Author : Tommy Yionoulis

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How are you mitigating rising beef costs?

I read this article from NRN, Restaurants find ways to mitigate beef costs (see article below), and here the bullets that I thought were most interesting:

  • Overall foodservice sales of beef in the U.S. in terms of volume fell slightly in 2014, to 7.9 billion pounds, compared with 8.7 billion pounds in 2013 – (800 million lbs is a slight decrease?)
  • Americans ordered 3 percent more hamburgers in restaurants in 2014 than in 2013, according to The NPD Group
  • Cheaper Cuts:
    • The chuck eye roast — a less expensive substitute for prime rib — is the fastest growing cut, rising by 6 million pounds in 2014 compared with 2013
    • Followed by Delmonico steak, or chuck eye steak, a less expensive substitute for a rib eye, whose sales rose by 5 million pounds in 2014
  • To help mitigate those costs, Dove suggests changing portion sizes and offering different types of protein.  “Instead of an 8-ounce sirloin, run a 6-ounce sirloin combined with a shrimp or lobster deal.
  • Kevin Good, senior analyst at CattleFax, said ranchers are working to rebuild herds that were reduced in the aftermath of multiple years of drought that drove up feed prices. Although more cattle should mean lower beef prices, it takes up to three years from gestation for cattle to reach market weight. That means prices of many cuts aren’t likely to fall significantly until 2016 or 2017.

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Fri, 2015-03-06 10:38

Beef is expensive and expected to remain so for the next year, but Americans still love it. They’re eating more hamburgers than ever and buying more premium steak. At the same time, restaurants and purchasing cooperatives are using an array of strategies to mitigate costs and get the most out of their beef.

The Centennial, Colo.-based National Cattlemen’s Beef Association reported in January that overall foodservice sales of beef in the U.S. in terms of volume fell slightly in 2014, to 7.9 billion pounds, compared with 8.7 billion pounds in 2013.

Hamburger sales remained robust: Americans ordered 3 percent more hamburgers in restaurants in 2014 than in 2013, according to The NPD Group.

Kevin Good, senior analyst at CattleFax, said ranchers are working to rebuild herds that were reduced in the aftermath of multiple years of drought that drove up feed prices. Although more cattle should mean lower beef prices, it takes up to three years from gestation for cattle to reach market weight. That means prices of many cuts aren’t likely to fall significantly until 2016 or 2017.

“You can potentially expect a little bit of relief in the second half [of 2015], but it won’t be much,” Good said.

Retail operations might see customers trading to less expensive proteins, such as pork or chicken, or from premium cuts of beef to less expensive ones, which Good said might help lower premium steak prices a little bit. However, he said he expected demand of high-end cuts in foodservice to remain robust. “That’s tied more to the stock market and corporate expense accounts,” he said.

At the high end, steakhouses are committing to even higher-end cuts of beef, as well as local steaks.

Steakhouses such as RPM Steak in Chicago and Charlie Palmer Steak’s New York City and Las Vegas locations are offering A5-grade Wagyu beef from Japan — the highest grade available.

“It’s surprising how much it actually gets ordered,” said Matt Zappoli, executive chef of Charlie Palmer Steak New York, where an 8-ounce strip costs $162.

Zappoli and other steakhouse chefs are also sourcing local steak. Houston steakhouse 60 Degrees Mastercrafted focuses on steaks from a Texas herd of Akaushi cattle, while Zappoli is sourcing naturally raised 30-day, dry-aged rib eye from a supplier that procures it mostly from New York, New Jersey and Pennsylvania.

“It’s part of what they call a local harvest program,” Zappoli said.

He also offers two different varieties of American Wagyu and a USDA Prime rib eye and New York strip.

Outside of premium, expense-account-driven venues, less expensive cuts are experiencing robust growth. The National Cattlemen’s Beef Association, citing its 2015 Technomic Usage and Volumetric Assessment of Beef in Foodservice, reports that America’s beef roast, also called the chuck eye roast — a less expensive substitute for prime rib — is the fastest growing cut, rising by 6 million pounds in 2014 compared with 2013. That was followed by Delmonico steak, or chuck eye steak, a less expensive substitute for a rib eye, whose sales rose by 5 million pounds in 2014. Although premium porterhouse is the third fastest-growing cut, rising by around 4 million pounds, it is followed by two other less premium cuts — flank or skirt steak and the ranch cut, which is a lean cut from the shoulder clod.

