such a business model is not only viable, it’s the wave of the future.

While restaurateurs probably won’t start giving away their entire menu for free anytime soon, new economic realities have forced some innovative approaches to luring customers back to the food service industry, and free has played a huge role.

Denny’s kicked off the new approach to restaurant marketing with a Super Bowl ad announcing that Grand Slams would be free for one full day after the big game.  The success of that promotion has encouraged other chains to get in on the act, including Quizno’s, who recently wrapped up a million sub giveaway through a specially created site called

A café owner in Ohio even removed prices from his menu and allows customers to pay what they want for the coffee and breakfast items he serves.  Sales and customer visits have shot up as a result.  The practice of pay-what-you-want was invented in Europe, and has become even more popular since the economy started going south.

Of course, it may not work so well if a guest can rack up a few hundred dollars worth of entrees and bottles of wine.

And there are hundreds of more examples of restaurants finding the benefits of giving something away for free.  In a larger sense, however, the advent of giving away products and services for free has become rooted in consumer culture, and once consumers get something for free, they’ll want other things for free in the future.

But the economics of free also make sense, even if they seem a little counter-intuitive at first.

First of all, your customer appreciates the gift, and if they get one thing for free, they are more likely to buy other things from you, either in the future or at the same time they redeem their free item.

Secondly, nothing should ever be free.  If your customer doesn’t pay money for the thing they get for free from you, then they should either be counted on to buy something else either directly or indirectly from the free thing or you should get something from them, like an email address or a survey.

In an information age, collecting data about your customers has become vitally important to the success of any company.  Giving something away for free is one of the cheapest ways to get the information you’re looking for.

Finally, giving something away for free is a great way to create buzz around your brand.  The free publicity chains like Denny’s and Quizno’s have gotten out of their free food promos has more than made up for the cost of the giveaways.

The economics of free are the economics of the future, and the business you can generate from giving away something for free can far outweigh the cost.  And making more money than you spend isn’t anything new: it just makes good old-fashioned business sense.

Giving things away for free can mean more sales and customer loyalty, and making more money than you spend just makes good business sense.

Giving things away for free can mean more sales and customer loyalty.

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Do Public Smoking Bans Affect Restaurants?

Smoking bans are coming to your restaurant.  Are you prepared?

Smoking bans are coming to your restaurant. Are you prepared?

Despite the objections of many groups in the food service industry, public smoking bans have been passed with increasing frequency over the past five years.

Restaurants and bars are primarily concerned with losing business as a result of these smoking bans.  Advocacy groups claim that the health benefits of banning smoking far outweigh any other concern.

As a restaurateur, you are probably either already under a public smoking ban or will be soon, and it’s important to understand the pros and cons of these bans on your business.

For starters, research has shown that bar and restaurant revenue did not show an appreciable drop after the introduction of a smoking ban.

Smokers just don’t go home after a smoking ban is passed.  Instead, they cut down on their smoking and go outside when they need a smoke.  Some food service businesses actually saw a rise in business after the ban was passed as new customers ventured out because of the new smoke-free environment.

However, specific segments of the industry do not follow this general trend. In particular, blue collar establishments take the hardest hit when a new smoking ban is passed.  Bowling alleys and small local bars have seen as much as a 50% decline in business after the passage of a smoking ban.

While it is unfortunate that some businesses take a huge hit when a smoking ban is passed, the health benefits that are a direct result of banning public smoking are significant, and should really outweigh other concerns.

Heart attacks in public places drop as much as 40% after the enforcement of a public smoking ban.  The air quality of restaurants and bars goes from “dangerous” or “extremely unhealthy” classifications to “normal” and “good” overnight.  The body of evidence linking even small amounts of second hand smoke to short and long term health problems is now overwhelming.

For the food service industry, smoking bans are a reality that must be dealt with.

If you have the bad luck of operating in a segment that will suffer from the passage of a smoking ban in your area, start to develop a strategy for the day the ban arrives, because it will be here sooner or later.  If you have already found yourself under a smoking ban, tell us how it has affected your business.

What are the benefits?  The drawbacks?  Do you oppose or support introducing smoking bans in other states?

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A Restaurant Survival Guide (continued)

The Back Burner’s Restaurant Survival Guide continues with some more tips on how to keep customers coming in the door in these tough economic times.

Take your product to the customer. You have already developed delicious entrees, trained your kitchen staff to cook them, and purchased all the equipment you need to produce on a large scale.

Yet your restaurant is seeing falling or stagnant visits every month.

You’re all dressed up with nowhere to go.  So go out.

Many large chains like Applebees, Chili’s, and O’Charley’s have developed very successful fast takeout operations to supplement sales of their core menu items.

Now some of these businesses are getting into full catering services as a way to boost sales in a gloomy economic environment.

Recent surveys of restaurant patrons have indicated they plan to stay home in record numbers in 2009, but that doesn’t mean they always want to fire up the home kitchen.

And small to medium sized get-togethers (of 10 – 50 people) still happen all the time, just not at your restaurant.  Customers see a great value in serving familiar foods from their favorite eatery right in their home, and you already have the staff and tools to service them there.

A little marketing, a slight adjustment in your menu offerings, and you’re on your way to finding your customers even if they aren’t coming to your restaurant as often as they used to.

Gift cards help. More and more chains are marketing gift cards, and smaller operations can do the same.  Not only are gift cards a quick and convenient gift for your customer, but they guarantee future sales that can help you through slow times.

They can also help bring in new clientele if they are offered as a promotion.  And best of all, customers who use gift cards tend to overspend the gift card amount, which means some added sales for you.

Meanwhile, the customer leaves full and happy, having spent less than he or she expected.

You can survive. The salient point here is that customers still want your product.  They haven’t forgotten how good it tasted two years ago.

They just don’t want to pay the same amount for it.

You have rising expenses to deal with, but that doesn’t mean a little repackaging and some clever marketing can’t help your customer realize exactly why they fell in love with your restaurant in the first place.

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