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The Right and Wrong of Tough Times


By Thomas Haas

Joseph A. Banks is a major discounter of men's clothing who consistently offers two-for-one merchandise. Buy one suit, get one free; buy one sports jacket, get one free. This is a strategy that places this company as a price/low ball retailer that will make it difficult to go back to the old fashioned "Buy One, Get One", which is the normal way of doing business.

This applies to the restaurant business due to the economic environment, which needs no explanation, and which finds many operators struggling to find the proper strategy to build business without throwing the baby out with the bath water.

A small group recently dined at a well known upper level seafood chain. The experience was less than favorable due to the restaurant unit's approach to the customer in delivering a credible experience.

We were introduced immediately to the various pricing specials such as wine. The wait person suggested a Sauvignon Blanc that regularly sold for $9.00 a glass and was on special for $7.00. A different Sauvignon sold by the bottle was reduced from $39.00 to $34.00. Also, he named a number of entrée deals that had been reduced as well - it was almost a Wal-Mart experience.

Next, the waiter suggested the special of the week, which was Wild Halibut, a firm, white, thick fish. Halibut happens to be one of my favorites, which like cod is seldom on menus. Halibut is a huge, heavy fish caught off Northern Canada and Alaska at depths sometimes of 150 feet according to two in our party who had actually been halibut fishing in Alaska.

The menu presented the halibut with "spring ramp" (wild leeks) and crab gnocchi. I asked to substitute the gnocchi with sautéed spinach, which was accepted. When the entrée arrived, the fish was sitting lonely on top of the spinach with spring ramps nowhere in sight. The configuration of the special was the perfect shape of a filleted fish with a tapered tail end and a seam in the middle running the full length of the portion. This entree failed dramatically to match the promotion poster on the wall which was plastered in the entrance foyer, as the consistency of the fish was light and flakey, which is not at all the characteristic of halibut.

It seems that this chain has a problem determining how to deal with the recession, as they fail to understand how to protect their brand and have difficulty promoting their pursuit of value without positioning themselves as the Joseph A. Banks of Seafood Restaurants.

Pricing is not the only tool available to promote value and protect one's brand without confusing the customers. Value is based on quality, consistency, service, ambiance, hospitality and price. In its premier issue, Eating Well magazine traced the journey of an Oregon Rockfish from the moment it was caught, frozen, shipped, distributed over a three week period, finally showing up on a menu in the Midwest as red snapper. Integrity is a key component of brand protection, which can very well determine how you fare in these difficult economic times. Once you lose the trust of your customer, any operator will definitely have a limited life as a going concern.

This difficult market is an opportunity for the wise and astute professional managers who are leaders, and respectful of their customers, focusing on quality, consistency and integrity, regardless of the special offerings for the week. These three elements are not sometime specials, but all the time fundamentals of staying in business. The best deal in the restaurant business is the operation which fulfills their promise and realizes that price should be based on value not cost, with value defined by Webster as something intrinsically valuable or desirable, which translated means more than two for one specials.


Thomas J. Haas is President of Thomas J. Haas & Associates, Inc. Mr. Haas is a food service industry consultant specializing in strategic marketing, and is a leading analyst in the industry. Mr. Haas can be contacted regarding consulting and public speaking engagements by e-mail at haaspitality@aol.com.





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