Early Bird Specials:

Restaurateurs who enact an Early Bird Special, should not offer regular items at a discount price. Create a special menu which offers value. The strategy of discounting regular price items is a death spiral

Do not discount your regular price items.

Strength and Optimism:

David Farkas’ post quotes Julia Stewart

Stewart, well-known for taking a personal interest in those she employs, suggested assuring workers that things will get better and showing them that everyone in the company is affected by the downturn of events.
"They're looking for any crack that suggests all is not well," she cautioned. "Demonstrate that you have not wavered one iota."
A leader's attitude should be one of "strength and optimism," she said, adding that leaders must "help people see challenge and opportunity" in times like these.

Bend but do not break:

Stewart Friedman’s post on resilience;

Business leaders who focus on what they love, and love what they focus on, and who insist that others do so too, strengthen themselves and their companies. To remain flexible yet firm, like that tree that won't break, you've got to be toiling, day in day out, for something you believe in, something larger than just you.

October is over, lets move on!

Apparent pricing power:

Chipotle decided to raise prices in the fourth quarter. There is wholesale deflation occurring in the world and a restaurant chain raises prices. Great strategy, they have pricing power and they are using it.

Mac and Cheese Cupcakes:

Trine Tsouderos’ article explains the full flavor cupcake trend:

"Everybody is pushing the limits of food right now," said Patty Rothman, who stocks her new Gold Coast cupcake emporium MORE with cupcakes that taste like a BLT sandwich or bacon with pancakes and maple syrup or, in time for fall, macaroni and cheese. "Can we take something familiar and re-create it in another way?"

In other words, can you make a cupcake that tastes like a bowl of steaming tomato soup with a grilled cheese sandwich on the side?

Of course, said Rothman. She sells out of the BLT and bacon-maple cupcakes every day. "People are open to it," she said. "Chicago is a pretty sophisticated food town."

Creativity comes from Chaos!

Offensive is order from chaos and defense is chaos from order:

Don Peppers and Martha Rogers wrote a great book “Rules to Break and Rules to Follow”

The book gives an interesting example relating to an offensive player’s locker being more orderly than defensive players. The justification for this disparity is that for offense to be successful, they must execute a structured plan. For a defense to be successful they must bring the other team’s structure offense into chaos. Innovation, creativity and growth happen in chaos.

Logo design drama:

Every new business agonizes over logo design. Some are truly obsessive. Seth reminds us that your logo is not your brand.

I guess the punchline is: take the time and money and effort you'd put into an expensive logo and put them into creating a product and experience and story that people remember instead.

A good logo is important, however it is nowhere as important has a memorable customer experience.

One day as a Lion:

“Every morning in Africa, a Gazelle wakes up. It knows it must run faster than the fastest lion or it will be killed. Every morning a Lion wakes up. It knows it must outrun the slowest Gazelle or it will starve to death. It doesn't matter whether you are a Lion or a Gazelle... when the sun comes up, you'd better be running.”
African Proverb as related by Thomas Friedman

Stop trying to understand all the horrors in the economic landscape. When you wake up, start running, you are a lion! Tomorrow wake up, start running, you are a lion!

Selling tuna or improving lives:

Seth’s post about marketing poses a valid question, are you selling tuna or improving your customer’s life?

“ Marketing had an arc, one that started with personal, local interactions between real people and rapidly morphed into very corporate anonymous actions aimed at the unwilling masses. Charlie the Tuna is humorous, but he only existed to sell tuna, not to improve our lives.”

If you are selling tuna then this is a tough market. If your restaurant is improving the lives of your customers then you are on the path. Keep on moving forward.

10/16/9 how did you get here?

Wow it has been an interesting year hasn’t it? Last year on this date you were waking up after watching the final presidential debate. The markets were in turmoil, business was brutal, heck even the Cubs had lost. Here you are today on 10/16/9, your restaurant is flourishing, your staff is happy and motivated, your looking to expand. How did you get here? Well, we...

…Now, go out and implement that plan to get you to 10/16/9.

