Steven Brown: How to make your food and beverage operation stand out

In recent articles I have focussed purely on matters financial, well now for something completely different!

It really doesn’t matter that you know how to read a profit and loss account, a balance sheet and a break-even point if you haven’t generated any profitable income in the first place because 60 per cent of nothing is nothing!

The first rule in business – nothing happens until someone makes a profitable sale. Which do you think is the most important word in that statement? I can put up a good argument for both ‘profitable’ and ‘sale’.

Well how’s your sales activity to date? Are your staff selling or merely serving? But, me thinks, I’m getting ahead of myself. Before you start to sell anything you need a market to sell to and a product to offer.

At my Marketing Masterclass seminars I ask delegates to start at the very beginning by getting them to sum up, in a single sentence, what it is they believe they are offering from their food and beverage service.

Terms such as ‘value for money’, ‘good prices’ and ‘brand awareness’ are not uncommon. I have no concerns regarding these comments other than very little else is offered as a reason for marketing success.

So what is successful marketing? Simple – be in the market your customers want you to be in. For lots of golf clubs there is only one ethos – enjoyment. I don’t know too many golfers who approach a golfing experience believing at the outset that this is going to be a chore and wholly unenjoyable. I accept if you have lost 10 golf balls (one in the ball wash!) that it may end up that way, but your responsibility in the F&B department is to toast their success, or lift their spirits whatever the golf was like.

So my answer to “what are you supplying your customers?” is this: an enjoyable, relaxing and carefree experience at the start, middle and end of the round.

Here is the major problem for most F&B outlets. Over 75 per cent of golfing customers either don’t use the F&B facility at all during their visit or only at the beginning or end of their stay!

So why is that? My own experience is that many golf clubs make the provision of the bar and food offer at a time which is convenient to them and their staff and not at a time that is convenient to the customer!

There are many arguments for and against this and I’ve heard most of them but the fact of the matter is, we as an industry dictate to our clients what they will have, when they will have it and how it will be served. If you are able to dictate to your customers like that (and some are) then you are very, very fortunate. For most outlets you cannot afford to be that arrogant.

The supply of food is a classic example. I know of countless clubs that provide a restricted food offer not because the client doesn’t want it but because the club isn’t prepared to staff that provision because “it would cost too much.”

Let me ask you this key marketing question: Golf clubs are in a seven-day-a-week business. Of those seven days which golf clubs have maximised their F&B sales’ opportunities to a position where they could not generate another single profitable sale during that time? The answer is none. How do I know?

Well consider this. The four greatest areas of food growth in our industry are as follows (in rank order)

1. Sunday lunch time food

2. Grazing (between 5pm and 7pm)

3. Take home food

4. Breakfasts

Which of these markets are you already in? Which of those markets could you be in? Which of these markets you are already in have you maximised?

Strange to report but when I ask my clients following a site visit to review their F&B operation they will often say, “my clients don’t want those services.” I can believe that if they have asked a meaningful sample of them in a survey they have conducted in the last 12 months!

Our marketplace is changing at an alarming speed, as are the needs and wants of your clients. We have to open up channels of communication to our customers to first of all listen to what it is that they want and then to rationalise that to what it is that we can realistically provide. Yes everything does come at a price and it may well be that what they want and what they are prepared to pay may not be viable for us to provide as a business, but how can you ever know if you’ve never canvassed opinion?

I feel so much better now I’ve gotten that of my chest! So let’s get down to a few simple marketing principles here and some suggestions.

Communicate with the marketplace

Consider an in-depth research project with your regular, occasional and potential customers to establish precisely the following:

a) What products they want

b) Times of the day / night they would support it

c) What standard and quality it must achieve

d) How it will be available (service style)

e) How much they will be prepared to pay

f) How often they would support it during a month (days / hours)

g) Where they currently go to receive that product or service.

Assimilate the information

Once you have researched your market you need to assess its practicability, viability and manageability. There is little point in building a conservatory to house 70 covers if all the market wants is toasted sandwiches! It is no good extending the bar capacity if you don’t open until midday and shut up at 9pm. Like any business you need to get a return on the capital employed. Decisions will be based not just upon the members’ views but must be supported by a fully-costed business plan justifying the case.

Review the current offers

Here’s a whole bunch of questions for you:

a) Is your product range as extensive as it needs to be (for example, wine) or in need of pruning? (Over stocking leading to confusion?)

b) How well-merchandised are your offers (merchandising is the art of silent selling)?

c) How well does your product offering match up to the environment in which the client consumes the offer? (A tired environment!)

d) How well does your customer service level match up to the product or service you are offering? (For example, Cordon Bleu meals served in a ‘come and get’ it style.)

e) What information (from stock results or till analysis) do you currently use to help you decide on your future marketing course? How up to date are you with market trends and research?

Identify your unique selling point (USP)

Answers this: Why would someone pass ten other outlets providing food and beverage to get to you? What do you have to offer that will make a customer do that? If you don’t have a USP then I strongly urge you to invent one. People need a good reason to part with money so give them one. (For example a unique food offering, original wine range, food available beyond 9pm!)

The four marketing options

1. To sell more existing products to existing customers;

2. To sell new products to existing customers;

3. To sell existing products to new customers;

4. To sell new products to new customers;

Wow! There is so much for you to have a go at here. The key to this matrix is this. You must focus on one of the opportunities and, once you have maximised it then maintain that level and move on the next opportunity.

