Washington Restaurant Magazine Jan 2013

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“Change me.”

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3 Personalized action plan 3 Money-saving techniques 3 Program awareness and promotion through the National Restaurant Association and media partners

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.

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New governor, new legislators, new session What can we expect?

Each legislative session brings a new slate of issues and priorities Governor for the WRA government affairs team. Find out what’s being done this session to protect and enhance your business.

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Mitigate the impact wage increase

This month, restaurant expert Rick Braa has plenty of solutions to manage the minimum wage increase as it affects your bottom line

Other stories 6

2013 Tech trends should help industry

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Congratulations, Governor Inslee

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New legislative environment in Olympia demands involvement

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Vendors can be your allies

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Crossing barriers between government and business: your education foundation can help

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Calendar/New Members

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Marketplace

On the cover

January 14 will herald the beginning of another legislative session, in which a new governor and 24 new legislators will assume leadership roles and bring new ideas to Olympia. This issue of Washington Restaurant Magazine is your guide for what to expect during Washington’s 2013 legislative session.

January 2013 | 5

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EDITORIAL STAFF Anthony Anton, Publisher Lex Nepomuceno, Executive Editor Heather Donahoe, Managing Editor Shawn Sullivan, Contributing Editor Sheryl Jackson, Research Editor Lisa Ellefson, Art Director WRA EXECUTIVE COMMITTEE Jim Rowe, Chair Consolidated Restaurants Phil Costello, Vice Chair Stop N Go Family Drive Inn Robert Bonina, Secretary/Treasurer Washington Athletic Club Bret Stewart, Immediate Past Chair Center Twist Nancy Swanger, WRAEF President WSU WRA EXECUTIVE TEAM Anthony Anton President and CEO Teran Petrina Vice President Bruce Beckett Director of Government Affairs Lex Nepomuceno Director of Communications & Technology Lyle Hildahl Director of Education Victoria Olson Director of Business Development Susan Howe Director of Internal Operations 510 Plum St. SE, Ste. 200 Olympia, WA 98501-1587 T 360.956.7279 | F 360.357.9232 www.warestaurant.org

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.

6 | |www.warestaurant.org warestaurant.org

2013 Tech trends should help industry How can they help your bottom line

By Lex Nepomuceno, Executive Editor It’s easy to defer to other restaurants and industry experts when deciphering how to take advantage of the latest technologies to improve operational efficiencies and sales. However, I would contend that being “customer savvy” is just as important as being “tech savvy” when determining how to utilize the latest advances in the restaurant business.

Customer empowerment appears to be a consistent theme among consumers for both full-service and limited-service establishments. Fifty-two percent of full-service customers would utilize electronic payment system at the table; and 44 percent of limited-service customers would like the option to place orders using a self-service customer-activated ordering terminal. What does this mean to the restaurateur?

Simply, diners want more control over their dining experience. They are willing to do part of the job of a server or order taker – thus, saving operators money.

It is important to recognize that technology must be familiar to the user. In the past, restaurants experimented with interactive kiosks and menus with little success because the technology wasn’t adopted by the masses yet. Once the iPad made tablet computing mainstream and not just something for tech-based professionals, it started making sense to develop consumer-facing applications.

Unfortunately, a significant technology gap exists amongst restaurants that take advantage of growing consumer demand for more technology conveniences.

According to the 2013 Restaurant Industry Forecast: Fifty percent of all adults, and 60 percent of frequent restaurant customers said they would like the convenience of a full-service restaurant’s smartphone application, with features such as viewing the menu, ordering takeout or delivery, and making reservations. Frequent customers also were more likely to say they would like to see menus offered on an iPad or electronic tablet, as well as the ability to pay using a mobile or wireless payment options, such as Google Wallet or a smartphone app.

Such high-tech convenience options are currently offered by fewer than 10 percent of full-service operators.

A natural concern for restaurant operators is cost. Tablets aren’t cheap and training staff to operate new software can take time and patience. However, business owners need to look at this issue as an investment and not just a new expense. In the end, better serving consumer desires to serve themselves can increase customer satisfaction and reduce errors.

“Savvy operators can take advantage of the fact that frequent restaurant customers are above-average users of technology to promote their restaurant and boost sales,” states the 2013 report. “Fifty percent of both frequent full-service customers and frequent quick-service customers said they have placed an online order for carry-out or delivery restaurant customers, roughly two-thirds have gone online for each of these restaurant-related activities.”

Customer-facing technologies have finally caught up with practical needs of a restaurant. It’s time for businesses to seriously look into deploying their own technology initiatives not just to compete with other food establishments, but to meet the needs of the customer. 

WRA has it’s

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The Washington Restaurant Association has launched a new, exciting way for members to reach potential customers! Join us on our radio show, DineNW, where we talk about Washington’s restaurant industry, and give listeners a taste of Northwest cuisine.

Listen from noon until 1:00 p.m. every Wednesday on KLAY Radio, 1180 A.M. www.klay1180.com www.facebook.com/dinenorthwest Interested in promoting your restaurant on DineNW?

WRA members pay nothing so contact Shawn Sullivan at shawn@wrahome.com.

