Washington Restaurant Magazine June 2012

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Inside

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Features

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Where are we on 1183?

By now you’ve heard it all—truth, misinformation and everything in between.

Here’s a closer look at what has happened so far with liquor privatization and what your restaurant can expect in the coming months.

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Are daily online deals dead?

Living Social, Groupon, AmazonLocal… you know them all well. Maybe you’ve even advertised with them. Are they a good idea, and where are they headed?

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Adding technology to the menu There is no doubt that technology is changing how restaurant personnel and guests interact with each other. Because of this, the National Restaurant Association has created an infographic for Mashable.com to show what the future may hold when it comes to ordering and payment options, apps, and social media.

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2012 Food and Menu Trends Check out this special NRA report on 2012 menu trends.

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ServSafe Alcohol serves up support It’s only a matter of time of time before ServSafe Alcohol becomes synonymous with alcohol server training in Washington state. Find out why ServSafe Alcohol should be your restaurant’s go-to for safe and responsible alcohol service.

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Other stories

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Why Infographics?

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News Briefs

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Your liquor rep told you what? Here’s the truth

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ConSERVESM helps restaurateurs lower costs and embrace sustainability

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Allied members—who are they and why are they important?

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WRA legal team supports restaurants by working with state agencies

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Calendar/New Members

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Marketplace

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Four simple reports for understanding your business

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On the cover Want to know what food trends are sweeping the industry right now? This is the issue for you. Check out page 18.

RESTAURANT TECHNOLOGY INFOGRAPHIC

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June 2012 | 5

EDITORIAL STAFF Anthony Anton, Publisher Lex Nepomuceno, Executive Editor Heather Donahoe, Managing Editor Shawn Sullivan, Contributing Editor Lisa Ellefson, Art Director WRA EXECUTIVE COMMITTEE Bret Stewart, Chair Center Twist Jim Rowe, Vice Chair Consolidated Restaurants Robert Bonina, Secretary/Treasurer Washington Athletic Club Steve Simmons, Past Chair S & S Hospitality, Inc. Nancy Swanger, WRAEF President WSU WRA EXECUTIVE TEAM Anthony Anton President and CEO Teran Petrina VP Internal Operations Bob Decker Director of Membership Bruce Beckett Director of Government Affairs Lex Nepomuceno Director of Communications & Technology Lyle Hildahl Director of Education Victoria Olson Director of Business Development 510 Plum St. SE, Ste. 200 Olympia, WA 98501-1587 T 360.956.7279 | F 360.357.9232 www.WRAhome.com

Letters are welcomed, but must be signed to be considered for publication. Please include contact information for verification.

Reproduction of articles appearing in Washington Restaurant Magazine are authorized for personal use only, with credit given to Washington Restaurant Magazine and/or the Washington Restaurant Association.

Articles written by outside authors do not necessarily reflect the views or positions of the Washington Restaurant Association, its Board of Directors, staff or members.

Products and services advertised in Washington Restaurant Magazine are not necessarily endorsed by the WRA, and do not necessarily reflect the opinions of the WRA, its Board of Directors, staff or members.

ADVERTISING INQUIRIES MAY BE DIRECTED TO: Ken Wells Allied Relations Manager 425.457.1458 ken.wells@WRAhome.com Washington Restaurant Magazine is published monthly for Association members. We welcome your comments and suggestions. email: news@WRAhome.com, phone: 800.225.7166. Circulation: 6,310.

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Why Infographics?

By Lex Nepomuceno, Executive Editor This month’s issue of Washington Restaurant Magazine includes a special centerpiece presentation of an infographic related to the restaurant industry. “Adding Technology to the Menu”, on pages 16 and 17, illustrates an assortment of different datasets in a graphical, fun format; but what is an infographic and why is it important?

Let’s face it—raw data can be boring.

Business owners get bombarded with interesting new facts and figures every day, but at the end of the day the most important stat is, “What were our sales?” Nonetheless, statistics and survey results can have a profound impact on the bottom line and foreshadow new opportunities and consumer behaviors.

Unfortunately, this type of information is often presented is through tables and rows of numbers. It is easy to be intimidated by data, but in doing so, restaurateurs could miss very important trends that could ultimately help or hurt the bottom line.

Infographics represent an emerging method for displaying complex information and a lot of data in a visually stimulating format. These are things a business owner would actually enjoy looking at because they are so engaging and aesthetically pleasing.

Infographics have been used in the tech industry for many years, and until recently were not utilized directly by the foodservice industry. Last month, technology news outlet Mashable reported how foodies are increasingly relying on online reviews to choose where they eat. The article went onto state that “45% of consumers have already chosen where to eat with the help of an online dining guide. Online reviews are a huge decider of what’s for dinner — 57% of patrons rely on them.” Sure, this is an interesting finding; however, the article was also appended by a poster-sized infographic drawn up by the National Restaurant Association. The graphic goes on to reveal other interesting facts that affect restaurants, such as consumer habits regarding restaurant websites and nutritional information.

The example in Mashable was highly engaging and made readers want to go through every tidbit of information – not because they had to, but because they wanted to.

True, some of the data in the graphic maybe more important than others, but many restaurateurs would feel compelled to at least go through the information as opposed to filing away somewhere never to be retrieved.

This restaurant industry infographic has been republished in pages 16 and 17. Dive right in and see if this is a more appealing way to digest the findings of complex research, and if the information in it can help your run your business. I’d like to hear what you think. Email me at lex@warestaurant.org.  

Primary Source of Information | News Briefs Tax agency offers guidelines for health-care cost reporting As restaurant operators grapple with proposed requirements tied to the new health care law, the Internal Revenue Service is offering more information on how to comply with at least one facet of the mandated documentation: the W-2 cost of coverage reporting requirement. Enacted in 2010, the health care law requires employers to report annually to the IRS each employee’s cost of coverage under an employer-sponsored group health plan on his or her W-2 form. This amount includes the portion paid by the employer and employee to the cost of coverage. Compliance with this requirement was voluntary for all employers for tax year 2011. Employers who will file less than 250 W-2s for tax year 2012 also are not required to comply yet. However, employers with more than 250 W-2s should track the value of each employee’s cost of coverage now so accurate reports can be issued in early 2013. Subsequently, all employers must comply with this reporting requirement for tax year 2013. For the full article, go to: http://wra.cc/healthcare24.

honors in Washington state’s Boyd Coffee ProStart Invitational in March, advancing to the April 30 national competition in Baltimore, Md., where culinary teams from 43 other states prepared meals for the judges.

For the full story, go to http://wra.cc/prostart5.  New SSA Washington website launched!