The popularity of such cuts might not just be due to rising prices, but to demographic shifts, said Andy D’Amico, partner and founding chef of the three-unit 5 Napkin Burger chain, based in New York City, and of 5 Napkin Grill in Miami. The latter has an expanded entrée section, including more steaks, and the skirt steak is a big seller.

“In Miami, where there’s more of a Cuban clientele, they really love skirt steak, and we sell a lot of it. “

By contrast, “New York understands hanger steak,” another flavorful, less expensive cut, and D’Amico just added it to the 5 Napkin Burger locations in New York, in a pepper sauce.

Mitigate costs during purchasing process

(Continued from page 1)

Dave Woolley, chef of restaurant consulting firm Food & Drink Resources, said he sees large and small chains continuing to push steak items.

“I think a lot of them are going into different parts of the sirloin,” he said, noting that the subprimal sirloin cut is a large piece of meat that can weigh a couple hundred pounds.

“You can call different things ‘sirloin’ on the menu that aren’t traditional sirloin,” he said, such as the tri-tip, a cut at the very bottom of the subprimal that’s popular in the western U.S. and growing in popularity elsewhere, Woolley said, “especially in the last year and change, it’s as mainstream as possible.

“Americans’ hankering for beef, the drive for it, is not going away,” he added, so restaurants are figuring out how to provide it and still turn a profit.

DeWayne Dove, vice president of risk management for the purchasing cooperative SpenDifference, said he sees both restaurants and retailers trading down to less expensive cuts, which is driving up prices of those less premium parts of the cattle.

“We have seen retailers moving from rib eyes or strips to top sirloin,” he said, which means top sirloin is now trading at record levels. He indicated top sirloin rose by 15 percent this year compared with record highs of 2014.

To help mitigate those costs, Dove suggests changing portion sizes and offering different types of protein.

“Instead of an 8-ounce sirloin, run a 6-ounce sirloin combined with a shrimp or lobster deal. … Those strategies are going to have to be in place not just this year, but pretty much through all of 2016,” he said.

Dove is figuring out ways to bring prices down at every part of the purchasing process.

“We’ll line up every component [raw materials, yield, labor, overhead, packaging and freight]. We’ll put five, six, seven suppliers side by side and figure out why one’s higher than the other,” he said.

“It’s important to understand how to dive into those opportunities, because the raw material market is working against you,” he said. “You’ve got to pull every penny out of every part of it that you can.”

Although some independent restaurants buy entire carcasses and process them in-house in an attempt to cut costs, Dove says that the journeymen meat cutters at a supplier are likely to be more skilled and get higher yields than cooks in a restaurant. However, he said, restaurants might consider purchasing whole primals and subprimals and having the supplier cut them for them.

“We work a lot on utilizing the entire subprimal,” he said, using the best parts for steak and the trim for kebabs or hamburgers.

He said suppliers are open to those solutions.

“To clean up that whole carcass and find other homes for it is very labor-intensive, so it’s definitely a door that’s always wide open” as far as suppliers are concerned, Dove said.

He also suggested buying flash-frozen meat when prices are at their lowest and having your supplier thaw them in advance of the high-cost season at the end of the year.

He pointed out that the faster meat is thawed, the more volume is lost, but good meat suppliers will have the meat undergo a thawing process that lasts between three weeks and four weeks.

Contact Bret Thorn at bret.thorn@penton.com.
Follow him on Twitter: @foodwriterdiary

Where have all the restaurant floor managers gone?

This blog isn’t based on a scientific study it is just an observation but where have all the restaurant floor managers gone? I very rarely see restaurant managers in the dining room managing the meal period anymore.

I try to look for managers every time I go out to eat from a curiosity perspective. I, as all restaurant people do, judge every restaurant that I eat in and will for the rest of my life. I see managers, but they are almost always in the window expediting.

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When I was a manager at a high volume full-service restaurant, we would staff at least 2 FOH managers for every weekday meal period and three on weekends. One of us would work in the window expediting meals, and the others would manage the FOH.

Expediting is very important job, ensuring that the food going to the table is cooked correctly, and the right meals are getting to the guests in a timely manner, matters. Let’s also be honest with ourselves, expediting is easier than managing the floor and is more fun because you’re not having to be on and in front of guests. You can shoot the shit and make jokes with the kitchen guys while you’re putting orders together.

