Subway’s Five Dollar Footlong Promise

 

Subway, Oops!

What is all the fuss about?   Subway’s famous footlong sub is actually an 11 inch long footlong sub! Did anyone really think that each and every bun that Subway bakes will end up at exactly 12 inches long?  Ever heard of shrinkage?

Ok, Subway got caught not over delivering on their promise. The pans they use to bake their footlong subs are twelve inches long and the buns can’t get any bigger than the pan, but the occasional one will not rise to the occasion and end up shorter. Not Good Subway! If you advertise a foot, your end product should be 12 inches. (My wife reading over my shoulder mumbled something about the head baker at Subway probably being a man….not sure what she was talking about.)

What I found interesting is the person that alerted the media to this potential end to civilization as we know it…an Australian! I grew up in Australia and wonder where an Australian got a ruler with inches on it? Australia has been metric since the mid 60’s, did he raid his grandfather’s tool kit, or is he just one of those people that spend their lives looking for their 15 minutes of fame?

What should the consumer be angry about? Being misled by an inch? Or the reported ( by a Subway franchisee ) 25% percent reduction in the amount of meat that Subway puts on their shorter than advertised buns. Now that is something to get angry about!

 

Control Costs and Increase Profits In Your Restaurant

Start Planning for 2013 NOW If You Haven’t Already….

 

cutting costs in your restaurant

The end of the year approaches and what a year it has been!! The economy is still in the dumps, although there has been some rebound in some parts of the country, most restaurants and food establishments are still not back to where they were a few years ago.

With the end of the year close it is now time to start planning for next year, in fact if you have not already done so, you should start now and I do mean now!!

Forget what has been and start to visualize how you are going to grow your sales and cut your costs for the coming twelve months. It is a new start and hopefully you will get a kick over the holiday period to help you put away a bit of money for promoting your business.

What do you plan for? Let’s assume you have done a complete budget for next year. Sales, costs, maintenance, recruitment, etc, etc. Now comes the planning for how you will achieve the sales and costs budgeted.  We all know that the two ways to ensure your business is healthy financially is to…. Grow Your Sales and Control Your Costs.

Sales growth comes from service and product excellence as well as marketing your business to keep existing customers and gain new ones. Sounds pretty simple but we all know that it is not. Trying to find time to run your business, worry about staffing issues and all the 1001 things that it takes to keep the doors open all fill your day from start to a very weary finish.

I suggest you take the time away from your restaurant business, even if it is one day to spend planning your strategy on saving costs and growing your business. Get someone to cover for you. If you have never let anyone look after your business before, then it is about time you started!! Sometimes it is necessary to spend time working for your business rather than in the business.

Decide on three major projects that will help you achieve these goals for the first half of the year, one long term or ongoing, one medium term and one short term. Plan to start them all by the end of January and ensure they are monitored to gauge their effectiveness. The sales growth part should start with the next six months of LSM campaigns and the budget for each. The cost control part is dependent on your circumstances but I would strongly suggest weekly stock takes and cost percentage reviews as a priority if you are not already doing so.

Still a bit lost as to what to plan and how to go about it?

I can help! I have just completed a guide “50 Ways to Control Costs and Increase Profit” and it is currently available for Kindle. Click Here to get your  Kindle copy.

In the next 10 days the book will be available for PDF download from this website with some very interesting and helpful bonuses such as:

  • A free copy of my LSM ebook
  • A Cost Control Worksheet to help you track your savings
  • An Excel worksheet Break Even Analysis
  • 50 Ways to Control Costs workbook to help you plan which of these great ideas you are going to implement

Both of these guides and the additional tools are perfect for planning the year ahead and assisting you in making the profit you deserve.

Good planning and a Happy Holidays!

Rod Smith

Restaurant Marketing 101 – Loyalty Marketing

Loyalty Marketing For Your Food Business

As promised the first and one of the most important items in my Local Store Marketing guide is customer loyalty programs.

Loyalty programs are any means a business uses to grow sales and customer base through repeat business from existing customers. This can also be used to gain new customers but once they step into your establishment hopefully they become repeat or existing customers.

Start by offering the customer an incentive to use your services rather than your competitor. This incentive must be strong enough to outweigh the convenience of a nearer competitor or even a competitor with a superior or better priced product.

This normally takes the shape of a deal that allows a customer to gain a reduced price, an addition product, or other long term incentive. The trick to any loyalty program is to make that incentive available after several visits to your establishment.

The most successful loyalty program for the restaurant and QSR business in my opinion is the “Buy 10 get one free” or “Buy 5 get one free”, it doesn’t matter what the amount is but it does matter that your profit margins on the program should still be healthy and that any loss for the give-away is more than matched by the increase in sales on a daily basis. This is particularly suitable for coffee shops, bakeries, fast food or any business where the price of the main item is between $1 and $10.

Take a coffee shop for example. Average price for a coffee is about $4 depending upon where you are. Most working people in reasonable sized cities have a coffee at least once a week, some have several a day. The customer walks or drives by many coffee shops on their way to work every morning and many large office buildings have their own coffee shops. So how to you compete with all this choice?

A Loyalty Card.

The best way to handle the mechanics of this program is to get cards printed with your logo and a place for the customer’s name and email address as well as room around the outside to punch 10 holes. You should have a unique hole punch made that is only found at your business. I have had a custom hole punch made for less than $40. Make the design of the hole something to do with your logo or something unusual. Many coffee shops are using a hole punch in the shape of a coffee cup so try to stay away from that design. Be sure to have the place for the customer’s contact details.

The collected information can be used in many ways, emails with new offers or products, contacting them if you haven’t seen them for a while, (you or a team member may have upset them) additional loyalty programs for your best customers; for example a draw of used cards for “Free Coffee For a Week”.

When the customer places an order the server asks if they have a loyalty card. If they don’t they ask if they would like one and explain the offer. The customer orders a coffee and the server punches a hole in the card.

When the customer has all 10 holes punched the server can tell them that their next one is free when they bring back the fully punched card. How you handle it is up to you – it may be that you wish to give them their 10th coffee free. Fully punched cards are then collected and a new one given to the customer.

Note: The cards should be small enough to be carried in a wallet or purse ( business card sized) and if a customer has more than one card with, lets say, 4 holes on one card and 6 on the other, then you must honor the 10 holes. Also if you see a customer with two or three cards, offer to consolidate the number of punches onto a new card and discard the old ones.

The coffee shop idea can be adapted to many different types of businesses and is not exclusively for low ticket average products. I know of higher end restaurants that use it too. Office workers will offer to get coffee for their co workers so they get a free one for their trouble. And I know of more than one boss that buys his/her entire team coffee on a Friday and enjoys his free one with his spouse on the weekend.

Be creative in your local store marketing, look at what your competitors are doing and how they are making their customers more loyal to their business. Adapt ideas that you see, not only from the food industry but from any type of business and get started.

With Back -to-School around the corner, next week I’ll talk about some ways to get your product out in front of the students and kids…