Seeking Paired Interests

Everyone wants to be good at their job. Really, they do, but employees easily become complacent when they get used to their hourly wage and have no opportunity for growth. In their eyes, they’ve reached their ceiling. The days are the same no matter how hard they try or don’t. Rather than focusing on maximizing their output, they’re main focus is avoiding getting in trouble. Even if an employee was to go above and beyond, there are no systems in place that reward or recognize this. With no vested interest in maximizing their output, your staff can and will become stagnant. When employees have a paired interest—when they win when you win and lose when you lose—they start to take ownership of their actions and their output.

Here are some incentive plans to ensure you have mutually beneficial interests:

Knowledge Employee Incentives

Rank or Certification Programs: Developing certification training where staff can earn a rank, badge or new chef coat or hat can create motivation to strive for more, especially when it’s tied to a pay raise. When an employee earns this recognition it gives them distinction among their peers. Those who are consistently moving up in rank or certification are more likely to assume leadership roles in your restaurant, this way they’ll stimulate other staff to level up simply by comparison.

In our restaurant, we’ve modeled ours after the military rank structure, where achieving a certain rank results in higher pay. This system is very clean and simple to understand for back-of-house staff who want to advance.

Efficiency Incentives

Efficiency is key in the kitchen, not just knowledge. Setting time trials for prep or executing menu items to show who is the best at doing it correctly and quickly creates a healthy and competitive environment. Giving immediate bonuses or pay increases to those who perform exceptionally well, especially during peak times, will pay for itself in increased productivity and efficiency. If they are seen as awesome, and rewarded as such, that behavior starts to permeate the rest of the crew.

Front of House

If your staff is becoming complacent it’s often because they don’t see opportunities for growth and get accustomed to the average tips they get. When you hear “advancement” it’s easy to assume that means a pay raise, but there are other ways to encourage outstanding staff that doesn’t come with a dollar amount.

Servers have a built-in incentive with tips, but even that can become routine. Introducing an incentive for not just having more tables but achieving a higher ticket average can greatly influence the overall health of the restaurant. Implementing a profit-sharing program for servers who consistently exceed the average ticket value can set a new standard of excellence. Many servers will strive to meet this standard, seeking to win the “gold star” and perform at their best.

Depending on the age of your workforce, you can gamify the day with challenges, like who can sell a particular item last, akin to a game of hot potato. The winner could get a prize from a treasure chest filled with fun items from the dollar store or gift cards for older teams.

Communication and Evaluation

This means tight but ever-flowing communication. All employees need to know where they stand through proper evaluations so they can set goals and take on projects with the belief that their accomplishments will be recognized and rewarded. Transparency through CONSISTENT QUARTERLY EVALS will build a sense of shared purpose for paired incentives.

I’m not saying this as a theory, I’ve seen it happen. When staff know they get more when you get more, they act the part.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post Mike’s Monthly Tip: Paired Employee Incentive appeared first on Pizza Today.

Action step to take when losing an employee you really needed to keep

This topic hits close to home for most operators. In fact, as I sit here writing this article my assistant manager is working out the last of her two-week notice, which she gave via e-mail the day after her boss, our GM, left for vacation. The truth is that there is never a good time to lose a key employee. Although, some times are worse than others.

A very long time ago, I hired my first GM, and one of the first things he said to me was “We all have an expiration date” Oof! Those words turned my stomach and kept me up all night. The truth is I was still really naive at that point in my career. I thought if I could provide “all of the things” that my employees were looking for in a restaurant job, they’d stay with me for the long haul. The truth is that we are in a very transient industry. Yes, there are those loyal employees who will be loyal to you for years, but those folks are the exception to the rule. That GM taught me one of the most valuable lessons there is to learn. While I am not saying that we should live in fear of that day, I am saying that we should do everything we can to prepare for that day.

Steps to follow to help navigate loss of a key employee

Below is my “Emergency Triage List”. I follow these steps to help myself and my team navigate these most difficult times that follow the loss of a key team member.

1. Just Breathe 

Keep calm — know that this too shall pass. Your team needs a strong leader and they are looking to you for guidance but more importantly to know that everything will be okay. If you worry, they will worry too. Take a deep breath and remember that this is all part of the journey, things always work out as they should.

2. Lead

Resist the urge to jump in and row! Think about a rowing team, if the steersman is back with the rest of the team rowing, who is steering the boat? I love this analogy because the roles of the steersman and a restaurant manager or owner/manager are essentially the same — Keeping the team safe by avoiding obstacles, making sure that the rules of the “race” are followed, steering the boat, stay in command at all times, coach when necessary, provide feedback to the team, make tactical decisions when required and take full responsibility for the boat and the team. If you or your manager are consumed with working the line or serving tables who is leading your team? I am not saying you shouldn’t help, but you cannot abdicate your role. You must strive to find balance in times of imbalance. Think outside the box to find ways to work with the team you have. Consider modifying your business hours or moving to a limited menu until you can fill the position. Don’t forget to take time for yourself when you can.

3. Identify

Identify those on your team that can help you. I guarantee that there are people on your team that want to help you. While they may not want to be a manager, would they be willing to open the store in the morning and put out the drawer or check sidework, close the drawer, and lock up at the end of the night? The truth is that most people want to help, it makes them feel good inside, think about how good you feel when you help others.

4. Delegate

Identify tasks that can be delegated to others. Can someone help with a specific task, or can it be broken down into smaller tasks?

When my sauté chef Russcel’s life was cut short by an act of domestic violence, we found ourselves in a big bind! Russcel was the backbone of our sauté line. She made all of our sauces, and pastas, and got us ready for service each day. She worked all six days we were open. In her sudden absence, I had no one to fill her shoes. While I did have to take on her shifts in the interim, I was able to share some of the load so that I could still lead my team and fulfill my responsibilities as an owner/manager. Servers could help me portion pasta, help with mise en plas for sauces, and other small tasks. My other cooks could come in earlier to help run the line so I could run payroll. It took a village, but we made it work.

5. Boundaries

Set a goal for how long you will take on these extra responsibilities. There is something about creating a deadline that creates urgency. where there is urgency, there is open-mindedness and creativity, and that is where we find solutions.

6. Non-negotiables

Decide ahead of time what your non-negotiables are. These are tasks that no matter how shorthanded you are must be done! At the top of our list at Wholly Stromboli, are inventory and stock counts because you only have to skip one before your data becomes irrelevant.

7. Communicate

Communicate with your team. You may want to hide in your office and stew over all of the things that are going to land squarely in your lap, but you’ve got to pull up your big girl pants, put on a smile, and talk to your team. Tell them you need their help and that you will get through it together. If you don’t tell them what has happened, what your plan is, and what you need from them they will make up their own (much juicer version) of the truth!

8. Believe!

Remember that you’ve got this! No matter what life throws at you, it is all part of the journey, people come into your life for a season and a reason, and they leave just the same. Take the lesson from the experience and grow from it. Find ways to improve and be open to what comes next!

MELISSA RICKMAN is co-founder of Wholly Stromboli in Fort Lupton, Colorado, and member of the World Pizza Champions.

The post What Happens When You Lose a Key Employee? appeared first on Pizza Today.

Pizzeria owners must make sure employees know safety, hospitality and beverages — Bar Staff Training

Training bar staff entails much more than demonstrating how to make a Negroni or Aperol Spritz. Learning how to pour wine and beer and prepare cocktails is important, but pizzeria owners say they cover other important details when teaching crew members how to serve alcohol. Whether it’s a small selection of wines and beers that pair well with pizza, or a full cocktail program showcasing the latest trends, alcohol sales account for a large portion of dine-in revenues. Alcohol also presents risks, as restaurants that serve alcohol could find themselves potentially liable if a customer becomes intoxicated and injures themselves or others.

Safety is Crucial in Bar Training

At Soprana Rooftop Cucina in Asheville, North Carolina, safety is the top priority in bar training. The rooftop pizzeria, located atop the new Embassy Suites by Hilton Asheville Downtown, opened in March. “At Soprana Rooftop Cucina, we prioritize responsible alcohol service to ensure the safety and enjoyment of our guests,” Brian Sherwood, director of food and beverage at Embassy Suites by Hilton Asheville Downtown, and Sean Moline, outlets manager at Embassy Suites by Hilton Asheville Downtown, said by e-mail. “Our team undergoes rigorous TIPS (Training for Intervention Procedures) certification, equipping them with the knowledge and skills to navigate legal regulations seamlessly while understanding the nuances of alcoholic beverage flavors and pairings.”

There is mandatory TIPS Training, and the entire service staff is certified to handle alcohol service responsibly. Staff at Soprana learn key standards, such as how to verify a customer’s age by rigorously checking IDs to uphold legal age requirements. Another standard is bartender protocol, which refers to following strict procedures to prevent overpouring and maintain quality. Staff closely monitor guest consumption to intervene when necessary, and are trained to identify signs of intoxication and manage situations effectively. There are also preventative measures, which include promoting responsible drinking by offering food, water and regulating drink service timing.

This focus on safety takes precedence over other beverage-related lessons. “Our commitment is to create a safe and enjoyable environment for all,” Sherwood and Moline say.

Online or Classroom Bar Training

TIPS (Training for Intervention ProcedureS) offers online and classroom programs that teach responsible sale, service and consumption of alcohol. Employers need to check with their state authority to see whether online training fulfills regulatory requirements for the state. TIPS’s parent company, 360training, notes on the TIPS website that the program provides a “reasonable efforts defense” in third-party liquor liability lawsuits, and provides a means of mitigating ABC violations, which can result in lowered fines and a waiver of license suspensions.

Another safety-focused training program comes from the National Restaurant Association, which developed the ServSafe Alcohol training program. ServSafe, also available online or in-person, is designed to equip foodservice industry workers with an understanding of the risks and responsibilities of alcohol service, and help them gain critical skills to protect restaurant customers and reduce operators’ risk of liability. ServSafe training programs, which are also available for food safety, allergens and workplace issues, are updated frequently to reflect regulatory changes and policy updates. Some states have mandatory training requirements, while others are optional, and ServSafe maintains an interactive map of state requirements on its website.

Bar Hospitality Lessons

Pizzeria owners say bar staff training also covers service-related topics. Employees must learn about hospitality, and how to answer customer questions about the various beverages. “The vast majority of the guests are not going to be craft beer nerds, they just want a good experience,” says Ned Lavelle, cofounder of Pinthouse, a pizza and beer establishment in Austin, Texas. “We do a deep dive on beer knowledge so the team can speak intelligently with guests.”

Pinthouse makes and serves 200 different beers a year. Each location has about 40 beers on tap, and some beers change each week. Lavelle sends employees a newsletter that describes each beer’s hops, flavor, ABV and style notes. “We’re also starting to talk about mouthfeel and special ingredients or inspirations for that beer,” Lavelle says.

There are also quarterly tasting sessions to discuss new beers and flavors. “If we tell someone this beer smells like lichee or dragon fruit, we bring the fruits in,” Lavelle says. “The team can start to develop that palate and understand what those buzzwords mean so they know they’re not just words to make the beer sound exotic.”

The 20 to 30 bartenders across the four Pinthouse locations must be Level One Cicerone certified, which means they passed the Certified Beer Server exam of the Cicerone Certification Program. Bartenders also learn to talk with customers, find out what they like, and recommend the right beer for them. “Number one is they’ve got to have hospitality,” Lavelle says. “You have to read the guest.”

Take a Test

At Good Pie in Las Vegas, owner Vincent Rotolo works with a consultant to develop new drinks and to conduct quarterly training sessions with the bar staff. The drinks must be easy to prepare, delicious and authentic to the Italian food experience. “If I have to explain the drink, if it takes more than four steps, we’re not going to do it,” he says.

Bar staff must know about the different spirits, the various Italian wines, and other details. Rotolo sends the staff PDF documents with information about beer, wine and spirits. “What we are looking for in a service professional behind the bar is knowledge,” he says. “If you can’t name five single malt scotches, tell me how vodka is created, and know the difference between tequila and mescal, you can’t work behind my bar,” he says.

New employees must pass a test that includes making three cocktails. People who don’t pass can start working at the slice window, and gain knowledge to work as a barback, then bartender. Bar staff training is part of the larger strategy of providing memorable customer service. “It’s not enough to have great food or great beverages anymore,” Rotolo says. “It’s about the experience.”

Others maintain that hiring is a key element for success in bar training. “A great bar staff starts with finding the right fit,” says Christopher Pinsak, chief restaurant operations officer for BJ’s Restaurants. “At BJ’s, we prioritize high work ethic, self-awareness, great communication and organizational skills. If a candidate has these skills in place, they are already halfway to being a great bartender.”

NORA CALEY is a freelance writer who covers small business, finance and lifestyle topics.

The post Bar Staff Training appeared first on Pizza Today.

Employee Retention Recipe for Success

In the ever-evolving landscape of the pizza industry, one crucial ingredient that should never be overlooked is retention.

Retaining employees is critical to ensuring that your busy kitchen and front-of-house operations work as efficiently and harmoniously as possible, and your customer satisfaction stays high. From creating a consistent dining experience for patrons to optimizing operational effectiveness and team dynamics, your pizza palace depends on retaining talented and dedicated staff.

“This industry has a constant churn of employees coming in and out of restaurants,” says Rebecca Hebert, business development representative at 7Shifts, a team management solution for restaurants. “When you find good ones, you want to do everything you can to keep them.”

We talked to some experts about why employee retention is not a mere garnish, but rather the main course of sustainable and thriving restaurants. We also share their tips on how to retain employees so your pizzeria can operate at the top of its game.

Save Money

The cost of recruiting, hiring and training new employees can be substantial in terms of time and resources. By retaining skilled and experienced staff, restaurants can save money they would otherwise spend on recruitment and training programs. Retaining employees means “you’re not posting jobs, you’re not spending money on labor to train people,” says Jack Hott, director of product management at Poached, a hiring platform for the hospitality industry. “Basically it’s a distraction. When someone leaves you need to do a whole lot of things that are outside the domain of what you need to do to run your business.”

Consistency in Service

Consistency in service is essential for building a positive reputation and retaining customers. Long-term employees are more familiar with the restaurant’s menu, policies and service standards. High turnover can lead to variations in service quality and negatively impact the overall customer experience. “Keeping your staff is good for consistency for the guests and the entire business, and it’s also good for morale for the entire staff,” observes Hebert.

Customer Relationships and Loyalty

Regular customers often form relationships with long-term staff, enhancing customer experience and loyalty. “The customers do notice,” notes Hott. “They see familiar faces. That’s part of creating a good regular clientele.”

Productivity and Efficiency

Experienced employees get more efficient as they learn your restaurant’s processes and systems. High turnover leads to poor efficiency as new employees get up to speed. Retention “reduces stress on the manager,” says Hebert. “It takes a lot of time and a lot of energy to hunt for someone new. That manager could instead be focusing that energy on their current staff – working on training and career development and just overall support.”

Knowledge Transfer

Experienced employees acquire valuable knowledge about the restaurant’s operations, customer preferences and industry trends. When employees stay with the restaurant, this knowledge is retained within the organization, contributing to its institutional memory.

For example, “when you have a long-term employee, you can move them around between roles as necessary,” says Hott. “Say you need somebody to fill a hosting shift who’s normally a server. They can do it because they’ve seen it happen in practice so often. Same with the back of the house – you might need a line cook to serve as a prep cook. They can step into that role because they’ve seen it happen through experience, but maybe not through direct training.”

Team Culture and Cohesion

A stable, long-term team is likely to develop strong bonds and effective communication, vital in a fast-paced and collaborative environment like a pizzeria. High turnover disrupts team dynamics, making it challenging to maintain a positive and efficient work atmosphere.

“Retention can be really important to a company’s culture,” reflects Hott. “Your long-term employees are training the new ones on culture and how to succeed in that workspace. These are both material things and behavioral things. Psychologically, people tend to mirror those who are around them. When you have strong long-term employees that behave a certain way, new employees will respond to that. When you have a lot of churn, you lose that culture. It’s harder to teach the cultural parts of the job when everyone’s so new that no one really knows what the culture is supposed to be. It can create some chaos in terms of how employees interact with one another. If you have an unpredictable workplace, you’re
going to have turnover.”

Employee Morale

High turnover can negatively impact the morale of the remaining staff. Constantly seeing colleagues leave leads to a sense of instability and lower morale among those who stay. “One price you can pay is that when somebody leaves, it may influence other staff who weren’t thinking about leaving. It often creates a moment where people feel like maybe this is the time to go,” says Hott.

HOW TO RETAIN EMPLOYEES

Pay Well

“People like to work for us because we pay well,” says Chuck Hammers, president of Pizza My Heart, with about 500 employees at 27 California locations. “We don’t have much turnover. Over 25 percent of all our employees have been with us over five years, and most of our managers have been here 10 to 30 years.” He notes that POS technology that invites people to add a tip “is truly a game changer for us. Our employees are seeing an extra five dollars an hour in tips on average, and that just keeps the employee there.”

Respect Your Staff

Hebert emphasizes that “this industry is notorious for overworking staff. It’s been glorified, but it burns people out, it makes them miserable. Ultimately they leave or do a bad job. People have lives outside of work and managers need to respect that. They need to be protected and supported by management.” In addition to offering career growth opportunities and ongoing training, support your employees when they face challenges with their families, medical issues, mental health issues or financial issues.

Train Well

“Have a solid training foundation,” advises Hebert. “Not just training for the steps of service and learning the menu, but about how the entire culture of the company works, because that culture is really what is going to keep people there, especially if it’s a good fit. So nurture them and put in the effort to train. Focus on productivity and well-being over just labor dollars, and you’ll keep staff.”

Cultivate Your Culture

Hott says “we find that businesses with strong positive cultures have retention, and they have an easier time hiring because they can use the network of those long-term employees. That business will also have a reputation within the community that will attract more long-term employees.” He observes that inconsistency from management causes a lot of turnover. “If you’re constantly changing expectations, constantly changing how tasks are structured, it creates a distraction for the worker. Most people want to be where things are predictable. Be very clear with what you want out of an employee. If you’re able to create predictability in your workplace, you’re going to have retention.”

Annelise Kelly  is a Portland, Oregon-based freelance writer.

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Hosting a staff development party

Hosting a staff development party is more than just a fun escape from the daily routine; it’s a strategic move to enhance team cohesion, and appreciation and reduce attrition.

Mike Bausch, owner, Andolini’s Pizzeria

“I have enough on my plate before thinking about a party.” I can’t emphasize it enough: this is not simply a party. A party is just a bunch of people in a room, typically drinking alcohol. This is not that, this is staff development. A staff development, or Staff-Devo for short, is a coordinated effort to relieve the attention of this high-pressure, fast-paced job and provide a relaxed setting for people to see other coworkers in a different light. When done appropriately, this builds unity and trust, which is the bedrock of a high-functioning team. A functioning team performs at a higher level and wants to quit their job less often, so how do you achieve that?

Beyond Just a good hang. Organizing activities that are fun and promote teamwork and communication can mirror the collaborative spirit.

Consider activities like team make-line challenges, restaurant-themed trivia or problem-solving games. Additionally, anything you would see at the World Pizza Games works excellently in this environment. Moreover, if you have an all-star, this can lead to you bringing them to Vegas to compete on the grand stage.

Beyond entertainment – these exercises in collaboration and communication show off acumen to all the members of a successful restaurant team.

Budget-Friendly, High-Impact. You don’t need to break the bank to host an effective Staff-Devo. The key lies in creativity and making the most of what you have. Utilize your restaurant space or collaborate with a local venue that offers enough room for activities. Sunday nights, post-close, often work best for such events, minimizing disruptions to your business operations.

Essential Staff Party Elements for Success:

1. Recognition. Introduce an element of friendly competition. Have a trophy or a custom title belt with your logo that employees can vie for. It’s a tangible symbol of achievement and a fun way to foster healthy competition. We use the Andolini’s Title Belt for our “ANDOMANIA.”
2. Professional Boundaries. Make it clear that while this is a party, it’s still a work-related event. Set boundaries regarding acceptable behavior to avoid any incidents that could lead to disciplinary actions.
3. Safety First. If alcohol is involved, ensure underage staff are clearly marked and understand the repercussions of breaking the rules. Arrange transportation for staff who may need help to drive home.
4. Personal Touch. Take the time to thank every team member who attends personally. It’s a small gesture that goes a long way in showing your appreciation. If you allow family members to attend, thank them.
5. Change of Taste. Serve food from a different restaurant. It gives your team a break from the usual and shows your support for fellow local businesses.
6. Legal Considerations. No matter what you do, have staff sign a waiver for additional protection. Have your lawyer draft something considering everything you plan to do.

Hosting a staff development party is a strategic investment in your team’s well-being and, by extension, your pizzeria’s success. It’s an opportunity to strengthen bonds, show appreciation, and ultimately, create a more positive, productive work environment. Food, ambiance, and SERVICE are what we provide the customer, and great service leads to return business and solid ROI.

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Operator Anthony DeSousa offers this commentary on the riddle of the employee rollercoaster

The cycle repeats. Not with the regularity of earth’s orbit, instead more like a comet impacted by changes in gravity breaking apart in time. I’m describing the cycle of being a business owner approaching three decades of running businesses and the toll it takes watching employees burn up in orbit while you continually stand. Soon you metaphorically resemble the surface of the moon — full of craters that tell of your experiences. The shadows they cast expose your vulnerability. Yet, on you go, battered but still in orbit.

Many employees start out on the same path: excited, energetic … even elated. Time exposes the truth as incompatibilities deepen the cracks until the inevitable occurs: their mask crumbles, exposing the true being. Excitement erodes over time despite the bonuses, praise and growth and opportunities you create through risking everything you have (money, family, friends and your health). Envy is the replacement, representing the beginning of the end. Once the green-eyed-dragon infiltrates, all is lost; for envy has no saturation point.

The patterns become evident faster as the employee count clicks by, becoming a 3-digit number. You begin to recognize statements like: “I love this job, am never leaving” to mean that they are already done. Lies come in the form of death in the family, cats that are sick, fake hospitalizations that cannot produce a modicum of validation and on and on. What they are saying is they are not committed and don’t know how to leave. YET. Even large bonuses fail to overcome the changes lobbed by envy’s irrational outfield and misery is great at finding company. Good will and generosity are no longer seen as such, they become an expectation, like free lunch. Lack of boundaries brings about the most damage, for any affirmation of your own boundaries is seen as an affront rather than the simple statement they are: this is not acceptable. Hunger for hours, money and increased responsibility give way to demands and your fate is sealed. What to do? Should you close the business, rethink its structure or is it best to persevere knowing that those around you are like light bulbs with a life expectancy of x-hours? Given that none of these problems are new to employer/employee relations since the beginning of time, the answer is to drink a shake made of resilience, perseverance and improving your coefficient of efficiency. Fortify your position and seek the truth. Are you part of the problem? Does your management style work today vs. when you started? Times change!

Who stands with you until the merry-go-round ride ends? Your family. Blood or no blood. Protect them or the business perishes, for their support is like having rebar in your concrete: it’s much, much harder to break. I am not happy coming to these realizations but remain steadfast in my ability to ride out the storms while continuing to connect with the people who allow us the opportunity to grow — our customers. Never lose sight of who butters your bread, even when all hell has broken loose.

Over the last few years, we’ve broken every record the store has. We’ve become best of class in every way — EXCEPT we still have not broken the code of the human condition. What to do? Keep on keeping on! Remain kind and focus on your craft. Let the wrong people go faster and seize the opportunity to hire the right people even when you don’t have a position for them. Train and invest in the tools your people need to do their jobs well. Invest in building their character, in repairing the cracks in their armor put there by doubt, experiences and lack of self-confidence. But only do it sincerely. Only then do you stand a chance of breaking the cycle. I will continue trying until my dying day. Count on it.

Anthony DeSousa owns Antonio’s Real NY Pizza in Estes Park, Colorado.

Check out another Employee-focused story by Anthony: Hiring Based on Personality

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Training Pizza Makers Takes Patience

As an owner or an operator of a pizza shop you are undoubtedly the master of your craft and the master of your domain. You have a product that you take great personal pride in. Over many years you have worked tirelessly to create, build and maintain a loyal audience of customers who love the pizza you make. The laws of nature dictate that you cannot forever be the only one making those beautiful pies 24/7. The time inevitably comes when you need to train someone else to take that lead position of pizza maker that you have perfected. It can be a daunting task at first, but it need not be. There are some basic ideas that need to be adhered to when training that next great talent.

Consistency is going to be key to maintaining that loyal following. Your new pizza maker will need you to give them the tools to succeed. The first tool you can give them is your patience. Rome was not built in a day, and your protégé will not be a master overnight. Have realistic expectations for the time involved with their growth. Remember how many of your first pies were served straight to the garbage can. You are not cloning yourself. If you’re ready for another Rome reference, remember that all roads lead to Rome. What we mean here is that we are looking for a great finished product from the new pizza maker. As long as they are following your guidelines then be patient and allow them to create in a way that best suits them. They may not put eight pounds of pressure on their index finger on the left hand the way you do when stretching out a piece of dough. That’s fine. Resist the urge to micromanage and allow them to grow and develop their own comfort zone so long as the finished product is consistent with what you have long created.

Training Pizza Makers in Each Station

Pizza making is a craft and you cannot train a master craftsman overnight. For some it will take weeks to master a station and others months, but each station in the process must be mastered first before moving to the next.

Start with making dough. The trainee should first become an expert at making dough. This does not mean just four steps in the mixing bowl, rather they need to be taught a full understanding of the composition of dough from flour, yeast, hydration, etc. Only then will they learn how and why dough can behave and react in different ways. This will allow them the knowhow to troubleshoot any issues that may ever arise with dough if you are not there standing over their shoulder.

When it comes to opening and stretching dough, regardless of your style of pizza, it is once again important that they do this in a manner consistent with what you have always done. So many factors need to be spot on, the consistent thickness of the dough when it is stretched out, the makeup of the crust along the edge of the pizza, and the correct size and shape of the pie. It just takes time and experience to get to that desired sweet spot of craftsmanship. Be prepared to work with them and throw out an inordinate amount of dough. It is a long learning process for an art which you can do in your sleep but is a completely foreign concept to the trainee. Think of the muscle memory and feel that you have when it comes to handling dough. You did not develop that overnight. You were once a hot mess when you were learning. Now be patient when creating the next great pizza superstar.

Next comes the actual construction of the pizza. Though this part may seem less complex it is still important for that new pizza maker to spend an adequate amount of time training on this station as well. Consistency in the amount of and distribution of the sauce needs to become second nature. For those of you who do not use measured portions of cheese, the maker will need to learn the correct ratio of cheese to be using. When it comes to topping a pizza, many rookies think that more is better. Taking the time to learn the station and not overtop pizzas will be key to developing that comfortable and consistent repetitious motion when pizza making.

The baking of this beautiful creation is where all the training now comes through to fruition. For those who use conveyor ovens you are in luck because a lot of this portion of the process is now automated for you. For the rest this part takes careful consideration and focus. We rarely cook one pizza at a time so the ability to cook dozens of pies at one time often across multiple ovens is a true art. There is a uniqueness in the cooking styles of many different types and brands of ovens. Many factors come into play from cooking on hot spots, to rotating a pizza and putting it back in the same spot, developing a rotation across decks and ovens to always keep an order for stone heat recovery, and keeping those cooking surfaces swept clean. Taking the time to work side by side with your trainee on this part will help them overcome the nerves of not cooking a pizza properly or losing control of the rotation of where every next pizza should be cooked. You will serve as a safety net for them in this ever-stressful part of the process.

And lest we forget the fun of launching pizzas off peels for the first time. Remember how many times you ended up sending piles of cheese and toppings off the pizza and into the oven only to burn into a smoky mess that needed to be cleaned up. How long did it take you to learn how to launch a pie into the oven that came off the peel in a round shape? Certainly, those who worked with you in the beginning saw their fair share of your pizzas that came out shaped like a football. It takes time. Patience is key to creating a consistent pizza maker. The amount of time it takes will not be the same for everyone. A commitment to patience and consistency when training will pay off as these new pizza makers are the ones that will carry your now great brand into the future.

Michael Androw owns E & D Pizza Company in Avon, Connecticut.

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Over the last 20 years I’ve been in this game, I have met and seen several restaurants close forever because of an owner who had to do it all. They wanted to keep it personal and be a part of every decision and task. These owners were incapable of trusting. Never able to train, and as a result, could never correctly delegate any task. They would assume everyone else didn’t have their best interests at heart or couldn’t be taught, and they would work themselves into a tizzy. I’m all for keeping it blue-collar, knowing your craft, making food on the line, and chopping it up with customers. But because I can, not because I’m the only resource.

A restaurant owner I’ve known since I started in 2004 owned a rib restaurant, and he would be the one going to Sam’s Club even into his 70s. While in the store, he picked up the trash instead of having a protocol to clean up each shift. I saw him push aside a server off the counter to say, “I’ll do it. You’re not doing it right.” He was a dedicated owner who just did everything backward. He’s a nice person but not a great leader. He eventually got very sick and had to close. He was the keystone; without him, nothing could run. This is how he designed it, even if he didn’t knowingly realize that.

Another restaurant had an insane level of sales, but because the owner wanted to be the only one making the tacos, they decided to close on Sundays so he could have a day off, then close forever when he got sick unexpectedly. This decision was at the peril of the rest of this family, who were eager and willing to make the food, but he wouldn’t have it. They eventually closed for good, to the stunned surprise of everyone in town who loved them.

The need to be needed is an emotional weakness. Sure, these guys can play it off like they’re passionate about their craft, and there’s even a marketing angle to that, but it’s a dead-end path.

Doing every single task and not letting go is an EGO play. I repeat, It’s ego. It’s an egotistical move. It’s the belief that no one on earth could do what you do. As much as passion plays a role in this job, it is not sustainable. And if you don’t want something sustainable, if you want to make the food yourself and have that be your thing till the day you die, that be it, so be it. But if you have other lives that depend on this job besides your own, then you should spread the wealth and even focus on the things you dig that you love. Let’s say it is making the pizza yourself. Great, but that doesn’t mean you have to be the one who goes to pick up every single drop and handle every single nuance.

You’ll never grow that way, and growth is scary. Growth means doing something not in your wheelhouse. Most young people are filled with vim and vigor to take on the world, but they need to do it themselves for an extended period to understand the task. Eventually, they get it. People who get set in their ways DO NOT ALLOW those kids to develop; they only hurt themself. They feel so comfortable in that role that they can’t imagine anyone else doing it, and it’s at the peril of themselves and those around them. Take this as a warning to your ego: your employees, both current and future, won’t be perfect. Still, perfection only happens through repetition. Allowing others to win with you is the only way to win yourself.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

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Holiday Planning should include strategies to help your staff thrive

Here’s the reality: the holidays in the restaurant industry aren’t easy. It’s controlled chaos. The big parties, the weird weather, days closed and staff gearing up for their lives while this wonky schedule has everyone out of sorts. Kids are out of school; shopping has the lunch rush coming in all over the place; for all these reasons, the holiday season has a weird, abnormal flow.

To combat this malaise and also maximize the season, here are some guidelines for making sure you have clarity on your goals while avoiding staff burnout.

Communication: The Backbone

The source of most frustration boils down to miscommunication. From waitstaff to kitchen crew, we are constantly drilling the importance of being clear and direct. It’s not about micromanaging; it’s about giving everyone the whole picture with extreme specificity. Who works when, who is running point on large catering, and when will you get a day off? Without clear communication and specificity, people grow expectations that, when they aren’t delivered, form antipathy, which is the downfall of a restaurant.

That means daily shift notes on specials and shift expectations. Additionally, going into the season, having an evaluation with each employee about goals and expectations. This sets the tone for the next few months to glide right.

Lock-in Those Schedules

No one likes a last-minute rush. Play it smart, especially about their time off during the holidays. Staff get to request their preferred days off months in advance. From there, it’s a tactical game of ensuring we’re over or understaffed. This isn’t just about ensuring operational efficiency but respecting personal time.

Incentives: More Than Just Tips

Here’s the straight talk: people thrive on incentives. We lay it out clearly. Sell those gift cards, and you’ll be rewarded with premium branded gear. Beyond the usual bonus structures, these tangible rewards drive competitive spirit and results. It’s not about dangling a carrot but rewarding genuine hustle. Also, it’s fun; people want to have fun, and you can either wallow in the day’s struggle or lead by example to ensure staff is stoked to come to your workplace.

Flexibility and Fair Play

Only some people’s holiday season is jam-packed with parties, getaways and family time. So, for those with some wiggle room in their schedules, we make it right to them later: more hours during days near Christmas and Thanksgiving along with New Year’s, and we cover more stuff they might want or need in the future shifts.

Hard Work Doesn’t Go Unnoticed

It’s simple: work hard, and you’ll see it reflected in both recognition and pay. A job well done might mean a bonus, a public acknowledgment, or even an extra day off. We don’t go for the over-the-top, cringe-worthy employee-of-the-month photos. Instead, it’s about genuine appreciation. Leaning in on that employee and directly saying thank you to them and, if possible, getting a special gift like concert tickets or something niche only they would dig.

Breaks are Non-Negotiable

I worked in a fine dining restaurant at 18 and had a schedule with six days on and one day as an on-call that I got called in for each time during the holidays. I worked 65 days straight while going to school and preparing for finals in college. I want something else for my staff.

We run a tight ship, but we’re not inhumane. Everyone gets a break. It’s a reset, a pause, a day or two to rest. It might sound like Restaurant 101, but you’d be surprised how many places overlook this basic need to give days off and breaks during shifts, especially during the holiday madness.

Staff Devo

A fun fest is always smart, either before the season or right after a big holiday blowout. Not just a drinking party but contests, music and dumb fun sets the tone for why the staff want to work here and nowhere else. I like to do one in September and then another event in January if we exceed projections and need a boost.

Post-Holiday Reality Check

Once the holiday hurricane subsides, we don’t just move on. We regroup. A complete analysis of what went down. The good, the bad and the downright ugly. This feedback isn’t for the faint of heart but ensures we’re better equipped for the next round.

Paychecks that Make Sense

This is business, but it’s also about respect. We ensure the holiday pay reflects the grind. You work harder; you earn more. It’s as clear-cut as that. People who want big shifts show up, do the job well, and get them. People who learn more, cross-train and become more valuable get more on their checks.

Training: The Foundation

Before the holiday rush kicks in, we double down on training. Refresher courses, new guidelines and revisiting the basics. It’s not because we doubt our team’s capabilities. It ensures everyone feels confident, reducing the chances of holiday slip-ups. It’s also a way to ensure standards are being held, everyone is aligned, and there is no miscommunication about the right way to do things.

Feedback Isn’t Just Top-Down

We encourage feedback from all levels. Whether it’s process improvements, a menu tweak or managing customer expectations better, every voice counts, especially during the high-pressure holiday season. When staff feels heard because they actually are, you mitigate attrition. January is notoriously a time of year when people find new employment. With a calculated and conscientious effort towards staff morale, you can minimize and even possibly eliminate that cash drain and morale killer of a staff exodus.

In sum, the holidays at Andolini’s aren’t about riding the wave and hoping for the best. It’s calculated, methodical, and direct. We prioritize clarity, respect, and genuine effort. We’re looking to have fun, get people around their families as much as possible, and make a solid and healthy profit to prepare for January, which is notoriously a dead zone when people go out to eat at a much lesser rate. These guidelines are how we keep our heads above water no matter how rocky the waves.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post A Gameplan to Avoid Team Burnout appeared first on Pizza Today.

Learning Management System Technology can help crew members learn and managers track progress

Training systems have evolved. Instead of expecting new hires to read employee handbooks or sit at a desktop and watch a series of video modules, pizzeria owners are turning to learning management systems, or LMS. As the workforce changes, so do crew members’ preferences for how they want to learn. Pizzeria owners are adapting with software training that leverages data, AI, gamification and more.

“It’s no longer, ‘I will put all of my content on the internet and employees can check it when they want to,’” says Rachael Nemeth, CEO and co-founder of Opus Training. “Employees demand content on the fly.” That means watching training videos and taking quizzes on their smartphones, not on a desktop.

Accessibility is important for all ages, and for people of different backgrounds. Learning platforms must be able to train workers in languages other than English, Nemeth says, as many foodservice workers do not speak English as a first language.

Data is another crucial component. Managers need to know whether employees completed their coursework, which areas need attention, and if crew leaders are improving their skills so they can train new hires.

Embrace AI 

In life, and on the job, learning never ends. Workers must keep up with menu changes and new policies, which requires frequent updates. For that, there is artificial intelligence, but not the creepy AI that is capturing much media attention. “The AI that we are building and machine learning models are not the kind that will ask you to marry it,” Nemeth says. “These are tools that help solve the content problem.”

The content problem is that pizzeria owners don’t have time to continually input instructions for new menu items and limited time offers. A training platform that uses AI can develop visual materials, write content and produce interactive training videos. AI can also communicate the changes to employees. Instead of sending out an e-mail that no one reads, Nemeth says, managers can use a content builder to generate a course that the team could take and get assessed on.

Innovations help

Improved metrics in LMS can enable managers to track employees’ progress, and help develop talent. “In the beginning, LMS quizzes and exams were a good way to validate learning,” says John Poulos, vice president of customer success for Crunchtime. “We needed to go beyond that.” The system can identify skills gaps, nominate high potential candidates for promotion and automate a schedule of courses and reminders. Crunchtime also has a survey component, so that course-takers can offer feedback about the system.

“It used to be side-by-side training, where you watch someone and then hopefully through osmosis you learn how to do it,” Poulos says. “You have the issue with standards, somebody learned from someone who is not doing it right.” He adds that blended learning, or taking courses through an LMS and then performing tasks, is most effective. For example, a kitchen worker would have to prepare three different pizzas, or a general manager would have to develop a local store marketing plan.

Must-haves

Poulos recommends using an LMS that is made for the restaurant industry and has foodservice-specific content. Ease of use is important, not just for new hires but for current workers who want to move to a different position within the restaurant. It’s important to have access to a large library of content that includes food safety training, harassment prevention, diversity and other topics.

Automation is another must. “Instructors should be able to set up automations, and let their platform do the rest: assign and remove courses, set expiration dates, arrange course sequencing and more,” says Natalie Petsali, director of customer success at Epignosis, the parent company of TalentLMS. “Automations help instructors update their content with ease to match the fast pace of their industry and because business needs and compliance standards are always changing.”

To start training right away, Petsali says, restaurants rely on LMS that offer ready-made courses that cover food and beverage industry topics such as compliance essentials and workplace safety, and soft skills and workplace topics. To engage the learner, the courses should be presented in short and interactive videos.

Gamification, or tracking progress through points and badges, can make learning more fun and rewarding. A system can challenge staff’s knowledge with questions such as naming the top three ingredients in today’s special. That can drive friendly competition through a leaderboard, and is useful for managers too.

