Restaurant Masterminds

Every once in awhile you come across a business that just plain “gets it’ when it comes to knowing how to successfully run and market a business. There are thousands of businesses in my hometown, but only a few really “get it” when it comes to marketing. This past weekend I had the great pleasure to come across what I like to call a business that “gets it”.

Let me give you a quick run down of how all this came to play. Every year my neighbor hangs the most beautiful hanging flower baskets from her patio, and this year I told my wife I was going to ask (via text messaging) where she buys her flowers and how much she pays for them. I texted her the question and within minutes she responded with the name of the flower shop in Arvada, CO. (Echter’s Nursery) In the text she also included the email newsletter link that they emailed to her, along with an email coupon that was included in the email (www.echters.com) . Now how’s that for marketing! The nursery not only had my neighbor on their mailing list, but she was able to forward it to me immediately. But wait, it gets better.

The very next day we went to Echter’s Nursery to see if we would find anything that we liked, plus the coupon was emailed to me which provided an immediate call to action with an offer. (Great Marketing point #1, get guests to respond immediately). Upon our arrival at the nursery, the marketing began, the parking lot was full of cars and well maintained, beautiful flowers and trees were in full bloom throughout the outside property. (Is your restaurant parking and entrance in great shape? Again, marketing starts the moment your guests arrives at your property, great marketing point #2).

Once inside the large nursery, we were greeted by an older lady asking us if we needed any help, and she pointed us in the right direction, (Marketing point #3 – Someone with a warm smile welcoming us as guests in their nursery). Do you know how many businesses, let alone restaurants, fail at welcoming their guests?

Now the fun part starts. WOW! What a selection of great looking hanging baskets, flowered pots, annuals and perennials. The aisles were wide, the flowers were all marked with exact descriptions of flowers and their “mates” in the garden. There was plenty of staff on hand to answer any questions we may have had. (Marketing point # 4 – Enough staff to provide a great shopping experience. Does your restaurant have enough staff during busy periods?)

As we walked down aisle after aisle, filling our shopping cart with beautiful flowers, we would notice, on certain flowers descriptions, large green flyers with discounted prices. The flyers stated, “For Green Card Members Only”, (Marketing point #5, member only prices) of course my curiosity quickly arose of how I can become a member so that I would receive the discounted prices…I asked one of the staff members and she quickly explained the program to me, and best of all, it was FREE, just sign up with the cashier when you exit.

Upon our departure, this is the BEST part of all, before the cashier began to ring up my purchases, she asked me if I was a member of their “Green Card” club, (marketing point #6 – Great training with employees to sell the program) in which I said “no”. At that point, she filled me in on all the details and informed me of how much I would save today if I enrolled… within 2 minutes I was now a new member of their club. The nursery now has all my personal data to continue to contact and market to me in the future (Marketing Point #7, collecting guests information). Now here’s the clincher; once I cashed out, the cashier gave me “Echter Greenbucks”, for every $20 you spend you receive $2 in greenbucks that you can now spend like real dollars, but only from July 16-31, 2010. (Marketing point #8, bounce back offer during a slow part of the year, I absolutely LOVED this part!) this promotion is just one part of what makes this nursery such a successful business.

In conclusion, to my great shopping experience, here’s the part where most small businesses fail. The Life time value of a guest! For years I purchased all of our gardening needs at a particular nursery close to my restaurant. I would spend nearly a $1,000 every year for the restaurant outdoor garden and decor, along with my personal needs. Not one time did they ever collect my personal information, send me a thank you card, offer me an incentive to come back and spend more money with them, or build a long lasting customer relationship….Basically, they took me for granted! They may not miss my $1,000 of annual spending, but if they lose 10-20 customers to Echter’s, do you think they will start to miss $10,000 – $20,000? If 100 guests moved away from them and multiply that number by a lifetime value of a guest of five years, you might say that business may end up with not much of a “fuchsia”….you get the point! I may only spend $1,000 a year with my new nursery, but I sure will be telling my neighbors, my friends, and even bigger than that, my 500 guests a day who walk through my doors about Echter’s Nursery! Do you think I’m worth more than a $1,000 a year now? ABSOLUTELY!

Tell me now, can you compare your restaurant to Echter’s Nursery? Can you compare the eight marketing points that they excelled in and does your restaurant excel in those same eight marketing points? If not, you are probably throwing away thousands of dollars in sales away from customers like me.

Finally another business that “gets it!” Is your business on my list that “gets it”?

Ben Martinez

Every small business has a sign out in front of their building, it’s how people know where they are. Most people assume that this is enough for customers to remember who they are and where they are located. The facts don’t really play out that way. If you were to focus on a particular side of the street during your next drive to work, I bet you’d see a number of businesses that you’ve never noticed before. Imagine driving to work every day for years and never even noticing a particular business. The sad reality is that this occurs every day. I can recall commenting to my wife about a new business that I noticed on my way to work one day, and her telling me the business had been there for over a year.

Branding is something the big corporations have down to a tee. It could be the Nike swoosh, or the Golden Arches, when you see these symbols, you know immediately who they are. This is accomplished through repetitiveness. You are bombarded by these symbols in magazines, TV, billboards, flyers etc. The idea is to surround you with their product. So, when you are hungry, thirsty or in need of sporting goods, you always think of these brands first. This is a tried and true process, one that is difficult for small businesses to duplicate. This is due to the limited resources and funds available to us with which to market our business.

