Why it’s so hard to sell to food and beverage operators: Recap

Here is an update to a post from a while back, as I continue to receive questions on this issue and have recently provided some new and successful solutions for my clients: (Tim)

nosalesmansignIn response to some questions I’ve received via LinkedIn and in person, I’ve thought about the primary reasons why sales professionals have so much difficulty selling in new products, line extensions, technology and new ideas in general to bar and restaurant (F&B) owners and managers. I’ve been on both sides of the table, selling to the industry and as an F&B industry buyer. I was marketing director for a chain of restaurants and bars for more than 10 years, with a purchasing budget in the millions. Also I’ve been a consultant and agency exec who’s successfully sold in hundreds of programs and products to the F&B industry.

I’m happy to answer any specific questions posted in comments, tweeted or otherwise sent my way re this subject. So here’s my take on the top reasons our industry is such a tough sell:

(1) Sales people often lack significant experience in the hospitality industry, so they aren’t current on the problems, workflow, challenges and even the language of F&B operations. Therefore the products they sell are often perceived as marginally relevant and trust is not established. Jargon is a big problem on both sides.

(2) You can bet that every operator has had bad experiences in the past saying ‘yes’ to supposed ‘free,’ ‘no-brainer’ or ‘money making’ products/systems. Every scammer, bust out or ball-dropper who wasted the operator’s time and money in the past works against today’s good sales person trying to sell to restaurants and bars.

(3) Successful operators often view the “new idea” sales person as trying to build a start-up on their shoulders, piggybacking on the F&B establishment’s success. For some reason this breeds resentment and unwillingness to buy/try.

(4) Complexity is your enemy in F&B operations. It’s already too complex and a daily struggle to operate food and beverage establishments. Good operators are focused on streamlining and simplifying, not adding layers. Anything that takes your eye off the ball of “the basics” better be a grand slam, not just somewhat beneficial, or you’ll lose more than you gain due to the drag of added complexity. I looked to get 7x return on investment for anything we spent time or money on when I was a buyer/marketing director for large independent. That’s a tall order.

(5) Inventories are kept low as possible. This makes line extensions and new brands a hard sell. Most top operators adopted “just in time” inventory principals more than 10 years ago. Every extra item stresses storage space and is seen as a waste or theft hazard.

(6) One of the biggest headaches in F&B operations is maintenance and repairs. One more thing to break down, have to call customer service/IT, download updates, read manuals etc is extremely unwelcome. There had better be ease of operation, along with a huge benefit.

(7) Training is an immense time and resource suck in a high turnover/low professionalism industry like bar/restaurant. Anything that requires training introduces higher costs than sales people usually appreciate. So many sales people make the statement “we will come in and train your staff.” Are you going to pay them too for the training time? Most sales people don’t know that many of us in the industry refer to training as “soft costs.” To be controlled as stringently as food and beverage COGS. There is a great training solution for new products services that I recommend to my clients, but most sales people are unaware to suggest it.

(8) Customers tend to go to full service restaurants and bars for an old school high touch, personalized experience. Sales people tend to not realize tech solutions that might be good for fast food are actually a downer for restaurant/bar customers who crave personal attention. This is slowly changing with increasing public embrace of technology, but you can’t rush it. If there’s even 10% of customers that are incapable of using a tech solution, you have to have duplicate processes which usually negates the benefit of the new tech solution!

(9) Frequently sales people will tell operators “you don’t have to do anything.” In my experience this is never true. More often than not new technology, additional inventory and other “feature bloat” to our operations becomes an additional pain for management and staff. Scheduling equipment installations is a classic example.

(10) No, most operators cannot hire a new person just to handle whatever it is you are selling. Nor can they offer additional customer discounts or staff incentives to get your program off the ground! The margins are not there. Support staff in today’s F&B operations is sparse. Sales people usually do not realize this. Most likely the person you are pitching will be responsible for most of the additional work generated by the product/service they say ‘yes’ to. Do you now see why they often say No?

(11) This point kind of pulls together (3), (7) and some of the others on this list: A basic truth is that any problem that the customer experiences in an F&B establishment they will hold the operator responsible for. So the operator is putting their reputation on the line to add any new technology or in fact anything being sold in by a supplier. This makes them very gun shy and reluctant to relinquish to anyone even a small element of control over the customer experience.

(12) And finally, the manager or operator my be just plain too busy for another meeting, sales call or study needed to make an informed decision. Staffs, margins, and time are so tight in our business it’s hard for others to understand. And the show must go on every day, serving customers food, beverages and a good time!

I will be happy to post solutions in response to comments/questions, as I have figured out many ways around these challenges. The solutions will often be dependent on specifics of the product, program or sales process. I am here to help. You can learn more about me and see more ideas at alistmarketing.net.

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One thought on “Why it’s so hard to sell to food and beverage operators: Recap”

  1. Tim, thank you for posting this and taking the time to chat with us about the specific solutions we’re looking for as a technology startup in the bar space. For anyone reading – get in touch with his firm, Tim is the guy for figuring out the industry!

    Like

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