“Interactive content is key to increasing engagement, retention and application of a restaurant’s training program,” says Brooke Hluza, vice president of sales for Restaurant365. “It’s also a great way for managers to gain insight into how confident an employee feels about performing their role and what else they need to excel.”

LMS pricing depends on factors such as number of employees, locations, courses and tech support. The billing could be a monthly subscription, or purchased as a bundle of courses. The pizzeria operator should also consider the hours needed for training, as workers would be paid wages while they take the courses.

“For the independent operator I would recommend thinking about what they are trying to accomplish,” says Poulos, from Crunchtime. “Looking at someone that has content that helps them get to where they need a lot quicker, from a compliance perspective, will be important when they think about learning development.”

Gen Z and Alpha Learners

Young adults really are starting at their screens. According to a 2021 Ipsos poll, 63 percent of Gen Z (age 16 to 24) are more likely to watch TV, streaming and videos alone on their smartphones. They prefer the small screen even if a big screen is available, according to the survey, because the small screen helps them focus.

For pizzeria owners, that offers insight into how to engage with Gen Z, and soon, Alpha, the generation born 2010 and later. “This is how they consume all forms of content,” says Rachael Nemeth, CEO and co-founder of Opus Training. “Whether it’s TikTok or a text from your mom or a text from your manager, none of this is on a desktop.”

It helps to make the information succinct, engaging, and interactive. Gamification can help: according to the Entertainment Software Association, 62 percent of adults age 18 and older, and 76 percent of kids under 18, play video games.

NORA CALEY is a freelance writer who covers small business, finance and lifestyle topics.

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Cuffers & Barneys: Long-term and short-term employees

One of my managers quit on the spot. I walked into his restaurant at 6:00 a.m. on Monday morning, the time every manager performs their weekly inventory and paperwork. He was sitting at his desk. I said, “Good morning.” He looked at me and said, “I can’t take it anymore”, handed me his keys and walked out the door.

Not exactly how I like to begin my week.

I pride myself on keeping employees long-term. Not every employee. Just the ones that should stay. What do I mean by this? After 40 years in the pizza business, I am a realist, and I understand the nature of those of us who work in pizza restaurants. To understand employee retention, we must first understand our employees’ needs.

The first category of employees is short timers. I call these ‘Cuffers’. The word is derived from a dating term ‘Cuffing Season’. Some roles in the pizza restaurant are, by design, transitory and minimum wage. These roles are not intended to be a career and they are not intended to be a ‘living wage’. These roles are for entry level, second job or students. They are temporary workers transitioning from one part of their life to another with us providing work along the way.

The second category of employees is longer term. I call these ‘Barneys’. Because Barney is a dinosaur…he’s been around a long time. Barneys may want to learn and grow with the company. They may want promotions and more responsibility. Some Barneys just want a steady full-time job with the same hours every week, so they can spend time with their family and raise their children.

As pizza owners and operators, we are in a business that averages an 80-percent turnover rate. That means if you have 25 employees on payroll, you issued 45 W-2s for the year. In other words, 20 people who you hired no longer work for you.

• Turnover rate = (#W-2s – #Current Employees / #Current Employees) * 100

How do we improve over the restaurant-industry average? The way we retain Cuffers differs from the way we retain Barneys. Let us discuss both.

Cuffers — long-term employees

It is interesting that managers often believe wages are the most important need of an employee. Not so with a Cuffer. Here are the needs of a Cuffer:

1. Schedule flexibility – time off
2. Schedule posted on time so they can plan their lives
3. Schedule flexibility – missing scheduled shifts
4. Get along with co-workers
5. Fun job environment
6. Desire to learn
7. Feeling part of a team
8. Management support with difficulties
9. Enough hours per week
10. Regular evaluations for pay rate increases

How do we retain Cuffers?

Notice that the first three needs relate to their schedule. By implementing the following system for scheduling, you will retain Cuffers much longer.

•Do the schedule weekly

•Post the schedule on Thursday

•Have an ‘Availability Form’ for each employee that indicates the hours they are available

•Have a folder next to the schedule on the bulletin board labelled ‘Request Off’ that says:

Must be on 8 ½ x 11 piece of paper

Must be in by Wednesday of the week before the schedule is made

Must have your name and the day/date/time requested off

•The rules are these:

All schedule requests will be honored

Once the schedule is posted, the shifts are the responsibility of the person assigned to the shift.

If the employee cannot fulfill the shift, the employee must get someone to cover for them

If an employee cannot find a co-worker to cover for them (they are required to try), they may call the manager and make it the manager’s problem

Taking care of the three primary needs of a Cuffer will result in a dramatic reduction in turnover.

Barneys — long-term employees

A Barney has different needs:

1. Enough hours per week
2. Regular evaluations for pay rate increases
3. Management support with difficulties
4. Schedule flexibility – time off
5. Desire to learn
6. Feeling part of a team
7. Get along with co-workers
8. Schedule posted on time so they can plan their lives
9. Schedule flexibility – missing scheduled shifts
10. Fun job environment

As you can see, the needs of Cuffers and Barneys are almost polar-opposite.

How do we retain Barneys? By monitoring how many hours they are working per week, reviewing their results as related to their pay, and maintaining an open line of communication. This can all be
accomplished by meeting one-on-one at least quarterly.

Just like a Cuffer, by addressing the three primary needs of a Barney, you will see a dramatic reduction in turnover.

Back to my Monday morning. My manager was a Barney who had been with me for over five years. We were just coming out of Covid and the challenges of his crew being out sick and the difficulty during that time of hiring new employees all led to tremendous stress and long work weeks. He was no longer following the scheduling guidelines, and often didn’t post the schedule until Sunday night. He was moody from working open-to-close shifts. In the preceding week, he had lost two Barneys. two more Barneys had given him notice that they were moving away. Let’s look at his three primary needs:

1. Enough hours per week. He was actually working too many hours.
2. Regular evaluations for pay rate increases. While he was making a lot of overtime pay, he was not achieving his goal numbers for pay raises or bonuses.
3. Management support for difficulties. As we were both busy, we had not had a one-on-one meeting for over a year.

As leaders, we must address the needs of our team members. Losing my Barney was my failure. It was a valuable lesson and the impetus for me to address the needs of the different types of employees. This has directly led to higher employee retention through lower turnover.

Because without Cuffers & Barneys, we’d be making ALL the pizzas!

DAN COLLIER is the founder of Pizza Man Dan’s in California and a speaker at International Pizza Expo.

The post A Lesson in Employee Retention appeared first on Pizza Today.

Strategies to improve your hiring game

Hiring has always been critical, but it’s more important than ever for the post-COVID pizzeria operator.

Lots of workers have left the service industry, and those that are left have higher expectations than ever. Good candidates are snapped up quickly, so competition is fierce.

As Rebecca Hebert, business development representative at 7shifts, says, “the script was flipped on us. It used to be people would come to us. Now we’re the ones searching for them and selling ourselves.” 7shifts is a team management solution for restaurants.

Here’s some actionable advice to help you improve your hiring game.

FINDING APPLICANTS

“Our number-one tip is to ask your existing employees, especially if they’re good,” advises Chuck Hammers, president (or “Big Cheese”) at Pizza My Heart, a Northern California counter-service chain with 27 locations. “Employees refer other employees, and that’s our number-one strategy.”

Jack Hott, director of product management at Poached, says “…go where the workers are.” Poached is a nationwide hiring platform for the hospitality industry. He also urges “when writing a job ad, put yourself in the worker’s shoes. Instead of requiring five years experience, you can phrase it more inclusively as someone with five years experience would be more successful in this role. Also, be concise. Our app is becoming our dominant platform for job applications, and there’s less screen space.”

“My number one tip is you need to respond to a potential candidate within 24 hours,” urges Dan Kezner of Kezner Consulting Group, which consults for new and existing restaurants and other hospitality enterprises. “The best platform that we work with is Poached, but I also encourage my clients to have an applicant tracking system that can aggregate multiple places where you’re posting jobs, so you don’t lose potential employees. Our customizable tool lets you track people visually through a pipeline, whether it be screening, call, first interview, second interview, all the way through to job offer, or rejecting a potential candidate.”

“Make it easy for them,” says Hebert. “Utilize everything online, have something on your website, use Indeed, use social media, go to where they are and don’t disqualify based on lack of experience.”

SELL YOURSELF

“You need to sell yourself to the applicant just the same way that you sell yourself to the consumer,” advises Ken Batali, owner of Batali Associates Hospitality Consulting, serving the Pacific Northwest.

Hebert agrees. “You really have to market your business and your culture. Sell what you’re offering beyond just pay and benefits – growth opportunities, a lifestyle, a work family.”

Hott affirms that a positive work culture is critical. In addition, he says workers value pay, job descriptions and career opportunities. “People want to know they can advance.”

VETTING APPLICANTS

Hott suggests you start by “writing down your must-haves, your nice-to-haves, and any deal-breakers,” to use as an evaluation framework.

Hebert recommends making your non-negotiables clear in online applications and postings and relying on “some preliminary questions to help you screen people before they come in so you’re not wasting anybody’s time.”

This is also a good time to identify any deal-breakers, such as scheduling conflicts or a history of theft or harassment.

INTERVIEWING APPLICANTS

“Make it professional,” says Hebert. “Have a system in place and be consistent. I highly recommend a two-step process, whether it’s the same day or not. Have them meet with multiple team members, do a working interview, really take the time to make sure it’s a good fit on both ends. Give them that opportunity to investigate you. Be an open book.”

Batali also likes to bring prospects in for a stage (working interview), “for both front and back of the house. Just be in the environment for a couple of hours to see how they fit in.” He also advises that operators have written questions to provide structure and consistency to their interview process.

“One of the biggest things we try to establish is if the person has a hospitality mindset, if it’s truly in their DNA to provide good hospitality” reflects Kezner.

Hammers says “I try to picture – could I go to a baseball game with this person? Could I sit with this person for three hours and have a conversation and walk away and say, that was fun? To me, that’s the biggest thing. That person can communicate and connect with someone that they’ve never met before and be instantly friendly and give great customer service.”

Reminding your candidates about the interview will increase the likelihood they’ll show up. It’s easy for people to forget these types of appointments, especially when they set it up while riding a bus or dashing between classes. Hott says that the Poached tool includes a friendly automated reminder which helps set both parties up for success. He also advises that “you have a consistent process for all of your candidates. You want them all to go through the same interview process and you want to document this. This will help with any legal considerations and help remove any unconscious bias. So have a form, take notes and retain the documentation.”

WHAT’S AN IDEAL CANDIDATE?

Having an idea about who you’re looking for is always helpful.

Batali says “an ideal candidate‘s probably somebody who’s a fan of the restaurant, because they’re already going to have a sense of pride and excitement to be there.”

“First and foremost, a hospitality mindset,” offers Kezner. “A willingness to work and keep a schedule, and potentially a proven track record.” He notes that low energy and a lack of enthusiasm are deal-breakers.

“I believe that as much as we’re in the pizza business, we’re in the people business too,” says Hammers. “There’s an expectation that our employees will be outgoing and really connect in a very short amount of time with their customers.” Even the cooks need to have some charisma. “They’re throwing the pizza right in front of the customers. And even if they’re not having direct conversations, the eye contact with the kid that’s mesmerized with the pizza flying in the air, it’s important.”

Our sources also emphasize that hiring and retention are two sides of the same coin. Master the retention game and you won’t have to hire as often. Nail the hiring and you’ll be bringing employees on board who you want to keep for the long haul. Prioritize retention and they will.

With wages up and competition fierce, don’t treat hiring as an afterthought. Screen, interview, and hire as if your business depended on it – because it does.

Annelise Kelly  is a Portland, Oregon-based freelance writer.

The post Hiring For Long-Term Success appeared first on Pizza Today.

So many of us are guilty of falling into the same trap: over time, we develop great faith in our people, so we continually provide what we think are opportunities for their advancement. After all, they are punctual, responsible, caring, excellent at __________ (fill in the blank). What many of us fail to ask is: “do you actually want this opportunity?” And, further, do they have the necessary personality traits to succeed? Instead, we believe that continual promotion is the end-goal of most employees. We believe in these people and are astounded when we promote them to a position they struggle in despite our teachings and their proficiency. It’s not that they cannot learn, it’s that their personality is not suited for the proverbial shoes!

How did this revelation come about? I had an employee who was extremely competent at making pizza — one way. The same exact way, over and over. He could make pizza continuously for the entire day and they were beautiful and identical. Didn’t matter if the dough was cold, warm, over-proofed, tight or yielding. He approached it in exactly the same manner. In time, he asked: “what can I take off your plate to make your life easier?” Since I both respected his abilities and believed in him, this is where our relationship began its descent. I put the wrong shoes on him. After handing over tasks and responsibilities that caused him to reach his level of incompetence, the frustration set in. What I later learned in discussing this paradigm with John Arena was that there is something called the “Peter Principle”. It states: “members of a hierarchy are promoted until they reach the level at which they are no longer competent.” BAM!

At this point, I realized that all of our top management should take a personality profile so that this idea of “putting the wrong shoes on an employee” would cease. It was mind-blowing. The reports came back and made me rethink the position each person was in, because their personality did not align with either the responsibility or the attributes necessary to master the task. Reading the employee above’s summary was an eye-opening moment. It essentially said, “You tend to master a single task and dislike anyone who tries to make you more well-rounded”. BINGO. And here’s the moment I began considering taking the wrong shoes off of people. However, just like a psychological mobile, moving any one piece shifts the entire group. It caused disdain, frustration, contempt and, in the end, an exodus. This was a painful lesson and I’m responsible for part of the pain. Why? I let it go on for far too long. Since this time, I have carefully introduced employees to positions based on their answers to questions about what they see themselves as proficient doing combined with my observations and those of management along with co-workers. Some employees believe they are meant to be servers but are overwhelmed by a full dining room and hide behind the pass-bar wall. Others are single-task oriented and enjoy doing the same thing over and over. Now, I no longer try to push people into a role they don’t necessarily want despite them being good, loyal, strong, etc. And I will never promote anyone to manager again without the testing that confirms my observations and beliefs.

There is a young man in the store now struggling with multi-tasking after attending chef school. While observing his struggles, I’ve given many pointers and asked the right questions. Recently, he jumped on dishes and proclaimed: “I love doing dishes, there is only one task to perform”. I heard him loud and clear. Shortly, I will ask: “if I offered you a position with only one task, would you prefer it over a position that forces you to multitask?” If he says yes, I will offer the dish position to him because it’s something he may excel at. Personally, I feel that being a dishwasher is a great escape from the difficulties of management for the very same reason: no one bothers you and you have only one task.

The personality testing I mentioned above is worth every penny. It’s administered by the Gallup organization and is titled CliftonStrengths.

Personality testing is not the solution to all your woes. It must be combined with a different approach to management. If an employee displays the abilities and personality traits you believe are necessary for the position, administer a test to confirm. Beforehand, ask if they actually want the position while having a discussion about where they believe their strengths lie. My favorite question is: “Where in this restaurant are you best suited?” Follow that up with: “What would you like to learn if you could have any position here?” The resulting discussions will give you a better idea of their thought patterns and what they’re looking for.

If you help people achieve their goals and put them in the most appropriate positions (not merely the position that’s open because someone quit) your odds are far higher that the retention and attention of this employee will be long term.

Anthony DeSousa owns Antonio’s Real NY Pizza in Estes Park, Colorado.

The post Hiring Based on Personality appeared first on Pizza Today.

Substance abuse in the restaurant industry

Anthony Bourdain, on multiple occasions, compared a restaurant to a modern-day pirate ship filled with counterculture non-conformists who all band together for a singular purpose in a small stuffy room and still get to where the ship needs to go, albeit layered with substance abuse problems. Over the years, that mindset and outward normalcy of a restaurant being a toxic work environment have softened, but it would be foolish to say it’s entirely gone away.

Drugs and alcohol are still pervasive in this industry. That’s a fact. Mitigating the problems that come from addiction issues takes leadership, empathy and standard bearing.

Regarding you, the owner or leader of your business, you are responsible for others.

Suppose you’re dealing with your own substance abuse issues. In that case, whether it’s too many drinks at night, pill addiction or something else, it’s on you to figure it out because you’re responsible for other people’s lives. You and your ability to make clear decisions is important. You’re not just affecting yourself at this point; you affect others. It’s something every owner comes face to face with. As owners, you think that running yourself into the ground is okay because you’re the only one that suffers, and that is a massive lie owners tell themselves.

Maintaining your health is like taking the oxygen mask first on a flight that’s gone awry. If you are going to imbibe, then don’t do it on premise. And if you, for some reason, are having a drink at your restaurant, it must be obvious you’re doing it as a civilian paying full price so as not to blur the lines and confuse the staff. They will lose respect for their boss if this is the norm.

For any other type of addiction, I’m not going to be the one to diagnose what treatment is needed for every individual; it’s very nuanced and personal. But every leader needs to stop, look in the mirror, have a heart-to-heart about what they need to improve and ask for help when needed.

Regarding your employees, there are three major guidelines that will help decide how you handle someone with a substance abuse issue.

1. The Standard

The standard needs to be protected at all times. If we’re letting someone’s substance abuse problem affect it, then we’re lowering our standards and being loyal to the person rather than the restaurant. The restaurant needs to be more important than the person as a whole, because it is what feeds and clothes all those involved.

2. Never Fire Anyone

You are best suited never to fire someone but rather promote those who have already quit via their own actions to customer status. That means if someone is genuinely trying and not manipulating you but seeking a way to figure their stuff out, you work with them and find a spot for them rather than getting rid of people out of antipathy. If someone steals, then they’ve chosen to quit. If someone shows up drunk after getting a write-up not to do it again, they have chosen to quit. If someone has an off day or showed up wonky, and it’s out of the norm, then firing them is purely out of spite and not productive.

3.  Everything is Stated for the Benefit of the Individual

Never speak antagonistically to any employee, no matter the situation. So, if you see someone has an issue, instead of saying, “That’s it, that’s the last time I’m dealing with your issues,” you’d be better suited to say, “Something’s going wrong here, and I want you to say what it is.” If they’re being coy or won’t say what it is, you could point out, “You’re not yourself, and I think you know that too. You want the successful version of yourself back and we do too. So, I think you need to take a break and figure out what you want to do with this job and come back when you’re prepared to do it with a clear head.”

Notice that in that whole conversation, I never said you have a drug problem, you’re fired, or you’re suspended because the last thing you want is to be on record accusing them of something and potentially setting yourself up for legal ramifications. Unless you have documented evidence of drug abuse, you’re in a weak position, and the odds are you don’t have any proof. Just like smelling alcohol on their breath is still highly suspect of an opinion, it would not hold up in court. It might, but that’s your best shot. Eyes dilated and speech slurred are all significant indicators of intoxication, but they’re not 100-percent proof. So, when you see these things say, “I think you’re good for today; I’m sending you home.” “But why, boss?” “I don’t think you’re in a position to work today. I’m sending you home,” and leave it at that. And then, if you decide to part ways with that person, say, “Your conduct at work just isn’t what we need it to be,” and leave it at that.

The odds are likely that there’s something else they’re messing up that is fact-based. Something you can point to as a reason for termination. Mind you, this whole article is my opinion. This is not legal advice. This is a proactive solution from someone who’s seasoned and who’s done it for a very long time. Each state’s laws are vastly different, so it would be wise to run any high-level situation or problem by an HR professional steeped in the legal and regulatory compliance awareness of your state before acting on something that is a murky gray area.

The truth is these people have chosen to work for, and with you, and in some way, you are responsible for them.

You are not responsible for their actions and choices, but in the good-human approach to life, it would be nice for you to be that special someone that helps them get ahead rather than pushes them down further. I’ve had many situations where I’ve told someone, “Go get your mind right, and when it’s clear, we’ll be here waiting.” And sometimes, those people have gone to rehab and come back a success, and sometimes they have not, and in some cases, those people have passed away from their addictions, and it’s tragic every time. As much as we all want to save everyone, it’s simply not our job, and it’s not fair to hold yourself to the guilt of those situations.

What you can do is be a positive, supportive presence, helping people who want to get ahead stay ahead and helping them earn good money while producing revenue for your cohesive team in a supportive, caring and productive environment. Doing that is the best any of us could hope to do in this life. And if you’re doing that, you’re doing the right thing. If you’re taking people’s substance abuse personally, know it has nothing to do with you. It started way before they ever set foot into your restaurant, and all you can do is mitigate the loss if it’s a problem and enhance the solution if there’s hope.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post Handing Drug and Alcohol Abuse in a Restaurant appeared first on Pizza Today.

When restaurant staff are ready for a promotion

People love to work somewhere they can grow. Most employees want not only a job, but a career. Right beside that, employers understand their business cannot grow without great people. So, putting both together — giving people the opportunity to grow along with your business — sets up a long-lasting relationship.

Of course, that leads to an obvious question: How do you decide who those great people are? The ones who will lead the rest of your team and help grow your business?

Core beliefs

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

For starters, it helps to establish a culture based on your business’s core beliefs, those non-negotiable values and behaviors that you expect from leaders in your company and, of course, yourself. But first, how do you determine your core beliefs? Simple — they’re the same core principles that you live by and helped you to start your business.

An example from my restaurant:

• Integrity: Know and do what is right.
• Respect: Treat others the way you want to be treated.
• Responsibility: Embrace
  opportunities to contribute. Learn more.
• Sportsmanship: Bring your best to all competition.
• Servant leadership: Serve the common good.

Promoting employees simply based on seniority is a slippery slope. Just because someone on your team has been there longer than others does not mean that they have leadership skills or truly demonstrate your core values.

Instead, pay attention to how members of your team interact with each other. A key component to the core values is how people treat each other. When you have members of your team who not only meet those expectations but exceed them, that’s when you begin to identify leaders in your organization.

More employee promotion considerations

Core beliefs are a good start, but they are not the only things that get people promoted.

I like when someone buys into the company, is team-first, and recognizes that although we may be in the pizza business, we truly are in the people business. I have honest conversations with the ones who exhibit these qualities, explaining to them what advancing to the next position or level exactly means. It’s not only about what the job entails, but what the pressures may be and what’s expected of them.

Promoting from within is great, because it creates an environment of appreciation, but it’s not always possible. There may be times when someone left unexpectedly, or growth is occurring at a high rate. In these instances, you must go outside of your four walls to hire — and do so very thoroughly. Interview based on your core values and look for superior people skills. It also helps to have some of your team do a portion of the interviewing so that they feel comfortable with the new person coming in at a higher position, provided that the interviewer is in an equal or higher position than the candidate.

In the next installment, we’ll return to inside our comfortable four walls, discuss what it takes to set up a smoothly running pizzeria — and what to do when all appears well.

Nick Bogacz is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Who Should You Promote? appeared first on Pizza Today.

Pizzeria owners are rarely only owners. Instead, we don many hats and understanding every role in the shop. In fact, I know one clever owner who wears a shirt that says “Maintenance Man” on the back.

Even if we’re not masters in every facet of our business, we’re masters of learning. But along with being students, we’re teachers.

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

We can all think back to our years of school and remember our favorite teachers. But what made them so memorable? They probably made you feel special, like you were the only kid in the classroom. They did that through the passion that they felt for teaching and for their role in helping young minds discover the world. That passion shines through and reflects onto the one being taught. Let your employees feel the passion you have for pizza and the business — that enthusiasm is contagious.

There are many things we must teach in our business, from the simple tasks of mopping the floor to the stuff we take for granted, such as stretching dough. All the way to more complicated matters, like how to read a profit-and-loss statement, these are things we want to teach and not train. Systems and how-to manuals are there to train our employees how to navigate certain operations in the pizzeria. Teaching is an art, where we inspire our employees to care and to perfect the task they are assigned.

Timing is so important in life, as it is when teaching. Teaching in a very hectic situation like during dinner at a busy restaurant is probably not ideal, so set yourself up for success when you are ready to teach your employees. Having a dedicated time when you don’t have to tend to the oven, answer the phone or perform other various tasks will be best.

It is important to teach because employees want to work at places where they feel like they are part of something special. Most pizzeria owners know they can leave a job and go just about anywhere for a shiny nickel. That’s why there needs to be a bond with your employees, one strong enough where they want to work for you, they want to do a good job, and they want to learn.

Through teaching, showing our passion and guiding with patience, they will experience just that. And not do we just want to teach them, but we want to empower them to become teachers, too. When a new employee gets hired, your team will take on the job of being the teacher, showing their passion and inspiring a new crop of employees and team members.

That’s when you can start to recognize the ones on your team who have become leaders and teachers. In our next installment, we will break down just that — how to evaluate and identify who you should promote.

Nick Bogacz is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: The Value of Teaching — Rather Than Training — Your Employees appeared first on Pizza Today.

How to handle the seasonal staff exodus at restaurants and pizzerias

Handling the exodus. It’s a little dramatic, but it might feel like that when you have one, two or maybe even three employees that decide to leave all at once. I’ve noticed that an exodus happens about the same time each year, right after the holidays and when school starts. People have gone through all the adrenaline of that season, are ready for a change, and start to believe the grass might be greener somewhere else.

It’s a common challenge that happens to every restaurant at some point. Losing great employees is disruptive and costly, but you can minimize or avoid this impact with the right practical strategies. Here’s how to handle this:

1. The Eval:

A solid conversation addressing all concerns brought up in a frank, open discussion will prevent something from going awry. Ambiguity is your enemy, and getting in front of the problem can help set you up for success and keep the wandering mind from thinking of moving on. Find out what they believe is going right, nail down what is going wrong with them or what they perceive as wrong, and map out a growth plan to address each issue.

2. Pay and Benefits:

What are they moving towards, and how will you compensate them when they accomplish this? By the
employee knowing that there’s more to come ­— with a clear path — breeds clarity. It must be clear that they’re not just getting more money because they’ve existed at your restaurant longer; the plan must build towards both parties set up for growth and success. This conversation creates a clear verbal contract for your mutual benefit.

3. Be Cool:

Especially after a crazy summer or a crazy holiday season, people might feel burnt out. Especially if the restaurant environment has been aggressive or not fully productive by all members, they might feel unappreciated and that this is their time to exit. Ensure you have a positive work environment; if you don’t, address whatever is lacking with a plan to fix it; getting in front of the issues that destroy morale is a daily task. Solid managers in a positive work environment create employee retention.

4. The Schedule:

If you didn’t have leeway in the schedule, make time and make leeway. It’s way cheaper to figure out what you’re going to do with one missed Sunday shift than 4-6 more without that employee in the mix. Being a hardliner on a few days of the week is not in your best interest. No one should have free rein to do whatever they want, but figure it out for employees who provide excellent service and earn money for your business. Compromise with them and game the schedule hard because it’s in your best interest to keep great players in the mix.

5. Appreciation:

Retain the talent by showing appreciation, giving gifts, and making good swag. Let all employees know beyond more than just money that you care about them. Whether that’s a party, one they want to have, or individual gifts that pertain to things they’re interested in, this is how you build employees who know you care.

6. Know When to Give In:

My business is a boomerang for great talent that eventually moves on to come back one day because we leave on good terms.

Don’t kill yourself over trying to save someone who does not want it anymore or has their mind made up that they need to venture out. This is a hard pill to swallow, but if they’ve already made up their mind, now you’re just trying to convince a body to stay on site that doesn’t want to be there. If you have addressed all their concerns and they still don’t want to work there, then understand if someone doesn’t want it, it’s a fool’s errand to try and save it.

7. Have a Plan:

People are going to quit and leave your restaurant; it’s inevitable. Always have a backup plan. Always have another ace in your back pocket, ready to fill that spot. If you don’t, work on your contingency plans during the great times. Recruit during the good times, train more, and onboard more during the fully-staffed times because a fully-staffed crew becomes dilapidated the second you think you’re riding high on that success and stop hiring.

In conclusion, handling this is a critical component of running a successful restaurant; offering a more incredible place to work, great opportunities to grow, a flexible schedule, addressing problems and issues, and killing the ambiguity before it becomes real is how you have a plan in place for success all year round, even during an exodus.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch

The post Mike’s Monthly Tip: The Seasonal Staff Exodus appeared first on Pizza Today.

Get more out of your team meetings

“Like a human being, a company has to have an internal communication mechanism, a ‘nervous system,’ to coordinate its actions.”
— Bill Gates

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

OK, do you really need to run your company like Bill Gates does? After all, you’re just a pizzeria. But a company of any type and size is a living, breathing thing that requires nurturing. So, why not take a few pointers from one of the best businessmen of all time?

We’ve talked a lot about communication in this column, so you might recall my favorite way to communicate is through meetings. It may sound simple to hold and plan a managers’ meeting, but there are a few key components to making them successful.

Step 1: Scheduling

Since I was GM of a single unit with 15 employees, I’ve been a big fan of meeting at the same time weekly or monthly. For example, every Monday at 8 p.m., we hold a GM phone meeting to go over the previous week. The first Tuesday of every month is our all-manager meeting, and every Wednesday at noon I meet with my regional team. These dates and times are set in stone. That way we’re proactively addressing situations that arise as opposed to reacting and holding a separate meeting to consider the issue.

It is important to communicate ahead of time when you set the meeting times and dates, along with an advanced notice of when it will be. You also set an expectation of how long the meeting will be. Then, hold your staff accountable for attending.

Step 2: Structure

Once a set day and time is settled, consider the meeting’s organization. It is important to take some time before the meeting to write out an agenda. Make a sheet or packet to hand out to everyone that has the outline of the meeting on it. You won’t get off track, and you won’t miss anything important. Just don’t do this a few minutes before the meeting — when it’s planned out ahead of time, it’ll be much more effective.

I like to start each meeting with a quick recap of our mission statements, visions and, of course, some good old-fashioned praise. I like to recognize great performances. I like to go over any issues that are occurring, break down upcoming promotions, let everyone know about special events or plans in place, and leave room for open discussion. Make the meetings collaborative. Everyone should have a chance to share their opinions and thoughts.

Step 3: Learn Something

Most importantly, I love using meetings to have teachable moments. Whatever the biggest issue of the month may be, do not just talk about it and brainstorm the solution, but really discuss and explain why you’re resolving the issue the way you are. We’ve had full-blown lessons on everything, from filling out employee paperwork to labor and food costs, as well as seemingly simple things, such as how to sweep the floor most efficiently at night.

Not a natural teacher? We’ll get into how to teach your employees — note: this is not training — in our next installment.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: 3 Steps to Hosting an Effective Team Meeting appeared first on Pizza Today.

Restaurant manager compensation isn’t what it used to be

With respect to manager compensation packages in today’s hospitality environment, Uno Pizzeria & Grill CEO Erik Frederick acknowledges one overriding truth: “The old rules,” he says, “don’t apply.”

To attract and retain top managers, shrewd restaurant owners are unshackling themselves from the status quo and crafting thoughtful compensation packages featuring competitive pay, attainable bonuses and perks supporting a work-life balance.

For hourly managers at Uno, Frederick calls a great work environment and flexibility more important than ever. At the general manager (GM) level, he says, his Boston-based company continues evaluating compensation and profit participation in new ways.

“It’s really a combination of listening to our GMs, aligning their interests with the company’s and, of course, keeping tabs on what’s going on in the industry,” Frederick says.

Honoring today’s environment

Historically, many restaurant managers inhabited a thankless job. As full-time salaried employees, they were expected to pick up the slack when others fell off and accept directives from ownership without hesitation. Such, after all, was their job. But times are changing, says Robert Krzak, president of Gecko Hospitality, a recruitment agency specializing in hospitality management recruiting.

The pandemic spurred reflection and an exodus of capable managers from the hospitality ranks, many of them frustrated by employers who overlooked their worth, notes Krzak, whose firm tracks the industry’s labor force by speaking to thousands of hospitality workers each month. While many former managers are finding their way back into restaurants, they as well as those who never left desire more these days. More pay. More opportunity. More flexibility. More say.

From chains to independents, Krzak says most restaurant owners know what’s necessary to recruit and retain managerial talent in today’s climate, though many are slow to do it.

“If [restaurant owners] want to attract the best, they better get their heads out of the 1990s and take a good look at what companies are doing now,” Krzak says.

Competitive compensation is non-negotiable

Competitive managerial pay is table stakes in today’s restaurant environment and annual pay for managers has increased about 25 percent from pre-pandemic figures, according to data compiled by Gecko Hospitality.

At his eight PizzaMan Dan’s restaurants peppered along the central California coast, Dan Collier traditionally started General Manager salaries at four percent of the store’s annual gross sales. While that worked “for many moons,” Collier says it falls short today.

“At a $1.5 million restaurant that means you’re paying the GM $60,000,” he says. “That might be great in some places, but not California.”

In the Mid-Atlantic, for instance, the average fast-casual GM makes $73,150, according to Gecko Hospitality’s 2021 Salary Survey Report. By contrast, the average fast-casual GM salary in the Southeast sits at $52,821.

It’s imperative restaurant owners understand the salary landscape around them and offer pay on par with their peers, Krzak says. The same goes for benefits. While a two-unit restaurant company might ignore health care coverage because the business is not subject to a government edict to offer such coverage, many local competitors do provide health insurance – some by force, others voluntarily – to attract quality managers.

“This is part of being competitive,” Krzak says.

One interesting trend Krzak notices: an uptick in restaurants ditching salaries for GMs in favor of hourly pay.

“If someone doesn’t show up or a delivery comes in late, the GM is then compensated for stepping in and filling that void rather than ownership simply assuming it’s part of their job description,” Krzak says.

Collier, meanwhile, has found success with bar managers, in particular, by guaranteeing them full-time employment, a rarity in the industry. The bar manager is given autonomy to run that area of the restaurant, from compiling the schedule to managing bartenders.

“I’ve actually found it’s easy to find a bar manager if we’re providing full-time employment,” he says.

Beyond the basics

With $60,000 standing as baseline GM pay at PizzaMan Dan units, Collier then provides achievable bonuses that can add up to 25 percent to one’s annual salary. While the bonuses are often tied to core profit-driving figures like sales, food and labor costs, Collier has layered in other key performance indicators as well, from service-level inspections to Yelp reviews. Given existing labor woes, some owners are tying managerial bonuses to employee retention as well.

Whatever one’s bonus criteria might be, bonuses should be attainable and in writing.

“This can’t only be promised in the interview,” Krzak says. “There needs to be transparency and clarity.”

In one interesting twist, Collier issues bonuses monthly. This way, he says, GMs feel the bump throughout the year rather than receiving one lump sum at year’s end. He feels this better impacts his managers’ standard of living and drives consistent motivation.

And while money talks, so, too, does quality of life. It’s why many forward-thinking restaurants are prioritizing flexibility and work-life balance. Krzak cites one fast-casual chain that gives its managers the option of working four 10-hour shifts or five eight-hour shifts each week. Another, meanwhile, provides its managers one weekend off each month.

“Managers don’t want to be married to or consumed by the work, so flexibility is appealing,” Krzak says.

What else do today’s restaurant managers want?

Restaurant managers responding to a recent Gecko Hospitality survey tabbed “better opportunity” and “no growth” as well as “not satisfied” as three of the top reasons they left their previous employer.

Gecko president Robert Krzak reminds that all staff members, including managers, aim to be a part of something bigger, not “beat into the ground and treated like cattle.” They want opportunities to advance, develop their skills, amplify their voice and contribute to a winning operation.

To this point, Uno Pizzeria leadership is working on a Managing Director Program for its GMs as well as an incentive program for GMs who mentor people to take on bigger roles elsewhere in the company. Dan Collier, meanwhile, created manager in training positions at PizzaMan Dan’s stores to elevate his most promising shift managers. Collier’s program creates advancement opportunities for motivated staff and also builds a stable of potential GM candidates to fill future vacancies.

Daniel P. Smith Chicago-based writer has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Today’s Restaurant Manager Compensation Packages appeared first on Pizza Today.

Common Compliance Issues with Tips, Tip Pooling and Service Charges

Tipping models and service charges are some of the most discussed topics in restaurants today among restaurateurs, employees and customers alike. While tips and automatic service charges may seem to be similar, they are treated very differently by the IRS and the Federal Department of Labor (DOL) with complex regulations.

The information provided in this article does not, and is not intended to, constitute legal advice and is for general information purposes only. Readers should contact an attorney in their jurisdiction for questions and advice regarding this topic.

How to Define and Classify Tips and Service Charges

A tip is a discretionary payment made by a customer independently, is calculated on their own, and is not dictated by restaurant policy.

In contrast, a service charge is a charge that is mandated by the restaurant and is a fixed amount, either as a flat fee or a percentage of the bill.

The key difference is that a tip is wholly owned by the employee at all times, whereas a service charge is wholly owned by the restaurant. This means that an employee must receive the entirety of the tip they are owed no later than the next regularly scheduled payroll. Whereas when collecting a service fee, a restaurant can distribute it to whomever it chooses or not distribute it at all. Further, employers may deduct their actual credit card processing costs from electronic tips given by customers.

Additionally, while tips are not considered income to the business, service charges are income and will be taxed as such. Service charges are also generally subject to state sales tax.

For employees, tip income and any service fees received are both considered income. Employers pay federal employer taxes on tip wages earned, however, a credit for the amount of tax paid on tips above any tip credits taken is available when filing year-end returns — ask your CPA about IRS Form 8846.

Tip Pooling

In a traditional tipping model, individual servers receive tips in addition to their hourly wage, while back of house receive no tips at all. This can result in a disparity in pay between the two and can bring some animosity between those who work in the front and those who work in the kitchen.

Recently, many pizzerias have instituted tip pooling, in which all tips collected are placed into a collective pool and then divided up among staff members. The pool can include anyone who is in the “chain of service”, including servers, dishwashers, bussers, cooks and other kitchen staff. While this may be off-putting to some career servers, it also can result in higher employee retention among kitchen staff.

While the DOL allows mandatory tip pooling imposed by an employer, this is not true of all states. A few states disallow tip pooling altogether, while others allow it if all employees agree to tip pooling and create the terms of the pool on their own. Additionally, some states will allow mandatory tip pooling but only among servers and not back of house staff.

If your state allows tip pooling, the best practice is to establish a written tip pooling policy as part of the employee handbook to ensure that all staff understand and agree to mandatory tip pooling to avoid confusion and potential legal liability down the road.

Who Can Accept Tips?

Federal rules mandate that only employees may accept tips, which excludes equity owners of more than 20 percent of the business, managers and supervisors unless they directly and solely provide the tipped service.

A manager or supervisor is someone (1) whose primary duty is the management of the entire enterprise or of a specific subdivision of the enterprise, like “bar manager”; (2) who regularly directs the work of two or more employees and (3) who has the right to hire or fire other employees. Note that the employee’s title is not a factor, meaning that someone without the title “manager” can still be considered one if they meet any of the factors above.

This means that if a manager or supervisor is covering a server’s shift and is solely waiting tables, they can accept a tip. However, if a manager or supervisor is not the only person waiting that table for the evening, they are not solely providing the service and therefore may not accept any part of a tip.