In my opinion there needs to be at least one restaurant manager on the floor managing guest service. Even in a lower volume restaurant there are things that the manager can be doing to positively affect the guests experience, help servers/buss staff, and speed up table turns.

Am I wrong? Please comment and tell me the deal. I would hate to think that in my early 40’s that I’m completely over the hill on this matter.

Feds roll out new way to analyze food outbreak data

Interesting article from the University of Minnesota Center for Infectious Disease Research and Policy about the US Government improving methods for sifting through data to estimate which foods are contributing to outbreaks. They focused the report on the four main outbreaks: Salmonella, Escherichia coli O157, Listeria monocytogenes, and Campylobacter.

It’s great that the government is focusing on these issues and trying to use data to draw correlations to try to minimize these outbreaks, but what I found most intriguing were the breakdowns of the various food groups by outbreak. Here’s what they found:

  • Salmonella: seeded vegetables (18%), eggs (12%), fruits (12%), chicken (10%), sprouts (8%), beef (9%), and pork (8%)
  • E coli O157: beef, 46%; vegetable row crops, 36%
  • Campylobacter: dairy foods, 66%; chicken, 8%
  • Listeria: fruits, 50%; dairy, 31%

Salmonella spans quite a variety of food groups and dramatically more than the others. The full article is below:

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US government agencies today reported on what they billed as an improved method for sifting foodborne disease outbreak data to estimate the contributions of different foods to outbreaks sparked by four common types of foodborne bacteria.

The report, focusing on outbreaks involvingSalmonella, Escherichia coli O157, Listeria monocytogenes, and Campylobacter, estimates the percentages of such outbreaks that were related to various foods from 1998 to 2012.

It was developed by the Interagency Food Safety Analytics Collaboration (IFSAC), a partnership of the Centers for Disease Control and Prevention (CDC), the Food and Drug Administration, and the Department of Agriculture’s Food Safety and Inspection Service, according to a CDC statement today.

In general, the analysis found that Salmonella outbreaks were caused by a wide range of food categories, with no particular one predominant, whereas just two food categories were dominant contributors to outbreaks of each of the other three pathogens.

“The new estimates, combined with other data, may shape agency priorities and support the development of regulations and performance standards and measures, among other activities,” the CDC statement said. “The recently developed method employs new food categories that align with categories used to regulate food products and emphasizes more recent outbreak data.”

Four leading pathogens

The CDC estimates that the four pathogens cause 1.9 million cases of foodborne illness each year.

The 12-page report says the four pathogens were blamed for 2,655 foodborne outbreaks between 1998 and 2012, but the study focused only on 952 outbreaks for which the implicated food or foods could be assigned to a single food category. Of the 952 outbreaks, 597 were caused by Salmonella, 170 by E coli O157, 161 by Campylobacter, and 24 by Listeria.

The report describes various statistical methods used to refine the estimates, including steps to smooth variations in outbreak size and reduce the influence of outliers. In the interest of timeliness, the model gives greater weight to data from 2008 through 2012 than data from the earlier years. The agencies divided foods into 17 categories.

Among principal findings, the authors found that seven food categories accounted for 77% ofSalmonella cases: seeded vegetables (18%), eggs (12%), fruits (12%), chicken (10%), sprouts (8%), beef (9%), and pork (8%).

In contrast, for each of the other three pathogens, just two food categories accounted for the majority of cases, as follows:

  • E coli O157: beef, 46%; vegetable row crops, 36%
  • Campylobacter: dairy foods, 66%; chicken, 8%
  • Listeria: fruits, 50%; dairy, 31%

The CDC cautions, however, that the Listeria data were sparse, leading to considerable statistical uncertainty (wide confidence intervals), and the 50% estimate for fruit reflects the impact of a large cantaloupe-related outbreak in 2011.

Toward greater consistency

The report acknowledges a number of limitations, including that it covers only foodborne disease outbreak cases, not sporadic cases.

It states, however, “Our novel approach produces better estimated attribution percentages than those based solely on the observed numbers of outbreaks and outbreak illnesses, and can be used to produce new estimates when outbreak data are updated.” In addition, it says that having consensus on one analytic approach may make for greater consistency in interpretation of estimates across different federal agencies.

The CDC said IFSAC was scheduled to describe its methods at a public meeting in Washington, DC, today, as part of federal efforts to improve foodborne illness source attribution.

