Why would I venture into this subject? Simple, my success depends on - PowerPoint PPT Presentation

Why would I venture into this subject? Simple, my success depends on you success. I’m on the street seeing the most successful and hardest working. Follow up on last y ear’s Food Show Seminar Overtime, Salary, Tips, • I-9 Audit – JK • This year – Talking $15 and how we can make more money, yes – make more $$ •

People Can Be divided into Three Groups • Those Who Make Things Happen • Those Who Watch Things Happen • Those Who Wonder What Happened It’s Time to Make It Happen!

9 States Already There! I don’t think it’s a bad thing but for smaller businesses , only the super strong will survive . - Manu Alfau, Chef/Owner, La Bodega This is a game changer. We cannot survive if we continue doing business as usual. I hope the public will continue to support their favorite spots while everybody figures this thing out. . . . pricing, reducing menu offerings – our business model will need to change. - Jeremy Hardy, Owner, Coastal Kitchen & Mioposto

8 Tips for Dealing with Minimum Wage Hikes Open For Business – Olivia Terenzio, December 15, 2015 For every dollar increase in minimum wage, restaurants will need to take 1.25 to 1.5% • From QSR to Fine Dining • Someone’s making $3 above minimum wage, and then minimum wage goes up by a • dollar, and now all of the sudden they’re only making $2 above minimum wage. One upside of minimum wage changes is that owners and operators know far in advance • when they are going to take place. If you’re going to raise menu prices to compensate, it’s recommended going into summer and before holidays. There is no better time to make price changes than when the minimum wage changes. • Since new laws are being discussed and reported in the media, the public is aware of the pressures and everyone is making changes across the board. The time is now! • Dishes specific to your restaurant – these items are where you have the most pricing • power – they are unique to your brand and customers can’t associate a specific value to those items. This gives you leverage when pricing your menu. Calling out local or specialty ingredients can raise a dish’s profile and influence guests to • spend more.

We survived the smoking ban, numerous but errant view on nutrition and labeling • requirements which were predicted to irreparably harm our industry. Yet today we lead in nutritional understanding and in many ways have come out the other side even stronger. – Denny’s CEO, John Miller Issues that were predicted to kill our business, including the smoking ban, tip credit tax, • menu labeling, 50% meal deduction, oil prices, stricter drinking and driving laws, and even the cholesterol-in-eggs hysteria. Each of those issues was surely going to shrink our industry smaller than the period that ends this sentence. BUT IT DIDN’T HAPPEN . Let’s build sustainable development programs that retain our staff and build more • leadership capacity in our units and brands. Pursue the bright spots. Best-in-class operators exist relative to high employee tenure • (and lower employee turnover) like Starbucks, Shake Shack, Chipotle, The Cheesecake Factory, Ivar’s Seafood Restaurants and Chick -fil-A, among others. They made conscious decisions to invest more in development, career pathing, pay and building cultures of kindness between crews and supervisors. The results are striking compared to the rest of the industry. So take the best ideas from the best practitioners, then edit and amplify in your own company.

People Can Be divided into Three Groups Those Who Make Things Happen • Those Who Watch Things Happen • Those Who Wonder What Happened • Danny Meyer – Makes Things Happen! Danny Meyer is eliminating all tipping at his restaurants and significantly raising prices to make up the difference, a move that will raise wages, save the hospitality industry, and forever change how diners dine. Why does this matter? "Hospitality included": Danny Meyer restaurants eliminate tipping https://www.youtube.com/watch?v=h3B2- _SLRBQ

So how does this news effect the independent restaurant on Long Island?

My Experiences with Consulting . . . When you think in extreme, everything else is relative. . . Trucks, people, etc. For the record, I have 400 staff members, 100 are less than $12/hour. I am looking at outsourcing everything that doesn’t add value. Full 5 year lease on half of our fleet. • Reduce O/T labor. • Keep current staff, minus low performers. • I need to build with my existing customers • Produce, Meats, Coffee, Wine • You need to build with existing customers • Get your best customers in more times per week •

Some Fundamentals of Retail • 3-5 % of the customers complain EVERYDAY to someone about pricing. That means out of 200 covers, 6-10 people complain. • 95% of your customers don’t complain, they want good food and great service. • Customers want to feel there is a relationship , personal service by people who care and appreciate their business. • Customers want knowledgeable staff who know and understand the menu and the specials. Train and retrain, then train again! • Customers want consistent quality = train the kitchen staff.

Since this presentation was made to my sales team, I received an email from Dan Murphy - last year’s presenter. companies with over 5 workers must provide 40 hours of paid sick time annually …

It’s just the beginning, but we have some ideas People Can Be divided into Three Groups Those Who Make Things Happen • Those Who Watch Things Happen • Those Who Wonder What Happened • Make sure you choose the right people! Walt Disney had a great outlook on business: Do what you do so well that they want to see it again and bring their friends. • Make sure it’s personal. • Make sure you have great staff. • Make sure they are trained and trained and trained. • Make sure customers know you appreciate their business

So what are we going to do? • Increase sales 15% = wine specials, cooking classes, paint night, psychic night, etc. • Increase prices 10% across the board, no less. • Reduce labor cost that doesn’t add value Have bartender come in early to cut lemons/limes • • Reduce staff • Reorganize and address existing staff Redefine roles and responsibilities • • Mandatory time cards Mandatory meal punch out • Phone break punch out • Schedule meals • • Reduce hours to 40 = scheduld 43.75 (-) breaks • 45 minutes x 5 days = 3.75 hours/week (9.3% pay) TRAIN - TRAIN - TRAIN

What does this mean to you, the independent restaurant owner? My opinion “Strong will survive, the weak will not” and the next 3- 5 years will decide who’s who. Labor – safe guestimate will increase 20-25% 50% of that is management/front of the house 50% is hourly (now $8-10/hour) Overtime going to $22.50

Independent Restaurant Annual Sales 2,000,000 Labor Cost – now 25% 500,000 Assume 50% hourly 250,000 50% management 250,000 Estimated Increase from $10 to $15 x 50% of staff (125,000) New Labor Cost 25% to 31.25 % (125,000)

Proposed Price Increase (10%) Remember 3-5% complain every day 95% want good food & good service 2,000,000 10% across the board some 5 some 25 200,000 Less wage increases (125,000) Net Profit to owners + 75,000 Staff gets 20% gratuity to staff + 40,000 EVERYBODY WINS The Choices are: Lose $125,000 or make $75,000 Every Week you wait costs $4,000 People Can Be divided into Three Groups Those Who Make Things Happen • Those Who Watch Things Happen • Those Who Wonder What Happened •

Closing Comments (JK) • Three types of people - I’m dealing with it too! • Please go through our show with open eyes. • Add some of our products to your new summer menu* with price increases – * get done by 4/29 and printed by 5/30. • Please consider our wines for your wine menu – Look at 30/30 with 5x1 mark up for you – Add a Daily Wine Special with your Dinner Special – Consider our Rosés!! – Let’s book a wine training today, pick a day of week and time – there’s never a good time, but we all need it and customers want it!! – Consider offering wine specials this week! • Stop working for everyone else! Thank you!