Importantly, managers and supervisors may not participate in a tip pool, even if some or all of their job duties include tipped work. However, managers can collect tips if they are fully contributed into the pool and do not take any tips out of the pool.

Generally, even if you don’t engage in tip pooling, the best practice is to prohibit managers and supervisors from accepting any tips. Improper distribution of tips is considered wage theft. Any tips improperly distributed must be paid back with interest to any employees who would have received those tips, in addition to potential civil fines imposed by the agency, which can be in the six figures or greater.

Service Charges

As discussed above, a service charge is a mandatory charge added to each customer’s bill, usually as a percentage of the overall bill. This should always be disclosed in the menu and as a separate line item on each guest check to avoid confusion.

The description of the service charge in the menu should also state how the service charge is used by the restaurant, whether it is being distributed to employees, is being retained by the restaurant, or a combination of both. Some states require that the disclosure statement not be overbroad or ambiguous or else the entirety of the service charge must be given to the employee.

Many pizzerias have replaced tipping altogether with a mandatory service charge that is either used to pay all employees a higher base wage or is directly distributed to all or certain employees. Other pizzerias, like my own, encourage tipping but also have a small percentage service fee that is distributed to managerial employees who perform tipped work but can no longer accept tips due to the regulations.

While customers are becoming more accustomed to mandatory service charges, they can still be a point of contention, especially if the service charge is higher than what they would ordinarily tip. It can be nerve wracking for an operator to add a service fee, just as it is raising menu prices, but it may be necessary to stabilize increased wage cost.

While there is no one size fits all approach to how to handle tips and service charges, government agencies are focused on these issues and are targeting enforcement action on those who do not comply with the rules. A well-run pizzeria should have written records and policies that can show state and federal compliance to avoid steep penalties and fines.   

Thomas Reinhard is a Seattle-based business attorney and a co-owner of Cascadia Pizza Co.

The post What’s the difference between Restaurant Tips and Service Charges? appeared first on Pizza Today.

You Get the Staff You Deserve

Restaurant Employee Training is an investment

The quality of your training directly correlates to your team’s potential success, which affects the quality of your food and the end customer dining experiences. Great businesses have great training. Whole Foods, The Four Seasons etc. and Disney, there’s no debating it, it’s an absolute fact. When a business shortchanges training, they choose not to invest in employees. No investment equals no return on investment.

Here are the fundamentals and next-level steps for a solid training program.

At a minimum, training should be five days carved out into orientation, culture, process and then each menu item with repetition or diving into service standards for guest facing employees. All this should be performed multiple times until they grasp it, not simply fight or flight. The result is often flight when training is designed as fight or flight. They quit or are quickly fired for performance issues they had no grasp of to begin with. In that scenario you’re left with what you might believe to be an elite crew who don’t need a lot of handholding, the ones who made the cut; when in reality, you have people just scratching the surface of their potential. Potentially great employees are limited, and the rest are unfocused automatons running out the clock.

Your goal is not to cull the herd. Your goal is to develop great behaviors. Big chains take the people that unstructured independent restaurants say are untrainable and develop them into managers. Why is that? The chains pull this off because they’re very clear with their expectations of the staff and train them as such. The X-factor is those chains are typically soulless and heartless. You can have soul and heart all day, but you need metrics and institutionalized boundaries.

Here are the three core fundamentals of all training:

• Classroom. Classroom training means anything they study. It could be written words on paper or PDFs or looking at a menu, videos or any training that can be taught sitting down. They must understand the product and what they’re supposed to do. But if this is all you give, it’ll be like teaching karate from a book—some things you need physically do to understand them. Making pizzas suitably is one of them. Working a POS and knowing how to engage a guest also takes in-person training. Computer screen recordings and simple, quick rough how-to videos are surprisingly effective training tools compared to classic training manuals. Have recipes and processes locked in, record them and test them. Nothing is easier or more effective than learning from videos with a test question.
• One-to-One Training. One-to-one training means that a trainer trains with the trainee and physically shows each aspect of the classroom training in detail. Additionally, the trainer verifies that this person knows how to do it. They go in-depth on each item to verify that this new trainee feels comfortable and is going along the path. The trainer needs their own training to learn how to be a good trainer. That’s called train the trainer. In this course the trainer learns that repeating things is ok and support rather than derision is the way to get new people on board.
• On-Site Training. On-site means on the job, that they are learning by doing the repetitions over and over and over again. Most restaurants, especially new ones, have on-site or on-the-job training and nothing else, which is not enough. If you throw a menu at someone and say, “Learn this. Now, go do it,” you have denied them one-to-one training. All three work together for someone to have a strong chance of performing well in their job and have satisfaction in their performance. That satisfaction and pride increase the likelihood they’ll be there on day 90, as well as day 365.

Verification

All of these styles of training require tests. You can test if someone knows the toppings on your supreme pizza by filling out a test, or you can have them make it for real. Both of these should occur. When you verify an employee has made it multiple times correctly, the probability of future failure is almost zero for that specific item. Yes, it’s tedious to do this for every item and task, but it’s also intelligent and saves money in the long run. That’s why it is an investment.

Testing is for the benefit of the employee to ensure their success. It is not to weed them out. When you were in high school, and you had a tough test where the teacher barely gave you any information, and you had to study all night in the hopes that you might get the question you hopefully studied for, you were in the midst of a testing game. This practice is not how you would prepare someone for the knowledge you absolutely needed them to know. That path is “gotcha testing.” Avoid this testing style; instead, seek education verification with a path to re-education for any slip-ups.

Otherwise, you are setting your staff up for failure, which is a problem because each employee costs about $3,500 to get fully acclimated and able to hold their own in your store. When they quit, all the investment is tossed out. If you get them up to that point and now they just don’t like the job, you’ve lost. If they work there a month and a half and are entirely up to snuff with what you want, but because you treat them poorly or they don’t like their job, they leave, you’ve lost. So, this investment only has a return if the trainee feels safe, secure and empowered while working for you.

How To Empower in Training

In all training, do it in front of them once, maybe twice. Then have them do it. If they do it correctly, you’re done. If they don’t, explain again what they did wrong, reinforce the things they did well, and keep doing corrective measures until they perform it perfectly uninterrupted. Otherwise, they are not trained. I repeat THEY ARE NOT TRAINED IF YOU DON’T SEE THEM DO IT RIGHT. If the training becomes, “You do it this way, this way, this way, you got it?” As you stare blindly at the employee, who then nods out of fear because they don’t want to appear dumb, then they won’t know, you’ll be frustrated, and it will be your fault.

When your staff feels pride that they know what they’re doing, it creates stability for creating a better product, which creates less anxiety, more pride and a higher likelihood of retention. With all that said, the number one reason why good people leave jobs is because of bad management. You are responsible for their success. Your subordinates are responsible for their success. When people know the standards, they generally want to reach them, so let them. Explain what success is, show what failure means, and have them hit goals, so they are on your team and not just a cog in the system.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.

The post Fundamentals and Next-level Steps for a Solid Restaurant Employee Training Program appeared first on Pizza Today.

Don’t blame others for a bad hire. Look in the mirror.

We all know the saying about subpar employees: One bad apple ruins the barrel.

But if that’s true, why do we as pizzeria owners tolerate the bad apples on our staffs? Obviously, no one wants to have malcontents bringing down morale and performance, but sometimes bad behaviors develop over time and problems don’t become clear until it is too late.

Look in the Mirror

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

As easy as it is to blame that employee for their actions and attitude, I know all roads ultimately lead back to the employer —me. Sometimes, a bad apple simply was a bad hire. In that case, maybe I missed a red flag during the interview. Perhaps because we needed an employee so badly, I overlooked how many jobs they blew through in the past few years.

Even if I’m not the one who hired the employee, I might carry some of the blame for the misstep. Perhaps I didn’t properly train my team and my managers on how to hire, what warning signs to look for during an interview, and what type of potential employee to avoid.

Set the Example

You should consider the overall behaviors in the pizzeria. I firmly believe that you get what you tolerate. Take timeliness as an example — do your employees show up on time? Are they five minutes early for each shift? Are they five to 10 minutes late for each shift, or do they literally show up whenever they want. Think about those questions. More importantly, think about how you react to each situation.

Also consider that your employees often mirror your behavior. So, if you are a few minutes late or worse for each shift, or even just a couple times a week, then they might believe they know what they can get away with. Nobody respects someone who throws rocks at glass houses, so it starts and ends with you.

Stay Out of the Pool

The same goes for gossip. Nothing kills camaraderie and teamwork quicker than gossip. Whether it’s gabbing about who is lazy and didn’t take out the trash last night or who is dating whom, by the time the gossip gets back to the subjects of the chatter, it’s never the same thing that was originally said. This Telephone Game is often very hurtful and makes them feel worse. Most of us have been there — it’s not great.

Once again, if it is something that you put up with, it will fester. We have a saying at each managers meeting: Don’t (expletive) in the pool, and don’t swim in the pool. It means that even if you can’t completely stop gossip, don’t partake in it, and do not stir it up. It will make it easier when you try to tamp down these damaging behaviors.

Manager meetings are the perfect place to talk about what is acceptable, what is not, and to share strategies on improving morale. How to conduct an effective manager meeting is what we’ll discuss in our next installment.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Bad Hire? appeared first on Pizza Today.

Why is it that you can have two people with relatively the same age, background and acumen have two vastly different outcomes from the same team? The straightforward and non-simple answer is leadership. Once you see them in action, is only when you see whether or not they’re real leaders. You may have a hunch that someone has leadership potential, but it’s never real until you see results. A great leader isn’t cheap, but a leader pays for their salary multiple times over. A leader has the vision to ensure things get done consistently and that they have a path to staying consistently done, along with calling an audible on stuff that’s not working. Leaders don’t call it in because they weren’t told to change anything or try harder.

Mike Bausch

Meanwhile, a manager only checks the boxes. All great leaders are superb managers. The reverse is not true. Managers are doers, and there is nothing wrong with that. You need people who are doers, but doers are not necessarily self-starters or visionaries who see the forest through the trees. That is a leader, and you need leaders.

Never has leadership been more important than today to guide in the highly competitive environment what it takes to let employees feel valued and driven simultaneously. It’s a tightrope walk that takes vision daily. In your restaurant right now, you have leaders, and they might not be supervisors. Your number one concern regarding your workforce must be nurturing leaders to take charge of your restaurant and motivating them to do so. With that said, great leaders don’t need motivation as much as they need a go-ahead from you to make moves and not get in trouble. They need the shackles taken off them. Whomever you have that is shackled right now, release it. Let your Mustangs be Mustangs, and your mules stay in place.

The leader leads by example, and the most significant defining characteristic is that they own everything. They take pride and comfort in knowing that they could have fixed anything that goes wrong, and that’s why it angers them. THEY OWN, therefore they progress. The opposite of a leader finds every reason to say why it’s not their fault or their responsibility. The person who was absolutely not at fault but still finds a reason to take some responsibility feels comfortable knowing they can control things. They feel empowered in fixing things and hate feeling like a helpless victim. That is why they’re a leader, and that is why they will make themselves successful. And you, in the process, promote these people, curate these people because they are your future.

They are your future because this leader can tend to their store, enhance their crew, and get you on to your next endeavor. Great leaders leave because of apathetic managers and lazy owners. If you think you are not lazy, remember that the laziest thing you can do is their job for them. Yes, when you do others’ work for them and don’t let them lead and develop, it’s out of a laziness not to spend time training and instead a choice to live in fear of their failure. As a result, this behavior never lets them develop, or you get out of your own way.

So for this new year, choose to remove shackles, develop, train, believe and grow.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch

The post Mike’s Monthly Tip: The Value of a Leader appeared first on Pizza Today.

Proper PTO

Paid time off, also known as PTO, isn’t easy for restaurant companies to navigate. It can enhance the likelihood of retaining top-tier talent, but it can also be easily abused. PTO is never fun when it leads to vital personnel gone when you need them most, but it’s a lot worse to have them burnt out and quit because they never get time to recharge. An effective PTO policy leaves you in control to make decisions and lead to what’s best for your company and not be at the mercy of a poorly designed policy.

I can tell you from firsthand experience that controlling paid time off is a nightmare when you have a job that is not a straight-up nine-to-five. It takes a lot of communication and staying on top of schedules to mitigate employees taking advantage of the system or the ambiguity of not knowing how many days off they have left and how to request vacation properly. Depending on where you live, because each state law is different, employees can come in for 20 minutes and legally negate that as a complete “day off.” With an ambiguous PTO policy, actions like working a little bit and taking the rest of the day off might not count against their PTO in court.

Along with that, a salaried manager could move the days that they usually work up to earlier in the week and then push the following week’s start to later, use some half days at the beginning and end, and turn it into a five-day break. They could do this and legally say they didn’t miss a workday unless you have a signed policy addressing actions like this. Even then, that might not fly in a court of law. Playing fast with hours happens all the time in the restaurant industry, with employers left with little they can do other than be on top of managers not to approve requests, assuming they are checking requests off at all. It becomes a lot harder when the person you trust to be in charge, i.e., a GM, is the one you have to control.

Below is my PTO policy; yours might be much different, but this is significantly better than the average policy. This policy leaves us in control to make decisions based on the situation.

PTO is for salaried managers only, and it’s accrued monthly.

PTO can be taken early in the year with permission submitted via an official document to a company owner or an area director.

PTO cannot be rolled over into the new year.

If a person is terminated or quits, only accrued unused PTO up till that point will be paid.

GMs are allowed an extra 40 hours above the standard, regular calculation.

PTO hours are based on the following metrics:

1-2 years = 40 hours PTO

3-10 years = 80 hours PTO

10+ years = 120 hours of PTO

Feel free to do what works for you; this is only a guide. It’s advisable to use the term hours instead of days. Instead of one week of PTO, it’s 40 hours because each day will count as eight hours of PTO. Going about it otherwise gets very murky, regardless of how many hours your managers typically work.

No federal or state laws require any employer to give paid vacation, but most salary jobs in America have that assumption. Here are the nuances of that. The honest debate is; sick days vs. vacation days vs. holidays and what should be official PTO. Our restaurant Andolini’s is only closed on Christmas and Thanksgiving, so yes, if someone wants to take off Valentine’s Day, then that would mean they would need to request PTO because that is a non-applicable PTO day, which we have very few, but that is one of them. Everyone works that day.

Now, if someone’s sick and another manager covers for them, do I, as the owner, really want to put that against their PTO? I don’t because I want my managers to go on vacation because it refreshes them and makes them appreciate the job. I don’t want it all used up on legit sick days where they are doing the right thing by staying home and trying not to get others sick. However, take that with a grain of salt because it all needs to be regulated and evaluated.

If someone was playing fast and loose with requests off, I would call that out before changing our whole PTO approach. We typically don’t go after sick days or dock bereavement. We don’t seek to dock anything that is not a vacation day. We reserve the right to, though.

The process to get approval is to fill out an online form and submit it. I’ve seen this done with an officially e-mailed PDF or specific payroll software and some scheduling programs have this capacity. Whatever you choose, make sure you have one singular portal and a clearly delineated path to filling out the PTO request. Otherwise, a text message could be inferred as an official request for PTO.

I’ve had employees that, only weeks after being hired, said to their direct supervisor they were going out of town and had mentioned it in their interview. That new hire expected everyone to know that that was their PTO. Or worse, no one noticed that this should’ve counted toward PTO, and then they kept doing it multiple times a year and, when asked about it, said, “well, I never got a notification that they had gone past my allowed PTO.” As a result, they went way over their PTO, and we have little legal recourse. These things happen when there’s ambiguity.

Regarding regular non-salary employees getting paid time off, we will take care of them if they have to leave for something we forced upon them, like a temporary store closing or a cataclysmic life event. But no, if a server who’s not on salary wants to leave for three weeks and still be paid, it’s not fiscally possible.

A strong PTO policy is designed to enhance the employee’s work-life balance and for you to have a more refreshed employee and limit attrition. That is the goal. It’s there is to be a competitive incentive. Whatever you choose, you must have it reviewed by an HR professional, even a lawyer, to ensure that you abide by all applicable labor laws relative to your state.

This article is simply a guide; it is not legally applicable to every state. This is a good framework for where to start when deciding your path to a strong PTO policy and procedure.

Mike Bausch  is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post A Framework for Paid Time Off appeared first on Pizza Today.

“Show me the incentive and I will show you the outcome.”
– Charlie Munger

In the restaurant industry, employers are constantly talking about how difficult it is to hire and retain good employees. My philosophy is, when it comes to staffing your restaurants, you need to look within first.

Often, employers worry more about hiring new employees than they do about retaining their current employees. In the middle of the COVID-19 pandemic, when hiring became more difficult, everywhere I turned, I saw companies offering hiring bonuses to new employees. Sure, growing the team is always important, but do employers pause to think about how emphasizing the value of new talent affects morale and confidence among their company’s existing team?

I’ve talked in previous articles about the offerings Caliente has built into our company to encourage employee retention, such as holiday parties, giveaways and health benefits. In this column, I want to highlight another strategy for incentivizing your team that differs from traditional employee offerings.

What’s not working?

Over the years, Caliente has hosted employee contests that are often lots of fun, but in the end, have resulted in me rewarding someone for selling only five or six special promotions in a month. I used to bang my head against a wall trying to figure out why the contests weren’t yielding the results I’d hoped for.

I realized a few things. First, the prize wasn’t very enticing. Sure, a $50 gift card was nice in the short term, but it wasn’t moving the needle for employee sales efforts. I thought to myself, if I only have $50 a month to allocate to prizes, how can I get the best contest prize for employees that will encourage them to make more sales? After exploring several alternatives, I landed on a new contest system, and the results have been much more rewarding for all parties involved.

Exploring new strategies

After settling on better contest prizes, such as 70-inch TVs and 3-night cabin stays at a ski resort, the next challenge was implementing effective communication strategies that reminded employees of the value their hard work contributed to the company’s growth and success, and of Caliente’s philosophy of rewarding our team’s achievements along every step in the company’s journey.

Two methods I’ve used to promote employee contests internally include creating and maintaining an active company-wide group message chain and pasting contest flyers next to employee schedules in each restaurant.

No matter what method you use to spread the word about employee contests and incentives, it’s critical that you communicate exactly what you’re aiming to accomplish, and why it will yield positive, measurable results for your company.

Fostering competition and camaraderie

At Caliente, we’ve found that updating a ‘leader board’ every week is an effective way to keep team members engaged and active throughout the employee contests and instill some healthy competition among coworkers.

Keeping your team engaged may seem difficult at times. But if your company culture and brand is strong, your employees will want to do what it takes to contribute to the company’s growth — they just need to be reminded that they’re important assets to the team, and that their talent and success matters.

Now that we’ve discussed some ways to incentivize your team, next month, we’ll talk about getting employees to show up to work on time, and how to kill bad habits in your restaurant.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Effective Ways to Incentivize and Reward Your Team appeared first on Pizza Today.

The Perfect Tandem

Any independent operator can tell the same story about the good old days when they first opened the shop. As owners we were working 18-hour days, seven days a week, 100 hours plus weeks, and no days off. But then as business grew, so did we. Everyone eventually (hopefully) reaches that point where business has grown to a certain level of financial stability that they can slowly begin to back themselves out somewhat. As they say, “We don’t open these businesses to give ourselves 100 hour per week jobs.”  The exact extent to which an owner can begin to step back will vary for everyone on a case-by-case basis. This is where the birth of a new job category arrives. The General Manager.

Finding, hiring, and training the proper person for the General Manager position can be one of the most important decisions contributing to our future success or lack thereof. The easiest route is to find an industry veteran who already has the proper experience in that role and just slot them into your operation. Unfortunately, those unicorns are rarely seen in today’s labor market. Nowadays many of these candidates are hired and promoted from within our current staff.

When we first promoted a staff member to a supervisory or managerial position it was easy. We just go by the old mantra for the selection process of “Our ‘employees’ need to be managed. The ‘managers’ are those who do not need to be managed.” It’s usually pretty easy to pick those candidates out, but now we are moving into a whole new level of responsibility. The General Manager is essentially the person who will be stepping into your role when you are not there. The bond between the owner and GM will be key to the continued success of the operation.

Building the bond between owner and GM is very different from that of other employees. We are in effect looking for a partner that will have that same sense of responsibility that you the owner has. Relationship building is key here. This is not the simple managerial promotion that comes with a set of keys and a pay raise. The GM needs to have the same philosophy and mindset as the owner in order to effectively run the operation as it is meant to be run. This is now our most important employee and needs to be treated as such. Passion for our restaurant and concept is wonderful, but at the end of the day that doesn’t pay the bills. Cash is still king. The GM needs to have a compensation package that will do two things. First, it needs to be at a level that is commensurate with the expectations of the position. Second, it needs to be at a level where the GM feels a sense of respect and would never consider looking to work elsewhere. This will undoubtedly be a high number, but we get what we pay for. A useful tool that many operators employ is creating a pay scale for the GM that has a base salary but also has incentive bonuses built in for hitting certain predetermined benchmarks in sales, food cost and labor cost each week or month. By tying a bonus portion of the pay package to the meeting these benchmarks the GM now has an absolute vested interest in operating the restaurant with the same passion as the owner.

Another part of this bond is how we interact with our GM. An owner can no longer treat that person like one of the crew. There needs to be a partnership camaraderie developed. No longer will discussions be held in the kitchen amongst the staff. The owner and GM should meet privately to discuss everything thus showing the GM such respect that they are not one of the average staff. Further, a relationship outside of the restaurant walls can greatly help the bond. Often there can be an age differential between the owner and GM that may cause a slight generational disconnect, but doing simple things like grabbing lunch or dinner together on a day off to discuss business or simply to decompress can go a long way.

As an owner there is certainly a period of adjustment that will come along with turning your baby over to the hands of another person. You know what works. You built this business. You did it your way. When training your GM clear expectations should be set out, but remember, all roads lead to Rome. Just because you handle a task in your restaurant in a certain manner does not mean that it is the only way it can be done. There are various methods to reach the same conclusion and we need to be mindful and respectful of our GM’s personal way of accomplishing things. Many times, too, a GM will have better success in dealing with the staff due to a more familiar feel and relationship with them. An owner needs to give the GM space and let them handle things without micromanaging. It’s easier said than done, but the relationship will flourish if they are allowed to handle their responsibilities in their own way.

As with any partnership there will be rough patches at times. This is a good time to remember that we brought this person in to run our operation so that we don’t need to be doing it 24/7. Remembering that word ‘partnership’ is key. Yes, you may be the owner and the buck stops with you, but this is not the average basic employee you’re dealing with anymore. Sit and discuss issues together. Work together to find the right solution to the problem. You may know the answer to resolving an issue right off the bat, but by communicating calmly with your GM and showing them that you want to work respectfully together to find the solution you will strengthen that bond.

Outside of family this will be one of your most important relationships in life. Your entire business that you worked so hard to build depends on it. Cherish that relationship and you both will flourish.

Michael Androw owns E & D Pizza Company in Avon, Connecticut.

The post The Crucial Owner/General Manager Bond appeared first on Pizza Today.

Words and actions are the key

“Great things in business are never done by one person. They’re done by a team of people.”
– Steve Jobs, Co-Founder of Apple

You can have the best recipes and the best location, but if you can’t build a great team then you will never be able to serve your customers the right way. Hiring is now a skill in itself, as we’ve discussed in this space. But once the hiring is done and your team is assembled, how do you build your team up?

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

Team-building begins at the top. Everyone is always looking and watching you in every situation, from how you handle a customer complaint to what you say about that customer behind the scenes. They watch how you interact with other team members when praise is deserved and how you handle a team member when you hold them accountable for their actions.

Your words…

As a leader, your words are the most powerful tool you have. Be mindful of who you are talking to when it is regarding other employees. Nothing divides and erodes a team quicker than gossip. Certain conversations may not seem like gossip to you, but those chats will not always be interpreted the same way, particularly if anything sounds like a criticism.

Therefore, a long-lasting way to build a team is talking great about people when they’re not around. Words always come back, so if you are talking up staffers, it changes the perception of that individual. It’s important to be genuine, but specific praise is great when warranted, such as: “Jane does a great job closing the store each night. I love that she cleans out the garbage cans.” When that gets back to Jane, she feels a sense of pride that helps build up the team.

Your actions…

Along with words, your actions have sway when team-building. Do you walk the talk? Integrity goes a long way. You can put up a “rah-rah, go team!” exterior, but if you do not act authentically and do as you say, it is all for nothing.

When it comes to actual events and team-building exercises, these are some of my favorites:

• I love having team meals. Think of the bonding that occurs when families sit around and enjoy a meal. The same type of connection can develop for your team.
• If you have ever been to Pizza Expo, you are bound to run into my team. We always bring along a huge crew. And not just our management team. It excites staffers to see what the industry is up to nationally.
• Contests between staff and stores build camaraderie. Any opportunity that we have to create a fun contest for our staff — we do it. And the bigger the prize, the better the success of the contest.
• We often take the team to sporting events together — with a meal first, of course. Watching a competition together when everyone is cheering for the same result creates a good energy.

And there’s more! In our next installment, we’ll discuss the contests and employee incentives that we implement to keep our staff energized and excited to come to work.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Team Building appeared first on Pizza Today.

In a column named “Building Blocks,” it’s no coincidence that we’re going to spend some time talking about building a team. After all, employees are among the most important “blocks” in your business.

Follow along for the steps to follow when hiring and assessing your new staff.

Make a ‘lineup’

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

The first key to building a successful team is knowing what positions you need. Just like a football team isn’t built with 11 quarterbacks on the starting offense, the same goes with making your own pizzeria lineup. Consider how many positions you’ll need to fill and what those positions are. You can get literal and make an actual list. For example:

• 3 full-time pizza makers
• 3 full-time sandwich makers
• 2 full-time greeters
• 5 part-time counter workers
• 4 full-time managers
• 2 part-time utility/do-all team members

With that list, the next step is hiring. 

Assess strengths and weaknesses

Once you have your roster of team members, you need to identify their strengths and weaknesses — indeed, someone can be great at one job and just not meet expectations somewhere else in the restaurant. This whole process may take a few weeks of working with your staff, possibly by taking notes or making a mental list of where employees do and do not excel. 

Once the weaknesses are discovered, try to avoid putting team members in those types of situations unless it is absolutely necessary. When there is time, work with them to strengthen their skills and help them become a well-rounded asset for your team.

Look for team-players

With your people in key positions, especially at the start, you’ll want to monitor their progress and performance. Importantly, see how they work with others. There are few areas in your pizzeria where it is a one-man show — that’s why I love this job so much, because it does take a team — so observe which team members best gel together. 

We talk a lot about “putting our aces in places,” and this is where that all starts. Once you have some great dynamic duos forming and you can see the strengths of your team, the next aspect you need to judge is one that is hard to see — or is it?

Judge the buy-in

Who is all-in with what you’re doing at your new pizzeria and wants to help make it a success? This is so important, because when things get crazy — and they will — these are the team members who will hold it all together and influence other team members to do the same. 

But how do you judge buy-in? Ask yourself: Who is always on time? Who stays past the end of their shift? Who covers shifts when no one else can? Who’s always in uniform? Who has a positive attitude? 

Once you’ve started building a team and identified your key people, the next step is Team Building — which, believe it or not, is quite different than building your team. We’ll explain the difference in the next Building Blocks.

The post Building Blocks: The First Steps in Building Your Pizzeria’s Team appeared first on Pizza Today.

The post-pandemic malaise is in full effect. Without seeking to knock on a ton of wood, it would appear that the pandemic is drawing to a close. Or as close to an end as possible. Will it ever be entirely over? Who knows? Probably not, but it’s certainly not at its height.

Mike Bausch, owner, Andolini’s Pizzeria

There’s a weird dynamic currently occurring. The workforce has become accustomed to working with fewer co-workers. and they have become great at taking to-go orders. The kitchen staff is lean and mean, and that’s a good thing, but not for customer-facing employees. The inverse is that the customer experience is suffering, not just with me; it’s nationwide. Even now that we’re getting staffed up, we have stores hesitant to work with appropriate staffing levels. The reason for this is they’ve never seen appropriate staffing levels. If you have someone who’s been with you for two years, they’ve been with you for the whole pandemic and nothing else. It takes someone who’s been with you for three years or more to understand that a highly functional restaurant should have staff fighting for shifts. They don’t know that a productive restaurant has servers that upsell desserts, appetizers and alcohol to get more incentives and better shifts. Instead, the staff is shell shocked by low staffing numbers and customer outrage for any number of reasons. In general, the average restaurant team isn’t trying to maximize the customer experience; they’re hardened and looking for a break.

What’s the fix? For stores that have a front-of-house serving staff, you will need to explain the value of smaller sections. As staffing levels normalize, smaller sections will mean a server has more time to spend at the table. More staff on shift will mean more time to build rapport with the customer to get better tips and create more incremental sales at their table. If you’ve never done that before with your staff, now’s the time to do it. If you don’t have enough staff to do this yet, realize surviving is not the goal; thriving is, and increasing staff to pre-pandemic levels needs to occur as a number one priority. Some front-of-house staff will buck this trend in fear of losing out on tips with smaller sections when the opposite is true.

You teach this not by explaining it while the staff nods happily; it’s to role play with the customer-facing staff the ideal customer interaction. Roleplay with managers and employees doing steps of service the correct way and have staff prove they can build rapport and not just order-take.

The next step is to have specific loyal customers and friends act as secret shoppers to these employees. Once you feel secure in their ability and have vetted them, they have demonstrated the proper way to interact with customers; now, let them prove they can do it to yield results. The ones who talk about their favorite menu items and pairings that enhance them will sell more and not look like they are selling at all. Their numbers will be better than the pack, and they MUST be rewarded. 

The odds are highly likely your staff is not currently the sales machine they once were, and your online ordering has done a lot of the selling as to-go orders have increased, and, as a result, the average ticket has decreased in the last two years.

It’s time to invert that. The beautiful thing is the staff that is there is solid and quick. If they are purely existing but not delivering genuine service and hospitality, they’re still in survival mode. As soon as possible, find time to break them of that, train them up again on building rapport, and get them into thrive mode.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch 

The post Mike’s Monthly Tip: Employee Thrive Mode appeared first on Pizza Today.

“Leaders become great not because of their power, but because of their ability to empower others.” — John Maxwell, bestselling author/speaker/leadership coach.

Often, I’m asked to share my secret for success. It is a humbling question — and one with many answers — but the most compelling and true response always circles back to the great people who work for and with me. I lead a team of well over 200, and to many of you, that may be a staggering number. To others, it might be a small number. No matter how big of a team you lead, however, there are some key points you must apply to be able to do so successfully.

My lessons in leadership draw from the classes and books I’ve read on the topic over the years, as well as profound personal experiences. These are just a few, but I hope you find them useful.

Recognize the power of words

I was in sixth grade, got into some trouble at school, a parent-teacher conference was scheduled, and I’ll never forget what my guidance counselor said: “Nicky, you’re a leader, not a follower.” I wasn’t sure if he was just trying to get me to stop hanging with — and leading — the wrong crowd or if he really saw something in me, but that line always stuck with me, and I hung on to it my entire life. Now, when I look back, I recognize what my counselor was really telling me: a person in power empowers followers with their words.

That’s why I make sure to use my words in a positive way to empower my employees, and when I introduce someone to someone else, I use the power of my words to edify them. There is no stronger way to build up someone than to personally praise them when given the chance. Coming from the leader, those words carry powerful and inspiring meaning.

Standards apply to everyone — including you

Whether you like it or not, as a leader, you’re always in the spotlight. All eyes are on you at all moments, even if you’re tired, beat up or going through a personal crisis. People are watching to see what behaviors are accepted, and they’re watching to see what pace you set. They watch how you dress, what words you say and even how punctual you are. Therefore, you cannot hold your employees to strict standards and rules if you do not attune to them, as well. 

Share the spotlight

There will be many ups and downs in your business. Great leaders know when to take the light off them and shine it on their team members in those high moments, just as they know to take the light and shine it on themselves in low moments. After all, we are trying to position everyone on our team to win — and a great leader does just that. They don’t just lead great teams; they build them. That’s what we will talk about in upcoming next installments. 

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Bite-Sized Lessons in Pizzeria Leadership appeared first on Pizza Today.

Fixing a behavior in the workplace

I had a recent situation where a person posted a bad photo of a slice of our sausage pizza served to them at lunch. It only had three pieces of sausage instead of the typical seven per the recipe. The knee-jerk reaction to this or any issue where something goes wrong is pointing it out to the staff. “Hey, don’t do that, do it this way.” The problem with this approach is that it leads to them simply seeking to avoid getting in trouble for this one thing and absolutely nothing else. Also, usually, it’s just the employees in front of you at that moment that get the scolding, not the whole team. 

I get it, though. You walk into your restaurant, everything looks good, and the one wrong thing is all you can see, and then you want to tell the staff, the people directly in front of you at that moment, “This thing is wrong. Fix it.” Please and thank you hopefully occur, but maybe they don’t.

Mike Bausch, owner, Andolini’s Pizzeria

This approach is the same as painting gold over rust. It’s a waste of gold and doesn’t tend to the rust. The rust needs to be removed and dealt with before you apply the gold paint.

The knee-jerk approach is a shortsighted response pervasive in the restaurant industry. In contrast, great companies like Trader Joe’s, Disney and the Four Seasons handle corrective action much differently. They avoid constant nitpicking of what’s wrong; instead, they chase greatness. We can all say we’re chasing greatness, but to chase greatness means that you point out when something doesn’t match the values of the restaurant or the company and then address the root cause instead of the superficial result. And instead of only nitpicking, there is a massive heaping of overtly appreciating who consistently performs protocol right to reinforce that behavior—also, outward actions to validate staff and verify they feel supported.

In this sausage example, only saying, “Hey, don’t do that,” fixes absolutely nothing. It doesn’t address the cause. The staff tried to make the fastest pizza possible and lost sight of the more significant priority: an excellent experience through a great product. The employee didn’t put enough sausage on because putting raw sausage on the pizza is tedious. So they moved quickly; it looked good enough, but sausage shrinks in the oven, and then it didn’t look so great by the time it baked. But, as long as they did their goal, which in this situation, the goal was to stab the ticket as fast as possible, then yes, they achieved their goal. The goal wasn’t to chase greatness for this staff member and the others working with them that day.

The way to fix a behavior like this is to have an all-staff discussion about what could lead someone to do less than the right thing. What is “Our Goal” as a team. Is our goal a perfect pizza or to get it done fast no matter what we do to achieve it? The root cause could be laziness, fast pacing being perceived as more important than quality, or assuming no one would check? To truly delve into the issue, lean into how this doesn’t represent us well and how it hurts all of us so they understand the why. And then show the perfect pizza, bake it the right way. Share it with everyone so everyone understands the difference, and let everyone have buy-in on what the team values. Overtly define what greatness is to really be on the same page. Heavily point out who is making it right and what the team can do to help keep it that way. At that point, systemically, we fixed it on a macro scale. Instead of continuing on like this, we’ve removed the rusted root ready for a coat of gold paint that won’t soon wear off.

The post Mike’s Monthly Tip: They did it the wrong way. Now what? appeared first on Pizza Today.

Steve Jobs, who knew a thing or two about growing a business, once said: “Recruiting is hard. It’s just finding the needles in the haystack.” And the legendary co-founder and former CEO of Apple spent a lot of time hunting for those needles, estimating he participated in the hiring of over 5,000 people in his life. 

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

That seemingly couldn’t be even more true today. But while it’s easy to get caught up in all we hear about how difficult it is to find employees in this economy — or just blame it on the younger generation that doesn’t work as hard (and I’m sure you heard that from your own elders) — the truth is, it has always been a painstaking task to hire. 

Just like perfecting a recipe, however, we can grow our management skills to not only improve at recruiting but retaining talent.

Set the tone

In our businesses, we set the culture, tone and environment. Knowing what kind of place people want to work at is important. 

Put yourself in the shoes of the current team members, see their side and find the point of reason. Businesses that are constantly reviewing and improving policies and procedures to incorporate employee feedback are the ones that end up thriving. Months or years should not go by before you solve a problem bothering your employees or seek a way to motivate them.

Ask a question

When we hire, too often we think of what we want internally. Really, what’s just as important is asking, “What does an employee want?”

These are some basics:

• Fairness. It’s as important as ever. People want to make a fair wage that reflects their position and have a fair chance to grow in their careers.
• To do a good job. Your best employees will take pride in their work, so it’s contingent on the employer to provide adequate training and resources to succeed.
• Respect. Fundamentally, people want to feel valued as an employee and a person.

Mind your manners

Think of how often it’s stressful in the pizzeria. It’s not always easy to be respectful and say the magic words that get you far in life: “please” and “thank you.” Nevertheless, those words should not be forgotten.

Early in my management days, my supervisor visited my store on a very busy Friday night. I was leading effectively — but a little like a drill sergeant. You’re probably familiar with the tone: “More dough! Pop that bubble! The phone is ringing!” My team crushed the rush, and I was so proud. I couldn’t wait for my supervisor to tell me how great I was. Instead, he said something that has stuck with me for 25 years: “Nick, your team did a great job, but before all your orders try putting a ‘please’ in there, and after the task is complete, try putting a ‘thank you’ in there. You may have had a great night but without those two words, eventually you won’t have a team to lead.”

That was a good lesson on management from a good leader — and that’s what we’ll discuss next time around: coaching and showing leadership.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: 3 Steps to Improving Employee Recruiting and Retention appeared first on Pizza Today.

Lead By Example — Employee Leadership

It’s imperative to lead by example. The way you act in your restaurant will determine how the rest of your crew performs. When you’re upbeat, fast-paced, enthusiastic and positive, it’s natural for everyone else to feel a reason to do that also. If you’re humdrum, down in the dumps and nonchalant, you’ll find apathy breeds cohorts and others will follow in suit. If you want people to care about your restaurant at a high level, you must care about it even more. An interesting dynamic occurs, though, that is different from leading by example. It’s the inversion effect. In this situation, the opposite of how you act is what occurs. It’s a sneaky thing that can hurt you if you’re not aware of it and how to use it.

Mike Bausch, owner, Andolini’s Pizzeria

If you have ever been told to “Chill out,” what was your reaction? I’m willing to bet the opposite occurred, i.e., no chill. The other person is insensitive to your situation and tells you they don’t care when you say to chill, relax or take it easy. Being easygoing and telling you to be the same is infuriating. These phrases don’t recognize the person’s issue at hand.

The inversion comes into play best with customer interactions. If you want a customer to react calmly, you need to act in a very heightened manner. If a pizza was ruined, maybe even has a foreign object in it; if you come off easy-breezy about the situation, it will drive the customer to go nuclear. The inverse has occurred: the customer is mad when your goal was to keep things even keel. The easygoing response comes off as flippant, condescending and even disrespectful.

