Archive for December, 2009

F&B Directors: the End of the Month is Too Late

You’re not going to like this. Not at all.

Why should you? After all, you’re executing every required procedure, submitting every required report, even meeting deadlines most of the time. A week or two after the month ends, you get a P&L and find out how you did. Sure, you already have an idea. Certainly you know the revenues for the month. Maybe even your purchases.

Then when you get your P&L you analyze the results, and plan how to make improvements. Good. Except – it’s too late.

The January P&L arrives February 10, you spend a week reviewing it, attending meetings, making plans, writing explanations, submitting reports. By March 1 you implement appropriate tweaks, changes.

But the time to react to January trends isn’t March. And it isn’t February.

It’s January.

Your controller shouldn’t have to tell you your results – you should tell your controller. Your GM should hear your results for the first time from you, not your controller.

 THE PATH TO F&B STARDOM

While I can’t describe the path exactly, I can assure you that the it has weekly milestones. That’s right: the path to success is guided by the dreaded weekly P&L.

In an earlier blog, “Are You Tracking That?” I talked about the plethora of data managers are bombarded with today, about how it’s overwhelming, how the best managers keep their own spreadsheet “on the side”, and how the best companies track a specific but limited number of items. So, here’s what your “spreadsheet on the side” should look like: weekly revenue, COGS, labor cost, other expenses, compared to budget. If your week ended Sunday, you should know the results by noon on Monday.

WALKING THE PATH TO STARDOM

Make no mistake about this. Initially you (or someone in your department) will have more work to do. Soon, however, the process will become systemic. You will not want to give it up.

There will be multiple data sources in a larger hotel, fewer in a smaller hotel. You may wish to split up the accountability.

Here’s how to track:

  • Start a spreadsheet – you may wish to have one tab for each week
  • Enter the budget once a month by first calculating a pro-rata weekly budget
  • Track by week with the week ending the same day the payroll week ends
  • If you’re on a calendar month (an unfortunate burden) you will have weeks that span two accounting periods – always use the new month’s budget figures, as most of the results will end up in the “next” P&L
  • Track the numbers DAILY for sales, covers, purchases, labor cost, labor hours, etc.
  • Conduct a weekly inventory of both food and beverage (a blog dedicated to this procedure – and how to make it easy – coming soon)

Here’s what to track

  • Sales – by outlet, by meal period; also for each, covers
  • COGS – food cost, beverage cost, A/V & Other costs
  • Labor costs – hourly wages, salaried wages, benefits costs
  • “Bonus” labor tracking: if possible, track labor hours. This results will allow two simple and revealing calculations: labor minutes per cover and sales per labor hour
  • Purchases of food and beverage
  • Ending inventory (yes, again, you should take weekly inventories – pay no attention to whether accounting wants or needs these figures)
  • Other expenses, supplies, etc.
  • You can – and should – enhance the weekly report with auto-calculated percentages, and a running total for the week (and for the month, if you wish)

Finally, remember above all else: this is not an accounting document, but a management information tool. Do this – your management effectiveness will increase exponentially.

Those are my thoughts, let me know yours.

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F&B Directors – Are You Keeping Up?

Are you keeping up with your industry, “hotel F&B”? Are you reading all of the right magazines?

Great. Now STOP. Stop reading hotel industry publications. Just for a while. Look for some ideas from sources not connected with the industry.

I know. Who’s got time to read, and anyway, who reads magazines anymore? Can you spell “webzine”? Maybe the Internet, per se, hasn’t killed magazines, but when you factor in recent mobile technology advances, including e-readers like Kindle, the print world certainly seems even more challenging.

No matter. Web site or print. You likely already subscribe to several excellent publications such as Hotels (www.hotelsmag.com), Hotel F&B (www.hotelfandb.com), Lodging (www.lodgingmagazine.com), Lodging Hospitality (www.lhonline.com), Hotel & Motel Management (www.nxtbook.com/nxtbooks/questex/hmm_20091123/index.php), and Hotel Design (www.hdmag.com/hospitalitydesign/index.shtml), to name a few.

No doubt you subscribe also to some of the many excellent restaurant industry magazines, including Nation’s Restaurant News (www.nrn.com), Restaurants & Institutions (www.rimag.com), Restaurant Hospitality (www.restaurant-hospitality.com), and Restaurant Business (www.restaurantbiz.com).

Of course there are the specialty magazines, often with cuisine or beverage-alcohol based content. Sante’ is among these excellent magazines (www.santemagazine.com), and many culinarians like Chef (www.chefmagazine.com).

OK, so now let’s go “off the industry path” just a little bit. Let’s see what’s going on in other parts of the world, even related parts.

If you run a fine dining establishment, read QSR Magazine (www.qsrmagazine.com). If you work for a large company, read a publication designed for independents, like Restaurant Startup & Growth (www.restaurantowner.com).

Who are your customers and what are they interested in?

Are you getting more requests for vegetarian items? Read Vegetarian Times (www.vegetariantimes.com), or even – if you want some ideas for vegan dishes, or to better understand the vegan point of view, Veg News (www.vegnews.com/web/home.do). Are they coffee aficionados? Try Fresh Cup for industry trends in specialty coffees (www.freshcup.com).

Let’s really get off the path now. Are they concerned about fitness? Read Fitness (www.fitnessmagazine.com), or Men’s Fitness (www.mensfitness.com). Are your customers boomers? Read AARP Magazine (www.aarpmagazine.org) – maybe you’ll have to borrow your parents copy?

And don’t forget to look at what’s going on in retail. Some may have publications available at the store only, but all have web sites. Look at Whole Foods (www.wholefoodsmarket.com), Dean & Deluca (www.deandeluca.com), Wegmans (www.wegmans.com) and Trader Joe’s (www.traderjoes.com).

Those are my thoughts, let me know yours.

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“In Room Dining” or “Room Service”?

What a dilemma! What should we call this special function, one which the hotel industry clearly “owns”. Upscale hotels seem to prefer In Room Dining, but I don’t know that anyone has ever asked the guest.

 Does it matter?       

 “In Room Dining” describes this from the guest experience point of view: dining. “Room Service” describes this from the hotel (and guest) points of view: service. “Dining” sounds just a touch expensive and formal (aren’t these elements many of us are removing from our hotel dining rooms?) and frankly, I’m not dining – I’m trying to get something to eat and drink, while I…

  • Work on my laptop
  • Watch TV
  • Shower & shave
  • Get dressed for an event / etc.

Note: this is often a convenience buy.

So, what does matter? How about capitalizing on one or more of these opportunities:

Opportunity 1: Room service is your ‘leg up’ on local restaurants. It’s the one game at which “they” can’t beat you. Go after them. By providing product and experiences equal to or better than what they have (+ “delivered to the room”). If your guests frequent a steak house 2 blocks away, what memorable steak experience can you provide? If they go to the sports down at the corner, make sure tonight’s sports channels and offerings are in the room when they check in, or are handed to them at the desk.

Opportunity 2: Room service provides a way for you to make an impact, create a point of difference. (If you’re thinking about this from a corporate point of view, it’s a great way for your company/chain/brand to communicate and execute a point of difference.) You can “brand” it. You can create signature “Room Service Only” signatures (Please, not personal pizza. Please.) A “Room Service Selected Wine List” (half bottles?).

Opportunity 3: Room service gives you the chance to create or extend your relationship with the guest, through a thoughtful promotion or service feature. Give them something they didn’t order (a chocolate? TV Guide? A cordial mini?). Interact with them in an unexpected but nonintrusive (and value add) way – squeeze the grapefruit juice at their table, or make the coffee with a French Press at their table, or decant the wine.

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