WRA’s Education Foundation has launched a new site for its ServSafe Alcohol training program. Members will still be able to access the information from the main wrahome. com site, but the standalone site will enable the ServeSafe Alcohol team to maximize the brand and gain better traction with search engines. Nationally recognized as the premier training solution for the restaurant and hospitality industry, ServSafe Alcohol® provides staff with

State Exchange News: The Department of Health and Human Services (HHS) announced that state exchanges will have until November 2012 to submit a blueprint of their exchanges to HHS to start the approval process. HHS is requiring states to prove their readiness by Jan. 2013 and that they will be operational by Jan. 2014. If not, HHS will step in and operate the federal exchange in those states. Read the HHS announcement here: http://bit.ly/L6x12v  WRA announces state Restaurant Neighbor Award winners The Washington Restaurant Association is pleased to congratulate its 2012 Restaurant Neighbor Award Winners. This year’s three winners demonstrate tangible compassion and generosity throughout their communities. These restaurants dedicated staff time, money, effort and food for the benefit of people in need. The WRA has selected Charlie’s Safari, Canyons Restaurant and El Gaucho as the 2012 Restaurant Neighbor Award winners. For an overview of each honoree and their charitable efforts, go to http://wra.cc/2012neighbor.  WRA applauds Tom Douglas for well-deserved honor In early May, Seattle restaurateur Tom Douglas landed his most significant recognition to date . He was named “Outstanding Restaurateur” by the James Beard Foundation. This national award honors the entirety of Douglas’ culinary career, which includes 13 Seattle-area restaurants. Douglas had been honored in past years for his cookbooks and Northwest cuisine by the illustrious James Beard Foundation, but Monday’s award is being called the crowning achievement of his career. The Washington Restaurant Association is pleased to congratulate Tom on this well-deserved award.  Oak Harbor ProStart team places 5th at National Invitational The Washington Restaurant Association Education Foundation (WRAEF) is pleased to congratulate the Oak Habor High School ProStart culinary team on its fifth place win at the National ProStart Invitational. Oak Harbor won top

the critical knowledge necessary to serve alcohol responsibly. Be sure to check out www.ssawashington.com, or contact Kristina McLeod for more information at 360.956.7279.  2012 Buyers Guide coming in July!

The Washington Restaurant Association will be publishing its annual Buyer’s Guide in July 2012.

The WRA Buyer’s Guide is a special directory inside the WRA’s magazine featuring vendor members of the association. This special issue also includes news and feature articles about WRA’s most popular programs, money-saving ideas and tools to help restaurants succeed. For more information, please call Shawn Sullivan at 360.956.7279.  June 2012 | 7

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Industry Outlook | WRA President & CEO

Your liquor rep told you what?

Here’s the truth The hottest restaurant trend this year?

Undoubtedly, healthy kids’ entrées. The hottest restaurant topic? Equally, without doubt, “Where am I going to get my booze?”

And, if you are a restaurateur who has not acted on either of these yet, it’s time get a move on it.

Unfortunately, there is a lot of misinformation surrounding the issue of liquor supply and pricing. We are getting several nearly unbelievable questions coming at us from restaurateurs who have been poorly educated or misinformed by some liquor sales reps who are spreading inaccurate information.

Here is a sample of the misguided information we are hearing… it usually starts with “My liquor rep told me … “…her company bought up all of the local distilleries and I can only get local spirits through her.“ (FALSE) “…there are now only two places in Washington where I (a restaurant) can buy from – Southern Odom or Young’s Market.” (FALSE) “…the Liquor Control Board ruled that I (a restaurant) can’t buy from Costco.” (FALSE) “…the new system increases the cost of liquor to restaurants by 20%.”

(FALSE) “…that I can’t do a co-op with other restaurants.” (FALSE) While these statements represent either a poor understanding of I-1183 or other, there is some reasoning to the mass confusion in the marketplace, and there are several fastmoving pieces out there that still haven’t settled including:

The Liquor Control Board’s reinterpretation of the

initiative and the impending lawsuits to correct the improper rulings.

The Supreme Court’s ruling on I-1183 (which at presstime this was still unknown).

The unexpected sale of ALL of the state’s liquor stores (most experts assumed a percentage would not sell).

The emergence of an 80+ store coalition among the old

Anthony Anton, president and CEO

liquor stores new owners.

The continued strong showing of local distilleries.

The WRA is doing everything we can to make sure the law is implemented as intended and that you have the information you need, but one of the best things we can provide are the graphics in this article. They clearly indicate that while things are different now, there is no structural reason that 1183 should impact your pricing. Now you know for the next time a liquor rep comes in.

Note: Don’t forget about another educational tool, LiquorExchange.org, when looking to discover your options.

FACTORS/COSTS UNCHANGED BY I-1183

Distributor margin Manufacturer’s bottle cost State and federal taxes

CHANGES FROM OLD SYSTEM TO NEW SYSTEM

Expense to deliver to LCB State cost to run system 23% additional charge in restaurants, 52% in stores, after all costs accounted for

Distributor costs to service to restaurants (Only cost change)

Strikethrough indicates costs no longer applicable under new system.

UNKNOWN COST VARIABLE The 10% distributor license fees to the LCB must yield $150 million by March 31, 2013. If it is not collected, the balance will be pro-rated among existing distributor licensees, based on sales.

REMEMBER NOTHING within the structure of I-1183 necessitates that a distributor recoup its investment by increasing your costs.

June 2012 | 9

1183 Implementation: Where are we?

By Julia Clark, WRA government affairs manager On Nov. 8, 2011, voters overwhelmingly approved WRA-sponsored Initiative 1183, privatizing the sale and distribution of alcohol. In less than eight months, nearly 80 years of Prohibition-era policies were overturned by the will of the people, and Washington state worked to set up a private system of alcohol sales, as directed by voters. This unprecedented change will ultimately lead to a modernized system for Washington’s restaurants, unseen anywhere else in the country. The overwhelming transition has come with significant challenges, some success and still a bumpy road ahead before we finally reach what restaurateurs envisioned in 1183. Here is a summary of what’s happened, and what we can anticipate moving forward:

Divesting the business

Immediately after passage of the initiative, the Washington State Liquor Control Board (LCB) set forth a plan to begin exiting the business of selling and distributing alcohol.

Challenge: Initially, the LCB informed stakeholders that in order to comply with the timelines set forth in the initiative, product would be limited to only those suppliers who agreed to sign a “buyback agreement” – which translated to a supply reduction of nearly 25 percent. Additionally, the plan called for the end of all special orders. The WRA responded immediately, with concern about the thousands of businesses who continued to be dependent on the state for their supply until March 1, when distributors and distillers were allowed to enter the market. The LCB responded, and we were able to reach an agreement that allowed restaurants to continue special orders and roughly 99 percent of product to be carried while the state remained the sole supplier.

Success: The initiative also called for each state store to be auctioned off to 10 | www.WRAhome.com

highest bidder. These locations, along with the contract liquor stores, would be the only businesses permitted to sell spirits in locations under 10,000 square feet. Recently, the bidding process was completed, generating nearly $31 million for the state and far exceeding expectations. This will allow for more than 166 independent businesses to enter the private market, generating millions of tax dollars for Washington.

shared warehouse among licensees was permissible, but permanent physical barriers were necessary to separate product purchased from different licensees. Obviously, this made the ability for cooperatives, a key feature of the initiative, nearly impossible. The WRA participated in a cooperative stakeholder process to reexamine the language and find common ground to allow co-ops.

Success: With the directive to cease the operation of retail stores, hundreds of state employees were displaced.

The private sector generously agreed to assist in the transition by offering preferential treatment to liquor store clerks. Contained in the budget passed by the Legislature this year, was a budget proviso extending additional benefits for those employees who agreed to stay longer with the LCB to see to the divestment. Additionally, the LCB reported the early closure of more than a dozen stores, on account of employees being placed in new private sector jobs.

Ensuring Public Safety Initiative 1183 also called for appropriate public safety controls, as the sale of liquor transitioned to the private sector. Additional training requirements were put in place, as well as doubling of penalties for sales of spirits that are out of compliance above and beyond that of beer and wine.