January 2013 | 7

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Industry Outlook | WRA President & CEO

Congratulations, Governor Inslee Let’s put our heads together Welcome to office, Governor. We are the state’s largest private sector employer, and we believe our industry has enormous potential to grow and prosper, with the help of your vision and thoughtful leadership. We recognize that the challenges you face heading into office are great: a persistently troubled economy, unemployment that has struggled to stay below 8 percent and a business climate that often makes it difficult for entrepreneurs to thrive.

Our industry is prepared to help dig into these issues and, as you said on the campaign trail, get Washington working again. Restaurants are a powerful job creator, but we want you to be aware of the barriers our industry has faced in reaching its full potential. Because of the tough business climate in Washington, we employ three fewer workers per restaurant than the national average. Across 13,500 restaurants, that works out to 40,000 jobs we might otherwise be able to offer.

Washington’s challenging business climate also has contributed to stagnant wages for professional cooks, high teen unemployment and a five-year 50 percent closure or sell rate among restaurants. State policies have driven costs upward, consumers are resistant to pricing adjustments, profit margins are squeezed to a narrow four percent (and that’s in the best economic conditions), and food prices are at a record high.

We need your help in coming up with new policy ideas that will reverse these and other troubling trends in the restaurant industry.

We appreciate your enthusiasm for emerging opportunities in aerospace, technology and green energy. And, we are excited about working with you and your team to take those concepts to the small business sector, where the majority of jobs are created and maintained.

In response to a question from one of our restaurant operators, during your campaign last summer, you made clear your position on one of this industry’s most important issues. Under your administration, no version of a tip credit or minimum wage relief will be considered—period, no window to discuss. While we do wish you held a different view on this issue, we appreciate your honesty in letting us know exactly where you stand on this matter.

So, here is what we ask instead: If traditional ideas are off the table, will you and your team work with us—the state’s largest

Anthony Anton, president and CEO

private employer—to find new, acceptable solutions or ideas that can turn around Washington’s business climate for the state’s hardworking restaurateurs?

If successful in finding these solutions, we could create a new business climate for Washington—a climate where restaurant kitchens are able to gain another much-needed full-time worker. These positions are entry level and allow those who are seeking a career to gain skills and experience so they can begin climbing a ladder to success.

These solutions could help create a climate where restaurants return teen employment to the mid-1990s-level, back when the majority of Washington restaurants proudly gave teenagers their first job, taught basic job skills, instilled a work ethic and demonstrated the value and reward of earning a paycheck.

The majority of these teens gained invaluable experience and applied it to careers inside and outside the industry. Without these basic lessons of the working world, many kids enter the workforce unprepared and, as a result, are not seeing the same success of previous generations. We can reverse this together.

If we work collaboratively on solutions, we can create a Washington where money once again becomes available to ensure that a restaurant cook’s wages are competitive with the wages in the construction, short haul trucking and warehousing industries. Since the late 1990s, those other industries have seen wages grow with inflation and economic growth, while state-imposed cost increases on our industry, coupled with customer resistance to higher prices, have virtually frozen the wages of industrious cooks, dishwashers and other back of the house staff. Reversing this trend would create more living wage jobs that stabilize families, encourage personal growth and increase community stability.

Mr. Governor, together we must find a better way to create jobs, stability and career growth in the restaurant industry.

If we can envision together what a better Washington would look like, and commit to work together on solutions that are mutually beneficial to your administration’s goals and restaurant operators, we can achieve something truly remarkable for Washington state.

Congratulations, Governor Inslee. We look forward to working with you.  January 2013 | 9

New legislative environment in Olympia demands involvement

By Bruce Beckett

It’s an exciting time for the WRA’s Government Affairs team. Washington has a new governor, 24 new legislators, a dramatically different State Senate and yet another fiscal challenge. This is precisely the type of environment that your GA team thrives on – new decision makers, important issues and new challenges facing lawmakers.

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But we need everyone’s help to make sure that new policy makers are introduced to, and understand, the vital importance of this industry to the well-being of the state’s economy.

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Democrats continue to control the House of Representatives by about the same margin as previous years; however, the incoming “freshman class” of lawmakers is keenly aware of the importance of the small business sector, and much more concerned over the state’s economic condition. It makes sense – these new legislators are coming into office on the heels of the worst economic downturn since the 1930’s, and in a recovery that is very slow to gain traction.

In the State Senate’s unusual power-sharing arrangement, we can expect more cooperation between the parties, similar to what happened in 2012. That bodes well for all of Washington’s citizens. It also makes the WRA’s work on the hill more important. Members on both sides of the aisle will need to agree in order for ideas to move forward.

Gov. Inslee will be forming his administration at the outset of the legislative session—new leaders in the agencies, new policy staff and new leadership in positions in the Governor’s office.

Finally, while the state’s financial situation is greatly improved than in recent budget cycles, the state was tossed a curveball when the Supreme Court decided that the Legislature is not adequately funding basic education. The common view is that legislators need to come up with $1 billion of new resources for education to adhere to the Court’s findings – in addition to an expected $900 million shortfall.

The WRA GA team is well-positioned to operate in this environment. But we have some challenging priorities in front of us: •

The WRA will work to protect against increases in the cost of doing business in Washington State (workers

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compensation, unemployment insurance, and new state or local taxes).

The WRA will work to protect the industry’s ability to offer a cost competitive retrospective rating program to lower the costs of workers compensation insurance to our members, and to improve the safety performance for all the people who work in this industry.

