As 2011 gets in gear, we find the stock market rising despite rapid increases in many key commodities. They are throwing the term stagflation around on the financial shows and websites. some economists don't see any reason to believe we are in danger of rising prices and unemployment. They cite improvements in the US job market.
I recommend allowing for expected trim loss in your recipe costing and menu item pricing formulas. The allowance for an acceptable level of spoilage may be added if your menu varies and your customers expect to pay a higher price. It is not as easy to pass along the cost of spoilage in this economy. Value conscious guests may look elsewhere if they feel your prices are too high.
The economy continues to make a slow but somewhat steady bounce off the canvas. With people paying down credit card debt and buying with cash instead of debt, we can expect the consumer to remain value conscious. Employment statistics mask the true unemployment which is higher than 10%. Still we see employers ready to hire in 2011. Most businesses run lean and mean and hiring will be modest.
The number one decision in managing your Sunday Brunch operation is the size of the staff for a given forecast. The staffing should include one or more people at the host stand. If your patrons know each other, you should consider seating people close to one another by opening zones in your dining room. Dining patrons will tend to spend more time in conversations thereby giving their digestive system ample time to send the 'I'm full!' signal.
Anyone who has used the popular Kasavana/Smith menu engineering model is familiar with the term 'Plowhorses'. A Plowhorse refers to an entree which is highly popular and has a relatively low contribution. My brother Paul is an Executive Chef at a major resort in California. We love to discuss menu engineering theory and we question the characterization of these under-performers as Plowhorses. Paul prefers to refer to the popular items with low profitability as deterrents.
An investment of time and money in any recipe costing model has a payoff in food cost analysis. Most operators lack sufficient information to conduct a meaningful food cost analysis. Many operators receive a simple percentage which they are told is either too high or too low(occasionally, just right).
Classic cost accounting techniques help operators to decide whether to close or stay open depending on expected sales volume. Generally, it is beneficial to remain open if your sales covers all variable costs and contributes to your fixed costs. If you can't even cover your variable costs, you would find more profits by closing your doors.
I spoke with a family member this weekend about the Saturday cooking shows, cookbooks, kitchen equipment and other post-holiday issues relating to food. Her husband is retired and they enjoy dining out. Typically, they avoid the packed dinner houses on Friday and Saturday nights. They prefer to go to restaurants on Sunday and Thursday evenings.