Implementation of immediate changes: 30 days after an initiative is passed, it becomes law. Accordingly, several things became law that were not tied to a specific date.

Success: Several tied house changes became effective December 8, 2011: central warehousing for spirits and wine, a wine retailer reseller endorsement allowing for retail-toon premise retail sales for wine and the prohibition on quantity discounts was repealed. Endorsements were issued to grocery licensees to allow for retail-to-on-premise retail sales of wine, and licensees now enjoy the ability to negotiate for quantity discounts for wine and, beginning June 1, for spirits.

Challenge: Initially, the LCB interpreted the language to allow for central warehousing to mean a

Success: Specifically, the initiative calls for retailers to be adequately trained to prevent sales to minors and inebriated individuals. Accordingly, the LCB certified Mandatory Alcohol Server Training, (MAST) as an acceptable training program. The MAST program is what our industry has successfully used to train our employees for decades. The WRA is excited to begin working with our partners to train employees entering into this market.

Creation of 2 new license types: As spirit sales transition to the private market, two new licenses are created: a spirits distributor license, to transfer product at the wholesale level; and a spirits retail license, to sell product to the general public and on-premise licensees.

Success: During this past legislative session, the WRA engaged in several conversations about possible legislation to change the licensing requirements approved by voters. One argument centered on the obligations for the spirits distributors; that they must contribute $150 million to the state by March 31, 2012. While this issue was

hotly debated during the campaign, some stakeholders continued to voice their opinion contrary to what voters approved. They argued, among many other nonsensical claims, that this would prevent distributors from entering the market. As of May, the LCB had issued more than 50 spirits distributor licenses.

Challenge: Spirits retail licenses also came with obligations approved by voters. One of those obligations was that if a retailer wanted to sell to a restaurant, they had to do so in 24-liter segments. While the obligation is somewhat odd, it is a product of stakeholder negotiation during the drafting of the initiative. At the time, distributors asked to have retail-toon-premise retail sales restricted. The WRA objected, as an important aspect of privatization was a competitive market. The agreed-upon language called for sales to take place in 24-liter amounts, but no restrictions on the number of transactions. This gave a slight advantage to distributors, but allowed for a retailer to become a primary supplier for a restaurant if a preferable business arrangement was offered by a retailer. At the insistence of distributors, a daily limit of 24 liters was imposed by the LCB. This policy decision is inconsistent with the intent of the initiative and is an inappropriate intrusion into a private market. The WRA will continue to pursue the policies contained in the initiative, whether the outcome come by way of a legal remedy or legislative remedy.

Challenge: Spirits retail licenses also require a 17 percent licensing fee on retail spirit sales. Again, after pressure from distributors, the Board has interpreted this fee to apply to all sales – even sales for resale to restaurants.

This will again put retailers at a competitive disadvantage, far beyond what was contemplated and approved by voters.

Establishing a competitive market The most beneficial component for restaurants in 1183 is the creation a private market, based on principles of competition. Spirits sales for restaurants and bars comprise nearly 30 percent of sales in a $900,000,000 industry. For the first time in Washington’s history, we will have the option to choose our supplier based on customer service, pricing and other business decisions. Washington is now unlike any other state in the country, as we now have more options than anywhere else. June 1, 2012, will mark the very beginning of a fully realized private market for spirits.

Challenge: Under Initiative 1183, a private market is established, allowing for the first time in history competition for our business. Competition will come from manufacturers, as distillers are now permitted to sell directly to retailers; from distributors, as the initiative creates a license to distribute spirits; and from other retailers as a privilege given to spirits retail is retailto-on premise retail sales. This means that competition from a private market will incentivize efficiencies, innovation and competition with customer service options and pricing.

However, the Washington Restaurant Association has experienced significant challenges with the LCB through the rulemaking process to implement the initiative. While the Board has yet to adopt final rules, it appears based on numerous public statements, they have decided to adopt policies inconsistent with the initiative that seek to limit competition and a competitive market from forming.

Specifically for our industry – a limitation on the amount of spirits we are allowed to purchase per day from a retailer, as well as imposing a 17 percent retail fee on sales for resale to restaurants. The WRA has been very vocal that this represents

an inappropriate intrusion into a private market, and that the voters overwhelmingly decided in November that was no longer an appropriate role for the state of Washington. We will continue to work for a resolution until we are ultimately successful.

Success: While it may be difficult to see through the frustration of the policies being contemplated by the Board, there are industry sectors emerging eager to compete for our business. At the May 24 Liquor Control Board meeting, the room was filled with contract liquor store owners, new state store owners, grocers and retailers, all voicing their opposition to the anti-competitive policies contained in the rule package. Each of these new industry segments are vying for the opportunity to do business with our industry, and serve our needs – for the first time in history.

The positions held by the Liquor Control Board are disappointing, to say the least, but we will ultimately be successful – we need only to look a few short years back.

In 2009, when the Legislature was charged with the task of filling an unprecedented budget gap, they swept the funds from the Liquor Control Board, and directed the LCB to increase their markup or create efficiencies to make up the difference.

The Legislature also directed the LCB that if they decided to increase the markup, that it would not apply to restaurants. Then, like now, the LCB decided to ignore legislative intent, and hiked our prices anyway, over our objections. Ultimately, we prevailed and the LCB was forced – through legislation, to follow through with the original intent. History shows that we ultimately will prevail. As the state exits its 80 year long role as our supplier, we look forward to putting these challenges to rest and moving forward with a positive, cooperative relationship with the Board.  June 2012 | 11

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ConSERVESM helps restaurateurs lower costs and embrace sustainability

By Shawn Sullivan

As we head into the second half of 2012, restaurateurs in Washington continue to search for ways to reduce costs, hoping to avoid menu price increases. Minimum wage is now higher than $9, and with the continually climbing food prices, restaurant owners and managers need to find innovative ideas to lower expenditures.

operation may seem extremely complex, but existing program members say thinking big but starting small produces quick results.

These issues are why the Washington Restaurant Association (WRA) worked closely with the National Restaurant Association (NRA) to launch ConSERVESM. ConSERVE is a new program designed to maximize cost savings in all facets of your restaurant, including energy and natural gas consumption, waste and recycling programs or even ways to reduce water usage—all with a strong emphasis on sustainability.

With a grant from the WRA, the University of Washington identified several best practices for energy efficiency in the foodservice industry. With the assistance of the WRA and the NRA, they developed complimentary educational resources supporting their findings, which can be reviewed on the ConSERVE website.

It can be as simple as turning off the lights when leaving a room, powering down point of sale systems at night, or shutting down kitchen appliances immediately after each use. These practices do not require any monetary investment, and reduce usage that could potentially lower your energy bill.

The NRA launched this energy program to respond to consumers, who continue to drive the restaurant industry to act on sustainability. “ConSERVE came from the industry,” Chris Moyer, Senior Project Manager for ConSERVE said. “Our members wanted an online resource where they could learn how to make their business more sustainable. Thanks to ConSERVE, they got one.”

Starting the program is easy. WRA members can register online to take advantage of several tips to start lowering consumption immediately.

“Since sustainability is always changing, it makes sense that ConSERVE is able to do the same from an online platform,” Moyer said. New advances in technology and sustainable processes can be included quickly on the website.

