First Seafood CSA Model In NYC

The first seafood CSA in NYC, Dock to Dish, will attempt to return restaurants to the older way of doing things, where they worked around what was in supply over what was in demand. We are more familiar with CSA’s where consumers sign up for a memberships to be provided with seasonal, local, fresh produce from local farmers. Dock to Dish operates in the same manner just with seafood rather than produce. Restaurateur Sean Barrett has come together with fishermen to apply the same CSA economic model to seafood and established Community Supported Fisheries (CSF).

Dock to Dish will help to foster the relationship between growers and eaters by shortening the distribution chain. Dock to Dish was founded in Montauk, Long Island to provide members with a weekly portion of high quality seafood caught sustainably within the last 24 hours. Dock to Dish then took off in New York City where it became the first Restaurant Supported Fishery with chefs such as Bill Telepan, Dan Barber and April Bloomfield subscribing amongst others. They receive an abundance of whatever is caught fresh such as bigeye tuna, fluke, black sea bass, swordfish, squid and many others. According to Edible, “Chefs used to rely on fishermen who came to their kitchen doors offering what was local, plentiful and in season. Then they wrote the menu. It put excitement into preparations: a little surprise to get the creative juices flowing.”

To read more about the CSF and watch a short video on how it operates, click here

Pizza On The Rise In Fast-Casual

According to Telsey Advisory Group, pizza will be the next trend in fast-casual dining. Perhaps the reason this is not yet a craze in fast casual concepts is because the cooking time for pizza is typically longer than say a sandwich or a burrito. A research firm, NDP Group, has showed that new pizza chains are using smaller ovens that can cook pizza in a shorter amount of time. Tom Ryan, founder of Smashburger, also is the founder of a fast-casual pizza chain called Live Basil Pizza. In it’s six restaurants the company uses gas-fired brick ovens that enable the pizzas to be produced at a faster pace. According to Tom Ryan, another reason the chain is successful is because guests are opting for Neapolitan pizzas over deep-dish pizzas which have a longer cooking time.

Warren Solocheck, vice president at NPG states that, “The concept of being able to have a fast casual pizza restaurant has been proven..it is now all about who has the capital to expand.” Buffalo Wild Wings has invested $9 million dollars in an L.A-based pizza chain, PizzaRev, and now operates 11 locations throughout California as well as five franchised restaurants in Utah and Minnesota. Chipotle has also invested in Pizzeria Locale which is mostly focused in Denver.

To read more about the rise of pizza in fast casual dining, click here

Menu Shrinkage to Lower Costs, Increase Profits

For a long time, in order to satisfy the consumer demand for more menu options, restaurants would try to add more choices. However, this is not the most effective way to stay competitive and increase profits. Here at TaraPaige Group we work with our clients to reduce their core menus in order to keep the offerings streamlined and simple. Shrinking the menu will allow a restaurant to cut costs and focus more of their efforts more on their most popular offerings.

The theory of less is more definitely applies here, as consumers (especially millenials) appreciate food quality over quantity. Chief Operating Officer of Tony Roma’s, Brad Smith, states that “We can no longer be everything to everybody all the time..I don’t think customers are out there counting the number of items. It’s about producing better quality products.” Tony Roma’s has already reduced their core menu items from 92 to 60. Other chains are doing the same.

BJ’s Restaurant has cut their entrees by 30 items and is aiming to get closer to 100 down from 181. Julia Stewart, CEO of IHOP’s parent company DineEquity has shared that IHOP has reduced its emu items from 200 down to 170. Darren Tristano, executive vice president of Technomic noticed that the average number of menu items in chain restaurants began to fall this year for the first time in a decade. Tristano mentions that, “Too many choices make it hard for consumers to make a choice..it also can make it difficult for consumers ‘to remember why they go to a particular restaurant,’ so the industry is moving from ubiquity to specialization.”

To read more about the less-is-more philosophy and how to reduce core menu offerings in order to lower costs, increase profits and still keep guests satisfied, click here

Fake Scarcity in the New York Food Scene

There is an interesting phenomenon occurring in the New York City Food Scene: that of fake scarcity. Food establishments are making their products or dishes hard to get as opposed to boasting a bountiful fully-stocked quantity of their products. This is the case in the fashion industry, where consumers will line up for coveted limited-edition limited-supply designer pieces, which makes sense to a certain degree, however should this also be the case for lunch or  a pastry? Totonno’s pizzeria in Coney Island is known for the times when customers used to be ushered away because the pizzeria had run out of dough, causing customers to line up early to ensure this wouldn’t happen to them. They now operate with sufficient dough for the demand, however the hype and memory of the frenzy that was caused by the running out of dough at Totonno’s will remain. This seems ironic, however the limited availability of a product and the hype that ensues if a product ‘runs out’ (although designed this way) gives the guest the impression that it must be an outstanding product worth lining up for.

A great example of this phenomenon is Dominique Ansel’s cronut. New Yorkers are willing to start queuing at the crack of dawn to get their hands on one of the 450 $5 croissant-donut hybrids. For those who are not willing to line up early, there is a “cronut black market” where the item can be made available for $40 each. Another example is at a restaurant downtown in SoHo called Raoul’s. Raoul’s is known for only making 12 hamburgers per day. 12 hamburgers. The line begins to form at 4:30 PM, an hour before the kitchen opens, and if you are lucky to get to order one of these 12 burgers you may only enjoy it at the bar. David Honeysett, chef at Raoul’s admits that, “If anyone could order a burger, it would really interfere with dinner service..Our check average now is much higher than what a burger would produce.”