You have to rise to the occasion with a heightened level of care to invert their response. When appropriately executed, the customer will react with a feeling of, “well, obviously, they value my opinion about this. Maybe I’m overreacting.”  Long wait time, hair in the food, cold, soggy, anything, is your chance to rise to the occasion.

Imagine a super egregious one like a piece of plastic in the pizza. A proper response would have appropriate inflection and tone that shows you care, like: “Oh wow, I am so incredibly embarrassed by this. This has never happened in the past (assuming that to be true), nor can I ever fathom how this happened. I’ll get to work tracking down if this came from the dough ball and will toss all those doughs. I’m going to research this on camera and interview everyone who was making dough today. Thank you for telling us so I can get to work on this and make this right to you.”

The goal of any issue, no matter how big or small, is for the customer to respond assured with, “Oh, okay. I see. That makes sense. You have this under control, and this isn’t the norm. Thank you for hearing me out.” While if you had responded, “Oh, something got into your food? Well, I’m sorry about that. Here’s a free coupon”… you would’ve gotten a much different response. “Free coupon? Why would I ever want to come back here? You obviously don’t take this seriously enough. You guys aren’t professional, and I never want anything to do with you.” Even if they don’t say that out loud, you can bet they thought it and told everyone they knew exactly that.

To invert their reaction, you have to lead with the inverted intent of what you want. Go big to get reasonable; underdo it to get disappointment, anger and resentment. Never be chill if you want chill. Go above and exceed expectations if you want reasonable discourse.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch 

The post Mike’s Monthly Tip: Inversion Dynamic, Lead by Example appeared first on Pizza Today.

This month, it’s time to tighten up, or it’s time to loosen up. Think about all the things you are fanatically interested in and even maniacal about. Loosen up on that stuff a little bit. If you’re an absolute stickler for punctuality and never being your REAL self in front of staff, maybe loosen up a skosh. If you are way too loose and drink with your staff, tighten that up and stop the lack of professionalism. If you’re a passionate chef who knows every nuance of fermentation and live it 24/7, never compromising your quality, it’s time to be passionate about something that’s lacking. Make sure your frontage and aesthetic are as tight as your recipe. Go into the front of the house and make sure your mats and your menu look clean. It’s time to dabble in something that ain’t your thing.

Because you need to be well-rounded to survive, you could be the absolute crème de la crème of a pizzaiolo and still be using non-branded pizza boxes that make you look bland and cookie cutter. And that means you need to tighten up on your branding. And understand that this is a multifaceted business. Have the courage to suck at something and not be the absolute dominating force of what you know so well. Swallow the humility pill to do something you’re not that great at.

Here’s the thing, though, nothing is really that hard if you give it time. Do you have a remote control at home? Of course you do. Do you know where the ON button, volume up, and channel down are without looking at them? I’m willing to bet you do. You’ve built up muscle memory by flicking and changing the remote over time. Develop that muscle memory in something else. Social media, HR, baking a style not your own, or any litany of things that just ain’t your bag today but could quickly become your bag with a few months of muscle memory and tightening up.

Allow yourself to loosen up on some of the stuff you’re being a little bit too serious about. I get that this is most likely your business, your money, your shot at doing it right, and being anything less than all-in intensity each day means dropping the ball; I’ve learned that’s not true. Don’t suffocate your staff and loosen up some things you micromanage to see if they thrive without your control. You might find some others do your thing better, which will take humility to allow. Some might do it ok, but not as good as you, but that’s also ok because it means they’re growing and you are developing. It’s when everyone gets locked into their box that things grow stale, and before you know it, everything sucks, and no one cares because the cog in the machine approach grows old quicker than you’d think. Encourage your management team to do this as well. The managers who know the POS like the back of their hands but can’t run the oven should meet the heat in the kitchen. The manager who everyone is afraid of because they’re too brash, have them avoid bad cop behaviors for a month and see what it does for their interactions and rapport with the rest of the crew. Mixing it up leads to growth, and you need growth, and you need growth because the inverse is stagnation and failure.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post Mike’s Monthly Tip: Tighten Up or Loosen Up appeared first on Pizza Today.

I highly advise copying the systemized practices of the major restaurant players. I DO NOT suggest copying their mass-market food style or lack of personal touch. However, interestingly enough, the big players are now factoring personal touch into their standard operating procedures. If you look at Chick-fil-A, they have non-random or intentional acts of kindness as a standard operating procedure (SOP). The staff randomly gives out stuffed cows throughout the day and performs several other “Surprise and Delight” tactics. Even Starbucks is big on giving animals pup cups (or Puppuccinos) completely free, especially via drive-thru. 

Mike Bausch, owner, Andolini’s Pizzeria

Why is that? Is it because of their altruistic goals to do great things in the community? Sure, I’m not so cynical to say they’re opposed to doing nice things, but I can also say without hesitation these tactics also generate an incredible ROI. The businesses that didn’t skip a beat in the pandemic have customer connection as part of their culture. The chains that are pure turn and burn with an attitude of, “Eat what we give you, or don’t — we don’t care either way,” are closing left and right across America. The biggest mass user of this approach is Disney; the house of mouse applies fun and kindness to all interactions, and it has yielded billions in profits and fandom. This approach is not proprietary or impossible to train; it just takes a little thought, some base effort and follow-up after execution.

To connect on a profound level, give attention to the thing your customer values most, namely their children and pets. Let’s assume you already know that, then take it beyond just you. Your random acts of kindness need to become protocol to you and everyone you employ. Instead of you, the owner, randomly choosing someone to get a freebie, empower your staff leaders to do it daily according to your set parameters. Maybe give out a branded kids shirt, two meals on the house a day to someone who needs or deserves it, a pizza toy, a quick dough show, or simply bringing out water for pets on the patio. All these acts of kindness can become systemized.

Grow beyond randomized freebies and tap into systemized graciousness. Doing this will never be a waste or destroy food cost. This approach is marketing, deep and meaningful marketing that will hit harder than any Facebook ad or TV commercial ever will. Notate these comps as marketing if you want; code it as promotion rather than a comp for your reporting. 

To truly get this, put yourself in your customer’s shoes and think of a time you got a freebie on a day you really needed it. How did it make you feel? Did you stay loyal to that establishment? I’ll bet you did, and you can do that for your customers every day. Not once in a while — every day.

Look to tap into the emotional sweet spot of, “Oh, you noticed me being loyal, and you actually appreciate me.” Or “They’re really being nice to my kid, and this feels great.” When you elicit that, a genuine connection can occur. 

Find ways to get your food and brand out in the community with a surprise and delight approach. Think up things you haven’t seen or a spin on something you have seen. Then do it and never stop doing it. The systemized practice is planting the seeds for the future. This approach will ingratiate your restaurant into your community and your customer base.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch 

The post Mike’s Monthly Tip: Systemized Graciousness appeared first on Pizza Today.

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

You’ve done all the hard work, and finally, job hunters are calling you. Now what? 

I like to break down the process into a few steps. But, first, if you recall from our previous Building Blocks articles, it’s a matter of speed. Be sure to reply to anyone who applies (and shows promise) within 24 hours, and then it’s on to the interview. In fact, the interview begins with that first call. 

On the phone

Start with this candid question: What are you doing now, and what are you looking to do? This sounds like a straightforward question, and it is, but the answers you’ll receive are telling. 

I’ve heard everything from, “I have a job now but looking for a new opportunity,” to “I haven’t worked in years because I don’t like structure, but I love pizza!” As you can guess, the question helps weed out candidates right away. But if this early questioning suggests they’re worth a follow-up chat, find out the earliest time they can come in for an interview. You’ll want to do this quickly because you don’t want them to find a different job in the meantime.

In the store

You can have your own interview style, but personally, I find making a candidate feel at home from the outset is important. Greet them with a shake of the hand, offer a drink and give them a moment to fill out an application. I start every interview by introducing myself, sharing my company’s history, and what jobs we have available. 

Most importantly, I share the company’s vision and how someone can advance. I want to paint a clear picture that this “job” can be a career. I also describe the positive things we do as a company for our employees and the incentive programs we have in place. It’s all about explaining the company culture. Once that’s done, it’s time for the candidate to share their story.

The most important question?

Sure, there are many revealing questions you can ask, but there is an especially powerful question that can open a conversation and tell you a lot about someone’s situation: “Now you know the company’s story, so what’s yours?” You’ll get all kinds of answers, but as long as there are no red flags and you like what you hear, you should feel confident to offer them the job. 

The offer and compensation

I like to offer the job with yet another question: “Is there any reason you would not take the job?” If they say no, they want it and you just hired them — I reach out my hand and say, “Welcome to the team.” If they answer another way, then it might take a longer conversation to understand their hesitation.

As for particulars, such as compensation, we’ve broken down pay scales and job descriptions previously in this column, so hopefully you know what the position offers and the number was already disclosed in an ad. 

We’ve certainly been repeating this process at my business. In fact, since I have started writing this column, I’ve built two more locations. So, for the next installment, I’ll share some lessons from opening two stores in less than six months.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: How to Conduct an Interview appeared first on Pizza Today.

In today’s labor market, morale needs a boost

The refrain since the pandemic began is “We can’t find good help.” We see pizzerias daily shortening hours just so the owners and staff can get a break. While a plethora of factors have worked in unison to create today’s tight labor market, improving employee morale obviously goes a long way towards retention. In this roundtable discussion, we spoke with some of the country’s most successful pizzeria owners to tap their insights.

The Players:

Nicole Bean (Pizaro’s Pizza, Houston)

Lars Smith (State of Mind, Los Altos, California),

Pasquale Di Diana (Bacci Pizzeria, Chicago),

Michael Androw (E&D Pizza Company, Avon, Connecticut).

Pizza Today: What are some measures you have taken to keep employee morale up during the pandemic?

Bean: We’ve been perking up our employees with positivity and positive reinforcements. Some weekends we grab cookies or energy drinks for the staff. We’ve also tried to pin-point problem areas that can alleviate the employee struggles, such as modifying expo areas to create a more productive workspace or implementing visual cook charts to reduce mistakes in the kitchen. The biggest assistance has been flexibility, acknowledging that the staff also needs that mental break — so we’ve been providing more opportunities for requests off even if it’s a little more work on us at the end of the day.

Smith: This has evolved over the course of the pandemic for us. In the beginning, we wanted to make sure our employees’ needs were being met. Most of our team were laid off from their second jobs, and we had to layoff most of our front of house staff. We were buying extra supplies and groceries for our staff to take home if needed. We also kept all of our laid-off staff on health insurance. 

Things we have done more recently are pretty simple, really. We see our staff as an asset worth investing in. So, we have made sure we are paying competitive wages and giving raises where they are earned. It’s so much easier to invest in our existing staff rather than hire in this market. We are checking in with staff regularly to see how they are doing, not just at work but in general. People are burnt out in our industry, and we want to make sure we are able to give staff some extra days off when needed. We also closed for an extra couple days after Christmas to give staff a break. Finally, we have made a huge effort to make sure we aren’t running shifts short staffed and adding to our employees’ stress level. We have modified service or hours as necessary to make sure our staff has the most positive work environment possible. 

Di Diana: I was on a flight from OKC to Chicago years back, and I was lucky enough to sit next to Coach Billy Donovan. At that time, he was the head coach of the Oklahoma City Thunder. About an hour into the flight, I built up the courage to introduce myself, and asked him: “Coach, what is the secret to your success?” And he answered me without hesitation and said it was his team. And the key to building his staff was letting them know how much he cared; hence he was on a late flight to Chicago in the off-season to go meet with a player and one of his staff members. Anyway, I really took that advice to heart during the pandemic. As a restaurant operator with multiple sites, the pandemic and initial lockdowns felt like the apocalypse. And while I was busy with everything on my plate, I had to take a step back and say to myself: “If I’m this worried about things and I’m supposed to be the captain of this ship, how scared must my team members be?”  

My perspective really changed a few months in, and I really dove into constantly communicating with everyone on a daily basis, making sure that not only in our restaurants — but in life — I was there to help them navigate this pandemic. Being there for them with their concerns, their fears for their families, their questions … was how I was able to keep their morale up. Also, for the initial few months I was allowing staff, especially those whose hours were cut due to it being very slow, to bring dinner home to their families. 

Androw: We have seen a substantial increase in our already busy business since the start of the pandemic. This has put more stress on the staff to churn out more food in the same amount of time. I’ve taken the additional income and put it into the pockets of the staff. Everyone has seen substantial raises throughout. A hefty, fat paycheck has a magical way of keeping morale up. 

PT: Are you seeing a light at the end of the tunnel with the universal staffing issues the industry has experienced?

Di Diana: I suppose so, although the light is not a very bright one. Meaning this: it is better, and I see more applicants than the first year of the pandemic, but nothing like the times before. My three pillars of recruiting, maintaining and multiplying great team members has never been harder, and I anticipate that’s how it will be moving forward for years to come. Too many people have left the industry due to many factors, and I’m just not seeing many people enter. So talented, reliable and competent employees are very scarce and harder to come by than ever. 

Androw: We are definitely seeing the tide start to turn in regard to staffing shortages. There was a period during the height of the pandemic where we were stretched very thin. Things have begun to change as we now have applications coming in on a regular basis once again. 

Smith: We are really lucky to have an incredible management team and kitchen staff that has stuck with us throughout the pandemic. Like I said above, we have made a huge effort in investing in our employees both in terms of paying good wages but also in time to train them. To be totally truthful I have no idea if the staffing issue is going to get better soon or not. But I think the tight hiring market highlights the need for us as business owners to create jobs that both pay well and have a positive work environment.  

Bean: There’s definitely been a ray of light shining through the hole! We’ve seen an uptick in applications. However, quality isn’t what it used to be — but we are learning to work with what we have and what we can manage.

PT: What is the number one request you receive from employees in terms of making the workplace the best it can be for them?

Androw: The most common request from staff is time. Most of the kitchen crew work doubles, so it can be exhausting. We have started a rotation of sending someone home early every night. As soon as the hit is done you walk out “rock star style”. That means you just drop what you’re doing and peace out. You don’t clean or restock anything. The rest of the crew stays a few minutes extra at the end of the night to take care of that person’s station. And then tomorrow night it’s the next person’s turn. Everyone seems to appreciate getting that extra time to themselves.  

Smith: The number one request we get is for flexible work schedules and the ability to request time off when needed. We make a huge effort to be able to honor time off requests and to be able to work around our employees’ availability. I think the pandemic made so many people re-evaluate their priorities and how much they want to work. Our staff wants to be able to take time off when needed without feeling bad or guilty about it. 

Bean: Flexibility and fairness. Both of which are extremely challenging when they want both simultaneously. And the current working employees want to be treated equally when it comes to scheduling and of course pay. While some tasks come easy to some it’s difficult for others, and each employee has their own personality. I’m not a parent, but I imagine my staff are my children and each of them have different needs. My management team is always working to provide a happy work environment, but every once in a while they will receive the “that’s not fair” response. We are always trying to solve the puzzle: how can we make it fair across the board when the board is uneven? We do our best to resolve one problem at a time. It’s a learning experience for all of us.

Di Diana: Clear, honest feedback and direction. That’s what I’ve come to notice. And flexibility when it comes to scheduling — which is one of the hardest things to provide in the restaurant industry seeing that peak days are on weekends. 

The post Employee Morale Roundtable Discussion appeared first on Pizza Today.

It’s a humbling endeavor to hire people. It’s on par with being a good coach, or teacher, to aspire to be a good boss. After working jobs you might not have liked growing up, with people you didn’t choose and a boss who did things you didn’t like, now you can do all of it the right way. We can hire who we want, and we can be the boss that we always wanted to have. That is not only a gift; it’s also a responsibility. It’s a responsibility I take very seriously, and it’s a responsibility that I think is super cool and fun. 

When it comes to young talent, you are only as good as the motivation and principles you bring to the table. All of your staff are INTO something. All of them care about something. And there is a way to make whatever their passion is, work for you and your business. Utilizing and appreciating your staff’s passions can bring more profit to your restaurant and achieve a lower attrition rate. When you burn staff out quickly and they quit, it’s not only demoralizing, it’s also costly.

Any of your employee’s hobbies, skills or passions can be utilized to energize their loyalty and love of their job. It will also make life for you, their boss, on a more stable footing. Not only more stable with your staff but also with your customer base. It’s done by nurturing that which your staff is passionate about and developing that talent. The easiest one to nurture is baking and a love of pizza. If they love pizza as much as you hopefully love pizza, yes, this is an easy start. A pre-disposition to baking is a good situation that you can monetize. You can push their dough throwing skills, new recipe inventions and anything else they do pizza-related on social media.

Let’s go beyond that; let’s think beyond just pizza and your brand. Let’s say you have a bunch of kids who love Pokémon or Dungeons & Dragons, or some highly nerdy but super niche and specific offshoot. Encourage them to hold Dungeons & Dragons competition night at your restaurant and invite all their friends. One of two things will happen. Either a few people show up, and if nothing else, your staff know you care about them and de facto increase loyalty. Or, potentially, it could blow up, and you have a whole subset of people coming into your restaurant each week that would not have otherwise. Regardless, there is no scenario where this doesn’t garner some positivity.

If you have staff into graphic design, whether doing it in high school or college, have them do some odd jobs and see how it plays out. I’m not suggesting having your whole brand rely on them day one, but have fun with it and throw them a job or two. Maybe some menu updates, a few flyers, or some social media images with text overlay. Start small and see how they do. Also, make sure to pay them for it like a regular vendor, invoice, and all, so they learn the business side of things and feel like a professional. If they are developing their passion under your roof, your pizza place just became a big part of their career development. If they can take work for you and add it to their portfolio, it will increase their loyalty to your restaurant. This employee might also turn into an affordable graphic design option that you prefer not only because they’re cheaper but also because they get your brand better from working there.

Be ahead of the times because the big boys are starting this practice as well. Dunkin’ Donuts just started paying ambassador employees who post TikToks. Imagine that; paying for staff on the clock to create and post goofy videos. Instead of getting mad, this publicly-traded company is monetizing its staff’s youthful energy. Instead of only paying a corporate commercial design firm, they’re letting their staff have fun, do their thing, record TikToks, videos they probably wanted to do anyway. And because they’re potentially getting paid for it, the staff will make sure they mind their Ps and Qs. Dunkin is now spreading their social message in a very organic, natural and morale-building way.

It’s motivation, and motivation is the gasoline in the engine of any restaurant. It increases pride. The pride you want staff to have a feeling of, “We do something cool and interesting here. We’re not just microwaving bland garbage, but instead doing something that I’m into and stoked about. I’m proud of this job because not only am I a better worker as a result of this restaurant; I’m also a more well-rounded individual in the thing I’m most passionate about that I want to develop.” That’s the north star you want them to feel, so let your business be a catalyst and portal to that end.

These are the ways you keep staff with you longer. Keep them happier and utilize their talents beyond just being bland automatons that do task X or execution Y at your will.

To tap into this, you have to communicate. As much as you can do it working the line with them, I find it best to do it in a very formalized sit-down fashion, so staff knows you take it seriously. Set up quarterly evals, sit them down, talk about what they did well, what they could do better, give an appraisal of their performance, and then ask them what they want to do in life. It’s on you to let a natural rapport-building conversation occur. You’ll be baffled by how many cool and exciting things your staff are into and how many ways to cross-promote that natural enthusiasm you have in front of you. That assumes you have the wherewithal and ingenuity to use your restaurant as a vehicle for this enthusiasm. This practice is not using staff or taking advantage of cheap talent. This is seeking happiness for the people that are your responsibility. Happiness comes from self-worth, and throwing dough and serving tables alone won’t be enough for all employees. That’s where you come in, and there’s never been anything more fulfilling and productive than the opportunity each staff member provides you each day.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.

The post Nurture Young Talent at Your Restaurant appeared first on Pizza Today.

Among the most significant business consequences of the pandemic is an epidemic — a hiring epidemic. While we haven’t been immune to this nationwide problem, we’re weathering it better than other restaurants, so I am frequently asked how we have a relatively full staff. It’s because we not only focus on hiring, but on staff retention. 

You cannot merely pay lip service to these items. If you’ve been keeping track of Building Blocks, you’ll recall we discussed the process of providing your staff with regular pay raises, which remains important even in lean times. However, just as essential is making your employees feel valued and appreciated by listening and acting on their needs and concerns. Many times, in fact, we have shifted our pay scale, hours of operation, items on the menu and the way we do business just from listening to our staff. 

But another strategy that benefits both employees and your business is developing incentive programs. Here are three easy ones you can get cracking on ASAP:

Recognition

Employee of the month programs, honoring someone who gives an extra-special effort, are tried and true. It’s special for someone to see their picture hanging in the store, but we add a bonus reward with a $50 Visa gift card, which gives a little more motivation to win the award. For our manager of the month program, we provide a $100 gift card and special shirt that makes them a member of our “Caliente Wolfpack.” Beyond the monthly programs, we hand out shirts that display how many years of service a particular staffer has, recognizing their contributions and building on our team atmosphere.

Contests

There’s nothing wrong with a little friendly competition, so we run internal contests throughout the year. They might be individual or location based. For example, who sells the most of a specific product? What store puts together the best holiday decorations? Rewards might be gift cards for an individual or taco parties for a store. We’ve found the staff looks forward to these programs throughout the year.

Events and trips

Beyond any recognition or contests, staffers most look forward to our summer picnic event. Every year, we close shop for a day and gather at a local park for live entertainment, bouncy houses, beer and food. The staff can bring their whole family to this event. The only thing to match it is our holiday party in December. In previous years, we’ve rented bowling
alleys, restaurants and even a ferry boat for the event, providing an open bar, buffet, music, door prizes and (the staff favorite) karaoke. We also hand out individual awards — more than 20 of them in the past year — with the prizes ranging from pro sports tickets to vacations. 

My personal favorite incentive is bringing staffers along to industry conventions. As many as 24 employees have joined our leadership at Pizza Expo in Las Vegas or Atlantic City, and we provide our guests with meals, transportation and entertainment. 

Each of these efforts play a role in encouraging employee retention, but they are hardly the only strategies. Get creative for your own. Remember, hanging on to the staff you have is as important as bringing in new talent. And in the next edition of Building Blocks, we’ll break down the other half of the equation: how to stay active in hiring every day.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Strategies to Incentivize Your Staff and Promote Retention appeared first on Pizza Today.

The Warm Blanket Approach to Welcoming New Employees

The hiring problems of the last year have not subsided. I still see businesses hiring the way they always did. Most business owners know it isn’t like it was in 2019 anymore and that there needs to be a change. Most pizzerias I talk to have switched to online application portals, more thorough training and dedicated incentives with better starting wages.

Mike Bausch, owner, Andolini’s Pizzeria

With all those improvements, the industry still has difficulty acquiring and retaining staff. Many resources say the same things on the topic, except the most obvious one. Here’s a straightforward tip that’s not getting talked about nearly enough: BE NICE.

Be accepting, kind and provide a warm blanket to these new hires coming into your restaurant. Sure, you’re a nice person, and I’m sure your staff is filled with friendly, personable people. But I’m saying as a protocol, as a standard operating procedure, be nice when welcoming new employees.

So, what does that mean? 

It means when a new employee has their first day at your pizzeria, it’s over the top welcoming. Do you currently have a fight or flight method? Do you currently push to see how they stack up, maybe even throw them into the hard Friday night from the jump? The old school mentality was this approach would weed out the weak and give new hires a good idea of the speed and beat of this restaurant. I’m saying today it is inadvisable to do that.

Not only should you start slow, but you should also be calculated in the orientation. Have the first day go down in such an accepting manner that everyone has it as part of the job to introduce themselves, make kind dialogue and build rapport. Do this, so they choose you. Do this so you can start to train; otherwise, you’ll scare them off before they even clock in. Make your workplace the most inviting one by far. 

Also, this costs nothing to do.

Building rapport does not start after they get hired. 

Even when they apply, the new applicant walks in and says, “I want an application.” Do you simply give them an application? Instead, I suggest, sit them down and have them fill it out in-store. Find them a spot in the restaurant to fill it out comfortably by offering them lunch. If nothing else, get them a drink and have each person go by and say hi to them while they’re applying. Make it so over the top welcoming that this person does not go to five other places to apply. 

If this approach is a no-brainer for you, great; just do it. If this feels over the top or inauthentic, then ask if you do have friendly people that work for you or not. If you don’t, be the change, act kindly, and expect your staff to follow.

In this warm blanket approach, you must be keenly aware that your applicants are interviewing you. It is not the reverse anymore. Sure, you’re going to want to evaluate and have a high-level person who could do the job. Still, there is such an abundance of jobs that any applicant has their pick of the litter, and you need to stand out. Not just financially, but also on a human level by being approachable, kind and accepting. By showing that your restaurant is somewhere that this person looks forward to being an employee.

Work can no longer be the opposite of happy home life. It needs to be an extenuation of it. The restaurants that do this, without sacrificing standards or quality, are the ones who will come out of this pandemic and hiring crisis better for the journey.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch 

The post Mike’s Monthly Tip: Welcoming New Employees appeared first on Pizza Today.

Employee Wellbeing

With minimum wage pressures and increasing concerns about health, it’s easy to see costs escalate, both in the form of higher paychecks and more safety-related gear. Amid the fear or rising expenses, there’s good news: changes can be made to improve staff wellbeing, and many of them cost little or nothing at all. “When we are, or feel, alone it can impact almost every element of our health,” says Logan Mallory, vice president of Motivosity, an employee engagement software. “A sense of community and inclusion is a key part of being happy at work.”

Find new ways to promote employee wellness. Consider the following strategies to create and maintain a place where staff members can feel a sense of belonging.

Work Together Toward a Common Goal

Boardwalk Pizza, which brings thin-crust pizza to Boston’s South Shore, opened during the pandemic. “Our team is undoubtedly the most important part of our business,” says Donato Frattaroli, Jr., co-founder of Boardwalk Pizza, located just south of Boston. “The five-person team has been working with us for quite some time.” Some of the staff worked together prior to the launch of Boardwalk Pizza, at a different restaurant which shut down during COVID-19. “We believe the longevity stems from cultivating strong relationships with that team and knowing that we are all working together toward the same goal,” Frattaroli, Jr. says. That goal consists of putting out the best possible product to enable the business to keep growing.

Offer Promotional Opportunities

Maintaining a focus on personal development can lead to a more productive, satisfied team. At Tampa Pizza Company, which has three locations in the Tampa, Florida, area, multiple employees have moved from servers to managers or kitchen managers. Staff members can also pursue culinary careers through the restaurant’s sister company, Melina International Trading. For workers who are looking to improve their skills and move up, the chance to climb a career ladder can keep them engaged and motivated. 

Carry on Meaningful Conversations

 While discussing menus, orders and processes are certainly necessary, there may be opportunities to let chatter expand into deeper matters. “We believe in our team and every day we try to show them that we have their backs,” Frattaroli, Jr. says. “Regarding satisfaction and wellness, it really comes down to communication, observation, empowerment and trust.” When staff works closely together in a team-driven atmosphere, the doors of conversation can open to discuss what’s going on at an individual level. 

Creating a space where voices can be heard can be especially impactful as workers wrestle with mental, emotional, and health issues related to the pandemic. “There is depth in our conversations,” Frattaroli, Jr. says. “We get to know the individuals; our employees are more than just a number. We can see if someone is having a tough day from whatever it is they have going on in their lives and truly listen.”

Provide Culinary Variety for Staff 

While guests will likely come in and crave the standout pies, staff members who see the same menu day after day might appreciate alternative food options on occasion. “Eating pizza together all the time gets old fast,” says Baron Christopher Hanson, the semi-retired principal of RedBaronUSA, a consulting, coaching and re-branding firm based in North and South Carolina. To shake things up, once or twice a month offer an exchange: the restaurant can send two or three pizzas to a nearby eatery that specializes in a different food segment. The neighboring restaurant can, in turn, deliver meals to the pizzeria. Through the switch, staff members might enjoy a Thai meal, an order of sushi, a barbecue plate or a burger and fries. The arrangement can help boost morale, as employees will likely appreciate the gesture and the chance to broaden their palate. 

Let Employees Shine      

With a younger generation that is tuned into the digital and connected world, there may be ways to promote the restaurant with their skillset. Better yet, team members typically thrive when they get to put their talents and passion to use. “Find out which employees have a knack for speaking on live radio or TV,” Hanson says. Ask staff members to come up with a catchy YouTube video featuring the restaurant and its menu. Or look for volunteers to put together a costume that can be worn to a local event. 

When having employees participate in promotional efforts, an award such as a cash bonus can provide extra incentive. A gift certificate could be given to the best video, or a dollar amount might be rewarded to the costume winner. The friendly competition can be team building, and the result is a dual win: the restaurant can have a new promotional angle, and the winning staff member can take home a prize and a sense of accomplishment.

Take the Time to Hire Right

Amid worker shortages, it can be difficult to find new employees who are a good fit and are ready to make a commitment. “We have seen the negative impacts of hiring the wrong applicant, and how it can negatively affect the team,” Frattaroli, Jr. says. “We work in lockstep with our team to ensure that any new hire has similar values and general ethics.” Asking employees for referrals may provide the chance for staff members to bring in others who share their priorities. Consider awarding employees who refer new hires with a free pizza, free merchandise or a gift certificate. 

Putting in the effort to develop a strong team can pay off in several ways. “There are times when we as a group need to rely on one another,” Frattaroli, Jr. says. “Whether it’s longer hours than normal or more stressful shifts, we have been able to lean on each other, which has built an amazing amount of trust.” 

While reduced turnover can help control costs, the long-term effect may be the sense of community that workers receive. “To describe these benefits on paper or e-mail is insufficient,” Frattaroli, Jr. says. “It’s something that truly needs to be seen in person—we have a bond with our team that is truly special.”

Rachel Hartman is a freelance writer who covers small business, finance and lifestyle topics.

The post New Ways to Promote Employee Wellness appeared first on Pizza Today.

Employee Expectations

The biggest secret in the pizza industry is not a sauce recipe but a human resources question: what do employees really want? Do employers really know what workers want? While that sounds like the setup for a joke – the punchline would be some variation of “more money,” or “not to work,” – pizzeria owners are not in a laughing mood. It has been difficult to guess what workers want, and raising wages has not solved the mystery of how to attract workers and help them thrive. 

There has been much research on employee expectations, especially on what young workers want. One study from the Novak Leadership Institute at the University of Missouri and Kansas State University found that workers ages 21 to 34 place more value on respectful communication than on fun perks. (Incidentally, the Novak Institute was endowed by David Novak, a retired CEO of Yum! Brands.) Research from Gallup notes that millennials and Gen Z want employers that care about their wellbeing, are ethical and transparent leaders and provide a diverse and inclusive workplace. Meanwhile a survey by the small business network Alignable found the top expectations among employees are flexible hours (22.6 percent), and financial compensation (21.5 percent). 

There are also pandemic-related expectations. A recent Harris Poll found that 47 percent of adults said they would be more likely to accept a job offer from a company that has an employee vaccine mandate. Of those, 59 percent cited “increased comfort interacting with coworkers,” and 58 percent cited “a sense of personal safety” as the reason.

Having a say 

The pandemic helped the leadership at Pizzeria Lola in Minneapolis figure out that employees wanted to eliminate the wage gap between front and back of the house. Much of the team was laid off at the start of the pandemic, and the remaining staff worked when the restaurant offered takeout only, and everyone earned the same flat hourly wage. Later, Pizzeria Lol a reopened with full service, and implemented 21 percent surcharge instead of tipping. The amount is distributed among all workers, and the results have been positive. 

“People want a more consistent connection, more consistent teamwork,” says store director Emily O’Brien. “It’s leading to less conflict, more empathy, and working together through problems instead of working on separate teams.” 

Pizzeria Lola’s compensation model is one example of the business’s shared facilitator leadership. Employees are encouraged to ask questions, share suggestions and offer input for a range of issues. “The bosses aren’t calling the shots,” O’Brien says. “We make decisions collaboratively with the employees it affects. It’s a two way dialog and a high level of engagement.” 

O’Brien adds that workers want more than fair wages. They also want stability. For example, they don’t want to call in sick and worry that it will result in getting less desirable shifts in the future, or otherwise losing status.

While wages get much attention in the current environment, engagement is important. Communicating with employees is crucial to helping workers, and the employer, thrive. “The mistake business owners make is deciding in a boardroom with their chief people that this is what people need,” says Kathleen Quinn Votaw, founder and CEO of TalenTrust, a recruiting firm in Denver. “They haven’t even asked what they need.” 

Restaurant owners might find that employees want to work shorter shifts, or they might want to be involved in
decisions that affect their daily tasks. More broadly, they want a feeling of community, and they want to work somewhere where they want to be. “It’s not about money,” Quinn Votaw says. “Most workers will take 10 percent less compensation if they feel respected, welcome, cherished, and that they matter.” 

They also want flexibility, as many workers have other jobs and schedules. “We’re in a gig economy,” Quinn Votaw says. 

Money and time 

Others maintain that employee expectations are more mundane. “It depends on if you’re talking about salary or hourly employees,” says Jason Berry, founder and principal of KNEAD Hospitality + Design, a restaurant group in Washington, D.C. “The hourly employees want a job, to get paid on time, and to go home when they want to go home.” 

The company’s restaurants include Kneadza Pizza and other concepts with schedules ranging from early morning bakery/breakfast to dinner. Berry says employees, especially servers, want to work early in the day. “People want the opportunity to work breakfast and make good money,” he says. “It’s not as hard to find those people. Everyone is competing for dinner cooks, dinner hosts. That’s the challenge.” 

Another challenge is that employees might find certain benefits to be less valuable than management thought they would be. KNEAD Hospitality offers health insurance to employees, and shortened the waiting period from one year to 90 days. Less than half of workers signed up. “Most everybody is young,” Berry says. “They don’t think they will die or get sick.” 

 Employees have other things on their minds. “The majority of people want three things: a fair wage, a safe and inclusive environment and potential for career development,” says Miller Mobley, founder and co-owner of Slim’s Pizzeria in Birmingham, Alabama. “The people we hire desire an environment that encourages mutual respect, clear communication, and freedom of self-expression.” 

Slim’s, which opened earlier this year, tries to take care of staff needs. “We believe if they are happy and feel taken care of, they will in turn take excellent care of our valuable customers,” Mobley says. 

Maybe it is about pay

Pay raises are presumably one way to take care of employees. According to the U.S. Bureau of Labor Statistics, for the year ended September 2021, compensation costs for workers in the leisure and hospitality industry increased 6.9 percent from September 2020 to September 2021, compared with an increase of 4.1 percent for the 12 months ended September 2020. For private industry workers overall, compensation costs increased 4.1 percent, compared with an increase of 2.4 percent for the year ended September 2020. 

More commonly, though, employees want something else, and it helps to listen to the questions applicants ask during the interview. “We don’t believe there is a labor shortage,” says O’Brien, from Pizzeria Lola. “There is a mismatch of needs, and not finding common ground.” 

Nora Caley is a freelance writer who covers small business, finance and lifestyle topics. 

The post Do Employers Really Know What Workers Want? appeared first on Pizza Today.

You have a defined management structure, and your leaders have clear job descriptions. Now, you might be asking yourself, “How do I get the most from them?” This is where accountability comes into play.  

There are some clever sayings on this topic — “You get what you inspect,” and “What you tolerate is what you procreate,” but communication is the most important characteristic for holding your team of managers accountable. Indeed, before you inspect their work (and decide what you’ll tolerate), your managers must understand your expectations and their personal accountabilities. 

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

An easy-to-create and effective tool to accomplish this goal is what I call a “responsibility list,” which catalogs every task that must be completed at each of my stores, along with which manager is assigned to a given task. The responsibility list is the main tool in making sure everything in the store is cleaned, maintained and operating properly. Not only is it beneficial for the managers, but it’s helpful for me, too. If I visit a store and some TVs are not working, I know who oversees that. Or if I go into a store and the dough is not proofed correctly, I know just who to speak with for answers.  

When it comes to full inspections, I refer to the list and identify about 100 key items, the ones that are truly important to the location’s vitality, to build a robust written inspection sheet for the stores. If something on the sheet is not complete, I can refer to the responsibility list and see who it is that I need to have a discussion with for an explanation. Creating clear lines of communication with the manager assigned to the incomplete item is important, and ideally the problem is solved quickly, but if the issue repeatedly occurs, that’s when the written documentation becomes important. Having a written record that can show precisely when the problem began provides you leverage if you need to have a difficult conversation with the manager or there is pushback in the discussion. 

With those tools in place, these conversations have a more meaningful effect and produce the most results. Most people want to do a good job — they just need a clear definition of the task and what makes the completed job important to the store’s operations. When something is not meeting expectations, then they need guidance and teaching. So, rather than something to fear, our inspections often become teachable moments that continue to build our team and develop our managers.  

It all goes back to holding the managers accountable — and it has a positive ripple effect. Once you build accountability with your direct reports, you can teach them to do the same with the employees who directly report to them. Suddenly, accountability is everywhere. 

One way to really drive everything home and get the most from your team is through a rewards program. There are many ways we like to reward our teams, and in the next installment of Building Blocks, we’ll be diving into this truly fun part of the job. 

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Creating Accountability with Tools and Teachable Moments For Employees appeared first on Pizza Today.

The whirling world of employee benefits

John Pask says smart restaurants have long known the importance of offering employees compelling benefits. If employees feel supported and valued, then customer service and employee retention often follow in a positive direction and drive the restaurant’s overall performance, says Pask, the co-founder and managing partner at GoBenefits, a Dallas-based firm that provides insurance for restaurants across the U.S.

And this realization, he continues, has only accelerated of late.

Given the health and safety concerns COVID-19 ignited, the startling – and ever-rising – costs of medical care and the intense labor challenges blanketing the restaurant industry, employee benefits, led by health insurance, are drawing intense attention from both restaurant owners and employees alike. 

“Operators come to us every day looking to offer benefits because they understand employees have a choice on where they can work and they see they need to offer benefits to recruit and retain employees,” Pask says.

Knowing the job hunters

While all large employers – defined as those with more than 50 full-time and full-time equivalent employees – must offer health coverage under the Affordable Care Act, smaller operators do not face the same mandate. Still, Clinton Wolf, senior vice president of health and insurance services with the National Restaurant Association (NRA), reminds smaller operators they are nevertheless competing in the talent pool with larger employers offering health coverage.

“You might be able to match on salary, but the large employer is offering benefits, too,” Wolf says, noting that management-level employees, in particular, frequently list competitive salary and benefits atop their priority list when job hunting. 

Increasingly, though, part-timers are also seeking benefits, keenly aware of the leverage they wield in the current labor market. Pask reports an uptick in part-timers seeking health coverage as well as vision, dental and even supplemental life products. 

“Offering a comprehensive package to every employee is taking on a lot more precedence these days,” Pask says. “The focus is no longer on the manager level and above.”

That reality leaves smaller employers in a notable quandary: risk losing out on talent to larger employers or investing in a health coverage program that boosts one’s profile amongst job candidates.