Death of non value:

Press releases lately have confirmed the obvious, people are reevaluating what value means to them. Sit down quick casual with table service concepts (Ruby Tuesday, Applebee’s and Chili’s) are being abandoned by consumers in favor of upscale counter service concepts (Panera and Chipotle) and retail food chains. Conventional thinking surmises that removing the wait staff is a cost saving for consumers. That thinking is misguided, if the server or the concept provided value then consumers would continue to honor their purchase decisions. Clearly the chains that are losing traffic are doing so because the extra cost of their offerings are not being met with a corresponding perception of value.

Business Wire story examines the dynamics of where customers are

“Retail food chains, eager to recapture share-of-stomach, have been actively developing retailer meal solutions with strong consumer appeal, allowing retailers to reposition themselves as competitors to restaurants,” says Darren Tristano, Executive Vice President of Technomic. “Consumers are facing increasingly difficult economic choices, like balancing the higher cost of gasoline with the decision to dine out. The economic downturn may alter consumers’ food sourcing habits. To stay in the game, retailers and restaurant operators will have to continue to adapt their value equations to meet the market’s changing needs.”

If you are not providing value to your guest, you are spiraling into oblivion.

Get interested in the customer:

Starbucks according Janet Admay’s post is trying to get baristas interested in customers again, maybe start a relationship with them

"The customer's favorite experience is when the people behind the counter know them," said Craig Russell, Starbucks vice president for U.S. store services. Baristas, the employees who make individual coffee drinks, will "be able to get you going faster by knowing what you already want."

Gee, what a concept!

One Drink Cup per table:

Walk into any QSR that allows free refills on Coke, Pepsi or coffee and you will notice tables of two with one drink cup. People are sharing a single cup because they can get free refills. Your customers are not taking advantage of you, on the contrary, they are doing it to not be taken advantage off by you. The reason this phenomenon occurs is that couples after they have been together for a while tend to drink the same beverage. After going to QSR’s and ordering two beverages they come to the realization that they can order one drink, save the $1.69 plus tax and still drink the requisite amount of beverages with their meal. The motivation is not frugality, rather it is the notion that the restaurateur is cheating you by charging for two unlimited drinks.

National Chocolate Week:

Thank goodness, finally an event that uplifts the soul. National Chocolate Week!

Drag and Drop Online pizza ordering:

Online ordering is getting more visual with drag and drop functionality. QSR Magazine's article:

. An extensive list of pizza topping graphics allows customers to easily spot their favorite add-ons and the drag and drop functionality makes creating and revising the makeup of a pie order a snap.

"This type of smart and fun technology encourages consumers to beef up their orders, whether it involves adding toppings or even additional pies to their guest check," says Seth Blech, chief technology officer of BigHoller. "Having a positive experience during the order process can play just as important a role in repeat business as the taste of the meal and quality of restaurant service."

May you live in interesting times:

Remember the good old days when restaurateurs only had to worry about decreased traffic, skyrocketing commodity prices and stressed out staffs. Gosh, that was only last week wasn’t it? The total collapse of the equity and credit markets has created a national crisis, an event similar in scope to the 9/11. People respond differently to a national crisis than they do to a slowing business cycle. People are stunned. Many opened their 401k account statement and were shocked. The statements do not reflect the markets drops of another 15% over the last two weeks.

What is the next step for restaurateurs? David Brooks of the NY Times suggests prudence:

What is prudence? It is the ability to grasp the unique pattern of a specific situation. It is the ability to absorb the vast flow of information and still discern the essential current of events — the things that go together and the things that will never go together. It is the ability to engage in complex deliberations and feel which arguments have the most weight.

How is prudence acquired? Through experience. The prudent leader possesses a repertoire of events, through personal involvement or the study of history, and can apply those models to current circumstances to judge what is important and what is not, who can be persuaded and who can’t, what has worked and what hasn’t.

What does your experience tell you?

Adjust the Sails:

It is pretty clear that the economy is navigating some pretty impressive headwinds. The squalls are very substantial. A ship rarely sails with a constant tailwind, more often than not the winds are coming fast and furious from the direction that you want to sail into. Sailors learn long ago that they cannot control the wind, however they can easily adjust the sails and take advantage of any wind.