Clark Wolf, a local restaurant consultant sums up the fake scarcity phenomenon by expressing that, “In New York, people love getting what they can’t have or fighting for it..running out can create drama and notoriety.” To read more about the marketing principle of limited supply in the New York City food scene, click here

Healthy Italian Fare at the High Line

Mario Carbone, Jeff Zalaznick and Rich Torrisi known as the ‘Torrisi Team’ are opening a restaurant at the High Line which differs immensely from their Thompson St restaurant Carbone. Carbone serves big portion heavy-duty Italian/American dishes such as veal parmiggiana and pasta alla vodka. The new restaurant at the High Line will be more focused on light and healthy dishes inspired by the cuisine of the Italian coastline. Zalaznick mentions that “there will be a huge emphasis on fish a vegetables..and almost no meat.”

The team did some research on the area where the restaurant will open and came to know that before the expansion, the high line was once the coastline of Manhattan. It was also a farmer’s market at one point some 100 years ago. The idea of opening a steakhouse was an option at one point, however the light, healthy Italian menu concept seemed more appropriate and in keeping with the area’s history. Thomas Waugh will also be serving cocktails inspired by the Italian riviera and serving them in the great setting which has about 100 indoor seats and 50 outdoor.

To read more about the new High Line neighborhood breakfast, lunch and dinner spot by the Torrisi Team, click here

 

The Hedgehog Concept and Foodservice Businesses

In Jim Collins’ seminal book, Good to Great, he outlined what enterprises have done to go from a good company to a great company. One of these principles, the Hedgehog Concept, can be perfectly applied to foodservice businesses in any stage—whether just starting up or expanding.

The idea is simple in concept but trickier in execution. It consists of three parts: being the best in the world, being passionate, and knowing what drives your economic engine. In this Enterprise Insight, we’re going to look at the three parts and how they apply to a foodservice business.

Being Passionate

This is the easiest for some and hardest for others; you have to be honestly excited and in love with what you’re trying to achieve. The type of restaurant an owner operates is largely driven by what they’re passionate about—whether that’s a great hospitality and a café, high-end cuisine and a fine dining restaurant, or coffee and coffee shop. If you’re not passionate about coffee, your coffee shop won’t be as good as it can be; you’ll never get to be the best without passion for what you’re doing.

Being the Best in the World

“Best” is subjective and someone’s world is tied the context of what that person has experienced. So, what we mean here is simply doing what you’re passionate about better than anyone else in your market. The goals for a local-favorite, third-place café are drastically different from a restaurant like Noma. However, they both are executing on what makes them great; warm service and familiarity with the café and cutting-edge, locally-driven cuisine at Noma.

Knowing What Drives Your Economic Engine

This is the integral third leg on the stool because all the passion and expertise in the world won’t guarantee that you turn a profit. Jim Collins explains the economic denominator as the “Profit per X”—the metric that would have the greatest, most sustainable impact on cash flow over time. In the foodservice industry, the most obvious economic metric that comes to mind is average check, and this is certainly valuable information. However, you can understand and drive your business in a more specific direction by choosing the metric that best reflects your ability to make money, because your average check is limited to your type of business.

For example, a coffee shop that’s focused on being the best in a given market would want to capitalize as much as possible on repeat guests. The average check at a coffee shop is not going to be able to increase drastically over time simply because of the product category. However, you could drive more sales per repeat customer per, say, week, by focusing on quality and service, thus compelling more customer visits. So, in this case, the average sales per repeat guest.

In a fast food or quick service restaurant, again, average check won’t rise over time. A better metric to push might be profit per labor hour. Limited-service restaurants need to run lean in order to be profitable, so finding the balance between maximizing sales while minimizing labor could drive you in the right direction. Meanwhile, a full-service casual restaurant should consider profit per seat, because it needs to maximize the number of turns per shift.

Applying Jim Collins’ Hedgehog Concept to your foodservice business can help to define or reposition your strategy. It is important to remember that the three items are reliant on one another: being passionate, being the best, and knowing your economic denominator, and when applied simultaneously, can be a powerful tool.

American Chains To Expand In The U.K.

In the U.K. as in America, health and lifestyle restaurant and fast casual concepts are becoming increasingly popular. The demand for innovation is high in both countries as the customer is mainly concerned with convenience, customization and movability. The fast casual segment in the UK had a year-over-year sales growth of 8.3% in 2013, and a five-year sales growth of 12.6% according to Technomic’s Top 100 U.K. Chain Restaurant Report.

Some fast casual concepts in the USA also operate in the U.K. such as Nando’s, the portuguese grilled chicken piri piri concept, and Pret A Manger, the healthy sandwich chain who is also currently the second largest fast casual operator in the U.K. Pret’s customers are very loyal because they appreciate the healthy recipes and preservative-free ingredients that are sourced fresh daily. In 2013, the 270 Pret A Manger stores generated £391 million. Of the Top 100, the fastest growing U.K. fast casual chain is Patisserie Valerie. The patisserie’s units grew by 24% in 2013 and sales increased 25% to £53 million. The concept is a patisserie/café that is known for their handmade celebration cakes, sandwiches, pastries and gelato. The design differs from restaurant to restaurant but the general decor theme is influenced by the 1950’s and some outposts have outdoor seating available.

A few American chains are considering expanding their unit counts in the U.K. such as Shake Shack, Smashburger and Five Guys Burgers and Fries; all budget chains whose main competitor in the U.K. would be Gourmet Burger Kitchen. The concept consists of made-to-order gourmet hamburgers that use only high quality ingredients. Total sales in 2013 for Gourmet Burger Kitchen were at  £46 million. Over the next years Technomic predicts that sales and unit growth for the segment will continue to grow and will perhaps promote an implementation of more global foods and advanced technologies.

To read more about the fast casual segment in the U.K. and America, click here

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