How does this program help reduce the bottom line? It redirects attention toward products and processes designed to reduce consumption. “ConSERVE pays for itself over time,” said Scott DeFife, NRA Executive Vice President, Policy and Government Affairs. “The more restaurant operators implement best practices, the more savings accrue. Our members have seen significant savings – sometimes even from implementing just one best practice.”

ConSERVE charges a nominal annual administrative fee, but the program usually pays for that within the first month of participation.

Right now, newly enrolled members located in Puget Sound Energy’s service district have the added benefit of a one-on-one review with PSE officials on sustainability. PSE will also review several programs and best practices only available to ConSERVE through a partnership between the NRA, the WRA and Puget Sound Energy.

All of the programs and practices on the ConSERVE online platform were developed in conjunction with some of the country’s most successful restaurants, scientists from the University of Washington, government officials and the NRA. Transforming a restaurant into an energy-efficient

With the cost of food, labor and supplies, Washington restaurants need to cut costs without sacrificing quality.

ConSERVE can help lower the cost of doing business through programs and practices designed to significantly reduce utility consumption. Contact the WRA today so they can help you stay in business.  To enroll in ConSERVE, please contact WRA’s Kristina McLeod at 800.225.7166 extension 135, or by visiting www.conserve.restaurant.org.

June 2012 | 13

Death of the daily deal

By Genesis Kobos, contributing writer

The daily deal marketplace is rapidly evolving.

Does this mean it’s getting better or worse for fullservice restaurant operators?

and volume. Huge discounts are needed to hook that cheap audience and huge volume ensures that all of them can participate (remember the deals sites are paid for each transaction).

My experience with the LivingSocial sales rep confirmed this.

I called on behalf of my wife’s podiatry practice, exploring the idea of running a deal for custom-crafted orthotics. It seemed like a good target; orthotics are expensive and frequently not covered by insurance. My wife had a new doctor joining her practice, so accepting a large volume of new patients even at a steep discount seemed like a reasonable idea.

Here’s the last sentence the LivingSocial sales rep got out before I hung up on him. “You can’t think about making money today…this is a marketing investment in the future of your business!” And that’s when I knew the daily deal was dying.

In 2011, we saw daily deals, led by the meteoric rise of Groupon, go from the newest new thing to yesterday’s news. Restaurants initially embraced the idea; and who wouldn’t? The promise of legions of new customers, who had never heard of an establishment, dropping by to fill up those empty tables on Tuesdays at 4:30 sounded so good.

Of course, this isn’t what happened. Some restaurants were mobbed; others saw those “new customers” once, never to return. None profited and rarely was that off-peak seat filled with a newbie who became a regular, loyal patron.

The success of daily deals site requires two things to keep their legions of penny-pinching fans happy: huge discounts

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It was when we got into the economics that I realized this approach was a very bad deal for my wife . . . as it would also be for restaurants. While custom orthotics run around $600, about $200 of that is for material and manufacturing. The LivingSocial rep pointed to an orthotics deal done in Texas on Groupon— a $450 product discounted to $175. At this price, we’d be losing money on every transaction AND the salesman

was pushing for a guarantee of at least 250 units . . . which would have resulted in an immediate loss of over $6,000.

Deal economics for restaurants are even less appealing. A large portion of a restaurant’s cost structure is made up of variables; i.e., each meal has individual costs, from the ingredients, to the cooking, serving and cleaning up. Deep discounts quickly eat through the direct costs (overhead like rent) and then cut into the variable cost, resulting in a loss to the restaurateur. Because the margins for restaurants are so slim, it’s very easy to quickly eat into those variable costs creating a situation in which restaurants are actually paying diners to eat.

I looked at the makeup of the deals coming out of daily deal sites such as LivingSocial over time, comparing a month in early 2011 (when they were all the rage) to January of this year.

With an admittedly limited data set, this is what I found:

10 percent of the deals were for restaurants in both 2011 and 2012.

There was growth in travel, which now accounts for more than a quarter of the deals.

The strongest appearances consistently come for offers like “Yoga class” or “One-hour massage.”

While I was expecting to see a huge drop-off in restaurant deal activity, it turns out restaurateurs have mostly stayed out of the daily deals world because of the economics of their business.

The percentage of costs that are variable are simply too high to make it work.

Now consider the strong categories of beauty and services, where the primary cost is variable BUT that cost is generally one person’s time (a yoga instructor, for example). Ms. Yoga Teacher can either make $60 an hour or $20 an hour, but she’s probably not going to lose money. Now consider travel, the one category that showed extensive growth. The variable costs of, say, a hotel room (a maid’s time to remake the bed and replace a tiny bar of soap) are miniscule compared to the customer’s cost of the room. With these tiny costs, deep discounts, even at volume, make sense. Thus the growth in daily deal travel activity.

Because the margins for restaurants are so slim, it’s very easy to quickly eat into those variable costs creating a situation in which restaurants are actually paying diners to eat.

We’ve seen the failure of daily deals across many large sites.

Last year, Facebook dropped their daily deals, followed quickly

by Yelp. OpenTable, which was never able to get daily deals proceeds to cross two percent of their revenue, dropped the business in late 2011. Even the grandfather of daily deals, Groupon, saw its traffic decline by 50 percent during 2011, according to a report in Forbes.

At Urbanspoon, we ran a discount promotion for a month in Seattle with 14 area restaurants offering 25 percent off. We didn’t want to inundate restaurants with diners at popular times, so we limited the deal to off-peak tables. We advertised heavily on our site and added the deal to our newsletter for Seattle residents. The result? Nothing. No change. Zilch.

Turns out a discount can’t make people book reservations for undesirable times or dates.

For restaurants, losing money on a diner is one thing; but making up for it with volume is a direct path to shutting your doors for good.  Genesis Kobos is contributing writer from Urbanspoon

June 2012 | 15

16 | www.WRAhome.com

June 2012 | 17

2012 Food and Menu Trends From Restaurant Association Reports

Locally Sourced Food Remains Hot in 2012

with more than nine out of 10 adding libations in 2011 and planning to add more in 2012.

Today’s restaurant customers are hungry for the latest trends and eager to test their knowledge of food and beverages. Restaurateurs who update their menus to reflect the latest taste sensations — while keeping their regulars happy — will have an edge over their competitors.

Nine out of 10 operators in both fullservice and limited-service segments said their customers are more knowledgeable and sophisticated about food and beverages than ever, prompting restaurateurs to incorporate new items. A majority of fullservice operators (nine out of 10) said they added new food items in 2011 and a similar proportion planned to do so in 2012. Eighty-three percent of quickservice operators and 77 percent of fast-casual operators said they planned to expand their food offerings in 2012.

Roughly one-half of quickservice operators added beverages in 2011 and plan to do so again in 2012.

Fine-dining operators are the most likely to expand the beverage menu,

Hot Plates The National Restaurant Association’s “What’s Hot in 2012” survey of nearly 1,800 professional chef members of the American Culinary Federation found that children’s nutrition and local sourcing will be the hottest trends on restaurant menus in 2012.

