Category Archives: Casual and QSR

The most requested #restaurants in each state.

Not every restaurant is available everywhere, so QSROnline.com sought to find out which restaurants were the most requested by residents of each state. Some pretty interesting results. I would have thought IN N OUT in Illinois. Here ya go!

mostrequested2016

 

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SURPRISE! Raising Wages = Higher Prices.

Chipotle just raised its prices in San Francisco 14%, exactly the same % as the raise in wages with the new minimum wage in the city. A popular chain like Chipotle has the option to do this, while most Mom and Pop restaurants and less trendy chains typically cannot raise prices.   They (we) just have to take a 14% hit.

There is no willingness of consumers to pay a little more so their fellow citizens who work in food service can make a living wage. Instead, “the dollar store mentality” rules with most customers. The lowest prices for the fattest burritos and self-throat-cutting “deals” drive sales. Thus, small businesses seem likely to lose out and possibly go out of business under the new inflationary scenario where operating costs rise but prices mostly cannot.

One lesson to be learned from Chipotle is great branding and marketing can help a business weather the storm.  Every business needs to give customers a compelling reason to look beyond the lowest prices.   Great marketing and branding can attract a high number of less price sensitive customers.  Volume plus profit margins equals survival in a time of rising costs!  This is something we are happy to say we’ve been able to help with for more than 40 hospitality locations.  Shoot us a note at A-List Marketing for a free consultation on how to beat rising costs and cheap customers.  It’s the only way to cover the ever rising costs in our businesses!

I liked this “Take Part” article about the Chipotle price hikes, as the writer seems shocked at basic economics.

Have a great day and enjoy every burrito! — TTBG

PS – I just want to add since I saw this – if you don’t tip because the minimum wage went up, you are a cheap ass.  You are not doing it on principle, you are a cheap ass.

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Jimmy John’s Non-Compete Employee Agreements – Fair or Unfair?

A variety of recent articles report Jimmy John’s Subs requires all employees, even line workers and drivers, to sign an agreement not to work for any competing sandwich shop for 2 years after working for Jimmy John’s.  I have been getting some questions on email and social media looking for my take on this as a F&B business person.

The reality is that in most states a non-compete for workers other than management or technical specialists is not enforceable.  There’s a long history of rulings that non-competes can’t be used to prevent someone from making a living with skills they learned working at a company after they quit or are terminated.  I can’t imagine that Jimmy Johns corporate legal and HR staff would not know this.  So the most likely explanation for the existence of the non-compete clause is simply intimidation, to scare employees from leaving for another sandwich shop.  Low level employees don’t have the money to even consider any legal defense, so just the threat of even an illegitimate non-compete clause will almost always be enough to intimidate the worker.

Whether the existence of this clause is an unfair and objectionable move on the part of Jimmy John’s depends on if you think it’s OK to use employee agreements to scare workers with unenforceable clauses, relying on the worker’s lack of resources to force compliance to a legally and civilly illegitimate demand.

While I am a big admirer of the Jimmy John’s rags to riches success story, I don’t agree with this tactic, and professionally I believe a business would lose more than it would gain in genuine staff loyalty and performance with these types of demands.  Additionally it’s “bad PR” that could hurt a chain’s image with customers when it’s revealed.

Read some more information on this issue, the legal, civil, employment law and public perception aspects here, here and here.

 

JimmyJohnsFounder
Jimmy John’s Founder John Liautaud built his huge sub sandwich chain starting with a single shop in a garage in Charleston Illinois.

 

Today: Qdoba dumps a truckload of coins for customers to scoop up

Scoop up your free nickels and dimes today, as Qdoba adds  free ‘extras’ to the menu

To promote its new stand against “nickel-and-diming” customers, Qdoba on Friday will send a dump truck filled with nickels and dimes to an empty lot not far from its Denver headquarters. It will dump the coins in the lot, and let consumers scoop them up by the cupful for keeps.

The change dump is a stunt to publicize a move sure to be watched carefully in the restaurant business:  Qdoba will no longer charge extra for guacamole, which previously cost customers $1.19 to $1.50 per serving, queso (a hot three-cheese dip) that used to cost $1; fajita vegetables that went for 69 cents; and chile BBQ sauce that also cost 69 cents.

These sound like small numbers but can make the difference between profit and loss for quick service restaurants on some orders.  It truly is a “nickel and dime business!”

“We heard complaints from guests and from team members,” says Tim Casey, brand president of Qdoba Mexican Grill. “They view (the extra charges ) as nickel-and-diming them.”

There are few things restaurant customers hate more than paying for extras — particularly millennials.

Read about it here.  Thanks to USA Today.

coin dump

Today was the opening of Chicago’s first Olive Garden Ever so I stopped by

On Addison just east of the Kennedy the first Olive Garden ever in the City Limits of Chicago is having a very successful opening day.  I stopped by to chat with the PR pro working the opening, Jenni Izzo of Costa Communications.  The place was packed and the building and decor would surprise anyone who has a stereotype of what Olive Garden looks like.  It was ground up construction with a nice new upscale look.

Of course, Olive Garden is not trying to be trendy but do I believe this location will be very successful, likely leading to more locations in Chicago and other urban areas.

Here’s more from Eater Chicago on the opening, and the garlicky political implications.

Why Chipotle’s hiring process is best, but most restaurants won’t use it.

Chipotle does a LOT of things right.  Beyond the obvious ways they are grabbing the market from millennials on up (high quality, natural ingredients, great marketing etc) they innovate with their music, something most restaurants blow off.  And as explained on LinkedIn Pulse, Chipotle innovates and excels in their recruiting, hiring, promotion and retention processes.  Staff is the foundation of every hospitality concept and reading how they do it can help every operator.  Here’s the problem:

It is easy to make the knee jerk conclusion that Chipotle succeeds by “treating employees well” but that’s missing the reason they succeed. It is not being nice to employees, it is excellent screening, hiring criteria, and training policies.

Most operators will read how Chipotle does it, and say “great ideas.”  And they are.  The meat of this article, “The Actual Hiring and Promoting Process,” is true genius. But most operators will balk at implementing it as it means extra time, training, money and profound changes in attitude.  Obviously it pays off, but sadly most  companies will talk the talk only, where Chipotle walks the walk and gets a good return on the investment most are unwilling to make.

The Actual Hiring And Promoting Process

Because Chipotle is looking to turn its $9-an-hour crew members into employees that garner six-figure compensation packages, they have a more rigorous hiring process for its crew members than the typical fast food place. When people apply, they are told to read the career site, and then when they come in for an interview they are asked about what they read.

Those interviews are often team interviews, where each member of the crew talks with the candidate, and they look for people who enjoy the food at Chipotle and actually did the reading they were assigned. This is smart, because now the candidate fully understands that Chipotle is looking to promote from within, and they’ll be properly motivated.

Along those lines, Chipotle cares little about experience and requires just a high school degree (after all, it is just a $9-an-hour job). Instead, they search for people who have the 13 characteristics they are looking for (which includes everything from “presentable” to “infectiously enthusiastic”), assuming that superiors will give new employees the training they need to move up.

Once hired, crew members do all the jobs at the restaurant, from washing dishes to the cashier to making the food. Again, since both the employee and the manager are incentivized if the employee is promoted, training in all these areas happens organically.

For a supervisor to get promoted to a higher-paying job, the employees who work underneath them are interviewed. If the employees speak poorly about the manager, the manager will not be promoted.