The WRA will work with a broad coalition to implement I-1183, liquor privatization, as was voted in by Washington voters in 2011. I-1183 is the solution to the challenges facing businesses for supply of spirits; it is not the problem.

The WRA will continue to educate lawmakers on the challenges facing the hospitality industry from the minimum wage laws, and lack of tip credit.

The WRA will work with a broad stakeholder community to set the stage for some form of tourism promotion in Washington state.

Please get involved These are difficult priorities, and member involvement makes the difference. Plus, it’s really easy.

Here are your best options for making a difference in Olympia: •

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Dial in to the weekly Government Affairs Committee (GAC) conference calls. Your GA team receives its guidance from members in these calls. It’s also the opportunity to bring issues to our attention.

Join us for Hill Climb and the Taste Our Best Reception on January 28. You’ll be able to meet with your legislators, and help deliver the message of how important this industry is to Washington’s economy.

Reach out to your area coordinator, and consider becoming an Ambassador to your legislator and/ or making yourself available to respond to Action Alerts during the session. Don’t know who your area coordinator is? Contact Jennifer Hurley at jenniferh@ warestaurant.org or call 3602.956.7279, ext. 126.

Your WRA Government Affairs team is proud to work on behalf of this incredible industry. But we cannot do it without your guidance, help and willingness to engage.

We look forward to a productive session. Thank you for partnering with us to make that happen. 

January 2013 | 11

New Governor

New

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New governor, new legislators, new session What can we expect?

By Julia Clark and Bruce Beckett

If the November election reinforced anything, it’s that Washington voters are exceedingly independent and have very little appetite for taxes. For the fifth consecutive time, Washingtonians approved a two-thirds majority requirement of the Legislature to approve a tax increase.

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Both advisory votes that were required to appear on the ballot (after the Legislature with a two-thirds majority chose to increase taxes for the banking and oil industries) revealed that voters strongly disagreed with the Legislature’s decision to raise taxes in each case.

Voters are asking their lawmakers to maintain fiscal discipline, to not increase taxes or fees on individuals or businesses, to increase resources for education and protect socially progressive policies. These mixed messages create a nearly impossible task, given the state’s fiscal situation.

The political situation

The Legislature will again be faced with the task of adopting a balanced budget against a forecasted deficit.

The Washington State Economic Revenue and Forecast Council projects a modest $900 million shortfall in the upcoming biennium. This is a far better situation than the last biennium’s $6 billion shortfall and the multi-billion deficits of previous years. The $900 million projection does not, however, include the $1 billion needed to adhere to the Washington State Supreme Court’s decision that the Legislature was not adequately funding basic education.

The choice for lawmakers: Either devote significantly more of the state’s budget to basic education (hence, cut deeply into other state programs) or raise new revenues to meet the court’s decree.

New Session

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Changing House and Senate dynamics

The numerical make-up of Republicans and Democrats in both chambers remains relatively unchanged from previous years; however, both the House and Senate will experience substantial changes due to the outcome of the 2012 elections.

House of Representatives

In the House, Democrats continue to enjoy a 55-43 majority position. However, a large number of incoming freshmen Democrats appear to be much more concerned over the fragile state of the economy, from a business perspective, on difficult issues. It appears the House will be more favorable to business interests than in recent years.

Senate

In 2012, three Democratic Senators joined with Republican members to essentially “take over” the budget process, leading to a much more sustainable fiscal outcome than in previous years. With the re-election of Sen. Don Benton in the very tight 17th District race, Republicans have gained one seat in the Senate. Democrats hold a razor thin 26-23 majority. This is where it gets interesting.

On Monday, Dec. 10, Senate Republicans along with Sens.

Rodney Tom, D-Medina, and Tim Sheldon, D-Potlatch, announced a majority coalition, and with 25 votes, a new

power sharing structure for 2013. While the Senate Democrats and Republicans have both elected party leaders, Tom will be Senate majority leader. The new majority caucus has named a bipartisan lineup – six Democratic committee chairs, six Republican chairs and three bipartisan co-chairs. Although it appears this new majority caucus will prevail, the formal structure cannot be implemented until the Senate meets for its first session in January, leaving time for more potential changes in the structure.

Nonetheless, the WRA is encouraged that the make-up of both the House and Senate create the need for bipartisan cooperation on difficult issues such as fiscal policy, budgets and the super majority requirement for any tax increases.

Administration

Governor-elect Jay Inslee is forming his new team and cabinet. The WRA looks forward to establishing working relationships with the new administration during this period.

It is also clear that the new administration will face significant challenges in fashioning a spending plan that meets the Supreme Court’s decision on education funding along with other priorities established during the course of the year-long campaign.

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Washington Restaurant Association priorities Tax and Fiscal Issues

The WRA will continue to fight against industry-specific tax increases including: • B&O Tax Credit for Pop Syrup – Protect the $1 to $1 tax credit offset restaurant owners are entitled to receive.

• Street Utility Taxes – The WRA expects the Association of Washington Cities to again introduce and lobby for authorization to impose street utility taxes based on street usage by businesses.

• Licensing Fees – The WRA expects proposals to emerge to increase license fees tied to the use of those fees for enforcement and education.

• Sales Tax – In 2012, many lawmakers wanted to explore a hike in the sales tax to assist in balancing the budget. It is a broad-based tax that everyone pays, and a “small” change can add considerably to state coffers (a one-cent increase raises about $1 billion).