In her book, “The Tao of Personal Leadership” Diane Dreher defines three kinds of people in any organization:

Those who see problems - the victims
Those who see solutions – the managers
And those who see possibilities – the leaders

What possibilities can you see from the current tsunami?

Maybe it is not you:

The NY Times has a great map showing areas that are in a recession and areas that are actually growing. Perhaps you have the right concept, the right menu, the right décor and the wrong location.

Move!

Hat Tip(The Big Picture)

The Second Century:

There have been several moments during the past six months where the Chicago Cubs actually demonstrated the capacity to stretch beyond the rip currents of history. Though the 2008 team bears no resemblance to the 1909 team, the common thread through the centuries has been the same, zero for October.

Wait till next year!

Reusable carry out bags:

Andy’s post about reusable bags got me thinking why don’t QSR's implement reusable bags.

Reusable shopping bag

Create an amazingly cool shopping bag. Something that is reusable and so cool that people will want to carry it around. For $1 you can have all of your customers become walking billboards all over town (and be happy to do it). Retailers should give the bags away for free instead of selling them. Trader Joe's or Whole Foods should flood a town with logo-covered shopping bags, watching their competitors turn green with envy.

P.S. Douglas Farquhar, Director of Business Development at Renovos invites you to check out ReJAVAnate.com where you can find environmental sustainability in a reusable bag program, not just a quick fix.

Thanks for the email tip!

Rollercoaster:

Cameron Herold’s post on harnessing the emotions entrepreneurs undergo during these crazy times:

* Stage 1: The first stage of the concept is called “Uninformed Optimism”. At this stage on a rollercoaster, just getting to the top of the rollercoaster, you experience feelings of an adrenalin rush, characterized by excitement and nervous energy.

* Stage 2: The second stage is called “Informed Pessimism”. As you ride over the top of the curve you now have a bit more information. Feelings of fear, nervousness, and frustration begin to set in. Perhaps you even want to get off of it.

* Stage 3 – The third stage is called “Crisis of Meaning”. You’re past scared. You feel despair. It’s as if you’re standing on the edge of a cliff ready to jump, and you begin to think “Today the rollercoaster’s going off the bottom of the track for the very first time.” You feel helpless and you’re both terrified and frozen.

* At this point, you face a critical juncture. You can come off the bottom of the curve and crash and burn, which is when your business goes bankrupt, you lose your marriage, you start drinking, or you end up in a doctor’s office because of stress. Or you can come around the corner because you’re getting support at “Crisis of Meaning” and you can enter an upward swing call “Informed Optimism”.

* Stage 4 – Informed Optimism. You’re calm. You’re informed. You might even say you are cautiously optimistic.

Investing in future Memories:

Creating memories is a great marketing strategy for any restaurant. Restaurants are all about making memories. Emphasize the memory aspect as to why customers should come to dine at your restaurant.

“Recent research from Harvard Business School professor Anat Keinan and a colleague suggest that we often regret not indulging ourselves earlier in life. Key concepts include:

• People can be too farsighted, or hyperopic, leaving wistful regrets of missing out on life's pleasures when they look back at how they spent their time.
• It's possible to motivate consumers to indulge themselves by simply asking them what they think they will regret in 10 years.
• Marketers can convince consumers that buying their product is actually a farsighted behavior, an investment in future memories.”

Upside of the Downside:

Recession are not all bad, this Reuters piece offers an upside,

"The availability of quality sites is greater than it has been -- more than we were thinking it was going to be just a year or so ago

Many restaurants and retail stores have seen traffic fall as U.S. consumers wrestle with the downturn in housing, rising job losses, a credit crunch and higher fuel and food costs.

As a result, they are trimming growth plans or closing stores. Some companies are backing out of planned developments for financial reasons, while others have seen deals languish because developers cannot sign up enough tenants.

An AP piece by Lauren Shepherd put it this way:

While the credit crunch is making it hard for some restaurant companies to get loans to build new locations and renovate old ones, other chains are using the slowdown to secure better terms from landlords struggling to find viable tenants.

"Landlords are being fairly aggressive now,"