 

How much money do we lose every year?

 

Having manager’s perform SMART Pre-Shift Inspections every meal period refocuses them on what is important to running a successful operation. The benefit of focus is something that I had to rediscover recently, but it makes so much sense.

We don’t do enough as an industry to focus and ground our manager’s every single shift on what is important to running a profitable business, and it is a gigantic missed opportunity. Managers are expected to be multi-tasking omnipotent robots that can instantly shift between their different responsibilities, and that is just not always the case.

I was a floor manager at one of the busier Changs in the early 2000’s when it was not uncommon for us to be on a 1:45-minute wait on a Monday night. I remember it as a very chaotic job that could go from 0 to 60 to 30 to 90 to 120 back to 0 in a single shift.

I remember scrambling to work on projects and deal with putting out fires in that two-hour window between lunch and dinner. Then getting back into the driver seat again for the dinner rush.

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I have also managed at slower restaurants, and I found myself fighting boredom and apathy. Trying to stay motivated and keep my team motivated to give great service.

Manager’s make restaurants successful. We have all seen a manager who got a location rocking and rolling: high sales, good profits, great service. They leave, and the next guy comes in and this location goes from hero to zero in 3 months. There were no major changes in the area driving the decline, it was just that the new manager couldn’t keep the staff on point, service up, and customers reacted.

It is the nature of this industry that we have customers in our building for large portions of our day. There is a ton of moving pieces that need to be dealt with every single shift. It is easy to get caught up in fire fighting and then stumble into your next shift without having the opportunity to focus yourself and your team on what is important.

Two tools that I have seen implemented with a lot of success are SMART pre-shift Inspections that manager’s conduct before each meal period and pre-shift meetings with each department.

SMART Pre-shift inspections get your managers walking around your restaurant looking at your critical safety and operational readiness items ensuring that you are ready to handle the rush. Performing this inspection reminds managers what is important and helps them catch things that they might have missed if they hadn’t done the inspection.

Pre-shift meetings with service and kitchen teams give us an opportunity to communicate shift info to the team and get them focused on serving guests.

Both tools have the same effect on your restaurant, they focus your staff on what is important, and that focus cascades through your operations.

We have recently created a free ebook on SMART Pre-shifts you can get a copy by clicking here.

If you like this blog, please consider following OpsAnalitica on LinkedIn.

Due Diligence and Due Care in the Restaurant Business

Due Diligence and Due Care are words  generally associated with investing, contracts, and lately network security.  In my last position working in custom application development and  cyber security those terms were defined as:

Due Diligence: Identifying threats and risks.
Due Care: Acting upon identified threats to mitigate risks.
I believe that the hospitality industry better adopt Due Diligence and Due Care as management concepts that we fully embrace and implement into our business processes.
In the context of restaurant management, I look at Due Diligence as doing what it takes to serve safe food in a safe environment.  I didn’t say delicious food I said safe food.  Meaning that we use HACCP principles to ensure that the food products that we are serving have been delivered, stored, and prepared safely.
Most restaurants today are, or should be, conducting daily inspections of their facilities paying attention for critical food safety violations.  Making sure food is stored safely, chemicals are stored away from food, temperature discipline is maintained both in cooling and heating.  We aren’t introducing foreign contaminants into the food preparation areas.
By following best practices and inspecting daily, we are performing our Due Diligence in providing safe food for our customers.  Due Diligence is only half of the battle, Due Care is the other half.
Due Care procedures are the processes that you have in place for when you identify an issue.  The key to Due Care is consistent and documented application of the process.
You may be familiar with the phrase “It’s not the crime, it’s the cover-up” that gets you into trouble.  That is especially true when you are doing your Due Diligence, conducting a pre-shift inspection, and you identify an issue but then you don’t correct the issue safely.
An example might be that you fill out a temperature log for a walk-in refrigerator, and you record a 65-degree temperature.  The person completing the temperature log doesn’t do anything to fix the issue, they just serve the food and they get a lot of people sick.
We as a nation are very intolerant of companies that had enough forethought to identify a critical area on an inspection but then not have a plan to fix the issue when they identified it.  We find that unacceptable, and for good reason, you wouldn’t want to fly in a plane where the pilot knew it was missing a wing but decided to take-off.
In the above example, we would hold the company responsible for, not training their inspector well enough to know that a 65-degree walk-in is very bad.  We would also hold them responsible for, not having a well-documented procedure to deal with the issue.
Look at your real-world experience, we for the most part understand when people make mistakes or accidents happen.  We get furious and litigious when mistakes are made and the people responsible are clueless when they should have known better.  We get even with businesses that profit while their customers get hurt.
As hospitality professionals, we have to make sure that our organizations, size doesn’t matter, have well documented Due Diligence and Due care processes in place.  More importantly we have to train, consistently follow, and document those processes in their application.  It is when we consistently apply our processes that we have a chance of protecting our brand and our businesses when we make a mistake.
My name is Tommy Yionoulis, and I’m a restaurant guy and a software guy.  I’m one of the founders of OpsAnalitica; you can learn more about our company at www.opsanalitica.com.