The top-10 menu trends for 2012 are locally sourced meats and seafood, locally grown produce, healthful kids’ meals, hyper-local items, sustainability as a culinary theme, children’s nutrition as a culinary theme, glutenfree/food-allergy conscious items, locally produced wine and beer, sustainable seafood, and whole-grain items in kids’ meals. Rounding out the top-20 hot menu trends are newly fabricated cuts of meat, farm/estatebranded items, food trucks/ street

Tasteful Additions

Proportion of operators who added new food/beverage items in 2011 or planned to add new items in 2012 Family Casual Fine QuickFast Dining Dining Dining Service Casual Added new food item in 2011

92%

90%

98%

86%

79%

Added new beverage item in 2011

72%

81%

94%

51%

74%

Plan to add new food item in 2012

92%

92%

99%

83%

77%

Plan to add new beverage item in 2012

73%

84%

97%

47%

55%

Source: National Restaurant Association, Restaurant Trends Survey, 2011

Fullservice Restaurant Trends for 2012

Top

20

1. Locally sourced meats and seafood 2. Locally grown produce 3. Healthful kids’ meals 4. Hyper-local sourcing (e.g., restaurant gardens) 5. Sustainability 6. Children’s nutrition 7. Gluten-free/food allergy conscious 8. Locally-produced wine and beer 9. Sustainable seafood 10. Whole grain items in kids’ meals 11. Newly fabricated cuts of meat (e.g., Denver steak, pork flat iron, Petite Tender) 12. Farm/estate-branded ingredients 13. Food trucks/street food 14. Micro-distilled/artisan spirits 15. Artisan/house-made ice cream 16. Health/nutrition 17. Non-traditional fish (e.g., branzino, Arctic char, barramundi) 18. Fruit/vegetable children’s side items 19. “Mini meals” (e.g., smaller versions of adult menu items) 20. Culinary cocktails (e.g., savory, fresh ingredients, herb-infused) Source: National Restaurant Association, “What’s Hot in 2012” Chef Survey, 2011

18 | www.WRAhome.com

NRA 2012 Restaurant Industry Forecast

food, artisan spirits, house-made/ artisan ice cream, health/nutrition as a culinary theme, nontraditional fish, fruit/vegetable kids’ side dishes, children’s mini meals (smaller versions of adult menu items), and culinary cocktails.

The “What’s Hot in 2012” survey also scouted out technology trends impacting the industry.

About one-quarter of the chefs (26 percent) ranked smartphone apps(applications) as the hottest technology trend in restaurants in 2012; another 25 percent said tablet computers — such as using iPads for menus and wine lists — will be the top technology trend. Sixteen percent said social media would be the top trend, while the same percentage said mobile/wireless/pay-at-thetable payment options would be the most popular and 4 percent picked QR codes. The Association surveyed 1,791 American Culinary Federation member chefs from October to November 2011 and asked them to rate 223 individual food items, beverages, cuisines and culinary themes as a “hot trend,” “yesterday’s news” or “perennial favorite” on restaurant menus in 2012.

For complete “What’s Hot in 2012” survey results, video and downloadable images, go to www.restaurant.org/ foodtrends.

Healthful Kids’ Meals Still Lead Limited-Service Menu Trends

For the third consecutive year, healthful kids’ meals topped the list of hot trends on limited-service menus, according to the Association’s 2011 Restaurant Trends Survey.

Limited-service operators were asked to rate a list of 68 food and beverage menu items as a “hot trend,”

A Hankering for Home-Grown Food Consumer demand for locally sourced food items continues to grow, with 72 percent of adults saying they are more likely to visit a restaurant that offers locally produced food items. Operators confirm this trend, as 83 percent of fine-dining operators and 71 percent of casual-dining operators said their customers are more interested in locally sourced menu items than they were two years ago. Demand for locally sourced items is not as strong in the family-dining and limited-service segments. To meet the growing consumer demand, many operators are adding locally sourced food items to their menus, particularly in the fullservice segment. Eighty-seven percent of fine-dining operators offer locally sourced produce, while 73 percent offer locally sourced meat or

Seeds of Change Proportion of operators who said their customers are more interested in locally sourced menu items in 2011 than two years ago 100

71%

80 60

83%

47%

42%

40

54%

20 0

Family Casual Fine QuickFast Dining Dining Dining Service Casual Source: National Restaurant Association, Restaurant Trends Survey, 2011

seafood. In addition, one out of four fine-dining operators said they offer food items from an on-site garden at their restaurant. 

Picked Fresh

Proportion of restaurant operators offering the following food items Family Casual Fine QuickFast Dining Dining Dining Service Casual Locally sourced produce

56%

63%

87%

28%

45%

Locally sourced meat or seafood

38%

54%

73%

10%

15%

Food items from an on-site garden

9%

8%

25%

2%

2%

Source: National Restaurant Association, Restaurant Trends Survey, 2011

“yesterday’s news” or “perennial favorite” for 2012.

Healthy fare for kids dominated the limited-service list, with fruit/ vegetable sides in kids’ meals ranking second, and low-fat/nonfat milk or 100 percent juice options in kids’ meals coming in fourth.

NRA 2012 Restaurant Industry Forecast

The limited-service segment also is on the quest for local items — locally sourced produce ranked fifth and locally sourced meat/seafood ranked 11th on the list of hot limited-service menu items. Other dishes making the top 10 were gluten-free items, lower-sodium items, spicy items, lowercalorie items, mini desserts/dessert bites, and lower-fat items.  June 2012 | 19

Limited-Service Limited-Service Restaurant Trends for 2012

Consumers Lean Towards Healthful Foods

Menu Trends Top

20

1. Healthful kids’ meals 2. Fruit/vegetable sides in kids’ meals 3. Gluten-free items 4. Low-fat/non-fat milk or 100% juice options in kids’ meals 5. Locally-sourced produce 6. Lower-sodium items 7. Spicy items 8. Lower-calorie items 9. Mini-desserts/dessert bites 10. Lower-fat items 11. Locally-sourced meat or seafood 12. Sustainable food items 13. Whole grain bread 14. Artisan/house-made items 15. Snack-sized items 16. Energy drinks 17. Flavored/enhanced water 18. Organic items 19. “Build-your-own” items 20. Sweet potato fries Source: National Restaurant Association, Restaurant Trends Survey, 2011

Inventive new dishes help keep limitedservice menus fresh and exciting, but perennial favorites still have their loyal fans. Soft drinks and French fries topped the list of perennial favorites at limitedservice restaurants, followed by iced tea, beef items, poultry items, hamburgers and cheeseburgers, chicken sandwiches, side salads, bottled water, and milk.

Limited Service Perennial Favorites Top 1. Soft drinks 10 2. French fries 3. Iced tea 4. Beef items 5. Poultry items 6. Hamburgers/cheeseburgers 7. Chicken sandwiches 8. Side salads 9. Bottled water 10. Milk

Healthful Choices

Proportion of adults trying to eat healthier now at restaurants than they did two years ago

Source: National Restaurant Association, Restaurant Trends Survey, 2011

Making Room at the Table for Mother Nature The interest in environmentally friendly dining continues to grow, particularly in higher-check fullservice restaurants, according to the Association’s 2011 Restaurant Trends Survey. Fifty-eight percent of fast-casual operators said their customers are more interested in environmentally friendly menu items, while roughly one-half of quickservice and family-dining operators reported similarly.

From the consumer perspective, 55 percent of adults said they are more likely to visit a restaurant that offers food that was grown or raised in an organic or environmentally friendly way. 