Now here there is a common mis-conception. Many F&B outlets believe that they need to focus on opportunities three and four exclusively to obtain the market growth they require. Not so. All businesses should start at number one. Why? For two reasons.

Firstly, it costs you six times as much to get new customers as it does to keep an existing one. Secondly, no outlet in the land has ever managed to achieve maximised sales from its existing customer base. I know this to be true because firstly, 91 per cent of bar staff do not sell, they only serve and secondly, your customers still leave your premises with unspent leisure money on their card or cash in their pockets!

The key to maximising the first marketing objective is to teach staff how to sell! It is easy enough just to show them any of the five simple sales techniques available, incentivise them to achieve your sensible targets and then empower and encourage the activity.

This is low risk marketing but don’t upset the customer by being too pushy in the process. Your second opportunity allows you to introduce new products, facilities or service standards. We like this as new means that there is nothing to compare it to in terms of retail price. That means that you can dictate what the price will be as it cannot be compared to any existing product. Slightly higher risk as your new product or service may not hit the spot but that risk is reduced greatly if researched properly.

Your third opportunity is to introduce new customers. Here, your options may be limited dependent upon your trading style. Membership may well exclude the ‘off the street’ customer and leave you at the tender mercies of generating extra income from visiting societies or dinner dances.

It is expensive to obtain new customers and many clubs are feeling the pinch here, which is why you need to focus on the first marketing opportunity again – maximising your existing customer base. Opportunity three is higher risk still as the drive to promote new membership doesn’t guarantee a regular F&B customer!

So how well are you selling your F&B service to these new people? That’s all down to you once they are members. Your fourth choice is high risk. This is the direct result of creating a brand new market for a brand new customer both of which are untried!

If successful you will be quite unique but research is paramount here, not just ‘I’ve got a great idea let’s do it!’ Remember -– achieve the achievable. Focus on what you do and can do well and you improve your chances of success.

The importance of maintaining standards

Customers persistently tell us that there are three things that matter more to them in their choice to select their preferred ‘supplier’:

1. Quality of service

2. Quality of product

3. Quality of environment.

I simply cannot overly emphasise the need to get these three things right. The margins between each of them are slight but the message is clear. If you fall down or fail in any of these areas you may lose a lifetime customer to another business.

So how would you currently rate your level of service, product and environment? Is one better than the others? Can they be improved and which should you do first. That is at least easy to answer. Affect the most easily affectable. The product and the environment may need time and investment to improve but the quality of service is instantly improvable.

Invest in quality staff from the outset. Pay above your competitors’ hourly staff rates, offer incentives for staff to sell and serve customers properly, invest in training them and demand a high level of return from them.

Pricing the product

Naturally an essential part of the marketing mix. This area has always been a thorn in the flesh of golf clubs, particularly non- proprietary, as the committee may well have an influence on your pricing policies.

A decision needs to be made as to whether your F&B operation is a profit-provider for the organisation or non-profit making service. If it is the latter then price is not an issue. If it is the former then you must be aware of the value of what you offer and how it is perceived by the purchaser. You can be perceived as being too cheap or too expensive. Neither option is desirable and you have to find a middle ground. The price you charge is affected by the following:

a) How much you paid for the product

b) How much gross profit you need to cover your costs and move you into profit (and future investment)

c) How much the customer is willing to pay.

You must continually research each of these by re-negotiating buying deals, controlling overheads and investigating competitors’ pricing systems. One comment here – don’t get too locked into the old chestnut of: ‘I know my customers and they won’t pay that much’. My observations are these: Your customers demand quality service and surroundings at the lowest possible price. That’s understandable but there is a price to pay. Your suppliers and staff do not and will not work the same way. They have bills to pay and demand higher charges and salaries. There are only three ways you recoup your increased expenses. Buy better (wholesale price), sell better (increased price) or reduce your overheads. Which ever course of action you take remember this: quality will be remembered long after price has been forgotten!

Internal customer communications

Do you take every opportunity to communicate with customers from the minute they drive onto the car park to the minute they leave? There should never be an excuse for a golf player to be unaware that you provide food and beverage as a part of their day’s experience at every turn (breakfasts, course snacks, lunch, tea, evening meals and the booking for their company function or wedding.)

Which of the following communications methods do you use: Chalkboards; merchandising; newsletters; pens and diaries; fliers; the internet; table toppers; your web site; posters; SMS; banners; staff talk (selling events) and / or notice boards? Which ever method you choose ensure that it will be seen, noticed and acted upon. Don’t be the best kept secret in town and always track your advertising success.

Find out from customers how they found out about you as then you will know the best way to communicate with your marketplace.

Promotional activity

I have no doubt that many sub-committees for social events are already in evidence and this is a great use of your facilities especially in maximising the chef’s time!

You have to ensure that every square metre of your F&B area is maximised to its greatest potential. Promoting the venue for in-house events is essential to reduce the fixed cost element of your business by making you use the services at times they would not have otherwise been used.

If you have the opportunity to ‘resell’ your floor space twice (or more) in a day then you are maximising your outlet.

Well here we are then. Simple really, isn’t it? The bottom line to marketing is easy. Think like an entrepreneur and outside the box. Don’t let your future success happen by accident, make it happen by design.

That’s the function of successful marketing.