First Watch Restaurant Shut Down for Live Insects

Here is another example of one bad actor running unsafe operations bringing unwanted media attention to the whole chain.

Click here to watch the news report

This is a trend, local news stations are trying to own food safety. In Denver, it is Fox 31; this story is by an ABC affiliate in Tampa. The reporter states to friend her on Facebook and send her tips on dirty restaurants. We can expect to see more of these stories.

Report Card:

First watch corporate based on our information gets a C.

Things they did well:

  1. They got Steritech in there to deal with the roach problem quickly.
  2. They released a statement from corporate.
  3. I’m inferring this from the report, they use Steritech or some other company, to inspect several times a year.

Things they could have done better:

  1. The completely glossed over the troubling things: roaches are gross, but they aren’t as dangerous as 56-degree pancake batter.
  2. Chemicals cross contamination is terrifying; ask the poor woman in Utah, who drank the bad sweat tea.
  3. The biggest ding against First Watch corporate; they don’t have the proper systems in place to identify issues and to ensure that their restaurants are performing safely at all times.

3rd party inspections a couple of times a year aren’t enough. You need systems in place to identify issues on a daily basis and to hold restaurant managers/owners accountable. I’m not advocating Orwellian type oversight. I’m not saying you need more area manager’s or a restaurant cop in every restaurant every day making sure that nothing bad ever happens.

I’m advocating:

  • Building a culture of responsibility and using those cultural standards to weed out people who don’t fit in your organization.
  • Setting up incentive based systems where you reward your teams for doing things right.
  • Designing your systems so that everyone is getting training on the critical things frequently.
  • Using technology to gather information.
  • Most importantly having the due care processes in place, so that when you identify an issue there is a clear set of guidelines that your team follows to correct it.

My name is Tommy Yionoulis and I’m a restaurant and software guy.  If you like what you read, please follow OpsAnalitica on LinkedIn and follow our blog.

The NRA’s Response to the State of the Union Address

Please take a look at the National Restaurant Association’s Official Response to the State of the Union Address.  I would like to add two personal notes to this story.

I started my working life at age 14 at a Jerry’s Subs and Pizza in Columbia MD.  I think it is fair to say that at the time I wasn’t the most productive or highly skilled employee, I was uncoordinated and goofy.  I would never have made that first paycheck or been able to get that first job at Jerry’s if they couldn’t afford to hire and train me.

In 2008,  I managed the Franchise Assistance Program at a large sandwich chain.  My job was to offer business coaching and assistance to franchisees who were struggling.  Remember how franchise chains work.  When you see the Subway in your local strip center, it isn’t owned by the Subway corporation with it’s billions of dollars in revenues and resources; it is owned by one of your neighbors.

Please click here to read the NRA’s Official Response to the State of the Union Address.

 

My name is Tommy Yionoulis and I’m a restaurant and software guy.  If you like what you read, please follow OpsAnalitica on LinkedIn and follow our blog.

 

Health Department Investigating Illnesses At Opryland Hotel

This article, Health Department Investigating Illness at Opryland Hotel, illustrates one of our key beliefs at OpsAnalitica. In today’s connected world, a news story like this can reach a national audience in minutes. I live in Colorado, and this article was sent to me by a friend.

The title of this article is meant to alarm people. When you read the article it seems as though Opryland acted responsibly, self-reporting to the health department, and went above and beyond to help their guests by supplying medical care.

On the OpsAnaltica blog, we are going to call them as we see them, and we believe that Opryland Hotel handled this situation well.
If they were using the OpsAnalitica platform they, would have been able to show investigators every self-inspection they had done to ensure the safety of their guests but that fact is for another post.