More Consumers Relish Green Cuisine

Proportion of operators who said their customers are more interested in environmentally sustainable menu items in 2011 than two years ago 80 70 60 50 40 30 20 10 0

67%

78% 50%

47%

Family Dining

Casual Dining

Fine Dining

QuickService

Although the rocky economy may make customers crave comfort food, a solid majority of consumers said they are leaning toward healthier items when dining out. According to the Association’s 2011 National Household Survey, 72 percent of adults said they are trying to eat healthier now at restaurants than they did two years ago. Women (78 percent) were more likely than men (65 percent) to agree with that statement, while younger adults are more likely than older adults to make that claim. A majority of restaurant operators across all segments concur that customers are paying more attention to the nutritional content of their food than they did two years ago. 

58%

Fast Casual

Source: National Restaurant Association, Restaurant Trends Survey, 2011

80 70 60 50 40 30 20 10 0

74%

73%

76%

18-34

35-44

45-54

72%

55-64

Source: National Restaurant Association, Restaurant Trends Survey, 2011

65%

65 or older

More information on healthful kids’ meals …

The National Restaurant Association launched the Kids LiveWell program in 2011 in collaboration with Healthy Dining to help parents and children select healthful menu options when dining out. Restaurants that participate in the voluntary program commit to offering healthful meal items for children, with a particular focus on increasing consumption of fruit and vegetables, lean protein, whole grains and low-fat dairy, and limiting unhealthy fats, sugars and sodium.  Visit www.restaurant.org/kidslivewell.

20 | www.WRAhome.com

NRA 2012 Restaurant Industry Forecast

2012 Top Trends by Category APPETIZERS

KIDS’ MEALS

1. Vegetables/vegetarian appetizers 2. Ethnic/street food-inspired appetizers (e.g., tempura, taquitos, kabobs) 3. Charcuterie plates/samples 4. Amuse-bouche/bite-size hors d’oeuvre 5. Warm appetizer salads

1. Healthful kids’ meals 2. Whole grain items in kids’ meals 3. Fruit/vegetable children’s side items 4. “Mini meals” (e.g., smaller versions of adult menu items) 5. Oven-baked items in kids’ meals (e.g., baked chicken fingers, ovenbaked fries)

SIDES/STARCHES

PRODUCE

1. Non-wheat noodles/pasta (e.g., quinoa, rice, buckwheat) 2. Black/forbidden rice 3. Quinoa 4. Red rice 5. Vegetable pickles

1. Locally grown produce 2. Organic produce 3. Superfruits (e.g., acai, goji berry, mangosteen) 4. Exotic fruits (e.g., rambutan, dragon fruit, paw paw, guava) 5. Heirloom apples

DESSERTS

ETHNIC CUISINES AND FLAVORS

1. Artisan/house-made ice cream 2. Bite-size/mini-desserts 3. Savory desserts 4. Deconstructed classic desserts 5. Dessert flights/combos

MAIN DISHES/CENTER OF THE PLATE

1. Locally sourced meats and seafood 2. Sustainable seafood 3. Newly fabricated cuts of meat (e.g., Denver steak, pork flat iron, Petite Tender) 4. Non-traditional fish (e.g., branzino, Arctic char, barramundi) 5. Half-portions/smaller portion sizes

PREPARATION METHODS

OTHER FOOD ITEMS/INGREDIENTS

1. Artisan/specialty bacon 2. Artisan cheeses 3. Ancient grains (e.g., khorasan wheat, spelt, amaranth) 4. Greek yogurt 5. Ethnic cuisine cheeses (e.g., queso fresco, paneer, lebneh, halloumi)

CULINARY THEMES

1. Pickling 2. Fermenting 3. Sous Vide 4. Liquid nitrogen chilling/freezing 5. Oil-poaching

BREAKFAST/BRUNCH

1. Ethnic fusion cuisine 2. Peruvian cuisine 3. Regional ethnic cuisine 4. Cuban cuisine 5. Southeast Asian cuisine (e.g., Thai, Vietnamese, Malaysian)

1. Hyper-local sourcing (e.g., restaurant gardens) 2. Sustainability 3. Children’s nutrition 4. Gluten-free/food allergy conscious 5. Farm/estate-branded ingredients

1. Ethnic-inspired breakfast items (e.g., Asian-flavored syrups, chorizo scrambled eggs, coconut milk pancakes) 2. Traditional ethnic breakfast items (e.g., huevos rancheros, shakshuka, ashta, Japanese) 3. Fresh fruit breakfast items 4. Prix fixe brunches 5. French toast/stuffed French toast

Download the full results of the National Restaurant Association’s “What’s Hot in 2012” Chef Survey plus watch and share the videos at www.restaurant.org/foodtrends.

NRA 2012 Restaurant Industry Forecast

June 2012 | 21

Allied members—who are they and why are they important?

By Ken Wells, allied relations manager Webster’s Dictionary defines the term allied as “having or being in close association, like a marriage, or joined in alliance.”

Several years of experience running restaurants taught me that allied companies are more than just associates, they are partners. Maybe not in the traditional sense, but that’s what they meant to me. Allied companies are more commonly referred to as vendors, distributors, suppliers, manufacturers or professional service companies—basically anyone who does business, supporting restaurants.

You couldn’t be in business without them.

You need them, and they need you.

You want to do business with professionals that care about the industry, and have as much passion about your success as you do.

Think about where you would be without any products to cook. Who could you call when you get in a jam?

There would be no one to help. Where do you go when you have problems to solve? Who would have the answers you need to succeed?

It’s the relationship with companies providing products and services that most operators take for granted. The allied community keeps their clients up-to-date on trends, provides solutions to problems and stands beside their partners in the trenches when needed most.

It’s ironic when the attitude shifts from a partnership to the cliché “why do I need you when there are 10 other companies that provide the same thing?” Restaurateurs sometimes get in the habit of treating vendors and suppliers like their guests sometimes treat restaurant staff.

“I can buy your product anywhere, what makes you so special,” is a phrase allied companies hear often, and they are expected to stand there with a smile and take it. At the same time, they are desperately trying to help their customer turn a profit.

Most of them understand the importance of building success through relationships, but it is always one or two bad apples that spoil the entire pie.

That is where the Washington Restaurant Association comes into play. The WRA has developed strong relationships with allied companies, working with them to improve the quality of service they provide to WRA members. Most allied members 22 | www.WRAhome.com

When a restaurateur has a bad experience with a vendor not affiliated with the WRA, or if that company makes a mistake, it can take a lot of time and effort to make things right—in some cases things are never made right.

“

“

of the WRA offer special rates, discounts or added services, just because you are a member restaurant.

In that same situation, but using a WRA allied member, the WRA will jump in on your behalf to make things right. They have built strong working relationships with all of their allied members, and will not hesitate to contact them when problems arise.

When looking for providers and service companies, here are some of the reasons why it is important to use WRA’s allied members;

They invest money and time to support the Association in keeping OUR industry healthy

Given the chance, they often provide solutions at a fair price

Like you, they are in it for the long haul, and prove it by being a WRA member They always act very professional in everything they do Your success becomes their success and vice versa

You want to do business with professionals who care about the industry, and have as much passion about your success as you do.

When looking for a new vendor to provide service, give the WRA’s allied community the opportunity. They will meet or exceed your expectations! Visit the WRA Marketplace at www.wrahome.com/resources/wra-marketplace, or call 800.225.7166, extension 126 for a suggestion. The WRA is always happy to help connect members to their next great vendor relationship.  Ken Wells is the WRA’s Allied Relations Manager. He has more than 20 years of experience managing, owning and operating restaurants around the United States. His expertise in restaurant operations gives him the experience necessary to represent the WRA’s allied community, and welcomes all companies supporting restaurants to join the WRA. He can be reached at 425.457.1458.