• Sales Tax on Services – Many services, such as legal and accounting services, are exempt from sales tax. Imposing sales tax on services could result in between $200 million and $1.26 billion in new revenue over the biennium. Because the tax is another “hidden cost” to business, it’s more difficult to pass on to customers.

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General B&O Tax Increase – Lawmakers increased the B&O tax in 2010 (Wasn’t this limited to specific sectors?), and they may turn to an additional increase as a “broad-based” business tax as part of their solution.

Labor unions and liberal interest groups will be pushing this tax in lieu of any general sales tax increase they consider regressive.

Local Government Tax Authorization – City and county governments throughout Washington are finding themselves in significant budget deficits. In addition, their options to increase taxes are currently limited to sales, B & O, utility and increasing fees for certain services they control and provide. This coming legislative session, more than any previous one, will include tremendous pressure from local government lobbying for new taxing authority. The WRA expects this to be a real threat and will directly engage when proposals are introduced.

Other revenue options

The WRA will continue work to build a coalition of business interests that share a common goal to reform Washington’s minimum wage law.

Gaming Like the last few years, the shortfall in revenue may create the opportunity for debate on if and how modifying current gaming restrictions could assist state and local governments, bringing new opportunities to full service restaurants that hold liquor licenses. The WRA team is exploring many options. Our goal will be to pursue proposals that can be successful at the legislative level and withstand a ballot challenge from tribal interests.

Labor •

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the Employment Security Department (ESD) shows a precipitous decline in teen employment over the last 10 years, leading to concerns that the emerging workforce is unable to get “on the job” training during their student years.

• The WRA will work with the Workforce Training Board, the Governor’s office and lawmakers to develop a strategy that could include elements that support programs such as ProStart.

Tip Pooling – The WRA, along with the National Restaurant Association, and our counterparts in Oregon and Alaska, filed a challenge to the rules adopted by the Federal Department of Labor that negate the Ninth U.S. Circuit Court of Appeals’ earlier decision that restaurants could require pooling of tips under certain circumstances. The challenge, which was filed during 2012, will be fully briefed by both parties, in early 2013, with a decision expected sometime later in the year.

Minimum Wage - The hike in minimum wage to $9.16 an hour (the highest statewide level in the nation), combined with no ability to credit tips as wages, is adversely impacting a majority of WRA members.

Although it is highly unlikely to enact sweeping change in the current law in this political environment, the WRA intends to explore other options.

Training and/or Teen Wage-- During 2012, the House Labor Committee held a hearing on a bill that would have allowed for a training wage.

Despite loud opposition from the labor community, a number of lawmakers continue to hear from constituent businesses that such a policy could be useful. Additionally, data from

Payroll costs •

Unemployment Insurance (UI) – In 2011, major changes were enacted in the social tax rates that led to considerable savings in UI taxes for the vast majority of hospitality sector businesses. Fortunately, the UI trust fund remains healthy. The WRA will work to protect against changes in UI that could lead to rate or benefit increases.

• A technical change may be introduced by ESD to fix the problem created when the federal Department of Labor declared that the 2011 UI reforms did not conform to federal law. The WRA does not expect these changes to have an

More priorities

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impact on WRA members.

There are increasing numbers of people who are exhausting all of their UI benefits. The WRA expects proposals to be introduced that would expand benefit eligibility and/or the duration of benefits.

Workers’ Compensation/Retrospective Rating programs – Major changes to workers’ compensation were adopted in 2011. In part because of these changes, L&I’s proposed rate increase was limited to 2.5 percent across all businesses for 2012 and an average of a 0 percent increase for 2013.

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• The WRA will work with the business community to protect the reforms adopted in 2011. Additionally, the WRA will defend against adverse changes to retrospective rating programs.

• Several retro employer groups will again propose legislation authorizing retrospective rating programs additional authority to manage claims and independent medical exams. Although the bill offers some modest improvement, the WRA will remain neutral so we can engage immediately if the bill is amended unfavorably as it has in the past.

Alcohol Implementation of 1183—Last June, the Liquor Control Board adopted rules to implement I-1183, several of which directly conflicted with the voter approved legislation. The WRA, along with the 1183 coalition, has filed a lawsuit challenging the rules that restrict retail to retail sales to just 24 liters. The I-1183 coalition will pursue legislation to eliminate the 24 liter limitations, and eliminate the 17 percent license fee on such transactions. The WRA and the I-1183 coalition are simply requesting the initiative be implemented as passed by the voters.

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Liquor Control Board request legislation • Granting the board the authority to make exceptions to tied house laws – The LCB has proposed legislation that would allow them to make exceptions to tied house laws through the APA rule-making process, under certain exceptions. The WRA will work to ensure this legislation will not give authority to grant exceptions that negatively impact restaurant licensees.

• Changes to a snack bar license – allowing for businesses that operate under a snack bar license that already have the ability to sell beer, to sell wine.

Microbreweries – Currently, businesses that brew beer under a microbrewery license, which limits the volume

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they can produce, are only allowed two retail locations per brewing location. If a business wants to expand retail locations, it must also expand brewing facilities.

The WRA will seek a minor change allowing businesses that brew their own beer to expand without the need for an entirely new brewing facility.