Understanding options

According to Wolf, many smaller restaurant operators misunderstand what’s involved in setting up a health insurance program. A good number, for example, assume they must pay 100 percent of every employee’s insurance when, in fact, the minimum is generally 50 percent per employee. Yet more, not every employee needs to enroll.

“I talk to operators all the time who say, ‘I’ve got 20 employees and can’t afford to give them all healthcare,’” Wolf says. “Once they learn that only seven of their employees would even want to enroll and that they share the costs, though, they realize health insurance is more affordable than they thought.”

Pask suggests operators survey their staff and discover how many people would be interested in enrolling in a health plan. If only a handful express interest, it’s unlikely the restaurant would meet participant requirements for a group plan. 

“If you have a lot of 18 and 19-year-olds in your restaurant and a small management team, then health insurance might not be in high demand,” Pask says. “Those individuals might be looking for alternative perks or benefits beyond healthcare and competitive compensation.” 

If, however, there’s greater appetite among staff members for health coverage, then investigating a group plan makes sense. Restaurants might investigate programs offered by a local chamber of commerce or professional association, such as the Restaurant & Hospitality Association (RHA) Benefit Trust managed by UnitedHealthcare. The RHA program is available to NRA member businesses with 2-99 employees in most, but not all, states. 

“These programs allow employers to band together and look like a much large employer to get better rates and plan options,” Pask says.

The RHA Benefit Trust, for example, offers more than 40 different health plan designs. Pask calls such variety important given the different healthcare coverage needs and priorities employees will inevitably have.

 “Much like ordering a pizza, some want anchovies and others want pepperoni,” he says. “You don’t want to offer just one plan because there’s no universal solution for everyone. Offer multiple plans and give employees a defined contribution alongside a digital platform that makes it easy for them to shop.”

Getting started

Wolf suggests operators find a broker who works with restaurants. Get a quote, he says, and make sure the required employer contribution is feasible before revealing potential options to staff.

“Find out what it’s really going to cost you and make sure that’s doable,” Wolf says, adding that purchasing employer health insurance is a business expense that will reduce one’s taxable income. 

If deemed unaffordable, other potential options do exist. The NRA’s HealthiestYou virtual care program, for instance, can be purchased for $9 per month per employee. The telemedicine program enables employees to connect via phone or video with board-certified doctors to discuss symptoms, diagnoses and treatment plans with a $0 copay. The program also provides access to licensed mental health professionals and dermatologists as well as back care programs. 

As a final note, Wolf reminds operators they can set up a health coverage program at any time. 

“You don’t need to wait for the start of the year,” he says. “In fact, you’ll probably get more attention creating your program later in the year when fewer people are looking to get programs going.”  

The perks beyond health benefits

As important as health insurance remains, other benefits can help restaurant owners attract and retain team members.

Employers can add dental and vision as well as a basic life insurance package to healthcare programs starting at about $30 a month, while some restaurants promote 401k retirement savings plans, retention bonuses and parental leave to woo talent. 

Of late, financial wellness programs have become particularly en vogue, as employers provide access to financial coaching, student loan assistance, education reimbursement or emergency savings help to drive employee health, engagement and loyalty. 

“People always like getting something extra,” says John Pask of GoBenefits.

Daniel P. Smith  Chicago-based writer has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post How Small Operators Can Tap into Benefits Programs appeared first on Pizza Today.

Do you have some employees who aren’t pushing to advance their role? They’re happy in their position and cause no issues. They don’t make a fuss, but they go under the radar. These employees are the bedrock of any restaurant. A busy restaurant owner can quickly end up overlooking these employees.

With labor shortages, price fluctuations, marketing pushes, constant setbacks, it’s hard to keep your head straight. When you look at all your staff members, you might see some all-stars itching to move ahead. At the same time, others are petering out and need adjustment. The problematic employees take up your time to deal with via discipline, write-ups and re-educating. The all-stars need more training to get to their potential. What about the people that are just consistent? 

I’m not a big golfer, but I like the phrase “Swing for show and putt for dough.” Your standard employee who pounds through work dependably every day will go unappreciated much of the time, but they are great putters. A great 250-yard swing doesn’t matter if you take four swings to put the ball in the hole. It’s important to remember that stores that hit revenue numbers and get great reviews do it because of consistent base-level employees. Consistent employees are vital to a great restaurant.

I’m big on saying if you’re not impressive, you’re unimpressive. A quiet employee might not come off as impressive to you. But those employees who consistently deliver a perfectly cooked pizza, who rarely if ever miss the toppings on what’s supposed to go in the oven, who always handle customer interactions proactively ensure you don’t have negative customer experiences. They are extremely impressive because a penny saved is a penny earned with employees like this.

When you have an all-star manager who will go above and beyond with a customer in dealing with a mistake or comp, they create loss prevention. Consistent employees ensure you never get to that point, and ideally, your all-star manager can spend their time building rapport with customers rather than putting out fires. 

When the food is consistently excellent and on time, it alleviates a customer’s purchase anxiety and creates more visits. The quiet employee who comes in and works hard, then goes home, and rarely asks for anything, is vital now more than ever. You already knew that, but after reading this article, translate it into action. What can you do for this employee? They might not be a chatty Cathy, but that doesn’t mean they don’t appreciate you publicly saying how much you appreciate them. Their lack of charisma doesn’t mean they aren’t funny and don’t have an opinion on what could improve the restaurant. So, I suggest you do two things this month and every month. 

1. Build or add to your professional
   rapport with these employees.
2. Find out something they need and help them with it. 

Roller coaster employees who demand attention one minute and then ruin your expectations the next will eat up a lot of your time. Faux hard-working employees who are excellent in front of you but lazy when you’re not around, destroy your store. These employees are okay with 40-minute ticket times when barely anyone is in the restaurant. They will disenfranchise your customer base quickly. It’s death by 1,000 cuts those small failures create, leading to a mass exodus of customers. The quiet, consistent employee doesn’t do that.

You must recognize all-stars. That’s a given. But keep motivating those who don’t demand your attention to be great, because they already are.

Build rapport with them and help them; it won’t be in vain.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch 

The post Mike’s Monthly Tip: Consistent Employee, The Quiet Hero appeared first on Pizza Today.

How HR experts encourage pizzerias to approach hiring

The hand-printed sign in the window of Dino’s Pizza in Chicago speaks volumes about current troubles testing the restaurant industry.

An establishment dazzling patrons on the city’s Northwest Side for more than five decades, Dino’s rich legacy and familial atmosphere have long attracted job applicants. These days, though, it’s not enough.

“Experienced Help Needed. Apply Inside,” the sign reads, followed by a list of four in-demand positions: servers, cooks, pizza maker and bartenders.

Dino’s, of course, isn’t alone, as pizzerias across the U.S. continue seeking workers. 

For independents and chains alike, a massive and ongoing labor shortage has proven a significant hurdle to operational stability in the post-COVID age – and reason for critical reflection, creativity and calculated investment.

Past, present and future

Amid pandemic-forced shutdowns, restaurant layoffs and resignations reigned – and the industry has struggled getting workers back ever since. 

To corral employees, many operators initially responded by boosting pay. From September 2020 to September 2021, the average hourly earnings for employees in the leisure and hospitality sector jumped 13 percent from $14.80 to $16.71, according to the U.S. Bureau of Labor Statistics. 

The pay increases, however, have not been strong enough to fill the ranks and deliver stability. While U.S. restaurants saw steady hiring gains throughout the first half of 2021, the momentum stalled by later summer with the nation’s restaurant workforce down about 900,000 from pre-pandemic levels, the National Restaurant Association (NRA) reports.

Over the second half of 2021, restaurants turned – reluctantly, in many cases – to various interventions designed to attack the continued labor shortage. Some leaned more heavily into technology and automation, altered operating hours, closed dining rooms, trimmed menus or supercharged benefits packages to include perks like transportation assistance, paid time off and retention bonuses. Others unveiled referral bonuses to use staff as a recruitment army, touted growth opportunities and offered sign-on bonuses – anything and everything to attract applicants.

And still, the labor pains persisted. In a September 2021 survey conducted by the NRA, four out of five full-service operators reported they did not have enough employees to meet customer demand.

In the near term, many industry analysts expect labor shortages to continue frustrating restaurant owners, 75 percent of whom told the NRA that recruiting and retaining staff is their top challenge – a remarkable statistic given the other hurdles confronting the industry. It is an undeniably trying issue. So, what are HR experts suggesting operators do to grab new employees?

Prioritize health and safety. Set and adhere to safety protocols, says Jennifer Chang, a knowledge advisor with the Society for Human Resource Management (SHRM). She suggests restaurants provide personal protective equipment (PPE) to staff and include paid sick leave in their benefits package to alleviate the pressure sick employees feel to report to work. The pandemic awakened heightened attention to health and safety and individuals are prioritizing employers who value their health.

“Especially in this climate, demonstrating a willingness to take care of your staff and treat them well matters,” Chang says.

Leverage technology to move fast. On the revenue front, many restaurants have adopted technology to capture orders, reservations and drive repeat visits. Technology can also be employed to bolster hiring. Landed, for instance, uses artificial intelligence to automate the hiring process and eliminate rote tasks that prolong or complicate the hiring process.

“Given the competition, you have to act fast,” Landed CEO Vivian Wang says. “Within 24 to 36 hours after initial candidate interest, you need to be interviewing them.”

Wang urges restaurants to use SMS text, not e-mail, for outreach since texting is faster and spurs a higher response rate. She also suggests restaurants adapt to a “digital-first environment,” including using familiar platforms such as FaceTime or Google Meet to conduct virtual interviews that require less coordination and planning. 

“Then, you can utilize the in-person time to sell the candidate on your business since many candidates today are job shopping, not job hunting,” Wang says.

Cast a wide net. While traditional talent acquisition strategies – digital platforms like Indeed, Monster and Craigslist as well as the simple “Help Wanted” window sign – retain their merits, restaurants must attract candidates in other ways. This might include using social media websites like Instagram or TikTok to brand the restaurant as a fun place to work, partnering with a local culinary institute or technical school to provide apprenticeship opportunities or teaming with nonprofit organizations that help veterans or formerly incarcerated individuals transition into the workforce.

“There are groups of people easily overlooked you might turn to here,” Chang says.

Involve everyone in solutions. So often, Wang says, a corporate office or owner pushes the hiring responsibility directly onto store-level leadership. Yet, that group is already taxed and understaffed, scrambling to fill holes created by worker shortages and extinguishing operational fires.

“Why ask them to do more?” Wang wonders. 

Rather than pushing it down, she encourages operators to “provide support and make investments in something that’s sustainable,” such as involving current staff in recruiting by investing in referral bonuses. A recent SHRM study found nearly 60 percent of businesses are using referral bonuses to attract job applicants to their most difficult-to-fill positions.

“And often, like attracts like, so you’re going to get individuals on par with your current employees,” Chang says.

Thinking beyond pay. In a tight labor market, competitive pay is necessary to attract talent, but it takes more than that now. Health benefits, even for part-time employees, are becoming more commonplace, while additional perks ranging from free meals to educational supports – one Arkansas restaurant group has given student workers a paid hour to do their homework – can also lure candidates. Even daily pay options powered by mobile apps like Tapcheck can drive applicants. Detailing mentorship, training and advancement opportunities can prove appealing as well.

“Treating your employees well and being a flexible, inclusive and engaged workplace where employees feel valued is so important,” Chang says. “It’s so easy to go to traditional solutions like higher pay, but it’s important to focus on your company culture as well.” 

Daniel P. Smith  Chicago-based writer has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Five Hiring Action Steps appeared first on Pizza Today.

How – and why – pizzerias might use the close of the year to recognize employees 

Back in 2013, Justin Klavon wanted to do something unique to acknowledge the employees at his namesake pizzeria in Jackson, Michigan. 

While long accustomed to handing staff sweatshirts or gift cards as a year-end thank you, Klavon wanted to “take it up a notch” and really energize his employees. The veteran restaurateur concocted the idea of an Employee Appreciation Day in which staff would receive all profits from one December Tuesday. 

“You realize pretty quickly in this business that you can’t do it alone, and I wanted to find a special way to give back to my staff,” says Klavon, a seasoned restaurateur who opened his first Klavon’s Pizzeria & Pub in 2007. 

As staff marketed the day in their own corners, Klavon’s promoted the day on its marketing channels and customers increasingly embraced the idea, the annual Employee Appreciation Day grew to be one of Klavon’s busiest days of the year with the company eventually distributing upwards of $30,000 amongst its employees. 

“It’s really something that has built camaraderie and recognizes the people who have built Klavon’s into what it is,” Klavon says of his pizzeria’s Employee Appreciation Day. 

The case for employee appreciation

While many human resources (HR) pros encourage businesses to show employees consistent and regular appreciation throughout the year, the calendar’s impending close and the spirited energy the holiday season generates provides pizzerias a natural opportunity to celebrate their employees. In 2021, this show of gratitude might be even more important given all that employees have endured of late – from picking up added hours or responsibilities to counter staffing shortages to dealing with rising incivility among customers to adapting to shifting policies, new technology and altered work environments in the era of COVID-19.

“There’s a lot to say thank you for this year … and the close of the year, in particular, offers additional reasons to say thank you,” says Katie Brennan, a human resources knowledge advisor with the Society for Human Resource Management.

Showing employees appreciation is not only a noble, fair-minded thing to do, but there’s a business case for it as well. Matthew Samel, a professor in the College of Hospitality Management at Johnson & Wales University who specializes in HR matters, says employee recognition presents numerous bottom-line driving benefits. It cultivates employee morale and confidence, propels the pursuit of business goals, demonstrates the company’s values and boosts staff retention rates while helping the restaurant become an employer of choice in a field clamoring for talent.

“It’s money well spent,” Samel says.

In fact, when employee recognition software company O.C. Tanner asked individuals what the most important thing their employer could do to spur great work, “recognize me” earned the top spot above all other incentives, including higher pay and more autonomy. 

Staff Appreciation do’s and don’ts

Year-end appreciation can come in many forms and can certainly be modified to fit different budgets and workplace environments. There are, however, some general ideas pizzerias can employ to craft a year-end employee appreciation initiative that is relevant and worthwhile.

Do recognize what employees want

Money or gift cards are a popular choice and something employees generally value, largely because they can put the money or gift card – provided it’s to a business they actually frequent – to immediate use. On the downside, a monetary gift carries tax implications as the IRS views cash and gift cards, even those distributed as an end-of-year perk, as additional compensation and, thus, taxable income.

“Some employers will often soften this blow by ‘grossing up’ the value of the gift [to absorb the tax burden],” Brennan says.

As for what employees generally do not want: skip the generic items like water bottles or mugs emblazoned with the pizzeria’s logo as well as the trophies or certificates that are trite and dull.

Don’t assume money is the best option

Yes, cash and gift cards are desired rewards, but even the practical can feel impersonal. Savvy business owners might look for more creative, distinctive ways to show appreciation for their team members.

“This shouldn’t be another training program. Innovation and creativity always sell,” Samel reminds.

Pizzeria owners, for instance, might create a dinner event or outing for their staff members and invite them to bring a guest to heighten meaning and foster community. Such experiential events might include a group bowling trip, indoor skydiving or a boat cruise. Brennan has even seen some business owners facilitate charitable events or gift giving, which taps into employees’ rising interest in working for a company that demonstrates philanthropic values.

“The bottom line is that it should be meaningful to the employee, not the employer,” Samel says, suggesting that pizzerias might even create an internal survey to discover what gifts staff would most like to receive. 

Do assign a point person

Samel recommends pizzeria owners appoint an internal person to take ownership of year-end appreciation and any other employee recognition programs. Having a specific individual charged to guide this effort and accountable to see it through helps ensure that employee appreciation receives the requisite attention and doesn’t fade into the background.

“Make it part of this individual’s job description and their compensation package,” Samel says. 

Don’t exclude

Some employees might have 10 years’ tenure; others might have just started last month. When doing year-end
appreciation, though, everybody should get something, Samel says, even if ownership might segment employees and distribute applicable rewards accordingly. Klavon, for instance, created a tiered program in which senior employees at Klavon’s received a bit more of the Employee Appreciation Day pot than the newest restaurant staff.

Do make it a big deal 

Samel encourages operators to make a point of recognizing employees both internally and externally. Pair the year-end gift with a handwritten note. Spotlight your employees’ good deeds on social media channels. Create a bulletin board where employees can give a shout-out to their co-workers. In fact, pizzerias can leverage the year’s close to stir new employee recognition practices management can integrate throughout the year to drive motivation, retention and performance. 

Daniel P. Smith Chicago-based writer has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Showing Appreciation to Your Employees appeared first on Pizza Today.

Why now is the perfect time to build more stores

Among Warren Buffet’s many famous sayings is “Be fearful when others are greedy and greedy when others are fearful.” Looking back through history, the best times to create wealth in other industries can be right after the biggest shocks to those industries. Take 1987, when the stock market crashed and soared to new highs, or the housing crash of 2008, which preceded one of the strongest housing markets ever. I truly believe right now is that time in the restaurant and pizza industry — it’s time to expand.

The devastation wrought by the pandemic and the restaurant industry’s labor shortage are creating a perfect storm for fiscally sound operators. If you’ve been following along with this series, you know how much I love a good deal — and today, once-in-a-lifetime deals are within reach.

On top of the wealth you’re building for your family, more stores will help you grow your operation to create more career-based positions on your team. Adding the chance to hire more workers, pay your current employees better and offer them more benefits than other operators, expansion is not only good for the owner but also your core staff. But first, you must get them on board. 

A clear vision spells out to the staff what’s coming and what’s in it for them. Having a clear path of where you want to go — and communicating it — is crucial. For a while at Caliente, we were building stores without an end number in sight. Now, I have a number and a year: 12 stores by 2026. 

Next, spell out what that looks like for your team. Discuss pay increases, projected dates for new stores to open, the benefits that will be added when new stores open. Have a game plan of what new positions will need to be created as the business grows. Start at the end and work backwards. For me, I researched companies with about 12 stores and worked that timeline backward to today.

Once you have that vision, you want to speak it over and over — not just to your current employees, but in your interviews as well. You want people who want to grow with you. Every company is hiring right now, but having a clear vision of growth and being able to communicate that to current staff and new hires gives you a leg up. Never preach anything false — your word must mean something. Once you start talking about your vision, you must be committed to making that happen, so make sure your vision is achievable. 

When describing to your team the different positions you are going to create to meet your vision, you must have a clear idea of what roles are required. In the next building blocks, we’ll examine all the types of managers, supervisors and shift leaders any pizza shop needs on its team to succeed.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Crafting a Vision that Resonates appeared first on Pizza Today.

Are you an adversary or advocate for your employees? Hopefully, your knee-jerk response is an advocate.

But advocacy for your staff means in all aspects of their job, you are rooting for them. That means all of them. When someone does something wrong, potentially fireable, the advocate doesn’t ream them out.

Mike Bausch, owner, Andolini’s Pizzeria

Instead, an advocate asks, “What are you doing? You might screw this thing up. We like you, and you could be great at this job. I’m pulling for you. Please don’t let stuff like this happen again,” This is preferable to an angry adversary. Staff won’t listen to a dismissive or confrontational employer when they don’t perfectly fall in line. They will listen to the person in their corner rooting them on, guiding them like a mentor.

If you believe your staff is consistently looking to get one over on you, you’re in an adversarial relationship. I’m not saying you shouldn’t protect yourself from theft, but if you never trust your staff, they will sense that. They will perceive you as an adversary and will seek to take advantage of you. It’s only when you’re the endearing advocate who says, “I really want to hit food costs. Will you help me out with that?” as opposed to, “If you don’t weigh this cheese right, you can find another job,” do you get traction and progress from your staff. People don’t want to screw over their advocate. People do wish their adversary ill will. If you are consistently championing your staff, you will become their advocate. I’m not saying some people won’t still pull a fast one on you. I’m not saying you won’t have failures. Yes, some will disappoint you, but they will be fewer and farther between. The ones who last will be loyal, and leadership by loyalty is stronger than leadership by fear.

Your concern is mainly monetary theft from staff, so engage your staff in talks about compensation. Every staff member wants more money. You should want them to have more money via performance incentives so that THEY ARE the only ones holding themselves back from their raise, not you. And you’re pulling for them to win with you when you create an advocacy-based management and leadership style.

Advocacy management style means when your team member has a need from you and the restaurant; you step up. For example, a once in a blue moon late request off, a family crisis, or a church fundraiser. These are the moments when you should lead by example and take care of your crew in a big way. When you respect their outside life and find a way for your restaurant to work with them and their life goals and personal situations, they work harder for you. When they need help, utilize your business to help them just as you would if it was one of your best friends. Be that boss, not the boss you hated growing up. The bosses who give reactions like this destroy restaurants, “Come here, work and go home, if you can’t be here tomorrow, find another job.”

Having a standard that doesn’t get taken advantage of is prudent. Being such a hard-ass that no one trusts you or wants you and your restaurant to win is perilous. If you become an advocate and really live it, you’ll see the emotion and temperature of the room shift in your favor and for your pizzeria.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch

The post Mike’s Monthly Tip: Advocate or Adversary appeared first on Pizza Today.

Currently, the restaurant industry is in the most significant hiring crisis in modern history. Monetary and governmental issues aside, the way to rise above these pitfalls is through high morale and keying into staff’s direct motivators. What makes them excited to work for you instead of any alternative? Theoretically, the answer is obvious, money; but as someone who has tried everything, new hire initiatives, signing bonuses, I can tell there is more to it than that. Staff needs to know you care. The staff needs to know that you care about them, the restaurant, the product and everyone’s well-being.

Mike Bausch, owner, Andolini’s Pizzeria

Now, I don’t doubt for a second that you, someone conscientious enough to read an article about employee management, cares for your staff. But are you outwardly and noticeably conveying that? Do you have a tangible reward system? Do you have something as simple as a “treasure chest,” i.e., some fun candy items or gift cards available to give out when an employee kills it? I say candy because it’s a lot easier to give fun and cheap rewards daily than giving gift cards daily. I believe in doing both and keeping morale and fun surprises around every corner. It’s not childish. It’s not unprofessional. It’s a mandate to have a staff who wants to work for you and wants their friends to work with them for you. Daily contests for pizza makers who get prep done on time are a win.

Additionally, server incentives for those whose average ticket price are higher, not only build sales, it builds esteem and healthy competition. Healthy competition makes the day go by faster, and a built-in reward structure makes that effort fun and worth it. If not candy, whatever affordable item you can have at the ready for your staff that they actually like.

Having a help-wanted sign does you no favors. It screams, “people don’t want to work here.” Even giving a startup bonus, I’ve found, doesn’t do much. To move the needle takes constant motivation and connecting with your staff. Moving the needle means that everyone feels part of something. Filming a fun or endearing video of your current staff and why they like working there will go further than any sign. Keep it under 45 seconds and post it as much as possible to get a leg up in the hiring fight.

When Covid was at its height, you probably backed off on hiring. You weren’t seeking to hire as many servers as possible, mainly because you didn’t know if you could guarantee work. That’s completely understandable but bear in mind, you reap what you sow. For not continually hiring and training, we all have less staff. Unemployment and individual extenuating circumstances for sure play a role, but continually hiring through new job posts and interviewing all candidates can never be put on the back burner.

The caveat to our current situation, with sales booming, is to back off on marketing. I am telling you now, 100 percent for a fact, this boom will end, and if you have no marketing seeds planted, you will be at square one when you least expect it. You might be hesitant to spend money on marketing when you can barely fulfill orders. But just like any harvest, even when it’s a fantastic harvest, you still need to plant seeds if you ever want to have another crop. You can’t back off on marketing now because you’re inundated, nor could you back off on training when you finally do staff up. You have to keep sowing, so you can keep reaping in all aspects of this business.

Staff morale, staff training, marketing, system investment, fiscal discipline, quality control, ambiance, system functionality, equipment maintenance, you MUST continually sow so you can constantly reap. Never take your eyes off the prize. And that is what perpetuates flowing success rather than simply spurts of it.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. Instagram: @mikeybausch

The post Mike’s Monthly Tip: Reap, Sow, Repeat appeared first on Pizza Today.

If you opened a new restaurant during the pandemic, hopefully you’re one of the many pizzerias across the country experiencing a sales surge due to your business’ existing options for takeout and delivery. But as states open restaurants to full capacity, the new challenge is hiring and retaining good employees. We broke down some of the strategies toward meeting those goals in the previous article, and now we’ll discuss perhaps the most powerful tactic — the balancing act surrounding employee pay and pay increases.

Creating your pay scale

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

For the last few years, the minimum wage, along with a livable wage, has been a hot topic of debate. All industries are feeling the crunch of a national employee shortage, and it is causing many operators to re-examine their current pay structures.

When setting up your pay structure, understand that it is an ever shifting and evolving part of your business. Nevertheless, it should be clearly defined — what is the starting rate? The ladder for raises? What to expect at a given position? The clearer it is for the employee and the employer to understand when the topic comes up, then a more meaningful discussion can happen.

Ideally, your pay scale would be based on your local market and your profitability. At the end of the day, we are in business to make a profit. But the current market is disruptive, causing wages to shoot up and prompting some pizzerias to implement signing bonuses, enhanced employee perks and, of course, higher wages.

Timing raises

Increasing wages might be difficult, and in many cases, you may not want to be the first shop in your area to do so — but you certainly don’t want to be last. If your business is booming and you are setting records weekly, and if the sales seem sustainable along with adding profit to the bottom line, then maybe you do want to set the market for wages in your town.

Being first has its advantages — clearly, you’re a more attractive workplace — while being first also opens the door to many issues. If you’re noticing employees leaving at an alarming rate, it’s potentially a red flag that your wages are too low. Conversely, if you’re having an impossible time going from a phone interview to an in-person interview, it’s another sign that you need to restructure your pay scale. Just start with your current employees first.

Doing the math

Of course, the big question when raising employee wages is: where do you find the money? Let’s say you’re running a 55-percent prime cost number, of which 30 percent is your food cost and 25 percent is your labor cost. If you give employees a pay increase that increases your labor to 26 percent, does your prime cost goal now just become 56 percent — while you sacrifice your profit percentage?

Personally, I’d say if your prime cost has been 55 percent, then that’s the figure that likely makes the most sense for your business. You’re left with one option: it’s time to raise prices. We’ll tackle that tricky task next month.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: When’s the Right Time to Increase Employee Pay? appeared first on Pizza Today.

Inspiring Greatness

As the manager of five pizza restaurants, I receive two questions more than most others: How do we find people? And do I ever sleep? The latter question, of course, refers to my busy schedule — but if I can answer the first question, it can turn the answer to the second into a resounding “yes.”

Finding, hiring and training the right people makes the job of an owner easier. It’s even better if I can turn them into a manager, because it allows me to work on high-level projects and build the business with an ever-expanding team in more and more locations.

However, almost every restaurant in America is currently feeling the pain of being short-handed and struggling to hire new staff. Now is as good a time as ever to revamp your hiring process, from the “help wanted” sign through the interview. If you look across the industry, you see restaurants are resorting to rare and expensive tactics: signing bonuses, free food, expanded benefits and more. The question becomes how the small pizzerias of the world compete with all of that? The one thing I can
assure you is that you can’t take the same approach as always.

Let’s dig into this process as we get ready to go to the city that never sleeps in August for the much-anticipated International Pizza Expo. I’ll be hosting a workshop on this exact topic alongside my colleague and fellow World Pizza Champions team member, Will Grant.

Marketing yourself

You’re probably used to marketing your food — now you need to market your company. Look in the mirror and think about how you position your company to your future employees.

A fresh, clean ad featuring a welcoming photo of you or your store is the first step. You wouldn’t use stock photos on your menu, so don’t use stock photos in your hiring ad. When it comes to posting the ads, remember you don’t share your regular ads in one place, so don’t limit yourself here, either. We use Facebook, Indeed, Craigslist and Instagram. On top of that, we have posters at all the stores and multiple banners on the outside of the stores. In addition, we use box-toppers to get the word out about our hiring.

Don’t forget to leverage word of mouth, too. We have an incentive program in place to reward employees who bring in their friends.

Identifying managers

Bringing in new employees is vital, but where do we find new managers? We don’t look far, as we love to promote from within, lifting people in regular staff positions into leadership roles. This makes us a strong company from the inside out, and we have a great idea of who we are getting. We do occasionally hire from the outside, but that is typically for an entry-level management position, such as a shift leader.

Whoever it is, they will work and train through the ranks, from kitchen manager to assistant manager and then, finally, into a general manager role. In the nine years of our company, we have never hired a general manager from outside the company. Only twice have we hired assistant managers from the outside, but each worked and trained very hard and became general managers.

Training days (and days and days…)

Training is essential for the overall development of the team and the retention of your staff. An employee who is trained well at their job and is a contributing member of a team is more likely to stay and be part of the team. We have all been in a situation at a job on the first day where the boss says, “This is Joey. Joey, this is the New Guy,” and off they go. Joey might tell the New Guy whether he likes the place and show some of the ropes — all with no rhyme or reason behind it. It’s your job to put some direction and purpose into your training program. We break ours into three phases.

1. Onboarding: This is the phase where we do an employee’s paperwork, get their information into the computer system, introduce them to the rest of the team and give them a tour of the store and its operations. This includes showing off everything from the dumpster and bathrooms to where the schedule is posted, where the coolers are located and everything in between. We want the new hire to feel like part of the team from the moment they come aboard, so it’s important for them to see the layout of the whole operation and to meet as many of the team members as possible.

2. S.A.W.: Show. Assist. Watch. It’s our simple process for training in common tasks. For example, let’s say we are teaching a new hire to stretch dough. First, we show them how we stretch a dough ball, step-by-step. Next, we do each step together and assist them along the way. Next, we watch them stretch the dough by themselves, coaching them as we go (in truth, the coaching never ends). In addition to using S.A.W., we also have a detailed training packet (which we will share at the class) that we guide each new team member through depending on their position.

3. Evaluation and constant coaching. The last phase might be the most important. We meet with each new employee on the last shift of each week in their first four weeks for an update on their progress and to simply communicate with them. We listen for feedback and we also give positive reinforcement. This culminates in a final sit-down in which we go over each line of the training packet with them, hopefully setting them up for success. Once this process is complete, we repeat it over and over for each new team member.

Following this process, we continue to find and train great team members — and I’m also able to get some sound sleep!

Jokes aside, hiring and training is right next to the quality of our product in why we’ve been able to succeed at Caliente. Customers truly can tell a difference when employees and managers are lacking in skill or training, so be sure to join myself and Will for our workshop at Pizza Expo. We’re looking forward to seeing you!

NICK BOGACZ  is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Finding, Hiring and Training Managers appeared first on Pizza Today.

Previously, we discussed how to build a staff of servers, cooks and drivers with a winning mindset. The unspoken question is this: how do you retain them? You’re not alone if you can’t find anyone to hire right now, making it so important to keep your team together.

Two concepts come to mind when talking about retention: communication and appreciation.

Communication

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

A staff likes to feel like they know what’s going on and they have all the pertinent information to do their job. No one enjoys chaotic, confusing workplaces, and most of those are characterized by a lack of communication. Regularly updating employees on the latest pizzeria news keeps them in the know and maintains a team-focused environment.

At Caliente, we use the GroupMe messaging app to communicate with all employees at once. We post updates, new menu procedures and important changes. We also host monthly meetings for staff, as well as biweekly meetings for the managers. These meetings are written in stone on the schedule and occur no matter what — they are the lifeblood of our internal communication strategy. Lastly, never underestimate a phone call or talking to a staff member in person during a trying and difficult moment.

A well-trained and informed staff learns to appreciate the workplace — but that relationship should be reciprocal.

Appreciation

Once the staff is in the know, they should feel more entrenched in the job. But how do you get them to care even more and stick around awhile? By showing how much you care about them, too.

We put significant effort into employee appreciation, beginning with two big, all-staff events each year. One is our annual holiday party, as we close all stores early and gather at a nice venue for a catered event with all expenses paid, including alcohol. At the event, we give away random door prizes and then we hand out our “Caliente Awards” that, of course, include giant trophies. The other big annual event is our Summer Picnic, as we invite employees and their families to an outdoor party. We host it at a local park with giant bouncy houses and live entertainment. These types of events build camaraderie in a stress-free situation.

Throughout the year, we implement smaller-scale appreciation efforts, such as our Employee of the Month program, in which a valued and talented employee is awarded a gift card and has their photo placed on the wall. We also have a Manager of the Month program, which includes a gift card, paid vacation day and t-shirt celebrating the achievement. In addition, we give out years-of-service shirts, in which employees receive a special t-shirt noting their years of employment on the sleeve.

Sometimes, nothing is better than an honest “thank you.” As an owner or manager, your words carry weight, and specifically telling employees what they did well goes a long way. Of course, one of the most powerful ways that you can thank an employee is through their pay and pay increases — and that balancing act is what we’ll tackle next month.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: How to Retain Your Winning Team appeared first on Pizza Today.

Represented

One of the nation’s largest private-sector employers, restaurants have long celebrated their role in promoting opportunity and diversity among the ranks.

And in so many ways, it rings true. Kitchens, counters and dining rooms at restaurants across the country are manned by individuals representing different races, ethnic groups, religions, sexual orientations and cultures, while the industry is rich in stories of individuals ascending the professional ladder.

Point 1: The restaurant industry stands among the nation’s most diverse work sectors with minorities filling 47 percent of all positions, according to National Restaurant Association (NRA) data.

Point 2: Forty percent of restaurant businesses are majority-owned by minorities while two out of five managers and supervisors are minorities, reports the NRA, which touts greater minority leadership than any other sector of the U.S. economy.

The last year, however, has put diversity squarely on the docket of U.S. businesses. With social justice movements and consumer sentiment compelling a more thoughtful, critical look at labor and power structures, many businesses, including restaurants, have looked more deeply at diversity, equity and inclusion (DEI) inside their operations.

The value of workplace DEI

A growing amount of research literature ties workplace diversity to improved business performance, while there also exists growing support for businesses that pursue heightened diversity and representation with thoughtful initiatives.

In an oft-cited 2019 study published in the Journal of the National Medical Association, researchers found “positive associations between diversity, quality and financial performance,” including “improvements to innovation [and] team communications.” Other research, meanwhile, has noted the impact of workforce diversity on analytical thinking and innovation.

“When work environments are homogeneous, you don’t have the best of everyone,” says Kathleen Wilson-Thompson, the former head of human resources for Walgreens Boots Alliance and Kellogg who now helps companies unlock human potential and drive more diverse and equitable workplaces as a consultant.

A more diverse workforce can also help a business attract and retain employees, a particularly important reality given the industry’s notoriously high turnover rates and training costs. A 2020 survey from Manifest found that 70 percent of job seekers want to work for a company that demonstrates a commitment to diversity and inclusion. This rings especially true for younger generations, who, having grown up in a more diverse world than Boomers and Gen X, largely see DEI as a business imperative.

Millennials and Gen Z not only want to work for companies committed to DEI, but are also choosing to spend their money with those who share their values. A recent study from Accenture focused on the retail sector – a worthy restaurant industry parallel – found that 54 percent of younger Millennials believe retailers have a responsibility to address wider social and political issues with regards to diversity, while more than half reported that they were more likely to shop at a retailer that demonstrated awareness of such issues. Nearly one-third, meanwhile, said that staffing diversity influenced their shopping decisions.

The takeaway? If a business is not genuinely committed to DEI, then it could fail to reach its potential, struggle to attract and retain talent and see consumers take their dollars elsewhere.

Cultivating a more diverse, equitable work environment

Given the tumult COVID-19 delivered, wherein 6 million foodservice jobs vanished at the onset of the pandemic, Wilson-Thompson reminds that restaurant employees enter a “new world order for labor.” As economies continue to reopen and dining rooms reacquaint themselves with guests, it is important restaurant workers feel appropriately trained and supported to deal with new regulations, rules and policies. While staff training might not be universally equated with DEI, Wilson-Thompson contends it stands just as critical a part of creating a stronger, safer work environment.

“How we bring these people back into the workplace matters,” Wilson-Thompson says. “To throw people out there without the necessary training invites issues. Restaurants need to help their people feel equipped for this and to think about the well-being and safety of themselves and others.”

Thereafter, Wilson-Thompson urges DEI-minded employers to consider how they advertise, interview and onboard employees, including asking – and listening to – feedback from current employees about their experience. She suggests leadership remove any barriers to entry, resist pigeonholing certain types of people into specific roles and provide management appropriate training to deal with workplace conflicts.

“If you don’t reflect on the entire lifecycle of your employees and the mechanics of this, then you open yourself up to complaints,” says Wilson-Thompson, adding that even a massive corporation like Walgreens conducted listening tours to better understand frontline worker issues. “The top doesn’t have all the answers, which is why it’s so important to survey your workforce and listen to what they have to say.”

Listening to employees, valuing their feedback and making tangible change to create a more responsive work environment stands an important step toward inclusion, which Wilson-Thompson defines as “respecting and valuing
employees.”

DEI also extends to respecting each individual’s unique qualities and identifiers and treating everyone equally. (While DEI is most associated with race, Wilson-Thompson reminds that diversity encompasses all different facets of one’s identity from religion and age to family dynamic and work experience.)

Wilson-Thompson urges restaurant leadership to provide the same opportunities to everyone. Consider who gains access to certain training opportunities or positions within the company and seek to broaden participation rather than limiting it.

“You don’t want to be doing things differently for different people,” Wilson-Thompson says. “If you really want to change the paradigm, then you need to remove any barriers to entry.”

So many businesses, Wilson-Thompson acknowledges, have their heart in the right place regarding DEI. They draft wonderful plans and put them on the wall, but then forget about them. She encourages restaurants to create an action plan rooted in their corporate culture and values set. This enables a business to move away from “checking boxes” to a more holistic and tangible DEI program with measurable results and real impact.

“You want to create a safe, accessible workplace where employees can thrive,” she says. “That’s when you create more diverse, equitable and inclusive work environments where everyone – the business, the employees and the customers – wins.”

Daniel P. Smith  Chicago-based writer has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Creating a more diverse and inclusive workplace appeared first on Pizza Today.

How to make winning contagious

When opening new locations, I would argue there is a magic formula, and I’ve tried to lay that out month-by-month. But there’s a missing ingredient to make it all work that’s completely up to you: a winning attitude.

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

As a leader, all eyes are always on you. You are the catalyst of what goes right or wrong in your new store. You are on the “stage.” It’s stressful, but you must display a can-do, make-it-happen attitude.

So, how do you foster that champion’s mindset and spread it to others?

Enter any project concerning a new store with a clear vision — your core messaging, your store’s menu theme, etc. Share that with your fellow leaders or managers and then with the entire staff. Everyone must be aligned on why this is important and how they will benefit from it. Address any doubts that your team may have. Just because you are able to clearly see opportunity doesn’t mean your staff will. Sometimes they see change as the enemy and not as the way to greater heights, so spelling it all out for them puts them in unison with the mission.