Why should you use SSA—Serve Safe Alcohol? Ask Kristina!

By Lyle Hildahl, director of the Education Foundation

The Washington State Liquor Control Board (LCB) will be out of the business of selling spirits by the time you read this article.

What will they be spending more time doing after June 1?

The LCB will be putting more resources toward education and enforcement to ensure public safety. As an operator you should anticipate liquor enforcement officers conducting more compliance checks or “stings,” as we call them in the industry. I believe the majority of the liquor enforcement officers will take an educational approach rather than enforcement. The objective here is to facilitate safe practices and encourage methods for making those practices routine.

To insure that your team is not in violation during a “sting,” be sure they have their current Class 12 or 13 permits. That’s where ServSafe Alchol (SSA) comes into play.

Lyle Hildahl, WRA Education Foundation director

were found in violation of serving a minor, serving a visibly intoxicated guest and light levels were too low to clearly read customers’ ID cards. Three violations in one sting! All of my staff members were trained and had current Class 12 and 13 permits, yet I still was unable to effectively convey the importance of responsible alcohol service to everyone on my team. I realized that the training program was just one step, and the key was to follow that up with daily practice. The fact that everyone had a permit was not enough. ServSafe Alcohol can get you to “enough”—more than enough, in fact.

SSA has received many national awards for safety, and the NRA continues to work on upgrading the program to meet the needs of our industry.

SSA was developed for our industry, by our industry—which is just another reason you should support it as your training program of choice. It is of the highest quality delivered in two formats. It is price competitive and supports the WRA Education Foundation. As a member of the WRA, you can feel great about using a top-of-the-line training program that also benefits the WRAEF.

WWW.SSAWASHINGTON.COM

So, why should ServSafe Alcohol be your training of choice?

The Mandatory Alcohol Server Training division, known as MAST, has approved training programs to comply with the required Class 12 and 13 permit process. As a busy operator, you have many choices of training programs and will determine which is best for your team. We are here to help you make that decision.

ServSafe WA is a partnership between the WRA Education Foundation (WRAEF) and the NRA. This national and Washington-specific program is available in person and online.

After successfully completing the program, you receive TWO certificates—one for national competency and one from the WRAEF for state certification.

As a hospitality educator, I was certified in TIPS - Training for Intervention Procedures and MAST through the WRAEF… and now SSA. They are all good programs with many more independent programs listed on the WSLCB web site.

A few years ago I was the target of a sting at a restaurant I owned and operated right here in Washington state. We

Still not convinced? Think about this:

Recently we launched a new website for SSA and a whole new approach to customer support. It’s called “Ask Kristina,” and it allows you to ask our resident programs expert, Kristina McLeod, any questions you may have about SSA. Simply click the “Ask Kristina” link, and you’ll get the assistance you need.

Kristina is in constant contact with the NRA and the LCB, giving her the knowledge you need, when you need it.

Years ago the word on the street was, “Do you have your TIPS card?” The TIPS program had done such a good job of branding, that the Class 12 and 13 permits were called TIPS cards. My hope is that the word on the street will soon be, “Do you have your SSA card?”

It’s only a matter of time.

Visit www.ssawashington.com today to Ask Kristina.  June 2012 | 23

WRA legal team supports restaurants by working with state agencies

By Sandip Soli, Esq. of Cairncross & Hempelmann, P.S.

From the moment a restaurant owner decides to roll out a new restaurant concept, to when the customer pays and tips, the WRA’s legal team is working with governmental agencies to streamline implementation and mitigate potential issues. Here is a closer look at the relationships we have with each agency:

Washington State Liquor Control Board—We

Washington Secretary of State’s Office—

United States Department of Labor—Separate

We regularly work with the Washington Secretary of State’s Office to form new limited liability companies and corporations on an expedited basis, avoiding the several weeks that it might otherwise take to establish a legal entity within which the investors, lenders and the operator can start expending funds to commence restaurant operations.

Washington State Department of Licensing —We assist restaurants in obtaining state business licenses and registering statewide tradename/ trademark for restaurants. If financing equipment and trade fixtures is under a security agreement with a lender, we also assist in filing Uniform Commercial Code financing statements.

Local Building Departments—Restaurant

owners have called us to help resolve issues with building permits that prevent restaurants from opening, including occupancy requirements, compliance with the Americans with Disabilities Act, etc. We have also helped respond to neighbor complaints about restaurant odor issues.

24 | www.WRAhome.com

have significant experience obtaining liquor licenses on behalf of restaurant establishments, and working with the Washington State Liquor Control Board on premisespecific circumstances in each case. Currently, we are assisting the restaurant industry in the implementation of Initiative 1183, including new rules providing for central warehousing among restaurants/retailers, new liquor taxes that restaurants may pay and monitoring the auctioning of state liquor stores.

Washington State Department of Labor and Industries—Our collaborative working relationship

with the Department of Labor and Industries (“L&I”) allows us the opportunity to address issues proactively as we anticipate wage and hour, and safety issues, that affect the industry. Along with our affiliate attorneys, we are there to assist when employees file claims against restaurants.

from the state agencies, the federal government also has jurisdiction over federal wage-and-hour regulations, and has been active in implementing tip pooling regulations in the wake of the 2010 United States Court of Appeals decision, Cumbie v. Woody Woo, Inc., 596 F.3d 577 (9th Cir. 2010), allowing restaurants to mandate tip pooling.

We are working with the United States Department of Labor, so that we may properly advise restaurants on tip pooling policies. 

“Change me.”

SucceSS Through SuSTainabiliTy The conserve Sustainability SM education Program : delivering value and providing solutions Conserve uses a variety of easy-to-implement methods developed with subject matter experts from industry and authorities in environmental sustainability to help improve your operation’s efficiency every day while boosting your bottom line.

3 Best practices checklist with more than 90 environmentally-friendly practices 3 How-to videos to guide toward more sustainable practices 3 Personalized action plan 3 Money-saving techniques 3 Program awareness and promotion through the National Restaurant Association and media partners

Serve responsibly.

Get certified.

Do it online.

• Get your Washington state mixologist class 12 and 13 permits • Training program at your fingertips • Award winning program

Join today and start changing. conserve.restaurant.org

©2011 National Restaurant Association. All rights reserved.

The National Restaurant Association logo is a registered trademark of the National Restaurant Association. The Conserve Sustainability Education Program logo is a service mark of the National Restaurant Association.

ServSafeAlcohol_halfPageWRM.indd 1

5/29/2012 4:01:07 PM

INDUSTRY CALENDAR

Visit www.WRAhome.com/calendar for a full list of events.

