Rebuilding Restaurant Sales with Delivery & Curbside 2.0

The Restaurant Sales have been in the dumps since the past one and a half years. No matter how hard restaurant owners try, convincing people to visit their outlet or order from them has become a cat and mouse game that's doesn't seem to reach any conclusion. Social Media strategies don't seem to be helping either. But survival is a must - by hook or crook, restaurant owners must ensure that they are able to generate enough sales to keep the kitchens running, staff employed and homes warm.

Given the current demand, delivery and Takeout have been two most consistent revenue generation models for restaurants in the past year. As a result, more and more restaurant have now started offering digital ordering as a full-fledged service coupled with the option of curbside pickup and/or takeaway. But as the competition in these domains soar, so does the restaurant owners' fallible anticipation on capturing new leads and retaining existing ones.

Taking this into account, the question now arises: how to stay on top of customers' mind? Is it possible to boost sales in the pandemic-wary world? what are people looking for and what restaurant need to do to meet those expectations?

How Restaurants Can Improve Delivery and Takeout Services

The construction of family meal bundles which include core menu items and value-added sides

Even in the midst of the Coronavirus crisis, restaurants have found innovative ways to replace revenue streams, reach out to new audiences, and develop meaningful food delivery experiences. In any menu engineering exercise, deciding what menu items to remove, change, or scale up can be quite challenging. However, if done smartly, menu re-engineering helps eliminate poor performers from the menu, make your profitable menu items more prominent and ensure your menu is designed for maximizing profits.

Shake Shack is a great example of thoughtful family meal bundle engineering. They realized that burgers and fries don't deliver well, and so they designed a new way for customers to get the taste of fresh burgers right at home: cook-at-home burger kits. Their customers thus felt assured that the food they trust is being delivered in a reliable manner.

Incorporating sides as main dishes

Introducing sides as main dish is a great way to boost sales. Side dishes have the potential to boost sales, appeal to customers, and encourage add-on purchases. Restaurants rely on their starters and appetizers to generate profits. Millennials, in particular, are increasingly attracted to small bites rather than a course meal. Your sides can become a trustworthy companion when you attempt to rebuild your sales post covid.

Complementary options can include appetizers, deserts, mixed drinks, signature brews, or any other plates that are not associated with an entree. Depending on your entree pricing, you will use these items differently. Offering free appetizers or discounting them when your customers order a drink or multiple entrees may be a good idea. Alternatively, you could create a combo that would be available at a discount.

For instance, if your restaurant is well-known for hotdogs, you can also deliver French fries, onion rings, or salad along with it. This would not only create a good impression, but your customers would also try out the side dishes that your restaurant serves, remembering to order them the next time they order from you.

The right combination of margin-building foods for your menu

It is important to make sure you are focusing on your profits rather than just your top-line revenue when creating a menu. Nevertheless, it's important to note that the profit margin is not just something to be measured; it's a performance metric that you should continually improve. As author Doug Hall said, “If your profit margins aren’t rising, chances are your company isn’t thriving.” 

It is possible to increase your restaurant's profit margins in many ways - and many of them are straightforward to implement. There are plenty of variables to experiment with, from modifying your menu to adjusting ingredients and to training your staff. But the most important one is to take another look at your menu and include margin-building foods.

It is best to keep food costs at 33% of menu prices, although some high-priced items, like steak, may run higher. However, profits can be increased without raising prices. If you replace a high-cost, low-performing meat dish with a satisfying pasta dish, you will certainly see the change, since pasta entrees average only 15% food cost.

LTOs - Have they become irrelevant, or do they continue to gain importance

A limited-time offer, or LTO, is a menu item or set of items that are only available for a certain period of time. The restaurant LTO offers a great opportunity to attract customers during lean periods. Each restaurant has its own unique goals, so there is no perfect formula to make an effective LTO. Having said that, when you are designing a LTO, you should take into consideration your current menu items as well as your target audience. 

Consumers are often observed to be looking for "new products to try" or "different twists on their old favorites" when they decide to try LTOs. It is possible for restaurants to determine which of their menu items is most profitable through menu engineering. When experimenting with LTOs, it is also important to be creative.

LTO has been used regularly by Taco Bell. Each year, they announce the return of their infamous nacho fries, and they usually disappear again at the end of the year.  McDonald's Shamrock Shake is a big part of their marketing strategy. They have often offered it for a limited time.  This was sold in a variety of variations such as a Shamrock Sundae in 1980, a chocolate version in 2017, and the Oreo Shamrock McFlurry in 2020.

Adapting to the post-COVID-19 environment

As people adjust to the post-COVID-19 environment, they crave normalcy and interactions with their favorite stores and restaurants. It's possible to increase your sales by creating and hosting unique and safe events.

COVID-19 severely limits dining options, but that doesn't mean digital events cannot be hosted. Perhaps you can offer live-streams of cooking classes or menu reveals, or maybe you can bring exclusive products to your patrons. Companies like 2 Towns Ciderhouse, which typically participate in an annual Cider Summit in Portland, OR, chose to deliver tasting kits to customers in its place instead of hosting a physical event. Following that, a virtual party was held so that participants could talk about the cider and enjoy it together.

Conclusion

Every restaurant is responding differently to the global crisis. Embracing takeout and delivery options can definitely help make up for the revenue that is lost, but in longer term, it would not be enough. Thus, it is vital to put on creative thinking caps and come up with innovative ideas that would help drive sales.

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