Once everyone is pointed toward the goal of opening a new store, it’s up to you to make it fun. A big project like this is a great time to bond with your management team and staff. We always buy lunch and dinner for the staff that’s helping us remodel and set up the new space, briefly halting construction to share the meals together. We also make sure to listen and ask for suggestions when there are challenges in the remodeling process — you never know who might have a great idea for a floor layout or process update. Doing all these things before you are open instills the team with the right attitude to succeed.

Even when the doors finally open, keep up the team-building efforts. Inviting everyone to a ribbon-cutting ceremony is a great opportunity for a group photo. You can also host a friends-and-family night, encouraging the staff to bring their loved ones to the new restaurant and try out the menu. Not only does it allow you to test your staff during something of a soft opening, but it also makes everyone feel like they are part of something much larger.

When the store is up and running, as mentioned earlier, these first weeks and months will likely be stressful. Most everyone will be working a lot of hours, so it’ll be your job to keep tabs on everyone and know when they need a rest or enjoy some time off. Talking to your staff and genuinely thanking them for all the hard work they put in to help open the new store is underrated but much appreciated.

Now that you have a great attitude instilled within your team, the next step is to focus on retaining that winning staff — and that’s what we’ll discuss next.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Instilling a Winning Attitude within Your Employees appeared first on Pizza Today.

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

In our last installment, we talked about how important labor cost is to your restaurant’s bottom line and being aggressive when it comes to setting targets for spending in this area. There are two important factors with regards to how you can either meet or come in below your spending goal: cross-training and scheduling.

•Cross-training. The difference between the winners and losers in the labor game are having employees that can do everything — and I mean everything. Having a store where the pizza cook only makes pizzas and never answers the phone, makes a sandwich or cleans a dish is counterproductive. Sure, I believe in having “aces in their places,” but I also believe all employees should be cross-trained in other roles so they have a level of comfort in all aspects of the pizzeria.

During a busy night or when an emergency occurs, you want staffers who can do it all. If a pizza needs to be in the oven, the person on the register can tend to it. If a pizza needs to be cut in a pinch, a server can do it. This makes a team feel like a team — and, frankly, you won’t need to have as many employees on the schedule.

• Scheduling. Writing a well-thought-out schedule is critical to your labor costs. The first step is projecting your weekly sales, drawing on recent weeks to make your estimate. For example, I use the average of the last four weeks of sales. Let’s say that number comes out to $20,000 in net sales. With a targeted 23-percent labor cost, that means you have $4,600 to spend on your weekly schedule.

In this scenario, do not try and run a 23-percent labor cost every day of the week. Rather, try to staff evenly throughout the week, so your labor cost may be lower than the target on a busy night and higher on a slower weekday. If the employees are properly cross-trained, the same level of staff will function successfully on busy nights. As long as you spend the allocated $4,600 or less through the whole week, you’re doing well.

When adding employee wages, remember to account for taxes and benefits like employer contributions. This might change based on your state and tax laws, but for my Pennsylvania-based stores, I add 14 percent for taxes and employer contributions. So if an employee makes $10 an hour, I count them at $11.40 an hour.

While it is up to you to ultimately decide who gets hours and how many, I always base schedules on the production of the employee and their performance. That means once I’ve completed the math that goes into the schedule, I begin filling the open spots with my best employees. I use three simple metrics: dependability, efficiency/accuracy and, most importantly, attitude.

When you use all those metrics, implement effective cross-training and write a schedule to hit your projections, you are on your way to having a healthy bottom line.

As mentioned above, the best employees have a great outlook, so the next time around, we’ll be talking about how to instill a winning attitude — and how to make it contagious.

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: Cross-Training and Scheduling appeared first on Pizza Today.

Set standards and enforce them

You’re in your business all the time, surrounded by the same four walls day in and day out. Even if you own multiple locations, you’re seeing the same people over and over again, and that’s not a bad thing. They’re the people that you chose, the people that you stand behind. They’re the people you support, and it’s normal and natural to want to do right by them and protect them. That’s all well and good, but it takes a turn for the worse when you start to value their comfort over the restaurant’s health. When that occurs is when your business stops being a business and becomes an employee hangout. That’s when you’re seeking an employee family funhouse rather than a team.

Mike Bausch, owner, Andolini’s Pizzeria

A family is a blood relation, meaning no matter what happens, you can’t undo that connection. That is not, nor should it be the case for your business. An employee hangout dynamic can quickly occur when your restaurant becomes the hangout spot for staff to come and chill before and after their rush. It makes their rush that much more lackluster. The restaurant should have peaks and valleys, but with a hangout, you have people standing around openly wasting time on the clock. You also have an owner who’s more concerned with staffing liking them rather than having highly efficient staff. The goal should be efficient and focused work from your team. They should see the owner as someone who cares a lot about them and the business. Hard work manifests respect and, in turn, breeds loyalty.

To combat the employee hangout, standards must be king above all else. There must be a known standard to start, and that no one, including the owner or any manager, is above that standard. When you work this way, your work choices are made for the business’s health rather than an immediate self-benefit. I don’t work for a business of me. I work for Andolini’s Pizzeria, and we, as a team, do what needs to be done to protect Andolini’s Pizzeria’s health. When you work for the business, the business works for you. When you have standards and don’t abide by them, you discredit the ideals and disrespect and disenfranchise those who would ever seek to comply with those standards.

Here’s an example. You have a staff member who hasn’t requested off in advance and calls in to say that “They’re not feeling it today.” They want the night off. Now you know you need at least three servers on your floor, but you figure the other two can “handle it,” and they’ll probably be okay. You want to do right by this one server because they helped out a lot in the past. Now, you’ve undervalued your standard of having three people in your rush. The other two servers feel like that standard doesn’t matter now, and they have to do extra work to cover for this person. All the while, the customer gets lackluster service and is that much less likely to come back to your restaurant. All because of your shortsighted theoretical loyalty to a singular employee.

Hangout dynamic starts slow and builds to erode the fabric of a successful restaurant. The correct answer would have been, “I’m sorry. You’re not feeling great tonight. You’ve got to get a cover. That’s the standard. You got to figure it out. Anything I can do to help you, I will. But we need three people on the floor tonight.” It’s not cold or emotionless; it’s respecting the standard and with a standardized answer. As a result, people appreciate it because that’s the rule. When everyone buys off on the rules and abides by them, they feel secure. That doesn’t occur with fake rules or loose guidance.  When people know the rules will have their back, they respect them. In this case, the other two servers, who now have an incomplete team, may grow demoralized. There are always exceptions that take judgment on your part to determine the call.  When constant exceptions occur, they’re not exceptions at all. Instead, they become your standard, even if you didn’t choose them to be your standard.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @mikeybausch

The post Mike’s Monthly Tip: The Employee Hangout appeared first on Pizza Today.

Nick Bogacz, founder and president of Caliente Pizza & Draft House in Pittsburgh

You’re open, your marketing and branding is working, and your processes and equipment are improved. Things are looking great, but there might be another major bottleneck bogging down operations — and it’s a big one: training.

Training is one of the key elements to a pizzeria’s success. Too often, it goes like this: “Welcome to the store, new guy. Meet Julie; you’re going to train with her. Bye.” And that’s it. The new guy shadows Julie, who might be a great employee, but she’ll probably only be showing him what she believes is important, or the parts that pertain to her specific role. That’s why the owner and managers must be taking the lead when it comes to training.

Step 1: The Tour

Training begins from the moment the new employee is hired, or at least during the onboarding process. I like to start with a store tour on the very day a new employee completes their paperwork, showing everything from where the bathroom is located, to where and how they purchase and eat employee meals, and where the dumpster is located. Within their first 10 minutes, they’ll feel more like a part of the team.

Step 2: The Binder

Afterward, if Julie is going to train, then she should be aware that it’s expected of her — and she should have resources to do so. In our pizzeria, new hires receive two items: a job description sheet, which details every duty they will be asked to perform in their position, and a “training binder,” which includes a checklist going over every procedure they must know to perform those duties and other general tasks. After the new employee studies the documents, the trainer quizzes them on the information and signs off on individual tasks they are confident the trainee has learned. It is crucial you spend time thinking about the most important tasks in the store and develop thorough descriptions for the training binder.

Step 3: S.A.W.

Our in-house training includes a method that we label the S.A.W. approach — Show, Assist, Watch. Take dough-stretching, for example. First, we show the trainee how to stretch the dough, as the trainer explains every step thoroughly as they perform the task. Then, we assist the trainee, performing the task together, taking the pressure off of the new trainee, and allowing us to help them through the process. Finally, the trainer takes a step back and watches as the trainee stretches the dough on their own, all while the trainer offers feedback and advice. This part can take a while, so repeat these steps as many times as necessary until the trainee understands and completes the task in a satisfactory way.

With a training system in place and the bottlenecks cleared up, are you still waiting and waiting for the store to turn a tidy profit? Controlling costs is crucial to the success of your new restaurant, so we’ll be digging into that in next month’s column, ensuring that your bank account rises just like your dough!

NICK BOGACZ is the founder and president of Caliente Pizza & Draft House in Pittsburgh.  Instagram: @caliente_pizza

The post Building Blocks: 3 Steps for Restaurant Trainees appeared first on Pizza Today.

The pandemic changed the way operators attract and hire employees

Finding talent has always been a challenge, and the COVID-19 crisis made the task even tougher. Pizzeria owners say the process of attracting, hiring and onboarding workers has changed, and some new procedures will remain in practice in 2021.

According to the U.S. Bureau of Labor Statistics, there were 2.1 million fewer jobs in food services and drinking places in October 2020 than in February 2020. Although there are many laid-off restaurant workers, operators are having trouble filling positions in the current job market.

“It has been extremely difficult hiring team members since the pandemic,” says Kim Bui, director of human resources for Rancho Cordova, California-based Pizza Guys. “Some of the challenges stem from people still hesitant to rejoin the workforce due to the pandemic, people not wanting to work in the restaurant business because they feel it is unstable, and competition from other restaurants that are also hiring.”

To find talent, Pizza Guys has turned to Facebook, Instagram, Nextdoor and Indeed. The brand also posts hiring messages on its digital menus and on its website. “In the past, we barely posted hiring ads on social media,” Bui says. “Now, they are one of the main sources we use to let candidates know we are hiring.” There are also box toppers, and current team members can earn bonuses for referring friends and family.

Others say the pool of applicants is expanding. “Prior to the pandemic, Austin was a very competitive restaurant market when it came to hiring, with lots of new restaurant development leading to an incredibly tight labor market,” says Steven Dilley, owner and founder of the two-location Bufalina in Austin, Texas. “That has changed, at least temporarily.”

Bufalina is finding applicants through word of mouth, recommendations of current employees, and by checking their email inbox. “We’ve received more unsolicited resumes in the past couple months than we usually receive in a year,” Dilley says.

Virtual Interviews

Employers are also relying on digital communications for interviews. Cincinnati-based Dewey’s Pizza is meeting applicants via phone calls and video chats. “We always put a premium on meeting someone face to face for that interaction,” says Joe Schlotman, director of organizational development. “But now there is also this recognition of safety and respecting space.”

Video meetings enable Dewey’s Pizza to connect with an applicant sooner than in-person, and allow management to experience the candidate’s tone of voice, body language and eye contact. The next round of interviews takes place at one of the restaurants. “There are less people in the building but there is always a manager and a team member,” Schlotman says. By having a team member participate in the assessment, the worker plays a role in hiring a coworker, and feels accountable during training. Also, it helps free up managers to handle COVID-19 related operational changes.

Zoom interviews are an option at Pizza Guys too. “Although it may not be as personable as an in-person interview, the candidate feels safer and more comfortable having the option to interview virtually,” Bui says

Showing Up

Joe Sitzmann, owner and president of P’s Pizza House, says he relies on social media to recruit workers, but some applicants fail to show up for the interview. Others are hired but do not come in for their first day on the job. “It’s almost comical,” says Sitzmann, whose two locations of P’s Pizza House are in Le Mars, Iowa and Dakota Dunes, South Dakota. “It doesn’t seem to be an exclusive issue. I talked to others in hospitality.” One theory is that laid off workers who are collecting unemployment benefits are applying for restaurant jobs merely to satisfy the requirement that they continue to seek employment.

Another factor that makes this job market challenging is that as states have limited capacity, or as customers in general have decided not to dine out, his staffing levels have varied. “I can say we are fully staffed, because we have less revenue,” Sitzmann says.

Chris Ernest, director of operations for Nina & Rafi in Atlanta, has also seen people fail to appear for interviews. “For every 10 interviews you have two people that show up,” he says. “You talk to them, communicate, set up an appointment time and they don’t show. Are they finding a better opportunity? That’s what we need to look at.”

New Ways to Train

Onboarding has also changed. Ernest says with the pandemic, keeping the restaurant clean and safe has become a large part of ongoing training. “We talk about sanitation every day,” he says. “We talk about wearing gloves, wearing a mask that covers the nose and mouth. It’s just a constant reminder, and we’re doing it numerous times throughout the day.”

The job descriptions have changed too. As more orders shift to takeout or delivery, Nina and Rafi added staff for Thursdays, Fridays and Saturdays. “We have someone triple checking orders because 25 percent of orders are for takeout and delivery,” Ernest says.

The pandemic forced Dewey’s Pizza to streamline its onboarding process. Before, a manager and trainee would sit at a table and go through the curriculum with a high level of detail. Today the meetings are shorter, and the training materials have fewer pages. “We leaned into what is the result and what is the behavior that leads to the result,” Schlotman says. “You can do that at a safe distance.”

The future

The video calls, team members participating in assessments, and streamlined onboarding will probably continue post pandemic. “We’re getting to speak to more interested applicants and we’re getting to them quickly,” Schlotman says. “Those are solid adds.”

Pizza Guys will continue to conduct virtual interviews post pandemic. “In addition to virtual interviews, onboarding will be electronic post pandemic,” Bui says. “Employers will have to develop a system to allow employees to complete and sign documents electronically, and incorporate some training virtually.” Another difference, Bui says, is the company mentions its safety enhancements and flexible schedules in its messaging, as these are topics that are important to potential team members.

Still, operators cannot predict the larger issue. “Fingers crossed that most of these places can pull through the pandemic,” says Dilley, from Bufalina. “I’d rather operate in the midst of a thriving dining scene than have easier access to new hires.”

Nora Caley is a freelance writer who covers small business, finance and lifestyle topics.

The post Current Job Market and Hiring Process appeared first on Pizza Today.

Acquiring talent has never been more challenging than it is today. Developing solid, dependable employees is currently extremely hard. It’s not too dissimilar to how hard it was to recruit enlisted service members after the Vietnam War. After removing the draft, there weren’t many willing participants who wanted to sign up to enlist. The value proposition was seemingly non-existent, and recruiters were taking anyone they could get.

My dad, Art Bausch, ran into this issue as a Marine Recruiter. Art is a Retired Lieutenant Colonel Marine Corps Officer who fought in Vietnam and changed how recruiting was done. He ran New York Recruiting from 1977-1981. He was in charge of multiple sites, including the Times Square recruiting station. Side note: He’s the reason it’s still there today. It’s the building in the center of Times Square with the neon American Flag on the side of it. The city wanted to take it back from the military, and my dad, along with Mayor Ed Koch, agreed it was a symbol that should remain in the heart of NY. This is where my dad would bring potential recruits to.

The marketing tagline “The Few and the Proud” was born from Art’s overhaul approach to Marine Corps recruiting. Instead of trying to get as many people to enlist, he sought to get the best people who could graduate. He changed the success metric from how many bodies were recruited to how many Marines successfully graduated boot camp.

To do this, he went after high-minded kids who were looking for direction. Art wanted people who wanted something more out of life. He asked them goal-oriented questions about what they wanted to achieve. The right answers were to go to college, gain skills or prove their worth to their family. When a potential recruit said these things, Art showed how the Marine Corps would help on this path and provide them direction. Applying this mindset to acquiring talent relates a lot to our current situation of hiring. Applicants need to feel and know that working for you is the righteous path in their journey, not just a pit stop along the way.

That’s not easy to convey. It’s never been quicker for an applicant to apply to multiple restaurants with little to no thought. Now anyone can go online and apply as many times as they want to as many restaurants as possible in minutes.

So how do you stand out and get great talent? First and foremost, don’t beg for talent. Show off how your restaurant brings business skills and a sense of purpose in your description. Go after staff that is high minded, and make them feel like absolute gold, so they get their other like-minded friends to come work for you as well. Incentivize them with bonuses for staff members that last more than three months that they recruit themselves. Give graduating staff members a swag bag upon completion of training. Also give a Golden Ticket to eat for free at the restaurant one time with their family. Pour on the warm and fuzzy feeling of completing your training. Make your training all-encompassing so that it takes effort. Make it so that completion means they accomplished something.

Make your interview process an exclusive call to action rather than a desperate cry for help. Don’t write, “now hiring” or “help wanted” ever. Instead, “Now accepting applications” or “We’re in need of more great people because we’re in demand.” The application and interview process must convey this is a team environment that pushes everyone. An environment that authentically makes real food, if you are into that, we have the home for you. Also, follow up on the promise.

These calls to actions elicit a response from your ideal candidate. A few ideal candidates is preferable to many failed candidates. “The few and the proud” isn’t the type of perfect tagline that comes along every day, but it is what you want them to be. You want your staff to be proud of where they work. You want the best, so go after the best, and make the best feel like gold. Do this, and you will attain a staff you can be proud of.

MIKE BAUSCH is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.  Instagram: @andopizza

The post Mike’s Monthly Tip: The Few and the Proud Employees appeared first on Pizza Today.

Keep Your Core Values Intact if You Expect to Thrive

What do you stand for? What are your values? Moreover, what are your core values? If you and your leadership team were to write it all on the board, every single character trait that mattered most, what would they be?

Now, go and do just that. Then identify and condense it down, because many of them will be akin. Then create your five main character traits of a successful employee in your company.

For Andolini’s, ours are:

Passionate, Ethical, Competitive,
Effective and Fun.

Mike Bausch, owner, Andolini’s Pizzeria

Passionate is number one, because if they don’t care about everything in an over the top way … nothing else matters. Fun matters because people want to work in and around fun people; it builds morale and stems attrition. Effective is a mandate, because it doesn’t matter how nice a person is if they don’t get results. Competitive matters, too — I want them to strive to be better and to go after the best possible pizzeria experience every time.

There are two traits that are non-negotiable for me: my leaders simply must have them. In short, they must be ethical and passionate. I cannot tolerate anything short of a passionate employee, and my business can’t survive an unethical employee. Ethical leaders make sure our restaurant’s integrity stays intact (as well as our bottom line being secure from theft). For anyone to advance in my company, they must have all five of these traits. They also have to be willing and able. I don’t take that for granted; if someone has all these qualities, but they don’t want it at this stage in their life or are not prepared for it, it won’t work. If they aren’t willing and able, and I force this role upon them, it fails. I can’t hope someone becomes competitive or hope they’re fun, they have to be that already.

If your leaders don’t meet these criteria, what you get is known as Warm Body Syndrome. WBS is when you have a babysitter at your restaurant, not involved any more than they need be, who is punching their ticket daily.  Managers and leaders like this make sure nothing goes horribly wrong, but they also completely kill your morale. At the same time, they don’t ensure anything goes incredibly right.

I’ve suffered warm body syndrome employees in the past. It’s excruciating when you want something for someone that they don’t want for themself. Bypass this by establishing what your values are and executing on them. Bear in mind, your restaurant is different than mine, and your values are most likely different than mine, and that’s ok. Do your own thing.

If a sense of urgency is king at your store, make that a core value. No matter what five you choose, what’s not debatable is a leadership team that is willing and able to take them on. They must be capable and willing to execute on these values at all times. If not, you’re spinning your wheels, hoping someone who’s a zebra becomes a giraffe. From experience, I’m letting you down gently here when I say it’s not going to happen. If they are motivated for each value, they can improve. But if they do not possess that character trait, you can’t force it.

What will occur if you do force it is they’ll be unhappy in their job, and you’ll be unhappy in their work performance. They will become zombified workers dominating your front lines. Do not allow WBS anywhere near your management team. Talk with your staff in quarterly performance evaluations about the things they’re doing that match your core values. Then delve into the things they’re doing that could be better. By setting clear expectations, you avoid Warm Body Syndrome. Additionally, employees learn what traits matter to grow in your culture enough to get ahead. This is how growth occurs for them and your restaurant.

This exercise is not corporate fluff; this is as simple as deciding who you are and informing your staff officially, with clarity, what you stand for. Call it traits, values, pillars; it’s all the same. Doing this will save you time, money and heartache, and it’s not that hard.

The post Mike’s Monthly Tip: Avoid Warm Body Syndrome appeared first on Pizza Today.

Getting off track when it comes to paying employees can lead to a downshift in profits, which no one wants, especially during shifting times. “Every dollar counts right now,” says Michele DiMeo, founder and CEO of Squisito Pizza & Pasta, a fast-casual Italian franchise with 10 locations in Maryland and Virginia.

Fortunately, the flipside is true: a streamlined system can reduce payroll costs and lead to higher profit margins. Use these guidelines as a checklist to see where improvements could be made to maximize every resource.

Start with the Basics

Consistency is key when it comes to an efficient payment system. “Set a payroll cycle and stick to it,” says Charlette Beasley, a careers and workplace analyst at FitSmallBusiness.com. If you decide every Friday will be payday, or if you establish that checks will be sent every two weeks, staff members will know when to expect their wages. “If you’re working with a payroll provider, take note of the direct deposit processing time so no one receives their money late,” Beasley adds. “Some providers require a four-day lead time, which means you have to process payroll at least four days before you want your employees to receive the funds.”

If you have drivers, make sure a policy is in place for filling up with gas. “The simplest route would be to have a company credit card they can use when they need to refill,” Beasley says. If you ask drivers to cover the cost of gas themselves and then reimburse them, you’ll want a system that allows them to submit the number of miles they drive each shift. “This will enable you to do a reasonableness check to ensure the mileage was spent on business trips versus personal,” Beasley says.

For tip-earning employees, check that it’s easy for them to report their tips for every shift. You might print of copies of the IRS Daily Tip Reporting Form and ask staff members to fill one out every day. If your system makes it possible to enter tips electronically, set reminders for workers to report tips when their shift ends.

Keep Track of Time

Without a time clock in place, “on average, 10 percent of wages are wasted,” says Charles Read, president and CEO of GetPayroll in Lewisville, Texas. This means if you ask staff members to simply write down on a card the time they come in and when they leave, you’ll likely spend 110 percent of what you should be paying for their hourly wages.

To correctly align wages with the number of hours worked, consider technology that helps record time. “A biometric clock prevents buddy punching,” Read says. This type of clock scans an employee to check for unique physical characteristics, such as their fingerprint, to verify the worker’s identity.

If your payroll system allows employees to swipe a card to check in and out electronically, you’ll still want to manually review their working times. You might find, for instance, that a worker forgot to swipe their card at the end of the shift, making it appear they worked for an extraordinarily long shift, like 24 hours.

Ensure Legal Compliances

If you manually calculate employee paychecks and the amount of taxes due, check that you’re using the most up-to-date tax tables. “The IRS tax rates can change on an annual basis,” Beasley says.

For places with more than a handful of employees, a payroll system or service can sort out the different federal, state and local tax requirements. “They provide payroll tax support by automating deductions and tax withholdings from employee wages, and remitting the correct amount to the various tax agencies based on the latest payroll tax regulations,” says Mark Dockham, president of Intrepid Payroll, Inc.

Payroll services can also manage annual tax forms. “When tax season rolls around, they create, distribute and file W-2s for employees or 1099s for independent contractors,” Dockham says. “Tax management services might also include 940 and 941 filings, W-2 and W-3 processing, state withholding and unemployment.”

Clearly Communicate Policies

Once you have your payroll system in place, write out the guidelines for employees in a policy manual or handbook. “Every aspect of how you pay your employees should be covered in detail,” Read says. Include information about pay rates, tax requirements, tip policies, overtime, time keeping, pay periods and pay dates, and payment on termination. Also list how employees are paid, such as through checks or a direct deposit.

When you hire staff, ask them to read and sign the manual or handbook. “Having policies for your employees that they have read and acknowledged at the beginning of employment reduces turnover, disagreements, misunderstandings and other unpleasant aspects of dealing with upset workers,” Read says. If you make changes to the way you do payroll, update the manual and ask employees to sign it again. This will allow state and federal labor offices to see you have written contracts with employees that outline your current policies.

Rachel Hartman is a freelance writer who covers small business, finance and lifestyle topics.

The post Payroll 101: Tips to Save and Stay Organized appeared first on Pizza Today.

Regulations vary, so pizzeria owners look to local authorities, friendly competitors and the Internet for best practices

Act quickly, but don’t panic. That’s the advice from pizzeria owners who have had employees test positive for COVID-19. As the number of cases continues to rise nationwide, restaurant operators must figure out what to do if a worker becomes infected with the new coronavirus. Regulations vary, so employers develop protocols based on a combination of local and state laws, guidance from the National Restaurant Association and the Centers for Disease Control and Prevention (CDC) and from each other. To safeguard employees’ and customers’ health, owners said they did more than what was recommended.

Make the call

One night, as State of Mind Public House and Pizzeria in Los Altos, California was nearing closing time, chef and co-owner Lars Smith got a call from an employee who, four days after working a shift, felt sick with COVID-19 symptoms. Smith told the employee to get tested, then called the Santa Clara County 24-hour COVID-19 hotline for advice. “I am an advocate of deferring to experts,” he says.

The county, which also has information on its website, recommends having the employee self-isolate for 10 days from the date symptoms began, and three days with no fever and improved respiratory symptoms. Also, the county recommends the restaurant close for 48 hours to deep clean and sanitize.

Stay closed until it’s safe

Smith let employees know what was going on, then posted information on social media the next morning. Lars, his brother and business partner Andrew, and other owners and family members cleaned the place, and also had their regular cleaning company sanitize. They decided not to reopen for 11 days. “We chose to close to get everyone tested, which is not required,” Smith says. “We thought it was the responsible thing to do.”

Smith provided employees with information on where to get free testing. When the sick employee tested positive, Smith had to figure out, per the county’s recommendations, how many days coworkers had to stay isolated. The county recommends the employer determine which people were in close contact, defined as within six feet for more than 15 minutes – in this case, everyone in the kitchen – and tell them to self-isolate for 14 days. “There was some complicated math,” Smith says. Not all employees could return when State of Mind Public House and Pizzeria reopened, so Lars worked in the kitchen.

The temporary closure was financially cumbersome, Smith says, because the owners paid employees for those days. When they reopened, customers came back, and they also posted on social media. “Most of the comments we got was, ‘Thank you so much for being honest and transparent,’” he says.

Be Transparent

Social media plays a big role in how pizzeria owners keep customers informed about an employee testing positive. “If you don’t tell your customers, and your employees tell them through a social media post, how would that look?” says Sammy Mandell, owner of the two-location Greenville Avenue Pizza Company in Dallas. “It’s better for you to deliver the communication to your customers than it is for an employee to do it.”

When a GAPCo employee called and said she was feeling sick with COVID-19 symptoms, Mandell told her to get a COVID-19 test. The test was positive, and Mandell alerted customers. “We informed our guests through social media,” he says. “We said, ‘We had an employee get COVID, we are doing everything we can, and we listed out everything we were already doing.”

The responses were all positive, he says, and people posted that they hoped the employee recovered (she did) and promised to return when the business reopened. “It was nothing but positivity,” he says.

Do More 

Mandell paid for all other employees to get tests. GAPCo also takes employees’ temperatures, requires them to call in if they feel sick, and spent $12,000 on Plexiglas barriers. The two locations closed for 24 hours, because the employee worked in both places a few days prior to having symptoms.

Before this happened, Mandell had a cleaning company use a sanitizing spray weekly at GAPCo’s two locations. While that added costs to an already growing list of expenditures, there was an additional benefit. “They give you a certificate you can put at the front of the business that informs customers,” Mandell says. “It tells them we do a weekly COVID-19 sanitizing spray.”

Closing the two restaurants and paying for everyone’s tests was expensive, but necessary for customer and employee relations. “Looking back on it I’m happy that we were able to give everybody peace of mind,” he says.

Be proactive

Blue Highway, a pizzeria, has two locations in the Gainesville, Florida area. When an employee exhibited COVID symptoms, co-owner Layla Ruffino told the employee to go to the hospital and get tested. “While we waited, I decided to be proactive and have everyone get tested,” she says. In a strange twist, the person who was sick tested negative, and another employee, who had no symptoms, tested positive.

With this new information, Ruffino decided to close for 24 hours to do a deep clean. She informed her team, and also let customers know by e-mailing them and also posting the information on Facebook. The response from customers was positive. “We had more shares and comments than anything we’ve done before,” she says.

Check in the with team and with other restaurants

Ruffino ended up keeping the two locations closed for one week, because team members let her know they weren’t comfortable coming back to work until all employee tests were negative. “Their safety and sense of security is most important,” she says.

She and some employees did a deep clean, and also donated food that they weren’t able to use while Blue Highway, a pizzeria was closed. Ruffino also did an online search for other restaurants that had employees who tested positive, and reached out to them for advice. “They were a wealth of knowledge,” she says.

For more information

The National Restaurant Association https://restaurant.org/articles/news/your-employee-is-positive-for-covid-19-now-what and the Centers for Disease Control and Prevention (CDC) https://www.cdc.gov/coronavirus/2019-ncov/community/organizations/business-employers/bars-restaurants.html#anchor_1589927210111 provide guidance on preparing for sick employees.

In addition, there are state and local laws regarding whether operators must notify these entities when an employee tests positive for COVID-19, and guidelines.

Nora Caley is a freelance writer who covers small business, finance and lifestyle topics.

The post When Employees Test Positive for COVID-19 appeared first on Pizza Today.

Best practices for creating, and then adapting worker guidelines

During this time, it is going to take strong leadership and partners to work with staff, as wearing gloves and masks all day and working behind glass is very different than what their previous normal looked like,” says Michele DiMeo, founder and CEO of Squisito Pizza & Pasta, a fast casual Italian franchise with 10 locations throughout Maryland and Virginia. The restaurant chain paused dining room seating during COVID-19 but continued with carryout and delivery services until in-dining options reopened.

With all the changes, especially surrounding health and safety protocols, keeping staff up to date on guidelines isn’t as simple as writing up a new list of rules. “Just forwarding the operational guide is not really going to be effective, as we need to create a new normal,” DiMeo says. “We need to make sure we are keeping staff as well as our guests healthy.”

And while setting up and implementing worker safety protocol is essential, the changing environment means that guidelines might fluctuate from week to week or month to month. To be prepared to adjust, staff at Mr. Moto Pizza in San Diego monitored the news daily as COVID-19 first broke out. “By the time it hit California, we were monitoring almost by the hour,” says Jorge Moreno, the head of Mr. Moto Pizza Marketing. The careful attention helped the restaurant get ready to shift to the different government-directed requirements. “Once the guidelines were set, we were able to adapt,” Moreno says.

As COVID-19 continues to impact regions and industries, there are several ways to make sure employees follow the latest guidelines. In addition, steps can be taken to make sure that everyone in the restaurant, from employees to the customers, feel comfortable. Follow these best practices to keep staff and customers safe and well in today’s shifting world.

Provide Timely Updates

Rewriting an employee handbook every two weeks to reflect the latest guidelines isn’t usually a practical strategy. Instead, consider creating a supplemental memo listing the most recent COVID-required procedures. Incorporate input from the CDC along with local ordinances. “With any type of policy or manual, it’s always important to distribute it and have a receipt to show it was received,” says Scott M. Behren, Esq., an attorney and owner of Behren Law Firm, which focuses on commercial litigation and employment law, in Weston, Florida.

These quick add-ons could address key issues such as how shifts might change, especially if you have a prep crew come in during morning hours and a service crew inhouse during the afternoon and evening hours. The memos could also outline mask, face shield and glove requirements. Be sure to note if the PPE listed will be provided by the restaurant or if employees will need to get it themselves. For situations in which workers will provide their own PPE, lay out guidelines for the equipment.

“We keep introducing weekly updates, trying to stay on top of the ever-changing environment,” DiMeo says. “From temperatures and health checks to daily logs, adding plexiglass shields at every counter, and soon-to-be new POS temperature check clock-ins, we are doing everything that we can to stay on top of keeping staff, as well as guests, healthy.”

Take Steps for Accountability

It can be helpful to talk to staff to make sure they understand both the “what” and “why” surrounding new guidelines. Holding a quick meeting or checking in with staff on an individual basis can allow you to gauge their reactions. When staff at Mr. Moto Pizza had to adapt quickly, “everyone was onboard and prepared for the ride,” Moreno says.

Besides listing what needs to be done, it can be effective to include what measures will be taken if employees don’t comply with the new rules. When updating employee guidelines, “put in repercussions,” Behren says. For instance, if staff members are required to wear a face mask, list the consequences that will occur if an employee doesn’t wear one.

Giving managers and supervising staff members tools to monitor the new guidelines can help ensure follow through. “We have daily logs for them to complete, which include temperature checks when employees come into the stores for work, including after their breaks, as circumstances could change throughout the day,” DiMeo says.

Don’t Change Customer Service Policies

Just as customers will notice changes like gloved hands or covered mouths, they will also pay attention to how they are treated. “My philosophy is that you want to provide the same level of service that you would in every environment,” says Michael Liebowitz, owner of NoNo’s Pizzeria & Bar by Frankie in Miami Beach. “You want everyone to be happy.”

The restaurant, which started with just takeout and delivery, opened in June 2020. From day one, staff members were trained to wear PPE, wash hands throughout their shift, and consistently wipes down surfaces. And while employees need to follow safety measures, customers are welcome to ask for flexibility when it comes to the menu. “Not everyone’s taste is the same,” Liebowitz says. If a customer asks for a pizza with more cheese or a thinner crust, employees oblige the request. “We’ll do it however someone wants it,” Liebowitz adds.

Even if the atmosphere looks different, customers are likely to appreciate the extra steps taken to promote safety. And the health measures can even help take customer service to another level by forging bonds in the community. “Our relationship with our customers is of utmost importance,” Moreno says. “We’ve been supporting our neighborhood schools and running weekly giveaways on our social media pages, and it is great seeing how they are supporting Mr. Moto through these difficult times.”

Ensuring top-notch health and safety for both employees and customers can help set your restaurant apart from the rest. Taking steps to reduce the spread of germs and promote cleanliness could even boost your brand, as clients become more health-driven in their choices. “I think it’s a great thing,” Liebowitz says. “A lot of this has been long awaited.”  

Rachel Hartman is a freelance writer who covers small business, finance and lifestyle topics.

The post Employee Handbook Revamped appeared first on Pizza Today.

Experts say safety measures should include more than watching the “Run. Hide. Fight.” video

Pizzeria owners want to build a safe environment for employees and customers. For a restaurant, the challenge is that the establishment is open to the public, so staff members are at risk for anything from hostility from irate customers to people getting into altercations to an active shooter. While the latter scenario is one of low probability, workers need training on emergency planning, threat assessment and response protocol. There are many resources, some of which are free, that can help workers stay safe by being prepared.

“The most common mistake we are seeing of late is employers only planning for how to respond when violence is actually occurring,” says Isaac Monson, senior risk consultant for the Chicago-based insurance brokerage HUB International Limited. “An example of this would be training employees to ‘Run, Hide, Fight’ in an active shooter incident and thinking that means they have a workplace violence plan in place.”

“Run. Hide. Fight.” is a protocol that the U.S. Department of Homeland Security recommends for government employees to protect themselves in an active shooter situation. The phrase comes from a video that the City of Houston posted online a few years ago, to instruct people on what to do if someone enters the premises and is shooting a gun. Over the years private, for-profit companies have developed their own fee-based videos, catchphrases and acronyms related to mass shootings. While many of the tips can be helpful, there are other things employers must have in place to keep workers safe.

Emergency Preparedness

While catastrophic events gain much media attention, other incidents are more likely to occur. According to the U.S. Department of Labor, the four most common perpetrators of workplace violence are robberies and other crimes, actions by frustrated or dissatisfied customers, acts by disgruntled co-workers or former co-workers, and domestic incidents that spill over into the workplace.

All four of these should be covered in any violence prevention and intervention program, Monson says. The program should include how to identify early warning signs of potential violence, and how to respond to threats of violence. “Assessing and managing concerns and threats of violence early and partnering with local law enforcement and/or security professionals can de-escalate situations and lessen the likelihood of violence occurring,” he says.

That means having a plan for certain scenarios, such as how to terminate a problematic employee, how to respond to an employee who mentions that she is scared a violent ex-husband may show up at the restaurant, or how to deal with two conflicting employees. “Awareness, planning and staff training can lessen the likelihood of violence occurring,” Monson says. “But there should still be a plan in place for an emergency response if an act of violence does occur.”

Threat Assessment

Unlike offices or manufacturing facilities, restaurants cannot close their doors to the public to keep employees safe. “That’s the reason they are hit much harder by this issue,” says John Dony, director, Campbell Institute at the Itasca, Illinois-based National Safety Council.

Being proactive or looking at factors that Dony says are upstream of the incident, can help. Employees can take de-escalation training to learn how to diffuse a potentially dangerous situation by using verbal skills and nonphysical tactics. There is also mental health first aid training, which covers listening, assessing and interventions. “We look at it as a systemic sort of spectrum, how you manage this risk,” he says. “The biggest factor is lower levels of violence, bullying and altercations, not guns and knives.”

The NSC and other organizations offer onsite and online training, and there are also various free online videos and other resources from insurance companies and others. “As with any training, doing something is better than nothing,” Dony says.

Response Protocol

The NSC has an initiative, Work to Zero, and released a report, Safety Technology 2020: Mapping Technology Solutions for Reducing Serious Injuries and Fatalities in the Workplace. The report made recommendations for certain technologies that could help keep workers safe, such as video cameras, wearable or app-based panic buttons, and mobile apps that utilize the location tracking and communication functionality of workers’ phones, so responders know where the worker is located.

Businesses often have low-tech response protocols, including a plan for what to do during and after an incident. The plan should have details such as where to meet in the event of an evacuation. Employers must make sure workers get medical attention and mental health services and must contact their workers’ compensation insurance provider to find out about medical bills, days off and other issues.

Insurance

In restaurants, the top three ways workers get injured are cuts, falls and strains, says Michael Hayden, safety services supervisor for Pinnacol Assurance, the largest workers’ compensation company in Colorado. “Four would be ‘struck by,’ and that’s where we would classify violence,” he says. The source could be a falling object, or a fellow worker.