Training | Meetings | Events | JUNE/JULY/AUGUST New Restaurants Al Boccalino Ristorante, Seattle Beignets et le Café, Spokane Browns Point Diner, Tacoma Browns Point Pizza, Tacoma

Training

Meetings

June 11

Allergy Certification

June 12

Spokane Chapter Meeting

June 12

ServSafe® Advanced Food Safety

June 19

MSC Board Meeting

Cafe Bengodi, Seattle

June 18

ServSafe® Advanced Food Safety

June 20

ServSafe Alcohol Train the Trainer

June 26

Board Development Conference Call

Carbonado Saloon, Carbonado

Aug. 28

ServSafe Alcohol Train the Trainer

July 3

Executive Committee Meeting

July 10

Spokane Chapter Meeting

Casa Mia Italian Restaurant, Lakewood

July 11

Seattle Restaurant Alliance Meeting Restaurants

Claim Jumper, Lynnwood

July 17

MSC Board Meeting

July 17

Finance Committee Meeting

Dairy Queen, Vancouver

Jul 23

Education Foundation Board Meeting

July 24

WRA Summer Board Meeting

Aug. 1

Seattle Restaurant Alliance Social Restaurants & Allied Partners

Buddy’s Whistle Stop, Yacolt

Dody’s Drive In, Moses Lake Fat Burger, Airways Heights & Spokane Fertitta Entertainment Inc., Houston Hana Sushi, Bothell

New Allied Members

Japonessa, Seattle

Proximo Spirits Matt McCarthy 9611 39th Ave SW Seattle, WA 98136-2800 206.854.7818 mmccarthy@proximospirits.com www.proximospirits.com

SkyFu Todd Spaits 534 16th Ave W Kirkland, WA 98033-4826 206.499.2879 todd@skyfu.com www.skyfu.com

1800, tequila, three, olives, vodka, kraken, rum, hangar, one vodka

SkyFu is a web based reputation management and social analytics tool for businesses that understand the value of social opinion and want to use it to their advantage.

McCormick & Schmicks, Seattle

Splango Media LLC Mate Hollos 1001 4th Ave Flr 44 Seattle, WA 98104-1119 360.556.4330 mate@splango.com www.splango.com

Rainforest Cafe, Tukwila

Recipe for Success, Inc. Deba Wegner 8041 NE 114th St Kirkland, WA 98034-3502 425.241.9023 deba@yourrecipeforsuccess.com www.yourrecipeforsuccess.com/index. html marketing, promotions, events, email, local store, branding, social, media, websites

social, media, marketing, loyalty, rewards, mobile, referral, Ipad, kiosk, advertising

Kokopelli Grill, Port Angeles Lady Luck’s Cowgirl Up Steakhouse & Saloon, Tacoma Mamnoon Restaurant, Seattle Marjorie Restaurant LLC, Seattle

Morton of Chicago, Seattle Naked City Taphouse, Seattle Pick-Quick Drive In, Seattle

Red Dragon Casino, Seattle Silver Wings Inc., Sumner Taco Time, Moses Lake Tony’s BBQ House, Sedro Woolley Watson Alpenhorn Café, Chelan Wine Tea Chocolate, Seattle Woody’s Tacos, Vancouver

26 | www.WRAhome.com

Can you afford to say “NO” to 45 million customers?

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We get you Allergy Safe Certified

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877.695.9733 www.wrahome.com

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Thinking about selling or buying an existing restaurant, or adding a new location? Call Allan Boden, Sunbelt restaurant specialist at 206.229.4717, or email a.boden@sunbeltnetwork.com. Sunbelt has been serving clients since 1982 with offices nationwide. http://seattle1.sunbeltnetwork.com

25 Year CPA and former restaurant owner can help you increase your bottom line, improve efficiency, plan an exit strategy and provide selling or buying services. Affiliated with business brokerage/intermediary firm of William E. Pearsall, P.S. Excellent references. Certified QuickBooks ProAdvisor. Call Jean Klein (206)795-4443. www. smallrestaurantspecialist.com

CONSULTATION, PLANNING, AND CONCEPT DEVELOPMENT

Thinking about opening up a new restaurant, moving into an existing, or re-modeling? DYNAMIK will provide a complimentary initial consultation to review your project.

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OWNERS GET PAID Who makes W.O.T.C. credits easy to capture? In 2012 will W.O.T.C. be ‘money left on the table’ or profits in your pocket? Contact Mike Lancey, MBA, EA, CHAE at (866) 547-8277, mike@mckenziechase.com. Mckenzie Chase Management serving Northwest clients since 1982. http://www.MckenzieChase.com

RESTAURANT FOR SALE Owner ready to retire! Great opportunity to own an established, year round stable drive-in business. Prime location. Close to Ephrata High School & Sports Complex.

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Ask the Expert | Restaurant Profit Coach

Four Simple Reports for Understanding Your Business

By Rick Braa, CHAE

Q: When I step back and take a look at my business, I know I need to spend more time analyzing sales information. Where do I start?

A:

The most underutilized tool in the restaurant industry is the Point of Sale System (POS). Reams of paper are used daily in support of a healthy business, but those wonderful reports are underused in decision making to move the business forward. Analyze POS reports from both a macro and micro level, and use various time parameters such as hours, days, weeks, months and year over year. To begin, focus on the macro level reports, specifically the following: Food and beverage sales percentage This key factor shows the percentage of sales in both categories. Typically, a higher percentage of beverage sales results in a more profitable business. Case in point, bars generally make more money than restaurants. Why? Not only does beverage cost typically have a better cost-ofgoods than food, but it takes less labor to produce and sell a beverage than it does for food. A great target is to run 30% of sales or better from beverage. Study beverage sales to ensure each item is being rung up, as well. The number one area of theft in a restaurant is beverage sales. More items are given away or not rung up in this area than any other profit center.

Percentage of the menu from fresh sheet (specials) and hard menu (core) This ratio shows the percentage of the fresh sheet of the sales categories. To use this ratio effectively to reduce cost and increase margin, engineer the fresh sheet five cost points lower than your core menu, while maintaining approximately the same average or better menu price in each category. For example, if the average menu item in the appetizer section is $9.00 and 30% cost, then offer a special priced at $9.00 or more and 25% cost. Using this technique will drop the average food or beverage cost by 1.5% and add a significant gross margin toward the bottom line. In addition, work with vendors months ahead to maximize seasonal pricing and drive a better cost.

Sales and Labor by hour of the day Studying sales and labor hour by hour will show the ebb and flow of sales and labor usage throughout the day,

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and will expose how labor is scheduled against sales production. This is one of the most enlightening reports available. Labor dollars should be scheduled as close to sales production as possible. For example, if a significant amount of sales dollars are earned between noon and 1 p.m., schedule prep production closer to lunch so the prep cooks can help the line through the rush. In the front, schedule more servers through the rush than before and after it. Most restaurants are too concerned about servers working enough hours to justify the commute to work. As a tipped employee, servers can earn a high hourly rate and be quite content.

Category sales as a percentage of the day part It’s surprising how many restaurant owners can’t answer a few simple questions off the top of their heads. Try it.

What percentage of your food menu are appetizer sales, side dish sales and dessert sales? The POS report will show appetizers, side dishes, entrees and dessert sales. On the beverage side, it will show the different types of beverage sold such as beer, wine, liquor and non-alcoholic beverages.

To continue the analysis, drill down further to see what types of liquor are selling; rum, vodka, whiskey, etc. in order to gain additional insight into guest preferences. Set a goal to increase appetizer, side and dessert sales by 10% in each category. Simply making the options available to every guest every time will increase sales and enhance the guest experience.

To maximize profitability in any restaurant it is important to have a number of levers to move up and down. Proper analysis will define those levers and proper management will move them in the desired direction. Using the Point of Sale system reports to highlight trends and shifts in consumer behavior can be the best use of time working on your business rather than in it. ď Ž For more information on building a world class company, improving profitability and driving sales, contact BRAA Associates at rbraa@braaconsulting.com. Rick Braa is the founder of BRAA Associates, a consulting firm specializing in helping companies grow profitability.

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