Industry expert Doug Radkey offers tips to foodservice operators on how to thrive as winter approaches.
By Doug Radkey
It’s a new day – but things are still shifting and changing daily. You have worked hard to take all of the necessary steps to reopen your restaurant safely and within local and industry-driven guidelines.
But there is that anticipated second wave hanging over your head – something that you don’t have full control over.
And in all likelihood, the second wave will actually not be a similar scenario as the first wave in terms of how you operate, adjust, and push forward. The government guidelines are different, the government support is different, consumer sentiment is different. In essence, the overall climate is different.
The question you have to ask yourself as an owner or manager is: “are we ready?”
We’ve all heard the numbers and chances of survival. We don’t need to go down that road any further. But it all honesty, it will likely take at least eight to 12 months for venues losing money right now to begin to visualize a financial recovery. That’s without any further waves or restrictions throughout 2021.
And while government support helps, business operations cannot (and should not) rely on it to fully recover or to run a business at its normal or required level. So how can you prepare, coast through, or potentially even thrive throughout the upcoming winter or ‘second wave’?
Though you’re not a certified emergency response expert, you’ve been through this once. Take some time to go through every part of your response to the first wave and ask yourself two fairly simple questions: “what did we do well?” and “what didn’t we do so well?”
Remember that it’s okay if some things didn’t go as planned, because no amount of bar or restaurant operation experience ever teaches you how to navigate a pandemic. But you’re here now and you’ve made it through the first wave and tough summer months.
But the fight isn’t over yet. Now it’s time to establish the premise of an action plan to maximize on the things you’re doing well and a priority checklist to address what you didn’t do so well the first time around. Create a plan and communicate with your team – or even better, get them involved throughout the process!
Put together an outline of plans for 30 to 60 to 90 days. Then rinse and repeat that process. These plans must also include cash-flow projections and creating both action and contingency plans. What would happen and needs to happen when your business is hitting 10 per cent, 25 per cent, 50 per cent, or even 90-100 per cent less revenue than projected?
Have a scenario outlined for each of the above. Determine your cash-burn, your break-even, and your areas of costs that can be immediately cut. What happens to your equipment, venue, marketing, and staff during reduced hours or a complete, but (hopefully) temporary shutdown?
While no one wants to talk about it, what is the plan if you have to permanently shut down? What is your exit strategy? It’s imperative to have this methodically laid out and communicated amongst your shareholders or leadership team.
It’s absolutely critical that you also know not only your local government mandates, but also consumer demand and the ever-changing competitive landscape. Consider what processes and systems you can put in play to monitor real-time demand and adjust operations accordingly based on daily changes. What communication plans and contingency plans are needed to continue operating at a consistent level?
What do you do if there is a “rolling lockdown” in your region with only 24-48 hours notice? What’s the marketing strategy to obtain and retain new consumer profiles? You need to stay up-to-date on your hyper-local area like never before!
Move over, “pivot” – the new buzzword is “flexibility.” As an operator, you need to ease your guests’ level of fear and anxiety. You need to provide flexible options and a multitude of revenue channels – or an “omnichannel”-type experience that caters to the new emphasis on health, safety, and convenience:
- Modified dine-in experiences
- Elevated patio experiences
- Curbside ordering and pickup
- Introducing food lockers
- Christmas and New Year catering packages
- Emphasis on retail (meal and cocktail kits + alcohol etc.)
- Online events such as pre-booked taste-maker education sessions
- Online ordering, reservations, and sales (using in-house platforms)
- Delivery options (Strive for 1st party followed by 3rd party and “last mile”)
You also want to provide flexibility to your workforce by continuously monitoring and improving labour efficiency based on the perceived demand. You also want to establish a workplace safety plan so that all of your procedures and policies are consistently laid out. Have a back-up plan in place in case a key staff member is sick. Have a contingency in place in the case of an outbreak at your venue. Assess the health risk of each and every position. Finally, ensure there is a procedure for regularly assessing staff compliance with these plans.
Keep your workforce fluid, safe, and a top priority!
Lastly, you want to provide menu flexibility by continuously reviewing your supply chain. Have a back-up plan for every single supplier and/or menu item. To make this easier to manage while keeping inventory, purchase orders, and potential waste to a minimum, it will be critical to keep your menu small but innovative, with precise flavour profiles and a flexible pricing model throughout the lean winter months.
Outside of providing a strong off-premise program alongside modified dine-in options, restaurants can still elevate their patio or outdoor program – even if you don’t have the space for tents (that are legal) or a private igloo park!
However, just installing patio heaters is not going to cut it, even aside from the fact they’re hard to find at the moment. If it was that easy, we would have been using them for years to extend the outdoor eating experience.
Quick reminder: winter is cold! Those heaters alone won’t do much when it is 0 or -5 or -10 degrees or colder outside, especially in Canada and the northern U.S. markets. You cannot expect guests to just sit down and enjoy a meal like normal, nor can you expect staff to go in and out of the cold all day long serving food and drink.
That is not feasible. You have to look at creating unique, micro outdoor experiences.
These could be the development of ice bars to ice sculpture exhibits, to elevated hot chocolate parties, chili/soup-focused menus and events, self-roasting s’more kits, outdoor holiday parties, and outdoor whisky tastings, to name a few.
Those patio heaters can only help a little, so you have to create an actual outdoor experience first. That is what will drive awareness, revenue, and repeat business.
While there is a multitude of other thoughts and processes to consider, more than one article can articulate – we have to remember that we can no longer rely on analysis like revenue per seat or square foot like we used to.
We have to develop a concept or business model that focuses on the experience first and foremost, whether on-premise or off-premise. Once you embrace that, you can formulate a plan to weather the second wave. With that mindset and planning, the revenue and profits will follow.
Doug Radkey is the president of KRG Hospitality Inc., the author of the book Bar Hacks, and an international keynote speaker on all things restaurants, bars, and boutique hotels. Being in the hospitality industry for over 20 years has allowed him to become a leading voice in the development of detailed feasibility studies, award-winning concepts, strategic business plans, unique menus, memorable guest experiences, and financial management systems. For more information, visit krghospitality.com