Credit Terms – The WRA will continue to pursue options that allow liquor, beer and/or wine licensees to be extended credit on terms acceptable to both their suppliers.

Environment/Sustainability Retail plastic carryout bag ban – The Northwest Grocery Association is introducing legislation that would, through a fairly rigorous process, create consistency throughout Washington state on this issue by setting one standard that county governments (pre-empting cities) may adopt as a plastic bag ban on retail establishments. As currently written, the ban would still allow plastic bags to be used for holding prepared foods, which is consistent with local bag ban ordinances already adopted and also recognizes the serious food safety requirements we are under as an industry. The WRA will work to make sure this exemption stays in the bill and, if so, will work proactively with coalition of supporters on helping to see the legislation passed.

Tourism Long-term funding for WTA – The newly formed Washington Tourism Alliance (WTA), of which the WRA is a founding member, is growing out of its infancy and working with the WRA and other stakeholders on ideas around a long-term funding strategy. We do not anticipate the WTA having a proposal for long-term funding vetted and prepared for this legislative session; instead, we anticipate an effort to provide bridge funding to keep WTA alive until a longer term proposal can be fashioned that works for all impacted industries.

Health Care Federal Health Care Reform Implementation – Lawmakers will be working with to continue to implement the federal Patient Protection and Affordable Care Act. The WRA will work with legislators and the Inslee administration, and will work to defeat any legislation that seeks to add new or increased burdens over and above mandates within the federal health care law. That being said, we will also seek inventive solutions that might aid our members as they work to comply with costly requirements of the law. 

January 2013 | 17

Vendors can be your allies — if you let them

By Shawn Sullivan Maintaining relationships with your vendors depends on how they approach you and, just as importantly, how you approach them. The success of your restaurant depends on your suppliers, whether they provide ingredients, paper product or even janitorial services.

Despite the reliance on vendors, some restaurateurs do not take time to appreciate everything their vendors do for them.

Oftentimes they can help make your restaurant more profitable.

Engaging your vendors, asking questions and building on your existing relationships will help you immensely in the long run. Most of your vendors have been servicing the industry for years. They see a lot, which could in turn, help you. They know which of their clients are doing well, and which ones are not.

Keep in mind vendors are not in a position to divulge any information about specific restaurants, nor should they.

However, they will gladly let you in on how other restaurants are saving money, bolstering profits or even conserving energy. They have a vested interest in you staying in business, and will strive to not only keep you as a customer, but help you make a profit as well.

Take a few minutes to talk with your vendors about your restaurant. The next time your rep comes into the restaurant, ask them for advice on a problem that hasn’t been solved or how to lower your costs. They may be able to provide you with information on the spot, and even if they don’t know at the time, they will probably ask someone who does.

As a restaurateur, you need professional, experienced and reputable vendors to help you succeed. Once you have them as part of your team, you should build on your relationship by talking about the specific needs of your restaurant. You may be surprised by the response you get.

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January 2013 | 19

Olympia’s premier lobbyists protect your business The WRA has assembled a team of the best legislative lobbyists in Olympia. This team of professionals has the experience, the relationships and the skill to advocate on behalf of Washington’s restaurant industry.

Bruce Beckett Government Affairs Director Bruce Beckett joined the WRA in 2009, and brings nearly three decades of public affairs experience to his role at the WRA. Bruce spent 17 years leading Weyerhaeuser Company’s Western Region and Washington State public affairs teams. Prior to joining the WRA, Bruce served as the director of public affairs for the Cascade Land Conservancy’s $20 million Cascade Agenda campaign.

He has served on the boards of numerous business organizations, including the Association of Washington Business, as a Deputy to the Washington Roundtable, TVW, the Washington Forest Protection Association, Northwest River Partners and the Washington Research Council. Bruce is accountable for overall leadership of the WRA government affairs team, provides strategic direction to the lobby team, and ensures WRA members are fully informed and engaged in the development of WRA positions and tactics.

From left to right, Josh McDonald, State and Local Government Affairs, Bruce Beckett, Government Affairs Director, and Julia Clark, Government Affairs Manager 20 | warestaurant.org

Josh McDonald State and Local Government Affairs Josh McDonald joined the WRA government affairs team in 2007. Before joining the WRA, Josh spent the several years previously splitting his time between contract lobbying work during legislative sessions and working on congressional, state and local campaigns. Josh spent three years working alongside our contract lobbyists Denny Eliason and Kim Clauson, assisting them with their daily lobbying duties and building relationships that help make him a strong asset to the WRA. In addition to his work at the state level on such issues as nutrition/obesity, food safety, tourism and the environment, Josh focuses much of his attention on building and maintaining a strong industry presence at the city and county level, as well as cultivating an ongoing dialogue with local health departments.

Julia Clark Government Affairs Manager Julia Clark joined the Washington Restaurant Association’s Government Affairs Department as government affairs assistant 2007 and significantly grew and strengthened the WRA’s grassroots network which was directly responsible for our most recent defensive successes—protecting the pop syrup tax credit and our Retrospective Rating program.

Additionally, Julia was responsible for establishing the WRA’s Ambassador training program—giving restaurateurs tools to communicate with their elected representatives.

In the past, Julia was successfully lobbied to achieve a tax exemption for free employee meals, as well as granting restaurants the privilege of selling growlers to-go. Julia works closely with state regulatory agencies, particularly the Liquor Control Board.

