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Food For Thought - Reprogramming Hotel Dining To Maximize Profits & Guest Satisfaction |
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Ken Wilson, CEO and Chad Crandell, President of Capital Hotel Management on the Myths of Hotel Dining |
Myth #1: It Is Reasonable To Expect Some Outlets Will Just Lose Money
We are firm believers that hotel restaurants should not lose money. Think about it...if a free standing restaurant was unprofitable, would you continue to operate it? Of course not! You would explore opportunities to improve performance and if all else failed you would close the doors. The same principle should hold true for hotel outlets. With all of the innovations and creative concepts available today, there is no reason why an unsuccessful outlet should be maintained just so it can continue to chip away at the departmental profitability (usually fueled by banquet sales). From a guest satisfaction standpoint, an outlet losing money is not likely pleasing anyone. Take the time to understand how each of the outlets contribute or detract from your F&B department's profitability picture. Identify those that are loss leaders and make adjustments accordingly.
Myth #2: Find & Replace Is a Prudent Strategy
While identifying unprofitable outlets is the first step, don't feel as though lackluster concepts need to be replaced immediately replaced, or at all for that matter. Be sure to consider your entire food and beverage program before implementing a new concept. In our experience, we have found that closing doors may open others. Study the highest and best use (HABU) of space, perhaps converting to retail, meeting space or addressing other facility needs that may generate a higher profit. Space is at a premium and should be programmed and utilized to maximize functionality and the bottom line.
Myth #3: Variety Is The Spice Of Life
This may be true on many counts, but when it comes to hotel dining, this philosophy is not recommended. Rather than trying to be all things to all guests, do your research and find out what your guests want. Pick a concept and follow it through. Guests are savvy diners. Rather than offering three half-baked concepts operating at lack-luster volume levels, likely creating internal competition, commit to a well-researched and executed concept to enhance the overall guest experience and profitability. Guests want to experience a sense of place. Go back to your mission statement. Does your concept complement your surroundings? Does it meet your guest profile? Is it a restaurant guests would patronize if operating outside of a hotel? If you answered yes, than keep going...you are on to something. Take a critical look at your outlets to identify opportunities to streamline operations and offer guests something that would attract them to stay in and dine. Compete against the market not yourself.
Myth #4: 'The Three-Meal' Is A Concept
Sadly, this myth has become a reality at too many hotels across the country. Offering food service for all three meal periods - good. Offering this service within one restaurant, that, in an attempt to appeal to everyone, appeals to no one - bad. This type of outlet will be used at best as a last resort and only out of extreme cases of guest desperation - a quick bite for breakfast or a late night arrival...not exactly the volume needed to sustain a profitable operation. Again, picture your three-meal operating out in the marketplace. Does it work? If not, it may be time to re-strategize. Providing guests with options for all three meals is advisable but seek creative and profitable means of doing so. What do guests want in the morning? A good cup of coffee and a bagel doesn't require a fully-staffed kitchen. Don't be afraid to meet each meal period using different outlets (in-house or local, for that matter).
Myth #5: Mini Bars Are Here To Stay
Mini bar technology has come a long way, offering a wide range of products touting everything from electronic point of purchase and inventory sensors to high energy efficient ratings. While we are proponents of technological advancement in all areas benefiting the hospitality industry, we believe that in some cases there is yet another mini bar option proving successful in boosting food and beverage profits-taking them out. Don't be afraid to think outside of the box and break out of the paradigm. Are guests asking for this service? Does it cost more to maintain than it generates in profits? Test radical changes wisely, but you may be surprised to find that there are many services you think guests want and need, but in fact they may not.
CHM oversees more than $300 million in annual food and beverage sales at properties currently in our asset management portfolio. We have extensive experience in food and beverage concepting, renovation and reprogramming for profitability. Call us today at 978.522.7000 or visit our website www.chmhotel.com to find out how we can help make sure you're not leaving profits on the table.
Ken Wilson, CEO Chad Crandell, President
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Contact Information:
Corporate Office
548 Cabot Street
Beverly, MA 01915
Phone 978.522.7000
Fax 978.522.7008
Click for Website
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Capital Hotel Management, LLC (CHM) is a privately-held hotel asset management and investment advisory company, providing a full range of acquisition and disposition expertise for its investors, as well as customized strategies proven to maximize hotel value and optimize investment returns. |
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