One factor that can help prevent an incident is to have clear policies and practices around hiring, which includes conducting background checks, checking references, and continuing the job search if the applicant has constant job hopping or other red flags. “Don’t bring on the person because you’re desperate,” says Todd Faubion, chief security and fraud prevention officer for Pinnacol. “When we are coaching on hiring, there are things we want to be mindful of, such as a person’s ability to tolerate frustration. We want employees who have elasticity and a mindset that when things don’t go their way they don’t turn to violence.”

Domestic violence is an important factor to be aware of with employees. An abusive spouse or former intimate partner often does not know where the estranged person lives, but they know where they work, so they might look for the victim there. “Encourage employees to report this to management so at least we know something is on the radar if the person comes in, and how to interact with that spouse and what to do,” Faubion says.

Keeping employees safe from violence is as important as teaching knife skills or food safety and should not be overlooked in the busy day-to-day. “The mistake is to take it lightly,” Hayden says. “Set up a formal program, and make sure it’s documented.”

Nora Caley is a freelance writer who covers small business, finance and lifestyle topics.

The post Protecting Employees Against Workplace Violence appeared first on Pizza Today.

Above: Trips to Pizza and Pasta Northeast or Pizza Expo have turned into great rewards for team members at Caliente Pizza & Draft House in Pittsburgh, Pennsylvania.

Reward Staff in a Practical, Productive Way

It may seem more common to hear about customer loyalty programs but providing incentives for servers and kitchen staff can be just as important—if not more so. Among employees who leave their jobs, 79 percent say a lack of appreciation was a key reason for leaving, per research by O.C. Tanner, a global employee recognition firm. In addition to retaining workers, rewarding performance can help build strong teams, lift a restaurant’s reputation, and drive up sales.

Putting a rewards system in place isn’t usually a task that can be carried out quickly. You’ll want to first consider what your goals are, along with the priorities staff tend to have. Follow these ideas for concepts that can be incorporated into your eatery and could lead to big returns for everyone.

“I have a tri-annual bonus that I give staff, if certain goals are met,” says Nick Herntier, CEO of Pizza Man in Shakopee, Minnesota. The goals for Herntier’s establishment typically are set around sales, and often involve increasing the level of sales for a current period compared to the level of sales during the same time frame the prior year. A goal might be: “Beat 2019’s January to April sales during the 2020 January to April period.” The amount of the bonus is determined by calculating how much sales improved from previous time frame to the current one.

Once the time period is complete, to distribute the bonus, Herntier takes the number of hours that each employee worked and adds them together to find the total number of hours worked. He then divides the number of hours each staff member worked by the total number of hours worked to determine the percentage of hours each person worked. “That’s roughly their share of the bonus,” he says.

The strategy has led to benefits in both sales and customer service. “It definitely helps people remember to upsell items, and even be nice to the customer,” Herntier says. “I train them this way to look toward the future of the customer. If they make the customer happy, they’ll come back, making their bonus even easier to get.”

Herntier makes the bonus available only to employees who have worked the entire sales period. If the sales period runs from May to August, employees who have worked during that time period are eligible; others are not. This setup helps with retention, Herntier notes. Employees also value the extra rewards. “For most part-time employees, it’s almost like an extra free paycheck,” he says.

In restaurants and other food services, millennials make up 49 percent of the workforce, according to a 2019 Business Insider report. If your staff consists of mostly millennials or younger workers, you’ll want a rewards program that resonates with this demographic. To connect and improve overall performance among millennials, link any awards system to your core values, says Jim Schroeder, a marketing manager at Online Rewards, an incentives and loyalty marketing company. “This reinforces positive behavior in your employees.” If one of your core values is to be eco-minded, you might align rewards with a reduction in waste or new ideas to recycle and reuse from staff members.

To help motivate millennials, consider personalizing the rewards given. Rather than giving out a predetermined prize to an employee, let the individual choose. For instance, you might give each server a sheet that looks like a bingo card. On each space, list a menu item. When a server sells a dish listed in a box, the item can be crossed out. Once all spaces are crossed out, the server could choose a prize from a collection of options. You might keep some merchandise, water bottles or gift cards to retailers in a certain spot in the back where employees can see them. This visual aid could also help encourage servers to strive toward their goal.

Millennials are accustomed to quick solutions. With that in mind, a program that is designed to spotlight accomplishments soon after they occur might work well in a pizzeria abuzz with millennial workers. If you have a goal tied to an event, such as selling a certain number of pies during a holiday weekend, you might offer a reward to employees if the team is able to surpass that goal. Then if the goal is exceeded, you can hand out prizes at an employee meeting the following week or hold an employee party in the restaurant during the next days.   

If you want to encourage staff to follow food safety guidelines or other safety procedures, a program built around your needs can increase awareness and involvement. Start by outlining what safety goals you have for the place. “Make sure the overall structure of your program is designed with those goals clearly in mind,” Schroeder advises.

You might first hold a meeting to outline cleaning guidelines, hygiene rules and ways to handle food properly. Then try adding a little competition to reinforce the principles. “Gamified quizzes and contests can be great ways to educate your employees on important safety practices in a fun and engaging manner,” Schroeder says. Employees could fill out a questionnaire on safety after studying the guidelines you have established for the restaurant. Those who score well on the test might get a coupon for a free meal at the restaurant with a guest or a complimentary slice of pizza and beverage.

Long-term employees are often highly committed to the place and its offerings. To reward high-performing staffers that have been with you for a significant period, think about naming a menu item after them, such as Eric’s Signature Margherita or Patricia’s Favorite Calzone. “Chances are, your employees will brag about it on social media, bringing in their friends and family,” says William Taylor, career development manager at VelvetJobs.

If your place is looking to add new dishes, challenge your kitchen staff to come up with their own unique twists on your classic items. Have employees sample and rate them. “Reward the best-tasting items by putting their namesake creation on the menu,” Taylor says.

Rachel Hartman is a freelance writer who covers small business, finance and lifestyle topics.

The post Rewarding Staff: Above and Beyond appeared first on Pizza Today.

A look at the leadership role in the new decade

Jeremy Galvin acknowledges this isn’t the pizzeria business he entered more than two
decades ago, particularly as it relates to the role of manager.

While the foundational basics of the manager’s post — overseeing customer service, scheduling and inventory management among them — remain central to the position, Galvin, president of the 11-unit Master Pizza chain in Ohio, says critical thinking, sound decision making and the soft skills have
become increasingly critical as competition mounts and labor challenges intensify.

“You can’t just go to work and crank up the oven like it used to be,” says Galvin, who helped develop the Romeo’s Pizza chain in Ohio before joining Master Pizza in 2015. “So much more is expected and needed of managers in today’s day and age.”

The pizzeria manager in 2020 …

… embraces servant leadership.

A 37-year veteran of the pizzeria trade, having begun his run with Chicago-based Lou Malnati’s Pizzeria as a 15-year-old before ascending the company’s ranks, Jim D’Angelo says today’s best managers recognize they’re in the people business, not necessarily the pizza business. And as such, they have it in their heart to serve others, customers and staff alike.

“We’re in the people business — always have been and always will be — and that’s why managers who have hospitality in their blood are always going to win,” says D’Angelo, now chief operating officer for the 60-unit Lou Malnati’s chain.

… values staff members.

Rory Brown, hospitality and service manager instructor at the Culinary Institute of America in Hyde Park, New York, reminds that, despite some cutting-edge technological innovations, restaurants still need to rely on people to complete most tasks.

“You wouldn’t buy the cheapest oven and pay no attention to maintaining it with the plan of just getting another one when it breaks down,” Brown says. “We need to look at people the same way – as valued capital, not a resource.”

… has a personality conducive to leading others.

Both Galvin and D’Angelo say the technical skills necessary to manage a pizzeria — scheduling, purchasing goods and seating a dining room among them — can be taught. What’s challenging to teach and arguably much more important: a positive attitude that inspires others.

“I look for attitude because that’s contagious,” Galvin says, adding that Master Pizza’s latest training program for managers focuses solely on interpersonal skills and leadership. “If the manager doesn’t have a positive attitude in hand, it’s a tough climb.”

… is empathetic.

With five generations now in the workforce, Brown says empathetic managers who try to understand their employees and “walk in their shoes” are better positioned for progress and to cultivate deeper employee engagement.

“As a manager, you need to land your message, but it shouldn’t feel like a punch in the gut,” Brown says. “Understanding your employees and where they come from will inform and direct conversations that need to happen and help everyone see a path forward.”

… is present and engaged with team members.

Lou Malnati’s favors a “side-by-side management style” and actively seeks hands-on managers who can support staff across the establishment, D’Angelo says. The company’s best managers work with their team members to coordinate front and back of the house and understand what’s going on in the kitchen as well as with servers.

“Staff want to be joined and know you’re in it with them,” D’Angelo says, adding that managers must nevertheless avoid getting caught in the weeds and understand how to “get in and get out” when supporting staff.

… is aware.

Galvin calls “self-awareness” imperative in today’s managers, who must be willing to evaluate themselves and find responsibility. Absent self-awareness, he notes, managers risk playing the blame game. At the same time, managers must be aware of others’ strengths and weaknesses, which will help them avoid the “assistant manager syndrome” – Galvin’s term for those who struggle to recognize their own shortcomings as well as others’ positive attributes.

“You can’t get the best out of someone unless you are paying attention to what they’re good at,” Galvin charges.

And D’Angelo adds that awareness is even more critical given the
accelerating pace of change. Managers must be adaptable, flexible and willing to grow, all of which starts with awareness.

“You can’t have the if-it’s-not-broke-then-don’t-fix-it mentality,” D’Angelo says. “That just doesn’t fly today.”

… manages etiquette.

While pizza shops have historically been casual environments, today’s manager must ensure a professional, civil atmosphere prevails. Galvin says managers, arguably the most critical staff member in the restaurant, must exercise etiquette and sound decision making that promotes a respectful workplace. Absent this, a store risks negative marketplace banter, disengaged employees eager to leave and, quite possibly, damaging lawsuits.

“Managers must be careful about what they say and do,” Galvin says. “They can’t cross lines with employees and must understand the rules around fraternization and relationships.”

… pursues quality.

As customers have more choices than ever and competition for the consumer’s dollar has intensified alongside expectations for speed, convenience and value, pizzerias must be on their game every day. That reality demands managers who can inspire front and back of the house staff to take pride in what they do. It requires a restaurant leader who strikes a balance between motivating staff and holding them accountable.

“The restaurant business is unforgiving, so managers have to be consistently focused on top-notch quality of product and service,” D’Angelo says.

… thinks critically and creatively.

The sheer volume of paperwork, laws and data has pushed the manager into the back office more often. Managers capable of thinking critically and creatively, however, won’t let those administrative responsibilities overwhelm them. By leveraging technology like scheduling or purchasing software, managers can more quickly address administrative duties and focus on the critical thinking and creative tasks that can drive restaurant performance.

“Maybe it’s understanding customer buying patterns or creating new revenue sources or marketing opportunities, but strong managers are going to have to bring creative thought to their job more and more,” Brown contends.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post The Pizzeria Manager of 2020 appeared first on Pizza Today.

Workers’ compensation insurance protects operators and employees

Even the most careful and skilled workers can injure themselves through cuts, burns and falls. Accidents happen, and the good news for employers and employees is that workers’ compensation insurance provides employees with wage replacement and pays medical expenses. Workers’ comp is a no-fault insurance, which means if an employee is injured in the line of work, the claims are paid regardless of who is at fault, and the employee is not allowed to sue the employer.

Most businesses are required to have workers’ compensation insurance. The premiums are based on the number of employees, the type of industry according to the National Council on Compensation Insurance (NCCI) code, and the experience modifier, which refers to the claim history the company has established. Operators can save money and protect employees, by focusing on safety.

“The majority of business owners don’t realize they can control their insurance costs by implementing safety measures,” says Ed Fitzgerl, general manager franchise insurance for Overland Park, Kansas-based Intrepid Direct. “A good quality safety program with the owner’s buy-in will typically result in a safer work environment and will reduce the number of claims. The workers’ compensation premium is essentially a function of your claims experience.”

The most common workplace injuries in pizzerias are burns from pizza ovens and from hot accessories. “A hot pan sits around and a worker might not know it’s still hot and picks it up,” says Jacci Zach, AIC , claim manager with Intrepid Direct. Delivery is another area where workers can get injured, especially among pizzerias, which tend to hire their own drivers.

According to the U.S. Bureau of Labor Statistics data on illnesses or injuries resulting in time away from work, job restriction, or transfer, in 2017 Food Services and Drinking Places had three cases per 100 full-time workers, compared to 2.8 cases per 100 workers among private industry employers overall.

Workers’ compensation insurance is regulated by each state, and the U.S. Department of Labor Web site has links to each state’s division, commission, department or other entity. Each state has different rules, such as how many employees the employer hires before they are required to obtain and maintain workers’ compensation insurance. For example, in California businesses with one employee or more must buy workers’ compensation insurance. In Florida, the number depends on whether it’s a construction business (one employee) or non-construction (four).

There are other details that vary. “Different states can value the cost of an injury differently,” Zach says. “What a worker receives for a broken arm in one state is different from other states.”

In some states, employers with drug-free workplace programs may qualify for a discount on workers’ compensation insurance premiums. Some states have legalized marijuana over the past few years, which complicates efforts to have drug-free workplaces. “There are some employers that do not want to do drug testing pre-employment because they are not getting enough employees,” says Bob Robenalt, a partner in the Columbus, Ohio office of the law firm Fisher Phillips, LLP. “We have employers who are testing for other substances, not marijuana.”

Still, Robenalt says, employers should have drug-free workplace policies in place, especially if the establishment has delivery drivers. If a worker gets into an accident, the employer may order a post-accident drug test. In 2018 the Occupational Safety and Health Administration (OSHA) issued a memorandum clarifying its position on Workplace Safety Incentive Programs and Post-Incident Drug Testing, noting that an employer that implements safety programs and conducts post-accident drug testing would only violate the law “if the employer took the action to penalize an employee for reporting a work-related injury or illness rather than for the legitimate purpose of promoting workplace safety and health.”

Making safety a core value is important. “Providing a safe workplace is the goal of any restaurant owner,” says Wayne Hilston, vice president of sales, programs and payroll alliances for the insurance company EMPLOYERS. “Developing a strong safety culture with training and procedures that support that is where it really begins.”

Hilston says operators should address workplace safety the same way they address food safety. “Incorporate safety best practices into their operations so they become routine, as opposed to an add-on,” he says. “For example, train employees how to prep ingredients safely. Explain why it’s important to have clean and grease-free floors. If the language of safety is incorporated into daily operations, employees will understand it’s a priority for the business, and will, therefore, focus on it more often.”

Hilston recommends operators work closely with their workers’ compensation carrier to develop best practices. When an injury occurs, the employer should report the claim right away. “One of the ways to minimize the ultimate cost of the claims, and to make sure employees get timely and fair treatment, is to report claims right when they happen,” he says. “Nothing good comes of a claim if it’s reported late, and as it gets older.”

Some operators incentivize safety training by offering gift cards or paid time off to workers who implement specific safety practices. “It’s called the gamification of safety,” says Zach, from Intrepid Direct. Also, it helps to set an example. “If the employee has to wear non-slip shoes, but the owner comes in wearing fancy dress shoes, all of a sudden employees might think non-slip shoes are not a requirement.”

Since delivery driver safety is a big issue with pizzerias, operators should implement safety programs related to driving. Driving while distracted is a big contributor to accidents, and operators should have a policy in place that prohibits drivers from using cell phones while driving. “Operators don’t realize how important it is to have a distracted driver policy,” says Christopher B. Smith, assistant vice president of Workers’ Compensation Specialty Products at the insurance company All Risks Ltd., based in Hunt Valley, Maryland.

One mistake operators make is to not communicate with their carriers. “Make sure you discuss whatever your thoughts are with an insurance agent,” Smith says. “At the end of the day, what you don’t know about insurance can hurt you. It always helps to reach out to experts.”

Nora Caley is a freelance writer who covers small business, finance and lifestyle topics.

The post Don’t Get Burned appeared first on Pizza Today.

The Baby Boomer Workforce

“I’ve been shocked by how many skills have crossed from my former to current profession,” says Richard Williams, founder and owner of Luna Pizza Café in Greenville, North Carolina. Prior to being a restaurant owner, Williams held a tenured job as a university professor. In his early 50s, he took the leap from campus life to the pizza industry. “Managing a classroom is not that different than managing a shift in a restaurant,” he says.

Having older and younger workers creates an environment at Luna where skills can be complementary. “Younger staff are great and fast and creative, but they don’t have the perspective that someone with more experience has,” Williams says.

An increase in older workers

As baby boomers step away from their professions, some are looking for part-time, steady work. This trend, coupled with the shortage of hospitality workers, has led to more restaurants hiring senior employees. Among restaurant operators, 35 percent indicated having job positions that were tough to fill, according to the 2019 State of the Restaurant Industry report by the National Restaurant Association. In addition, the number of restaurant workers age 55 or older increased by 70 percent between 2007 and 2018, according to the report.

While more older adults are showing interest in restaurant jobs, their reasons vary. “There is an abundance of ‘older generation’ individuals who have retired, have lots of energy, and are simply bored and are delighted to work in a pizzeria,” says Christine Corelli, a business expert and keynote speaker with ample experience in the restaurant industry. Other senior workers might need additional income above their Social Security checks.

Regardless of what attracts them, older workers can provide key advantages for a pizza place, both in terms of the working environment and marketing knowledge. Following are some of the top benefits they can bring to a pizza place.

1. Scheduling ease

Creating a work calendar for younger employees can be like “a game of chess with requests off,” Williams says. College-aged staff may need time off for an out-of-town football game, school event or family vacation.

That may not be true for senior workers. “Unlike younger staff members, an older hire is likely more flexible with their availability,” says Chris Myers, CEO of Professional Alternatives, a Houston-based staffing and recruiting company.

In addition, older workers might appreciate working weekend evenings when younger employees want time off. They may prefer these busier times for the potential to earn more in tips and have a chance to socialize with others.

2. Stronger commitment

“Older employees understand the need for punctuality, take less days off and are more apt to comply with rules,” Corelli says. “They are often more willing to stay late when needed.”

Their steadiness often goes beyond fulfilling basic requirements. “Older workers are more emotionally stable than younger ones,” says Bruce Sanders, a consumer psychologist and author of Senior Persuasion. “They’re unlikely to get caught up in the daily drama which often occurs when people work closely together under time pressure.”

3. High-level communication skills

For those who grew up without cellphones, face-to-face speaking skills often run deep. “Older people know how to treat customers and are not texting constantly,” Corelli says. Older staff members who focus on relationships can set an example for younger workers.

They might also participate in training new employees. “One way in which older employees like to gain respect is to teach and mentor others,” Sanders says. “Help them create a legacy.” They might train new staff how to greet customers, handle special meal requests and address complaints.

4. Insider knowledge of the older generation

“We’re in a university town and most of the businesses are restaurants are geared to students,” Williams says. When he started Luna, he held a vision of creating a space that would be different. “We have a whole population of professionals and we intentionally put together an experience for adults,” he says. While some students do come in, Williams estimates that at least 90 percent of the customer base does not consist of students.

The business plan led to an award-winning restaurant. “I recognized a hole in the market,” Williams states. “I don’t know that we would have been able to serve that market if we didn’t have the same experience. It’s easier in the same demographic to identify what they want.”

5. An ability to prioritize.

Older staff members might easily identify the most critical steps in a process or procedure. “As you age, you focus on what’s most important,” Williams says. “You thin out the noise.”

This can be advantageous during peek times and unexpected rushes. An older worker might quickly spot a customer who needs attention or be careful to avoid mistakes when putting together an order under pressure.

Having older workers on the payroll can bring numerous benefits, but the optimal team might be a mix of generations. “If you find the right people, young or old, your business can grow immensely,” Myers says.

Rachel Hartman is a freelance writer who covers small business, finance and lifestyle topics.

The post Five Benefits to Reap from Older Workers appeared first on Pizza Today.

That you’ve trained to be lazy

When you stay at a hotel, do you clean your room? Do you make your bed? Do you hang your towels up after using them? I don’t, and why would I, the hotel has someone who cleans the room for me. Now, do you do that at home? I don’t, because my wife would very much not like it and also I don’t like to live in squalor. We act this way at a hotel because we’ve been trained to do that. We’ve been trained to know that someone is coming to pick up after us, and that’s the social contract that we have at a hotel. There is nothing wrong with it — it is accepted and normal.

Mike Bausch, owner, Andolini’s Pizzeria

What is your social contract with your employees? What is your normal with them? How have you trained THEM to treat YOU? Do they work in an environment where no matter what they do, unless it’s incredibly egregious, you’ll cover for them or pick up their slack? Or do you expect great things from them with a high standard of quality and responsibility? Not just on the food, or even service, which are paramount to your success, but even just taking out the trash at night. Does your staff think, “Well, the trash can is only half full, so I’m not doing that tonight?” Are they lazy and more importantly, are you OK with that?

A staff that views you as their catch all safety net and not their authority figure is a dangerous situation. It leads to weak performance, weak attitude, and weak sales. Doing things half way leads to the broken window effect. Where, like a broken window in a bad neighborhood that never gets replaced, and leads to more broken windows, anything is allowed to slide. What broken windows exist at your restaurant? Weeds growing out of the sidewalk near the entrance to your restaurant, or a dirty dumpster. Maybe a few lights are out because it doesn’t matter; someone else, i.e., you, the authority figure, will take care of it. With broken windows and a weak social contract any restaurant staff can deteriorate into a “that’s-not-my-job” workforce.

Ownership of every task, asking why it wasn’t done, not angrily, but in a Socratic method of using questions to have staff come to the answer themselves is how you empower your staff to handle the restaurant like it is their own. They must be fully aware that that is the expectation, that they actually do it and take ownership of every task. Even just showing up for work, if YOU find their cover, you will always be in a free fall looking for staff to work shifts.

If you ever have heard this phrase…

Employee: “Oh, I can’t make my Saturday night shift this week.”

You must respond with…

Owner/Manager: “Okay, who are you going to get to cover your shift?”

Employee: “I don’t know. I can’t.”

Owner/Manager: “Okay. Well, if you can’t get a cover, then I’m going to assume that you don’t want this job, and we will part ways.”

Employee: “Oh, okay. Well, hold on. I’ll find someone.”

That’s the world you need to live in — where they pick up after themselves, and make their own bed, … because the social contract binds them to do so.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma.

The post Mike’s Monthly Tip: Lazy Employees appeared first on Pizza Today.

How to spot and stop employee theft

What if your employees, or at least one of your employees, are ripping you and your business off? It might be as little as a wayward breadstick or an extra-long break, or it could be as blatant as stealing money from sales or actual cash from your drawer.

“On average, businesses lose a median five percent of their annual revenue to fraud, and one of the biggest causes comes from employees who steal. In the restaurant industry, the average cost per fraud scheme is $90,000,” according to Tiffany Couch, CEO and founder of Acuity Forensics.

And a thieving employee may be the one you least expect. Kamron Karington, former owner of Wasatch Pizza in Salt Lake City and current founder and CEO of Repeat Returns, was blindsided when an employee he considered to be trustworthy, well-liked and hard-working stole approximately $10,000 from his operation. Karington’s former employee utilized several tactics to skim money from the pizzeria, such as voiding numerous tickets, using another employee’s number to void tickets, and flat-out not registering sales. Every method afforded him a chance to pocket Karington’s profits.

After Karington witnessed suspicious behavior from his employee, he did some sleuthing and discovered the shocking details recorded in his POS system.

“The evidence was in front of me all the time, but I was making money, so I didn’t pay attention. This was my fault. I let it go on for too long. I didn’t do the work,” Karington says.

Although Karington was able to get back half the money that was stolen from him, he wonders now if he should have pressed charges against the thief to serve as an example to the rest of his staff.

Speaking from experience, Karington advises operators to be aware of red flags such as rising food costs with no cause, an employee who voids more tickets or rings up more POS-installed coupons than the rest of the team, voided tickets inputted by an employee who wasn’t working that day, and a perfectly balanced drawer each night. Another red flag, he adds, is an employee who buys expensive items, such as a fancy car on a not-so-fancy salary.

Theft can manifest in several ways, Couch says. Food-related thievery revolves around employees handing out free food, upgrading orders for family and friends and stealing beverages. Couch adds that some employees are not shy about helping themselves to paper goods, supplies and even expensive equipment.

Money-related scams that cost operators include register-skimming and short-rings, Couch says. Owners who aren’t diligent with money-tracking could easily fall victim to register-skimming; at the end of a shift an employee can pocket upwards of $20. If an employee does this at the end of every shift he or she works, the amount stolen will easily and quickly add up to an expensive loss for an operator.

“It’s as simple a scam (short rings) as this: it’s a busy Saturday during college football. A customer orders an $8 microbrew and pays for it in cash. The cashier takes the money and rings it as a $5 domestic beer, pocketing the difference. The customer is none the wiser, because he was charged the correct amount,” Couch says.

As an operator, you’re in the restaurant business to make money, and employees who steal will quickly curtail your profitable goals. But, if theft is so widespread, how can you protect your business?

“To help prevent employee theft, it’s always best to take a proactive approach to hiring by conducting pre-employment background checks based on the role the job candidate will play once hired,” advises Elizabeth McLean, an attorney with GoodHire.com. “For example, for employees who will have access to money, you might choose to run a National Criminal Databases Search to uncover any felony or misdemeanor criminal convictions, any pending criminal cases and any history of incarceration as an adult.”

Drug-screenings before and during employment can also assist with decreasing thefts “by employees who may try to finance illicit addictions,” adds McLean.

By creating a positive workplace that values honesty and ethical behavior, you can increase your chances that your employees will act honestly, notes Couch. And, knowing the ins and outs of your business is integral to knowing when something is wrong.

“Monitor food inventories and track the cost of food as a percentage of sales,” Couch adds. “An easy tip is to lock the walk-in, freezer or stockroom and only allow a few trusted employees to have access. In larger restaurants, an integrated inventory management tool can better keep tabs on supplies.”

Finally, use your existing system or upgrade to a POS system that has your back.

“Implement a modern POS,” Couch says. “Even if you’re a small pizza shop, it’s worth the investment to install a good POS system. Mismatched daily sales reports compared with the money in the till makes cash theft more obvious. You can also investigate the issue quickly by asking who was cashiering or closing at the time of the loss. If employees know you are closely monitoring the cash register, it can deter them from skimming.”

Although theft is a real concern in the restaurant industry, by paying attention to your day-to-day operations and reports and creating a positive work environment that promotes trust, you can help prevent your business from losing money at the hands of your employees. 

DeAnn Owens is a freelance journalist living in Dayton, Ohio. She specializes in features and human-interest stories.

The post The Buck Stops Here appeared first on Pizza Today.

Avoid turnover by understanding your youngest workers

Smartphone Generation, iGeneration, Millennials on Steroids, Homeland Generation — whatever you want to call Generation Z — may reshape the workplace and ways employers approach communications and training. Gen Z’ers range from 12 to 20 years old with a gap generation up to 22 years old who can relate.

Think you can approach Generation Z the same as previous generations? It’s time to take a look at your youngest employees.

Consider the following: Gen Z have grown up with technology and information at their fingertips. The Internet has always existed. They can’t remember a time before smartphones. They have no memory of 9/11. Educators teach them with e-books and online resources. Unlike the previous Millennial generation who came of age during recessions, Gen Z are entering the workforce with a strong entry-level job market, especially in the restaurant sector.

“That has completely shaped the way that they not only interact with the world but with one another,” says Gen Z expert Ashira Prossack, based in New York City. “They are an emerging generation because the speed at which technology is influencing change, they are going to continue changing. We’re going to keep seeing a lot of seismic shifts happening in the workforce, in these entry-level jobs.”

The youngest Gen Z’ers are already entering the workforce but in a very different way. “We look at this absolutely precipitous growth of the gig economy, so you’ve got 13 year olds running businesses on Upwork and Fiverr,” Prossack says. “But that is preventing them from entering into the conventional workforce. So right now, we seem to be seeing a divide. The ones that are entering the workforce are entering at that 16 or 17 years old again. Once they are able to drive, they are getting jobs.”

Putting a ‘help wanted” sign in the window may not attract Gen Z. “Businesses have to start doing more outreach,” Prossack says. “Go into the high school, maybe host an assembly. You have to preface these entry jobs as ‘Here’s how it can help you in the future.’ And that’s for Millennials, too. It’s especially true in the smaller communities where it is even tougher to find workers. Companies now have to have value propositions to employees. That is the market we are in.”

Gen Z has come into the workforce carrying several known characteristics and stereotypes. Prossack says many are either unfounded or can be nurtured as an asset. “One of their absolute best qualities is their ability to multitask without getting overwhelmed,” she says. “You can throw seven different tasks at them and they will get everything done. It’s usually flipped on the negative, ‘Oh they are not focused enough.’ They will voice their dissatisfaction, shall we say, but they’ll do it.”

Recently, I reached out to Pizza Today Facebook followers to ask: What are your takeaways on Generation Z in the workplace? Pizzeria operators from across the country responded with insightful comments.

Prossack, who consults with companies on Gen Z engagement, weighs in on common observations in the Facebook thread:

• Addicted to their smartphones. “They are always on their phones, so tap into that,” she says. “These kids are all about social media. Every business needs a social media feed and it needs to be active. Let them do a SnapChat. Have them run your Twitter feed. Post on Facebook. Engage them. ‘You are going to be our Twitter ambassador for this week. Have fun with it. Here are your guidelines, here’s what you can’t post and do it.’ They are going to be thrilled and they are going to be so much more engaged.
• A communications disconnect. “They text their friends instead of talking to them,” she says. “In terms of scheduling, especially if you need someone to come in, don’t call them, send them a text. Don’t e-mail a Gen Z person. They don’t do e-mail. It’s all about text or any kind of instant message.”
• Less math skills. “Unfortunately, that is true because, here again, technology,” she says. “Make a little cheat sheet and tape it on the register. Nothing confuses a Millennial or Gen Z more than you hand them $10.01 and they are like, ‘But your total…’ You can literally see the panic on their face.”
• Less pride in their work. “That one is very much a perception base. Because Gen Z communicates through the phone and they are sharing their feelings with their followers and their friends and not the people immediately surrounding them. “It’s not that they don’t care. It’s simply that they’re not outwardly expressing their emotion in the same way we all used to. … Look for other signs. Are they engaged? How are they interacting with the customers? How are they interacting with the other team members? That’s a measure of how you can see how much they ‘care’ about their work. Their priority is that they want to share it with their online friends. The big companies all have Slack or some other kind of instant (group messaging app). Even if there are five people on your team, you can have a Slack channel.”

Prossack sums up how to reach Generation Z in one sentence: “Meet them where they are.”

Gen Z: A Whole New Training Game

The young generation is changing the way employers train them. “The training models of yesteryear where you sit there and you read through a manual or you go through those simulations…those don’t work,” Gen Z expert Ashira Prossack says.

“Gamification is exploding and it will continue to,” she adds. “It’s basically turning these dated training videos into quick little 30-second video clips where they answer a quiz about that and then it moves on to the next one.”

The thousands of dollars pizzeria owners have spent to develop training programs do not have to be wasted, Prossack says. “If you are a creative manager, you can turn your existing training materials into… you can gamify those if you are that inclined to it,” she says. “If you have that 10-minute video, you are going to play it, pause it and say, ‘Okay, here’s why this is really important to reinforce that.’ You can fast-forward past the parts that are monotonous or repetitive. So you are helping them extract the most important bits of knowledge. What you do after that is you simply just have to keep reinforcing that.”

Prossack warns you cannot put a Gen Z’er into a room with an employee handbook and videos and expect them to retain the information. “Managers are going to have to work a lot harder at developing the communications skills and face communications skills of Gen Z because they really don’t do a lot of it. Helping them is providing them with guidance. Role play.”

Role playing is especially true when greeting and interacting with customers. “Things that for us in the older generations that are common sense are honestly not for these kids,” she says. “They text. There is no greeting in a text. You simply ask what you want. With the role play, you will be met with a lot of eye rolls but all of these employees will say ‘This is great. This is helping us.’ After the first week or two of eye rolling, they are going to be really engaged in it.”

Denise Greer is associate editor at Pizza Today.

The post Gen Z in the Workplace appeared first on Pizza Today.

How to use your company ‘bible’ to build a stronger company culture

You can spot the companies that have a well-defined company culture the minute you walk in the door. There is something about the way the restaurant’s staff interacts with customers and each other. Being able to spot culture and being able to define your pizzeria’s culture and cultivate it in your operation are two very different things.

Before you can train your staff to exemplify your company culture, you must be able to make your culture tangible. That begins with your employee handbook.

David Scott Peters, restaurant coach and founder of TheRestaurantExpert.com, pinpoints where to begin. “I can tell you exactly the one thing that’s critical to make that happen and that is that we as owners document our core values,” he says. “Core values are who you are as a person. They almost never change.

“If you really want to inject culture into your employee handbook, the key is listing and defining your core values so that your employees can make decisions based off of your core values and not their own.”

Restaurants owned by multiple owners face an even larger challenge when addressing core values. “We have to go through the process of finding your shared core values,” Peters says. “One of the challenges we have in the business is inconsistency in management enforcing rules. When two owners have two very different sets of core values, they come into the business with a different set of priorities. I walk people through a list of core value words and we find out what’s similar.”

You don’t have to write pages and pages of core values. Peters suggests: “I’d like anywhere from one word to seven words, but there is no wrong way. My personal opinion is (that) I like five words that are defined.”

Take Christal and Eric Spata, for instance. When they took over half-a-century-old Valeo’s Pizza in Kenosha, Wisconsin, they identified three areas as foundation of their business moving forward:

• Authentic unity. “We mean we want to know you as an individual and we don’t believe that you should leave your home life at home and your work life at work,” Christal says. “We believe in bringing the whole self to work. We tell people in the beginning it’s messy at times. Families fight, and then you make up but you have that underlining foundation of respect and trust. With that core value, we wanted people to be safe and know that we are not going to judge them for the one off or reprimand them for a one off. We’ll come along beside them and say ‘you are going through something, what is it? How can we help?’”
• Passionate service. “Because unfortunately people think either you have passion or you don’t,” Christal says. “We believe it’s learned, that there is a way to develop passion in everyone within every avenue. Then we frame everything.”
• Fanatical excellence. “It means that if we give our guest their food and we forget to give them 75-cent ranch sauce, we view that as stealing,” Christal says. “People work really, really hard for their money and we need to constantly provide more in value than we receive in payment. That’s where we pull portioning in. If you choose not to portion, you are choosing to steal from the team or the guest and we don’t steal. That’s not who we are.”

With its rapid growth of 18 stores and 12 opening soon, Southern California-based The Pizza Press is currently redefining its mission statement and values.

“We realized that we had relied on word of mouth and personal training to infuse that culture into each of the new locations and realized that that wasn’t enough because we really did want to be what we call ‘newsworthy,’” says Jennifer Moore, director of marketing at The Pizza Press. “We had to take a step back and really refine our mission statement so it creates newsworthy experiences to make people want to come back. (We) articulated our brand pillars which are: newsworthy service going above and beyond the standard customer service model; newsworthy product…finding great purveyors and offering a high-quality, consistent product; a newsworthy environment creating subtly themed experiential spaces; and ultimately — and this is the critical piece — is newsworthy people — from the franchisees, who we bring on as strategic partners, to our line-level employees. Without the newsworthy people, none of the other pillars can support the brand and make it distinguishable.”

The Pizza Press’ core values begin with its founder and CEO, Dara Maleki. The first page is a letter by Maleki emphasizing the pizza company’s core values.

Peters says core values are only the starting point. A few specific areas where an operator can instill its culture includes time and attendance, policies and procedures on sexual harassment and discipline. “The more clear we are in our policies and procedures, the easier it is then to manage your business,” Peters adds. “And this goes back to a phrase that people like to fight me on when they are independent restaurants and that is that employees hate rules. They love rules. What they hate is the inconsistency in management enforcing those rules. So that employee handbook is that first step of professionalism. It’s that first step of culture. It’s that first step on ‘here’s how we are going to manage this business’.”

Another area of the handbook that is relevant to creating culture is your history. “That might be the only other piece that can truly help instill culture in your handbook — knowing where you came from, where you are today and ultimately ‘Hey, everybody, we’re going in this direction,” Peters says.

Where your core values come into fruition is in your training program. “If we were to take a step out of the employee handbook and into the training systems, that’s where it really starts to define what hospitality means to you or two-minute check times or how you ask questions or how you want the guest handled if there’s a mistake,” Peters says. “So when we talk ‘employee handbook’ do know that that is only one piece of the whole training system and that’s where your core
values really start to show up is in your training.” 

Denise Greer is associate editor at Pizza Today.

The post Culture at its Core appeared first on Pizza Today.

How to address wage and hour claims

Whether you own one pizzeria or 100, employees notice when you’re violating minimum wage and overtime laws. One manager requiring employees to arrive at work 10 minutes early before clocking in can spark a labor investigation that prompts a wage and hour lawsuit or class action involving hundreds of employees.

Don’t think a class action can’t happen to your restaurant. In Jan. 2014, Domino’s Pizza agreed to pay a class action settlement of $1.28 million to 61 workers for minimum wage and overtime violations. In June 2017, Pizza Hut of America Inc. settled a wage violations class action for $3.1 million.

Restaurants are “notorious for being sued” for wage and hour violations, says Arthur Ehrlich, an employment attorney at Goldman & Ehrlich in Chicago.

Food service employees filed more wage and hour complaints in Fiscal Year 2016 than in any other “low wage, high violation industries,” according to U.S. Department of Labor (DOL) statistics. That year alone, the DOL processed 4,975 food service wage and hour cases and enforced payment of back wages totaling more than $39 million.