Julia has spearheaded the WRA’s efforts in ensuring that I-1183 is implemented in the way voters intended.

Contract lobbyists Denny Eliason Denny Eliason is regarded by much of Washington’s legislative community as one the most accomplished lobbyists on the hill in Olympia. Among other significant wins,

Denny’s hard work yielded the B&O tax credit on pop syrup taxes that saves restaurants across the state an average of $3,000 annually. Denny is the founder of Alliances Northwest, a business-oriented government relations firm emphasizing representation before the Washington State Legislature and local governments in Washington state.

Denny has experience working on a number of issues, including banking, energy, employment, environment, finance, growth management, health care, insurance, pharmaceuticals, retail, securities, taxes and transportation.

Some of Alliances Northwest’s other clients include Puget Sound Energy, Nintendo and Amazon.com.

Kim Clauson-Hoff Kim Clauson-Hoff is a partner with Denny Eliason at Alliances Northwest.

Kim’s primary focus is workplace and labor issues. She is also a strong force on the front lines for the Washington Restaurant Association on some of the industry’s toughest issues. She routinely delivers results on issues that affect restaurateurs’ bottom lines. Kim has landed the state’s restaurateurs their biggest proactive wins in the past five years, which include tackling issues such as workers’ comp, gift certificates and pushing the obesity lawsuit prevention bill past the governor’s desk. Kim has defended WRA members against a series of bills that would have expanded eligibility for unemployment insurance benefits to (1) those who voluntarily quit their jobs and (2) those who are seeking only part time work. If enacted, these bills would have increased the overall costs of benefits for UI, thereby leading to higher UI taxes for employers. 

January 2013 | 21

Retro: Keeping Up With the Success of the Program

By Dominique McNeil, for the WRA

In 1986, the Washington Restaurant Association (WRA) introduced a program to the restaurant industry that offered the opportunity for operators to be rewarded for running safe restaurants. 26 years later, The Retrospective Rating program continues to be one of the top-rated programs of its kind in the state, with continued success at an astounding 27 percent for the 2009 program year— much higher than the average results in the past. With such continued excellence in the program, Retro’s exponential growth is expected to continue.

Over the past 10 years, the WRA has an average return of 20 percent and most recently received a 24 percent return, equal to $8.97 million for their 2011 plan year and received an overall refund in the amount of $10.5 million, for three coverage years. The WRA makes up 81 percent of the Department of Labor & Industries’ entire Hospitality/ Entertainment industry category, in terms of premium; and they have received more than 80 percent ($70.7 million) of the $88.2 million in refunds that have been paid to this industry over the past 10 years.

Retro is a safety incentive program, designed so employers can earn a partial refund of workers’ compensation premiums paid if such an employer, as a member, reduces workplace injuries and lowers associated claims costs.

When in an employee is injured on the job, it can cost the company a great deal, whether it be in output, hiring and training of replacement employees, rescheduling of work, or the loss of expertise. As a member of Retro, associated claims costs can be lowered, as well as reduced premiums (upfront costs).

Over 26 years, from 1986 to current day 2012, soon to be 2013, the average refund for the Retro program has been at a stunning 24 percent. This percentage makes the program year’s refund even more notable as they grow in numbers. The percentage for 2009 being at 27 percent, it ranked at roughly 12 percent above the target state refund.

With a strong 24 percent for the year of 2011, refunds earned are most definitely at an increase.

With the growth of the Retro program in refund compensation, restaurant owners and valued members of the WRA are extremely happy with the results. “If they improve their workplace safety, they receive a better return 22 | warestaurant.org

and pay less upfront in premiums,” said Teran Petrina, WRA vice president.

With the past and current results of Retro, the predictions for the end of 2012 are very positive. The WRA is thrilled with how the program has performed in the past and present, as it continues to grow to be the second largest Retro program in the state.

“On behalf of the Retrospective Rating program and the Department of Labor and Industries, we are pleased to report the continued excellent performance of the WRA,” said Tim Smolen, L&I Retro program manager.

“The returns that the WRA has earned reflect the sincere and effective commitment of the Association and their members to worker safety, claims management and return to work programs.” 

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Crossing barriers between government and business: your education foundation can help

By Lyle Hildahl, WRA Education Foundation director

As a former restaurant owner, I found it very frustrating to work with a plethora of government agencies putting up barriers to running my business. I wanted to focus on team motivation, customer service, hospitality, food and beverage and entertainment— the stuff that motivated me to get in the business in the first place. But as an owner, I was spending most of my time on taxes, permits, licenses, inspections, lawsuits, etc. from the DOL, WSLCB, DOR, DOH, L&I, INS, ICE. The list goes on, and as a business operator, I’m sure you know what each of those agency abbreviations stand for!

One of my best discoveries in dealing with these government agencies was that I did not have to do it alone. By joining the WRA and reaching out to them, I found some comfort in having a resource to channel my frustrations and frequently gaining tangible positive results. WRA leaders at the time— Gene Vosberg, Trent House and Anthony Anton (back when he was director of WRA government affairs)—were quite helpful whenever I needed them.

