Service, Quality and Flavor are Key for Full-Service Restaurants

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Full-service restaurants will see an average sales decline of 1.9 percent this year and a slow start to 2012.

But those that do well are differentiating themselves from the limited service competitors that are eroding their market share, according to research results presented at the recent Technomic Restaurants 2011 Trends & Directions Conference.

“It will be a tough year,” predicts Ron Paul, president and CEO of Technomic, the Chicago-based restaurant consultancy. The economy is in a modest recovery, but low consumer confidence continues to diminish how often diners frequent restaurants and how much they spend when they eat away from home.

Results of a Technomic operator survey conducted in May show that cost control is the most prominent profit maintenance strategy. Some specific strategies are reducing waste, more focus on product yield, reducing high-cost ingredients, shopping around among distributors, emphasizing lower food-cost items and reducing portion sizes.

The elements of full-service dining that have served that segment well continue to attract customers—good service, enhanced food quality and flavor differentiation, according to Technomic’s Consumer Brand Metrics Update, which was compiled in May.

These elements are often more important than price. A majority of consumers surveyed are willing to spend more on premium ingredients.

Full-service consumers, especially younger adults, increasingly seek out flavor differentiation in foods they would not prepare at home. Leading “flavor inspirations” include Italian, Asian, Mexican, Mediterranean and Caribbean.

Hospitality and ambiance work to the advantage of full-service restaurants, according to Kevin Higar, Technomic’s director of research and consulting services.

Consumers who said they are visiting full-service restaurants more often cited their welcoming, family-oriented or upscale atmospheres as reasons for their choices. They especially like using casual dinnerhouses as gathering places.

Superior service is a major advantage of casual full-service restaurants. Higar says the comprehensive server knowledge of the seafood served at Bonefish Grill and the huge beer selection at Yard House are examples of service that sells.

In a panel discussion on pricing strategies and related topics, Lane Cardwell, president of P.F. Chang’s China Bistro, says “We are dialing up our hospitality.”

He referred to new efforts to be sure that a sufficient number of servers are on duty at all times. He also noted that customers did not cut back on ordering their favorite Chilean sea bass after the price was raised because servers were trained to explain that rising food costs necessitated the increase.

Keith Sirois, CEO of Big Boy, says servers are trained to lead customers to higher-priced items instead of to advertised specials. “We arm the servers,” he states.

Casual dinnerhouses that have built their reputations on the dinner daypart are doing more with lunch in this economy, notes Nancy Kruse, a foodservice analyst specializing in food and menu trends.

Among chains she pointed to that are offering special pricing to entice more lunch customers are Copeland’s of New Orleans, Chili’s Grill & Bar, Abuelo’s and Cotton Patch Café.

“They have to meet time and price requirements,” she says. “They are taking back business they lost to fast-casual.”

Other successful strategies include having low-calorie and healthy offerings, “premiumization” in proteins, playing up regional influences and featuring meal deals to promote a value perception.

Several speakers talked about the “daily deal” phenomenon in which consumers subscribe to coupon sites to get big discounts at participating restaurants.

Although many operators are leery of the trend, the Technomic Daily Deals Report compiled in May disclosed that 83 percent of consumers who used such a coupon recommended the restaurant to others, and 67 percent returned to the same restaurant without a daily deal.

By Carolyn Walkup

News and information presented in this release has not been corroborated by FSR, Food News Media, or Journalistic, Inc.

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