Food and Beverage Management - Coursework Example

Running Head: Food and Beverage Management Food and Beverage Management Name Institution Food and Beverage Management Introduction Restaurant promotions are strategies made use of by restaurant owners to bring more business and also to show customer appreciation. They may be done monthly, weekly or daily. There are different kinds of promotions which range from the use of buffets, nightly happy hour to dinner specials (Mealey, 2011). The case study in this paper makes use of a buffet to increase their sales volume and also to attract different clientele. A buffet is a method in which food is put in public and then diners serve themselves (About.com, 2010). Another term used interchangeably with buffet is sideboard. There are a number of types of buffet, namely; “all you can eat”, special occasion, cafeteria style and catered buffets. “All you can eat” buffet is a type which offers guests a lot for their money. In this form of buffet, customers pay a single price and serve themselves from a number of stations that range from hot items, dessert station and salad bar. Cafeteria style is a method in which customers choose plates of food when they move through a line. For instance the customers may pick a plate that has a sandwich, a dessert and soup cup. This form of buffet is less utilized in restaurants. Special occasion buffets are those offered during special occasions in lieu of the regular menu. For instance a restaurant might offer unique seafood on every Friday of each month or they may also offer a unique Mother’s Day brunch instead of the usual menu. Catered buffets are those offered by catering services so as to feed a large number of people quickly and effectively. Holiday parties, weddings, business meetings are the types of situations that make use of catered buffets. Restaurants may facilitate off site provision of their catered buffet services and as such expand their businesses. Effect of “all you can eat” strategy The “all you can eat” strategy implemented in the case study has a number of effects. Firstly, it impacts on cost for example tables are turnover very quickly because nobody waits for the arrival of meals; there is the reuse of food (roast beef that is left over is used in tomorrow’s beef stew). The starches used in “all you can eat” buffets are usually low cost starches (for instance bread and potatoes). During the buffet days; that is Monday and Tuesday the labor costs is lower since fewer cooks and waitresses and used (Heard & Woolf, 2003). The staff needed to handle the buffet is small since all the food is laid out and customers serve themselves. The number of people fed at a buffet is large. It has also been noted that the average person consumes less at a buffet in the comparison to the standard entrée size. It allows for the restaurant to rotate food in the kitchen faster. It draws in customers who are on a budget and as such prefer bargains who normally do not dine at your restaurant. The overall impact of a buffet is an increase in profit margins on proviso that the buffet menu is priced right. Measurement of “all you can eat” strategy results The results are measured by recording different entities from the following areas; sales & marketing, kitchen management, staff & employment administration, restaurant management and drinks management (Campbell, 2007). Sales & Marketing Management The number of customers who frequent the restaurant is recorded. Visits by patrons; that are the top 100 customers are recorded. Sales per head that transcend all areas are captured. The cost of the entire buffet is measured. The total cost of the buffet is measured against the response garnered. Response rates; the number of people who responded to the weekend campaign is measured and its effect on profit is determined. Function inquiries are taken down; that is the number of people who come in to ask about the Monday and Tuesday buffets. The conversion rate for sales inquiry is recorded; which is the number of inquiries that are transformed into actual sales. For instance if there were 50 people who asked about function packages and the restaurant ended up having 10 bookings then the conversion rate would be 20%. Kitchen Management The percentage cost of food is determined quickly by the addition of the food purchases for the buffet against actual food sales. The total food cost is determined. The cost of food per head is also determined. Percentage kitchen labor during the buffet is measured by the comparison of kitchen labor against the total food sales. Kitchen labor hours are determined by the measurement of the total hours worked in comparison to the sales hence productivity is also derived. The worst and best selling items in the buffet are measured by the checking of the sales from dockets or POS. Staff and Employment The wage cost percentage is measured against sales percentage. Total labor hours during the buffet is measured and compared against sales so as to determine productivity. Restaurant and Front of House Management The total sale per head is determined by the division of the total sales by the quantity of customers. A comparison is made during the running of the buffet. The total number of customers is determined so as to evaluate the popularity of the restaurant. Beverage, Dessert, Food Sales per head is measured. This measurement helps in the determination of what appeals most to customers. Seating efficiency is also determined. This is how well tables are turned over while maintaining quality customer service. The things that impact on quality service are seating, service, clearing and cooking time. Basket analysis; that is the number of items bought by customers so as to determine ordering patterns. Percentage labor of the front house that is the number of hours worked in the buffet section. The value is compared against sales to determine productivity. Customer satisfaction is determined through the use of complaints and feedback forms. Strike rate is measured. In the event that 500 people frequented the restaurant at night and only a hundred ate at the buffet then the restaurant’s strike rate is 20%. The value is compared to similar businesses. Drinks Management Sales per head. The drinks sold are categorized into alcoholic and non alcoholic beverages. The results reflect on the amount of beverages that appeal to customers and how well they are selling. The sales gross profit is determined which is the difference that exists between sales and cost of the foods and drinks. Sales mix heavily influence what is stocked and as such the profit made. If the sale of two bottles of the same type of drink costs different amounts $5 and $7 then the restaurant should stock the one that costs the least amount. Drink turnover which is how fast drinks are selling is measured. Checklist of examinable areas Product (foods & drinks) Favorite foods Favorite drinks Total food sales Total drink sales Customer satisfaction Market Function Inquiries Number of buffet frequenters Sales per head Customer Ordering Patterns Response rate Operations Tables Turnover Seating Efficiency Kitchen Labor Waiter Labor Problem analysis Profitability is the main reason restaurants are started and is the corner stone of their survival. It is essential for their growth and expansion (Neunekner & Murphy, 2009). It maintains the existing investors and also attracts new investors. It therefore follows that a restaurant’s management revolves around ensuring that it is profitable. To ensure that profitability is maintained a feedback control mechanism is put in place. The feedback mechanism will provide information that pertains to the sales & marketing, kitchen management, staff & employment, drink management, restaurant & front of house management. The information obtained from the feedback control of the aforementioned areas will give a clear insight of the business position. The position being whether or not the business is profitable or not, whether there are problems cropping up or the business is running well. The information therefore gives the management a clear picture and allows them to direct the business in the right direction. Strategies to improve restaurant profitability Restaurant profitability might be improved through a number of means namely; promotions and financial accounting (proper keeping of profit & loss statement). A profit & loss statement (income statement) is a report that depicts expenses, sales, profit or loss of a given accounting period (Nuenekner & Murphy, 2009). It ultimately measures a restaurant’s profitability for a given period. A profit & loss statement allows management to keep track and analysis of their sales and ultimately be better placed to control their expenses. Its analysis provides the management with appropriate information for instance the percentage decrease or increase in expenses and sales from one period to the next, the ratio of cost of sales, labor cost ratio and other vital information. Promotions may include the use of buffets, open mic events, happy hour and special meals for special occasions (Campbell, 2007). References Campbell, D (2007). Non-Financial Performance Measures and Promotion Based Incentives. Retrieved November 3rd 2011 from http://www.chicagobooth.edu/jar/conference/docs/campbell-incentives.pdf Heard, G. & Woolf, G. (2003). Success in store: how to start or buy a retail business, enjoy running it and make money. Worsley publishers- New York. Mealey, L. (2011). Restaurant Buffet. Retrieved November 1st 2011 available at http://restaurants.about.com/od/restaurantconcepts/a/buffets.htm Neuneker, R.A & Murphy, S. (2009). QuickBooks for the Restaurant. John Wiley & Sons Press-New York About.com. (2010). Restauranting. Retrieved October 31st available at http://restaurants.about.com/od/marketing/a/promotions.htm Read More