Another discovery I made was the Education Foundation (EF). It turns out that the Foundation works with the majority of the government agencies I listed. Connecting with the EF helped me build better relations with government agencies and inspectors, which in turn created a business environment that the agencies looked to support, rather than close down. When people (the agencies staff) like you, they tend to support you. If they don’t like you, well… it can be a less than pleasant experience.

24 | warestaurant.org

Other than the government agencies the EF works with on a daily basis, they also are well-connected to the Office of the Superintendent of Public Instruction and the Workforce Training and Education Coordinating Board through a program called ProStart.

This is one of the most powerful tools available to us in building strong legislative support for the restaurant business.

Through ProStart, graduation rates go up, at-risk teens find a way to succeed, restaurants find motivated and talented employees and the economy grows. Pretty amazing how that works, huh?

In 2011, our GA team invited Sen. Janéa Holmquist Newbry to a lunch prepared by the Moses Lake High School ProStart students while touring a site for a new skills center.

After learning about the impact this program, and those kids, had on the community in Moses Lake, Sen. Holmquist Newbry became one of our strongest supporters.

I strongly believe that the ultimate strength and outcome of building relationships with the kids, the teachers, the government officials and the agencies is TRUST. Once you have that, the barriers come down and the path to success is made clear.

Why not give it a try? The WRA and WRAEF have 46 board members, 125 industry ambassadorsambassadors, 30 team members, 32 ProStart high schools, and 5,000 plus members to support you, your business and our economy. Get connected. Start the relationship. It all comes down to trust. 

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INDUSTRY CALENDAR January/February Training Jan. 17

ServSafe® Manager

Jan. 21

ServSafe® Manager

Jan. 22

ServSafe® Manager

Jan. 23

ServSafe Alcohol Train the Trainer

Feb. 5

Allergy Safe Certification

Feb. 12

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Feb. 18

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ManageFirst Class - Purchasing

Meetings Jan. 8

Spokane Annual Member Social

Jan. 8

Executive Committee Meeting

Jan. 8

Board Development Conference Call

Jan. 8

Spokane Chapter Meeting

Jan. 22

Finance Committee Meeting`

Jan. 23

Government Affairs Committee Conference Call

Jan. 29

WRA Winter Board of Director’s Meeting

Jan. 30

Education Foundation Board of Directors Meeting

Events Jan. 28

Hill Climb & Taste Our Best

NEW RESTAURANTS Angelo’s Caffe, Oak Harbor Denny’s, 18 locations in Washington state Bellingham Golf & Country Club, Bellingham Boxcar Grill, The, Tacoma Bread of Life Mission/Heroes Subs LLC, Seattle Carrs Restaurant & Catering, Lakewood Coconut Kenny’s of Ferndale, Inc., Bellingham Denalli’s Grill & Bar, Everett DJ’s Barbecue, Marysville Europa Bistro, Tacoma Front Street Grill, Coupeville Honey Hole Sandwiches, Seattle Jubilee Tea Room, Vancouver Kelso Theater Pub, Kelso Low Bar, Vancouver Occasions Catering and Special Events, Olympia Pine Tree Lounge, Westport Pizza Schmizza Pub & Grill Salmon Creek, Vancouver Prestige Care Inc, Vancouver Racha Thai, South Center Rock the Dock Pub & Grill, Tacoma Shrimp Shack, Bellingham Soup Bowl, Mount Vernon Terminal Degree LLC, Vancouver Topside Bar & Grill, Steilacoom Whidbey Coffee, Burlington

26 | warestaurant.org

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Degginger McIntosh & Associates Dustin Dekle PO Box 1400 Mukilteo, WA 98275-1400 425.740.5200 dustin@dmainsurance.com www.dmainsurance.com Degginger McIntosh & Associates specializes in a variety of commercial insurance products that offer broad and sufficient coverage to various businesses across the Northwest. Our team of professional risk managers is here to provide you with the information necessary to adequately protect your business from a potential financial loss. Our strategy is to discuss possible loss exposures while providing you with a set of options that will best fit your needs.

With a large variety of coverage’s and distinct differences between each, Degginger McIntosh & Associates strives to advise and implement coverages that fit the everyday needs of our customers.

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Management Concepts William Henkens 8416 NE 121st Pl Kirkland, WA 98034-6027 206.369.0990 weh1221@aol.com We are a restaurant rescue company.

Northwest Commerical Kitchen Repair Marian Prescott-Fox PO Box 48625 Spokane, WA 99228-1625 509.723.1374 admin@northwestckr.com www.nwckr.com Northwest Commercial Kitchen Repair is locally owned and operated. We provide a higher instance of successful first-time repairs. We are master-level certified to diagnose and fix the commercial kitchen equipment used in the food industry today. 15% discount on repair of commercial kitchen equipment.

On Deck Capital Eitan Smilchensky 155 E 56th St New York, NY 10022-2708 888.701.4390 esmilchensky@ondeckcapital.com www.ondeckcapital.com On Deck provides restaurants with the financing they need to purchase equipment, hire new employees, or launch a new marketing campaign with fast decision, quick funding and competitive rates. On Deck should be your first stop for financing. Ask about Minimum savings of $250 off cost of loan Pastry Smart Marc Rosenberg 1100 S Amphlett Blvd San Mateo, CA 94402-1969 650.384.0596 marc.rosenberg@pastrysmart.com www.pastrysmart.com Pastry Smart has been baking a difference since 2006. Located in San Mateo CA, our 25, 000 sq. ft. state of the art production facility produces all-natural baked goods bringing high-quality products to retail and foodservice operators.