It starts with the name of your business and your logo. Make sure your logo tells your story, who you are and what you do. Make sure your sign is as big as legally allowed and is legible to people driving by. It’s amazing to me, how many signs I see that aren’t readable. It’s key to keep your sign fresh, trim bushes that grow up around it, and replace it when necessary. Your sign is your calling card to any passerby. It doesn’t end here. You need your name multiple times throughout your business. Above your door, on the rug leading into your business, on your take-out bags, cocktail napkins, all over your wall of fame in articles and on plaques. In pictures of your restaurant, make sure the sign is included in the picture.

We can’t compete with the big Chains when it comes to branding, we don’t have the money behind us or the budgets. This is not an excuse to ignore our brand and work on building it. The difference is, it will take more time for small businesses to get their name out and have people identify their logo on a drive by. With the use of the internet, it’s a level playing field. We have the ability to have a great website with our name plastered all over it. We can use Constant Contact and have our logo in all of our business correspondence. Facebook allows us to connect to the world and showcase our brand and who we are. It’s about strategically getting your name out, it starts in your business and moves outward from there. The key is to keep building on your progress, hand out business cards every day, sell logo wear for your business, utilize give-aways with your name on it. Private label your famous sauce or marinade. Get your name in people’s homes and watch your brand become a household name.

Finally, don’t forget the media, they love local “feel good” news. Send out press releases and entice the media to use your business whenever they need a last minute story. It’s amazing how some things that you think are nothing are some one else’s news. You don’t need a big budget to get your name out there, you just need a little ingenuity and a plan. Execute your plan and make it happen.

Dick Varano

One of the key observations I’ve had as a restaurateur over the last thirty years, is how critical it is to establish a solid relationship with your key vendors. This is a process that is developed over a number of years. One of the key reasons behind developing this type of relationship, is the the long term growth of your company. When you change vendors constantly, the resulting chaos can be difficult on your kitchen and staff. However, when you take the time to develop a personal relationship with the upper management of your vendor, you have tremendous leverage when it comes to dealing with issues. In many instances, issues can be eliminated long before they even become and issue.

When I first started in the restaurant business, I was taught to bid everything out and always get the best price. This makes great sense and can definitely save you money. The problems that can arise from that theory are simple. If your vendor runs out of the product and you have to approach another vendor, the price can be substantially higher, or if you order from lots of small vendors, the chances of problems and outages increase significantly. When you have a prime vendor, with a well established relationship, your communication is typically much greater. You are usually alerted to problems before they happen, which in turn gives you a much better chance at rectifying the problem before it shows up on your doorstep. The last thing a restaurateur needs is a problem with a delivery on a friday afternoon.

A major bonus of having a great relationship with your vendors is the fact that you get alerted to deals when they are in a very limited quantity. One of my vendors just changed their pasta vendor, I found out that they are sitting on about one hundred cases of penne from their old vendor and want to move it in one fell swoop. They called me and asked me if I’d take it for ten dollars off a case. ( Of course I will.) Each summer, my seafood restaurant uses four to five hundred pounds of butter a week. The cost is ridiculous, I contact my major vendor, give them my usage for the season and in the spring when butter is low, they purchase my butter, freeze it for me and hold the price. These types of deals can only happen when you have a great relationship with your vendor. Sometimes saving pennies can cost you dollars. If you utilize your prime vendor and maintain the relationship, you can more than compensate the savings of using multitudes of small vendors. The key is to stay in communication and take advantage of the many deals that are available to you.

Find a major vendor and negotiate your best deal with them, commit seventy or eighty percent of your business to them and fill in the rest of your purchases with your specialty vendors. This system works, I’ve used it for years. The key is to find a balance, have very specific specs and hold your vendor accountable. It goes beyond that as well, leverage your major vendor, utilize their facility for training, they offer these programs. Organize cuttings and tastings in your location with their butcher or chef. Utilize their staff to help your company identify new money making ideas. The resources that are available for you are limitless, the key is to ask and stay on top of your vendors. A couple of examples: when I opened my Prime Steak House, my major vendor took me to Boston several times and took me to dinner at the major Prime Steak Houses. Not only did they pay for everything, they provided a driver, so I could have a great time and not worry about driving home. More recently, I just spoke to one of the top executives of my major vendors and we worked out a deal where I could purchase new patio furniture and equipment for my new Al Fresco kitchen and pay for it over the summer when my revenues are much higher. This is an interest free loan that benefits my restaurant and my vendor. The vendor receives the equipment sale they might not have gotten without the loan.

When choosing a prime vendor, interview their top management, ask the difficult questions and make sure you are up front with your expectations. You are basically interviewing a partner, make sure you are comfortable with the terms, what kinds of special considerations you can expect, and even who your specific salesman will be and what kind of a delivery schedule is available to you. Keep your communication open, work in unison with each other and get together annually and evaluate your year. Go over things you didn’t like and make note of the things that are working. Then set some goals for the upcoming year and build on your relationship. Good Luck!

Dick Varano