Quantum Law, PLLC Brock Gavery 3418 NE 65th St Ste A Seattle, WA 98115 206.834.5482 brockgavery@quantumlaw.net http://www.quantumlaw.net/ Quantum Law PLLC is a small law firm that represents restaurants and businesses that support the restaurant industry without the exorbitant fees of a large law firm.

Starlight Desserts, Inc. Emily Brune 2001 W Garfield St Ste C92 Seattle, WA 98119-3119 206.284.8770 emily@starlightdesserts.com www.starlightdesserts.com Starlight Desserts is committed to producing great quality desserts with exceptional value. Our desserts contain no trans fats or tropical oils. We use only butter or unsaturated oils in all of our production which gives our pastries and cakes a clean fresh flavor everyone is sure to enjoy. While many of our desserts are available frozen via local distributors such as Peterson Co. and DPI, we also make fresh cakes, cookies, pies and mini desserts available for delivery in the Seattle area.

TheBrownLounge.com Holly Brown 4701 SW Admiral Way Ste 365 Seattle, WA 98116-2340 2064653249 holly@thebrownlounge.com www.thebrownlounge.com Holly Brown cooks, laughs, and shares food and wine discoveries that inspire your inner foodie! Her friends call her kitchen “The Brown Lounge.” Tune in to her weekly FoodieTV show, search for recipes, get inspired by photos, and check out her blog each $500 Digital Media Promo Package. Includes: 1) Creation, production and distribution TheBrownLounge.com is where food, wine and friends meet!

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Ask the Expert | Restaurant Profit Coach

By Rick Braa, CHAE

Q: Minimum wage is set to increase again. I feel the squeeze of financial obligations already. How can I overcome another increase in expenses without any foreseeable benefit?

A:

Washington boasts the highest statewide minimum wage in the nation and, because of a voter approved measure, is one of only 10 states where minimum wage can increase annually based on the federal Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). As a result, minimum wage will normally increase each year. Over the last five years Washington state’s minimum wage has increased nearly $1.00 per hour and approximately $0.50 in the last two years [Exhibit 1].

Effective January 1, 2013 minimum wage will once again increase to, gulp, $9.19.

The financial impact is undeniable. For every $1 million in sales, restaurant operators will lose about $2,000 to the increase in minimum wage in 2013, after losing about $5,000 in 2012. Since 2007, the financial impact exceeds $20,000 cumulative per million in sales.

To combat these increases in cost, consider the following: •

Eliminate or minimize support positions. With the high cost of minimum wage, revenue generation is key. Eliminate support positions, such as bussers and runners, and replace those bodies with servers in reduced-size sections. Create an environment of teamwork where servers are required to bus and reset each other’s tables, deliver food, and engage the guest. Additionally, set sales goals for each server daily.

Challenge your team to sell an extra five drinks and five desserts per day. This would generate at least an extra $50/day, or more than $18,000 in added sales per year.

Reduce the front desk position to one superstar per shift, and supplement seating with the additional servers on the floor. Rotate servers through the front desk position and train them well on the functions of phones, making reservations, greeting, seating and thanking the guest. Evaluate the kitchen staff as well. If there is slow time, push prep and/or dishwashing into those slots.

Make sure you have enough dishes that the restaurant

30 | warestaurant.org

•

•

can run without the dish machine operator (DMO) if needed, without running out of supplies. Bring in a DMO only after the restaurant is full of guests. Cooks in the morning can wash their own dishes or leave them for the DMO. Manage labor aggressively. Start with great forecasting.

Study sales data and trends and schedule precisely-by the minute-to forecasted business levels. Stagger scheduled start times for your staff. When reviewing restaurants, I often find that labor management is better on Thursday than it is on Friday. This is usually caused by overstaffing Fridays at the beginning and end of shifts. Watch in and out times with a vengeance. At $9.19/hour, every minute equals $0.15 per person. If two people are scheduled to start just 15 minutes later, as business levels increase, and are cut from the floor 15 minutes earlier as business levels taper off, the labor savings is $9.19/day and nearly $3,300 per year. In the kitchen, most restaurants hire prep cooks, then forget about process improvement to reduce or eliminate those hours. There is opportunity in every kitchen to improve labor cost and increase efficiencies.

Build a sense of urgency. Every team member should start every shift ready to go and in high gear. If they’re not in high gear, they should not be clocked in. Teach managers to work every area of the restaurant including the kitchen, the front desk and the server station, and keep the staff motivated and moving with a sense of urgency. Build the mentality that every minute of the day is the rush, not just when the orders are coming in from guests.

Minimum wage increases are a way of life in Washington state. Nearly every year, there will be an increase, diminishing margins. Be proactive by taking a fresh look at operations and challenging the prior ways of doing business.

Stay aggressive with labor management and use only what the business needs to generate maximum sales. Managing your restaurant with a sense of urgency, and building that sense of urgency into every person working in the restaurant, will ensure an offset to wage increases while creating a more productive work environment.  For a more information on improving profitability and driving sales, contact AMP Services at rbraa@ampservices.com. Rick Braa is the founder of AMP Services, an accounting and consulting firm specializing in helping companies grow profitability.

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