So, how should a pizzeria owner respond when served with a summons for a wage and hour lawsuit? Here are six steps you need to take when an employee sues:

• Contact an employment attorney immediately. Restaurant owners often make the mistake of planning their next move without consulting an attorney, says James Nowlin, CEO of corporate consulting company Excel Global Partners in Austin, Texas. Don’t try to battle an employment lawsuit with your real estate lawyer, either. Choose an experienced employment attorney to determine the strength of the employee’s case.
• Don’t ignore the lawsuit. “Too many times, I see a client who says he or she got sued by a disgruntled employee making things up and is just getting around to contacting a lawyer,” says Ehrlich. Depending on state law, the defendant generally has within 20 to 30 days after receiving the summons to file what’s called an “answer” to the lawsuit allegations.If you fail to respond by the deadline, the employee will typically have to “prove up” the allegations under oath or with an affidavit, and a judgment against the employer for a specific amount of money is entered. In some states, you may be able to file a motion to try to vacate the judgment within 30 days of the entry. “Many employers who come to me so late feel that they can prove the employee lied, but if too much time passes, it’s too late,” says Ehrlich.
• Gather relevant documents. You’ll need to provide your attorney with documents that could include timecard entries, pay stubs, bookkeeping journals and other payroll records for the employee (or employees) who filed the claim. In fact, you may have to provide payroll records for all your employees. That’s because your employee’s attorney will probably want to amend your employee’s lawsuit to a class action if you’ve underpaid other workers. “The biggest threat to a restaurant or any company is a class action,” says Robert Ottinger, an employment attorney at Ottinger Law, which has offices in San Francisco and New York.
• Don’t retaliate. One of the worst things you can do is angrily confront the worker, fire or demote the person, change their schedule to undesirable hours or harass them. If the employee’s attorney adds a count of retaliation to the lawsuit, and if you lose, you could end up paying all wages for time the employee missed if you fired the worker.“Retaliation cases are incredibly easy to win,” says Ottinger. If the employee had a spotless work record for two years and you fired him a day after he sued, it’s going to be hard to prove the termination wasn’t punitive.
• Explore a reasonable settlement. Your attorney can try to work out a settlement with the employee’s lawyer. However, most employment lawyers won’t want to settle because they’re in it for the class action, says Ottinger. You can always call the employee and offer to pay what they say they’re owed so they’ll dismiss the case.However, make sure your discussion is not a threat to retaliate if the employee won’t settle. The purpose of the discussion is to prevent the case from proceeding and becoming a class action, which could cost you thousands, or even millions of dollars if you own numerous restaurants.
• Take precautions to prevent future lawsuits. Your pizzeria or chain should have a comprehensive employee handbook with policies approved by an employment attorney, says Nowlin. “Keep documents of employee performance and payroll records for at least two years or more,” says Nowlin. “Know the law, specifically the Fair Labor Standards Act, which guarantees the right to a minimum wage and overtime pay.”

Whatever you do, don’t ignore an employee who approaches you, claiming that you owe unpaid wages.

“If you find out employees are owed money, don’t be stingy or bicker with them,” says Ottinger. “Put on a smile and say, ‘Hey, let’s sit down and work it out.’ It’s better to pay three people than 300.” 

How to Avoid Wage and Hour Violations

Your restaurant needs an accurate time entry system to show exactly how much time an employee works, says Ehrlich. That system could be a time clock, swipe card system or a log where employees sign in and out. However, it’s important that managers check the log for accuracy. If an employee inflates hours, a manager can change the time only after bringing it to the worker’s attention and having the employee initial the entry.

Common mistakes managers make that lead to wage and hour lawsuits:

• Reducing employee hours (time shaving) to avoid paying overtime.
• Not paying employees for time required to wait to clock in or time required at work after clocking out.
• Misclassifying supervisors and managers as exempt from overtime.
• Having a policy of not paying overtime to employees who work more than 40 hours in a week.
• Not offering legally required meal and rest breaks.

Deb Hipp is a freelance writer who routintely covers a variety of topics for news and trade publications.

The post When an Employee Sues appeared first on Pizza Today.

What is your training program? Is it jumping into the fire and trying to not get burned? Is it “just follow this guy for a few days?” Maybe it’s not as abrupt as that, but is it the best investment it could possibly be? The truth is that training is an investment, and you get back what you put in. So here are some tips and suggestions that we do at Andolini’s to ensure our training is effective (bear in mind, nobody is perfect on day one and this should take time to get right).

If you’re small and starting out, the simplest base for all training should be to first show in detail. Verify how to do every task. I’ll use making a pepperoni pizza as an example.

• Trainee is shown by trainer how to make the pepperoni pizza while explaining every action in detail.
• Trainee now recites back everything that needs to be done before they start. Trainer either confirms what they said or corrects them.
• Once trainee can verbalize what needs to be done, they can then, and only then, do it.
• Trainer then reviews what they did right and wrong, until it is done without any trainer intervention.

If it sounds like overkill, I would advise you that until this person can do every task without oversight, they will absolutely, without a doubt, cost you money in added labor or lackluster execution.

If you are a larger organization, it helps to have training streamlined with dedicated trainers that train all staff from all stores in your area. This way you have one point of contact for updates and one person directly responsible for the training results. Several successful businesses beyond just pizza places do this. They have training locations that centralize and make training the focus.

Orientation is also extremely important. Orientation should be done by another dedicated individual, preferably someone who deals with payroll, is upbeat and represents your values well. This person should handle these tasks:

• Read your employee handbook in detail, highlighting things that are need to know items and clearing up expectations.
• Ensure new hires are logged correctly into your POS, online scheduler, payroll system and any other functionalities.
• Get them uniforms and all materials they need for their day one of actual training. (This is preferable to a trainer on site shuffling through boxes of shirts in front of the trainee on their first day of work).
• Go in detail on all legal things like sexual harassment training and your alcohol service policy.
• Most importantly, have the new hire sign acknowledgments of understanding and read all things related to their empowerment, such as NDA’s, policies and government forms like I-9’s and W-4’s.

Harvard Business Review and countless studies will support the fact that having ZERO ambiguity, and a clear path to success, leads to high employee retention and staff seeking to excel in their job rather than look for their next option.

Mike Bausch is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. He is a frequent speaker at the International Pizza Expo family of tradeshows.

The post Mike’s Monthly Tip: Effective Orientation and Training appeared first on Pizza Today.

Surveys concentrate on dining experience, but it’s just as valuable to learn who your customers are

Every other Friday, kids in baseball uniforms bustle into your restaurant, stomachs rumbling, coach leading. No deductive reasoning needed; you have a baseball team in your dining room eager to feast. 

Knowing who your customers are is an important way to increase sales and help with direct marketing. For example, giving the baseball players coupon books to be used throughout the school year will keep them coming in during the cold months, too. Congrats, you’ve just turned summer customers into year-round clientele. Bonus: the kids will likely show up with their parents, and mom and dad have to eat, too.

Figuring out who’s in your dining room isn’t usually this easy. Granted, if you’ve been in the business awhile, you learn client type by osmosis, which isn’t the same as knowing exactly where they’re coming from. For the most part, customers don’t wear uniforms or have business cards pinned to their lapels. Sure, you’ll notice groups decked out in office attire during the afternoon rush, but are they coming from the office complex up the street or the one farther down the road, and how can you serve them beyond lunch? You want to cater their retirement and Christmas parties. You want to deliver pizzas during their work-through-lunch meetings. The goal is to build more business through existing clientele by marketing to them (and others like them) effectively. The first step is learning who they are.

So how well do you know your customers? Maybe the baseball team scenario doesn’t resonate with you. Maybe you’ve never even had a sports team in your dining room. Adam Milne, owner of Old Town Pizza & Brewing in Portland, Oregon, says there’s an easy fix for this.

“A few years back, we drove around to different sports fields and dropped off coupons,” he says, “giving players one large pizza and letting them know we were offering a 10-percent discount to sports teams who came in wearing uniforms.” Today, he has sports regulars.

Lee Kim, owner and pizza chef at Burattino Pizza, located in Rancho Palos Verdes, California, also took steps to know his customers by honing in on an untapped demographic and creating new customers. He distributed menus to serious fitness enthusiasts at the local gym. “I wanted to see how receptive they would be to our gourmet pizzas for health conscious people,” he explains. “I got such an amazing response that we’re now creating special fliers and coupons for gyms, martial arts academies and bicycle clubs.”

Not only do these two pizzeria owners know their clientele, but they’ve taken steps to help create portions of their clientele. They’re in a good position to ask these sports teams and fitness enthusiasts for catering gigs — tournaments, marathons, after parties and pizza booths set up during big games.

Truly knowing someone requires ongoing engagement, and the more you engage, the more you learn. That’s why Kim makes it a point to respond to everyone on Yelp. “And if I sense someone is even slightly unhappy, I will remake the pizza, jump in the car and deliver it personally.” What a way to engage! 

Collecting business cards in a bowl and holding drawings periodically for free lunches or having guests fill out a form with their contact information is another way to get to know your customers. “Key data items to collect should include name, e-mail address, the zip code where they work and the zip code where they live,” says Warren Ellish, president and CEO of Ellish Marketing Group and a marketing expert with Synergy Restaurant Consultants. 

A part of knowing your customers includes understanding your trade area. For this, Ellish recommends the pin survey. You’ll need a blown up street map of the geography around your location, with your restaurant at the center of the map. Mount this map on a foam core board and have a box of pins handy with two different colored heads. “Have a team member ask each client to place the corresponding colored pin on the map to represent where he lives and where he works.” If you do this for a week, separating the data collected by time of day, you’ll have a good geographical map of your trade area and a real sense of where you should be spending money on freestanding inserts, mailers and door hangers. 

“When you can clearly define your target market, you can provide products and services that meet their needs and communicate to them in a way that resonates and builds trust,” says Ellish.

You’ve done the work; you’ve learned your target market, who your customers are and exactly where they’re coming from. Maybe you’ve even followed Milne and Lee’s lead and tapped into a new demographic. The next step calls for building.

Now that you know them, build. “Once you’ve learned who your customers are, “invest in a simple e-mail system like Constant Contact or Mail Chimp and reach out to your database regularly with specials, new menu items and other news,” says marketing expert Nancy A. Shenker, founder and CEO of theONswitch.

Knowing who your customers are and where they’re coming from provides the foundation for building. In the meantime, make sure you keep them coming in; make sure the reasons they’ve chosen to frequent you pizzeria don’t change. J.D. Wood of InfoSurv, a restaurant survey company, suggests including this question on your surveys, “Will you come back again?”

Now that you know your clientele and have built trust, asking for add-on business is easy. If you’re like Lee, answering all your customers’ questions on Yelp and hand delivering a pie to ensure customer satisfaction, it’s not a big deal to ask these same customers if you can cater their family reunions, sports tournaments and business lunches. They know you, they trust you and more importantly… you know them. 

Bobbie Metevier is a full-time freelance writer and former book editor.  When not writing, she likes to spend time with friends and family in Southeast Michigan.

The post Feedback: Check it Out appeared first on Pizza Today.

Ways to celebrate National Pizza Month

It’s October and you know what that means — National Pizza Month. Pizzerias across the country celebrate the month-long tribute to America’s favorite food.

Fun fact: Did you know National Pizza Month was created by Pizza Today’s founder Gerry Durnell in 1984 to commemorate the first issue of the magazine? The U.S. Congress officially designated October as National Pizza Month in 1987.

Pizza Today goes big in October with the release of our coveted Hot 100 Independent Pizzerias. This year we added the largest gathering of pizzeria and Italian restaurant operators east of Las Vegas — Pizza and Pasta Northeast, at the Atlantic City Convention Center on October 17 and 18. Join 3,000 pizza and Italian restaurant professionals to exchange ideas, shop nearly 300 booths of pizzeria specific products and services, gain world-class instruction and compete for pizza or pasta titles. Come to the show for only $5 using promo code EBR15 when you register at pizzaandpastaexpo.com before the event.

Last month, we rolled out an online tool kit to help pizzeria operators mark the occasion and promote National Pizza Month campaigns in store, in your communities and on social networks. The kit has downloadable marketing assets, including the official National Pizza Month logo, social share images, customizable media releases, infographics and marketing ideas from around the country. Go to the Pizzeria Tool Kit: pizzatoday.com/national-pizza-month-october-2017-pizzeria-tool-kit/.

Let’s take a look at how four pizzerias approach National Pizza Month:

Hungry Howie’s Pizza

The Michigan-based chain has dedicated October to raising funds for the National Breast Cancer Foundation (NBDF), donating over $2 million to date. In its ninth year, the Love, Hope & Pizza campaign donates a portion of every pizza sold at Hungry Howie’s nearly 550 locations in 21 states. Pizzas are served in light pink boxes emblazoned with NBCF’s logo. Campaign swag, like bracelets, bandanas and T-shirts, are available with proceeds going to the NBCF. Customers can also purchase donation paper pizza slices that hang in store.

To promote Love Hope & Pizza, the pizza chain focuses on a strong social media push with donations made for every like and Facebook interaction, as well as sharing “Stories of Strength” from cancer survivors. Other methods have included TV and print ads, billboards and in-store promotion.

Fong’s Pizza, Des Moines, Iowa

Giveaways have worked well for Fong’s. Owner Gwen Page says every day of the month a lucky diner wins a free meal. “This one is always fun because the guest doesn’t expect it and it truly makes their day,” she says. “We’ve received hugs, high fives and screams of joy when they find out their meal is free.”

She also runs a Facebook promotion prompting guests to share their favorite Fong’s memory for a drawing to win a free pizza party. “It’s a great way to engage with customers and also to become even more inspired to create special memories for our guests,” she says.

New this year, Fong’s will crown a Crab Rangoon Pizza champion. It’s the company’s signature pizza. Page says the staff encourages guests to keep their receipts with Crab Rangoon purchases to enter for a chance to win a small pizza each week for a year.

Campaigns are promoted on Facebook, Twitter, Instagram and some local publications. 

Woody’s Wood-Fired Pizza, Golden, Colorado

This year, owner Jon Bortles says Woody’s is raising the game from its past National Pizza Month social and in-house digital TV marketing with a contest, “Get Your Pizza-Da-Pie.” Ramping up to October, Woody’s asked its social media fans — as well as customers through other platforms — to submit their ideas for the next Woody’s Specialty Pie. Once Woody’s team selects the winner, their creation — named after them — will appear on the specialty menu. The winner will also receive a free lunch or dinner punch card for a year.

“With over 1,000 people eating here each day, we think the number of submissions could be substantial,” Bortles says. “Getting our customers involved in a dialogue, in a truly interactive capacity, is always when we have the most success in our campaigns. It will also be a great way to stay on top of the ever changing tastes of our guests. A win-win!” 

J.J. Dolans, Honolulu, Hawaii

J.J. Dolans hasn’t focused on National Pizza Month campaigns until this year, says Co-Owner J.J. Niebuhr. His team will put their spin on pizzas from around the world and country, picking the top pizzas from each state and country. Going a step further, each pizza will be paired with a specific beer.

There will be a charitable contribution tie-in, Niebuhr says. The campaign will be promoted online through Twitter, Facebook, Snapchat and Instagram, and with radio advertising.

Six More Ideas from Pizza Today Editors

1. Pizza History Night (sell a dinner for $X per person. During the event, tell your patrons about the history of pizza) ­—­­­ Jeremy White
2. Original pricing from when the pizzeria opened if it’s a legacy pizzeria. — Mandy Detwiler
3. Tie in other unique October observances, like National Disability Employment Awareness Month or even Friday the 13th and Halloween — Denise Greer
4. Press Night (Invite local food writers, bloggers, etc. in for a free dinner during which you hit key talking points that differentiates your pizzeria … i.e. expand on whatever it is that makes you special and unique in your city, whether that be locally sourced ingredients, gluten-free, organic, beer in your dough, etc.) — White
5. Partner with another pizzeria for a charity challenge. Whoever sells the most pizza wins a “trophy” or something until the next year. — Detwiler
6. Offer a National Pizza Month one-of-kind offer to your loyalty club members. Think swag, secret menu item, etc. — Greer 

Explore 20 Ways to Celebrate National Pizza Month.

Denise Greer is associate editor of Pizza Today.

The post National Pizza Month — Let’s Do This! appeared first on Pizza Today.

Pizza restaurants raise money for charities, but receive beneficial kickback marketing, too

In December, Papa Murphy’s in Stanwood, Washington, donated an entire day’s sales to a local woman who suffered serious injuries and burns and lost her two children in a car crash.

The store gave $40,000 to the cause. “It’s moments like that, that make it all worthwhile,” says Director of Operations Jeremy Lovelace. “It was a great opportunity to give back to this community.”

It’s hard to fault fundraisers. They are, at heart, altruistic events, though a side benefit is they can provide great marketing to a pizza restaurant. But they must be done right.

Lovelace pulled his off in about 10 days and did no marketing. “The beauty of social media is word can travel fast,” Lovelace explains. “Someone created a Facebook event page and we instantly saw upwards of 1,000 people saying they were coming to the fundraiser.”

The social media page also allowed Lovelace to see the response was enormous and to assemble a team. Managers came from other stores, many of whom donated their wages or asked for no pay. “That’s when you know you’re doing the right thing,” Lovelace says.

Other marketing came from local TV and radio stations and a UPS store that donated advertisements and flyers.

Lovelace opened the store three hours early to handle the fundraiser’s business onslaught, “which helped alleviate some pressure, especially during the prime time,” he says. And he stayed open later in the evening. He didn’t reduce the menu, but instead borrowed a food trailer from another Papa Murphy’s franchisee and used it to sell 500 ready-prepared versions of the five most popular pies.

He did gussy the store up for the event. He erected a four-foot by 10-foot poster board in the lobby with “One Family, One Community” written in the middle “so we could not only present money, but also a billboard with well wishes,” he explains. He also had a donation box for guests who wanted to go above and beyond or people who wanted to donate, but not eat pizza.

A fundraiser may offer great marketing for a restaurant, but that can’t be the reason you hold one, says Bill Marvin, a restaurant consultant in Gig Harbor, Washington. “If you do it for the kickback marketing it won’t work; you have to give unconditionally.”

Kamron Karington, founder and CEO of Repeat Returns, a pizzeria marketing company in Las Vegas, estimates Papa Murphy’s received $20,000 in free publicity from December’s event, and he’s a big proponent of fundraisers; however, he suggests that ongoing fundraisers — 90 days for example — offer the biggest boosts to a restaurant’s bottom line.

“If people come for a one-time fundraiser, it’s easy for them to return to their regular pizzeria,” Karington says. “But if a restaurant’s donating money for purchases over three months, people have a reason to come back several times. This can create a new habit.”

In January, Pizza 9 in Las Vegas, Nevada, donated a day’s profits — $900 — to the family of a police officer who was killed in a car crash.

This is nothing new for the Albuquerque, New Mexico-based brand. Since it launched in 2008 it’s been a proponent of fundraisers and encourages franchisees at its 22 locations in New Mexico, Texas, Oklahoma and Nevada to hold them.

Last year it held an event to raise money ($3,000) for the family of a Navajo girl who was kidnapped and then killed. It also donated $1,000 to a student who was badly injured in a car crash.

“It’s often our franchisees telling us about the need,” says spokesperson Karina Rodriguez. “Our owner-operators care about their communities.”

Pizza 9 hosts two types of fundraisers: Straightforward profit donations, and others — such as when a store donates 25 percent of net sales from one day to an organization or team. The organization is in charge of printing a flyer and promoting the event.

Like Papa Murphy’s, Pizza 9 doesn’t market the events. “Our biggest voice is our customers and social media,” Rodriguez says. Local businesses and local people also post on social media that they’re going to be ordering pizzas, she says.

Some stores double their sales on fundraising days. Sometimes the stores limit sales to take-out and dine-in — no delivery — because the response is so huge.

Six months after the first Azzip Pizza opened in 2014, the Evansville, Indiana-based company launched its We Give A’Zip giveback program.

“It was something we felt was needed in our community,” says Founder Brad Niemeier. Last year alone, the company donated $30,000 to more than 200 organizations.

Azzip holds its fundraisers quietly. It allows charities to sign up to be a beneficiary — or sometimes invites the charities. Once signed into the program, Azzip sends vouchers to the charity for a specific fundraiser day. The charity distributes the vouchers and when recipients visit Azzip, they show the voucher and 20 percent of their sale goes to the charity.

It’s not a lot of work for Azzip. “We send them copies of the voucher and they are in charge of promoting their Giveback to supporters,” Niemeier says.

On the days of the fundraisers there’s a substantial boost in business at the stores, but he also guesses most new customers come back in the long-term.

Each Azzip location holds one of these fundraisers every Monday, Tuesday and Wednesday. On a typical Giveback day consumers redeem an average of 25 to 50 vouchers, though sometimes as many as 100. On top of the money donated, Niemeier believes the fundraisers also help business.

“Connecting with these locations gives people a reason to try Azzip,” Niemier says. “It also helps build positive relationships in the community. That piece can’t be overstated — the goodwill we’ve built up.”

Amanda Baltazar is a Washington-based freelancer who covers restaurants, food, beverages and retail. She is donating half of the income from this story to charity.

The post Fun Fund-Raising appeared first on Pizza Today.

Coupons are still a viable marketing tool, if used wisely

Don’t tell Peter Wiley the paper coupon is irrelevant. Wiley, one of the co-founders of Kettering, Ohio-based Rapid Fired Pizza, says the chain sends out coupons in postcards, local discount magazines and newspaper inserts in Cincinnati, Columbus and Dayton, Ohio. These coupons get measurable results. “A lot of people say ‘why do I need paper, direct mail is dead?’” says Wiley, who is also director of marketing for the 14-unit chain. “It goes out and you see sales go up and customer counts go up, and nothing else is causing that.”

Not only are coupons still viable, but some coupons are also more effective than others. “Typically the ad is food focused with three coupons,” Wiley says. “It’s hard to get a big food shot but we try to include a picture of a pizza.” Sometimes the ad features a whole sheet of coupons. The fast-casual Rapid Fired Pizza offers craft pizzas baked in three minutes, so a dollar off is usually the most popular coupon because it appeals to one person buying one pizza.

The wording of the offer is important. One coupon campaign failed to include a disclaimer about which foods may not be included in the discount. The deal was for two drinks and two pizzas for $16.95. Some customers used the coupon for gluten-free pies, which usually have a $6 upcharge. “We fixed that for the next print run,” Wiley says.

Even when people don’t use the coupon, it can still keep Rapid Fired Pizza in the mix when customers are thinking about where to eat. “There is something to a tangible coupon that sits on your counter,” Wiley says. “A lot of people hang it on the refrigerator. Even if you don’t use the coupon you see our ad on your refrigerator.”

Paper coupons are good for attracting new customers, says Steve Cocca, owner of Cocca’s Pizza, with six locations in the Youngstown, Ohio, area. Cocca’s Pizza, which was founded by his parents in 1982, has long used paper coupons. One detail that makes coupons more effective is to make them valid for a short time. “It creates urgency that makes people use it right now,” he says. “If you put a long period of time they forget about it.”

Cocca’s Pizza sends coupons in direct mail pieces every five to six weeks, and also puts coupons in the local discount magazines. “There are so many awesome pizza places in Youngstown,” Cocca says. “It’s a very competitive market. There might be customers who order pizza two or three days a week but they might go to other places.”

Now Cocca’s Pizza is adding online coupons because it already has online ordering. Cocca says one challenge is to make sure the point-of-sale system in all six stores, not to mention the managers in each location, can process the discounts. Also, both paper and online coupons present an age-old challenge. “How many times can people redeem a coupon? If you put out an aggressive coupon, if they use it each time, you may be discounting your product.”

Discounts are indeed attractive to restaurant-goers. According to Port Washington, New York-based research firm The NPD Group, in its report, “Losing Our Appetites for Restaurants,” 75 percent of consumers who have decreased their restaurant visits say they watch how they spend their money on most or all purchases, and a high percentage of these respondents think that restaurant prices are too high. Also, light users who visit restaurants one time per week said that discounts would entice them to visit more.

“Consumers are still looking for a deal,” says Donna Josephson, chief marketing officer for Fazoli’s, based in Lexington, Kentucky. “They are willing to cut the coupon or save it in a mobile app. Others say make it easy, offer everyday value that doesn’t require coupons, but there is still a vast audience out there for coupons.”

The 220-location Fazoli’s uses paper coupons in Sunday newspaper free standing inserts (FSIs), and is testing online and mobile versions, as it is getting ready to launch mobile ordering for single orders. The chain already offers online ordering for catering. “With that comes a loyalty feature, treating consumers with surprise and delight,” Josephson says. One goal is to increase the frequency of orders, moving people from light to medium to heavy users.

One thing that works for Fazoli’s is to give the customer choice. “If I give you a free cookie with any purchase, the redemption is almost zero,” Josephson says. “If it’s $2 off $5, that gets higher redemption. Instead of being very prescriptive, you get to choose whatever you want.”

For some, a low rate of coupon usage is acceptable because the coupon serves other purposes. Buddy’s Pizza in Detroit moved from the traditional paper coupons to online. Redemption has been low, says Wesley Pikula, vice president of operations, because people have to do a little extra work to visit the Web site, find the coupons and print them. Still, one advantage with online coupons is that the technology can collect data on how long a visitor stayed on the Web site, which pages they visited, and whether they looked at the menu, for example.

Pikula adds that coupons are one small part of the marketing effort for Buddy’s Pizza, which opened in 1946 and now has 11 locations. The eatery also does community outreach and social media. “Independents have a tremendous advantage over chains because they have a story,” he says. “Chains don’t have a story.”

Coupons can fit in with that storytelling, says Gregory Weiss, president of Adrienne Weiss Corporation, a branding firm in Chicago. “If you have a brand story you want to take advantage of every opportunity you can to tell that story,” he says. For example, the story could involve authentic regional cooking, or pizza like momma used to make. “Your coupon should have some language that strengthens that.”

As part of a branding strategy, coupons can be much more than a way to offer a discount. “It’s an opportunity to communicate about your brand and you should take advantage of that,” Weiss says. “If your voice is cute or funny or serious or homey, make sure that comes through in your coupon.” 

Nora Caley  is a freelance writer specializing in food and business topics. She lives in Denver, Colorado.

The post Cut It Out appeared first on Pizza Today.

Are you successfully promoting your victories?

“To the victor go the spoils.” The spoils of victory are the bonuses and treasure you get for winning. In the olden days of war, the winning army pretty much got to loot the countryside and take whatever they wanted. In a relatively civilized setting, we use it more symbolically or metaphorically. The winner gets whatever benefits go with the actual winning of the event. They could be formal or informal –– that is, they could be a designated part of the prize: a gold medal; a contract with a manufacturer; celebrity status; gifts or media attention or simple bragging rights.

In our industry there are some pretty major events, such as the International Pizza Challenge at International Pizza Expo. Joe Torre, a professional baseball executive, once commented: “Competing at the highest level is not about winning. It’s about preparation, courage, understanding and nurturing your people, and heart. Winning is the result.” How do you prepare to become a victor at such an event?

There are several common attributes among winners: desire, preparation and association stand out on the list. Everyone has the desire to win, but only champions have the desire to prepare. Jane Mines of Nima’s Pizza put Gassville, Akansas, on the map when she claimed the titles of “best traditional pizza in the United States” and second place “best traditional pizza in the world” in 2010. Mines desired to excel in her field, and she says she “dreams a lot at night, dreams recipes.” Mines has competed since 2008, associating with like-minded individuals and always working to perfect her craft. This perseverance made Nima’s not just a restaurant but also a destination.

Exposure to people who are more successful has the potential to expand your thinking and catapult your success. We become like the people we associate with, and that’s why winners are attracted to winners. The reality is, winners think differently from the complacent and there’s much to be gained by being in their presence.

Chris Decker from Metro Pizza in Las Vegas competed for the first time at the 2017 International Pizza Challenge. Decker admits: “I’m not much of a competitor, but I have to admit it felt good placing so high. I’d rather let my pizza do the talking than do the talking myself.” His pizza spoke and Decker walked away placing third in the pan division. The spoils came rolling in, Decker says. “We had a nice print (write) up in Las Vegas weekly, full color photos and great action shots.” Metro Pizza’s tagline is “The Pizza Guy and the Other Pizza Guy”, and now Decker is the honorary guy behind the other guy behind the guy. Once again, the lottery cliché “You got to play to win” proves true.

When we first met Nick Bogacz of Pittsburgh’s Caliente Pizza and Draft House, he was a new, independent operator working hard to make his name known. Bogacz had experience in the pizza industry but had never attended Pizza Expo. He and his team began attending Pizza Expo and brought back a newfound enthusiasm and perspective that can’t be beaten: four first-place wins in 2016 and 2017. Bogacz realized that winning is an outcome. However, when people become obsessed with outcomes, they can lose sight of the journey, lose sight of who they are and how they got there, and lose appreciation for the valuable people who don’t win. Bogacz never lost sight of the journey, winning intensified his appreciation for his team, always persevering and keeping perspective.

How did he reap the spoils? Bogacz says: “When we got home I sent out press releases to all media outlets. Within minutes the local news called, wanting to tape a segment for their 5 o’clock news. The taped segment aired three times and was posted online. We also got mentions in major print publications in the Pittsburgh area. The largest radio show also plugged us and read the press release live. Not to mention countless shares from social media.

“In 2016, when we won our first award at the Pizza Expo we came home and put out the same press releases, we got picked up from print nine different places. Our sales increased 20 percent because we used it in all our marketing. We changed our slogan to ‘The Pizza of Champions,’ and created a culture inside our stores that now breeds champions. Because of Chef Eric Von Hansen’s 2016 win, our other team members started training and creating culinary dishes resulting in three wins in 2017.

“In addition to changing our slogan we had a photo shoot with our now World Champion chef and his awards and we use that picture on all of our marketing. After the press received this year our sales have risen another 20 percent.”

Like Mines and Decker, Bogacz’ pizzeria has become a destination.

Regional franchise Rotolo’s Pizzeria in Baton Rouge was built by the diligence and determination of founder Mitch Rotolo. Today the spotlight is on Mitchell Rotolo, Jr., owner of their Lafayette location.

“This year I won the fastest dough competition for the second year in a row,” says Rotolo, Jr., who competed in the World Pizza Games, “as well as second in the triathlon and third in the box folding, while also competing in the pan division” of the International Pizza Challenge.

He further adds: “I got home and got back to work! My IPC awards are not only important to me but also to the Rotolo’s brand. Our team, franchisees and regulars all take pride in the wins and are excited to know how I performed. We opened the contest up to our entire staff for the past three years, bringing the top two to Vegas to compete. This is a huge opportunity for kids just getting their start in the business and it’s an excellent culture and team builder for Rotolo’s. Of course, the local press coverage is an amazing benefit, too.”

Competition is fierce. Stepping out of your comfort zone puts you in the company of winners. Whether it’s via a gold medal or placement among the notable entrants, you still win. You’ve become a major player in our industry. As winners are attracted to like-minded ones, the public and your customers are attracted to winners also — cheering you on and boosting your bottom line.

Scott Anthony is a member of the World Pizza Champions and owns Punxsy Pizza in Punxsutawney, Pennsylvania. He is a frequent speaker for the Pizza Expo family of tradeshows.

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I know I’m supposed to write about pizza, but I can’t stop thinking about burritos. As I write this, the food world is in an uproar over a controversial pop-up eatery in Portland, Oregon. A pair of friends discovered incredible handmade tortillas while on vacation in Mexico and decided to launch a business back home using techniques they picked up.

Scott Wiener

Founder, Scott’s Pizza Tours and SliceOutHunger.org

Local Portland press initially treated the restaurant favorably but some quotes from the two proprietors about picking the brains of the tortilla makers and studying their methods by peaking through kitchen windows led to harsh accusations of recipe theft and cultural appropriation. As much as I love a good burrito, this story makes me feel so relieved to live in a pizza bubble.

It’s hard to think of a food that has enjoyed the benefits of trans-cultural influence more than pizza. In a sense, this simple food was a foot in the door of acceptance for immigrants fresh off the boat in the early 20th century. It may have taken a few decades, but eventually this simple dish helped non-Italians take notice of a population that once seemed as foreign and frightening as the unfamiliar aroma of their food. Some of the biggest pizza companies in the country were started by people with Irish and German heritage, who invoked mustachioed men with strong accents to sell themselves as authentic. In hindsight, we now see those ads as over the top and offensive. But those images were helpful in creating a degree of familiarity that set the stage for the widespread cultural acceptance we now enjoy. Those stereotypical images have all but disappeared as they’re being replaced by the less definable image of the modern pizzaiolo.

As with any popular food, pizza has remained relevant because it absorbs influence from every culture with which it comes in contact. When a pizzeria in Sweden serves a pie with tuna, banana and curry, it is intended as an adaptation to local tastes rather than a proposed improvement on the Neapolitan original. In fact, pizza as we know it began as a culinary mash-up of bread from the Greeks, tomatoes from the New World, herbs from India and cheese from the Asian water buffalo. If cuisines were never allowed to mix across cultures, the world would be far less flavorful. If Keith Richards never heard the blues, the Rolling Stones wouldn’t exist.

It’s easy to understand how inspiration and theft can appear identical from a distance, but they are vastly different beasts. Thankfully, the pizza world has transitioned from “I could tell you, but I’d have to kill you” to “Please watch my YouTube video about making mozzarella.” The best pizzamakers I know are the ones writing books, teaching classes and helping others improve their own methods. Some of the worst pizza makers are the ones nervously guarding their secret recipes.

And even if someone covertly studies another chef’s techniques, it’s highly unlikely they’ll end up with the same results. Pizza dough and tortillas both require some serious manual interaction that can’t be absorbed with the eyes. Just because I’ve watched Dom Demarco make pizza dozens of times at Di Fara Pizza in Brooklyn, I doubt I’d be able to make an identical pie. Food that’s manipulated by hand is more than a jigsaw puzzle with one correct solution; it’s a pile of blocks with no instruction manual.

Scott Wiener is the founder of Scott’s Pizza Tours in New York City and SliceOutHunger.org.

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The average pizzeria can produce its own successful videos

We’ve all heard the phrase, “a picture is worth a thousand words,” but did you know that a video is worth one million? A recent study concluded that one minute of video is worth 1.8 million words! Video has quickly become the No. 1 medium used for interacting with your customers. The reason is that video is able to combine and leverage the benefits of imagery, music and message to create a moving and dynamic piece that evokes emotion in a way that would be difficult to accomplish on their own. This year alone, video content will account for 74 percent of all online traffic, with 55 percent of people watching videos online daily. The question is, will it be your video content they are watching, or your competitors?

Until recently, video has been met with warranted levels of anxiety by many in our industry. Historically, video has been difficult and expensive to produce due to specific skillset requirements and equipment investments. But the proliferation of digital technology has brought with it the ability to shoot, edit and produce high quality video at a low cost, and you no longer have to be a professional videographer to create engaging video content. In a seminar that I presented at the International Pizza Expo last March, I highlighted the ways your pizzeria can and should be producing video on a small budget. These are the key takeaways from that seminar:

First, let’s talk about filming. You are going to need an HD camera. SURPRISE, you already have one… it’s your phone! True, phone cameras can be limiting but with some attention to detail, they can produce exceptional video. With any camera you need to be mindful of the following when filming:

• Stability. The idea with video is to invite the viewer into the video, beyond the screen they are viewing it on. If the video is shaky and unstable, they will inevitably be stuck on their side of the screen and unable to engage fully with the piece. There are many affordable stability devices sold for every kind of camera, ranging from tripods to selfie sticks with gimbal mounts. Choose one or several that suit your needs.
• Lighting. Natural light is best but too much natural light can overexpose your shot. You also want to avoid backlighting the subject. The best results are created by diffused natural light, such as a pizza you are filming near the windows at the front of your restaurant where the light is cascading down onto the pizza through the window. When that is not an option, auxiliary lighting is necessary and the goal should be to create the same result of natural light by illuminating the subject and reducing shadows. Auxiliary lighting does not need to be expensive. We’ve used a Verilux HappyLight as a solution which can be found on Amazon for $39.
• Movement. If stability is paramount, then movement is the key that turns your piece into a work of art. Movement can be accomplished in many different ways such as zooming, panning and changing focal points. There is a lot of equipment that can help you accomplish movement in your filming from drones to Ronins, or you can simply move your body while keeping the camera trained on the subject. However you do it, just make sure to incorporate movement in your shots to increase their effectiveness.
• Content. Shoot more content than you need. By shooting B-roll footage (shots that are not directly related to your film) you will be able to tie your piece together into a well-rounded production. For example, if you are making a commercial for a special pizza, consider getting a few shots of your pizza maker tossing the dough or of the exterior of your storefront that can be used in the intro or outro of your piece.

Next let’s talk about audio. You’ll need to decide if the video will include music, narration or both:

• Music. If the film will have a song playing through the piece, you won’t need to worry about background noise, which can be a distraction for viewers. You will want to secure the rights to any music you use in your videos to avoid copyright infringement. The best way to do this is to use royalty-free music, and Audio Jungle is a great place to find a wide variety at a low cost.
• Narration. There are two ways to incorporate narration to your piece, either by speaking in front of or “on-camera,” or by including the audio afterwards in the editing process, “voice-over.” With either option the goal is to amplify the voice audio of the subject and reduce the background noise. If “on-camera” is the choice, you’ll need a microphone to capture the subject. Directional camera mics can be effective at closer range but can also pick up background noises. The best mics we’ve found are lavalier mics that plug into our phones to record voice audio that we marry to the video in the editing process. You can buy them on Amazon for $10. If you are doing voiceover audio, give thought to your recording space to minimize any ambient noise when recording. We use Garageband on Mac to record voice audio.
• Both. If you are going to use a mix of voice and music, just make sure to adjust the music volume during the speaking segments so that you can hear the message clearly.

Now that you have the raw video and audio, you’ll need to cut them down to size and combine them in the editing process. There is a lot of editing software out there. Choose one that is easy to use. We use Cyberlink PowerDirector ($70), but prior to that we used Windows Movie Maker which is free. Both can accomplish the same or similar results. The idea is to cut your piece down to the shortest duration possible and to create a flow in the shots through transitions in both the audio and video files. This will ensure that your audience stays engaged through your entire video. A tip to make the final piece really pop is to align the video transitions to the timing of the music you selected for a professional result.

The final step is to export and share your video. Make sure the video is properly formatted for the intended destination (i.e. proper file type, formatted for the right screen resolution in HD) and upload the video directly to the location where you want the video to be viewed. So if Facebook is where you want people to watch your video, upload it directly to Facebook as opposed to first uploading it to YouTube and then sharing the video to Facebook. This will maximize the amount of people that see and engage with your piece.

My final tip is to just do it. You don’t have to be a pro, but you do need to start using video because your customers are demanding it.

Clayton Krueger serves as director of marketing and communications for Farrelli’s Wood Fire Pizza and is a speaker at International Pizza Expo.

The post Video Stars: DIY Video Production appeared first on Pizza Today.

Do you give smart employee reviews?

Are you updating your pizzeria’s Facebook and Twitter pages more often than providing performance feedback? Just like you, your employees want a constant stream of likes, comments and constructive redirects. With life, love and careers moving at an instant, employee feedback must follow suit and occur frequently.

“We have to understand the generation we’re working with is on social media and thrives on constant feedback,” says Dan Walker, director of national training and development at Little Caesars Pizza. “If they’re only getting feedback annually, chances are, with a turnover rate of 150 percent, they’re not going to be there for their yearly review. If you want to keep them, give encouragement and reviews frequently.” By implementing more regular employee reviews, you can reduce turnover and boost your restaurant’s productivity and profitability.

But as a busy pizza restaurant owner, what are some critical ways to ensure they’re useful and how do you create the time for additional reviews? Here are four ways operators can conduct productive employee reviews on a timely basis:

1. Set expectations from day one. From the onboarding process, tell your hires how your review system connects to their job description, your expectations and your brand’s core values. Explain how often reviews occur and what they contain by showing the form or giving a detailed explanation. This way, your employees will know to expect daily feedback, a monthly casual one-on-one and a more formal review every six months, for example.

“Everyone needs to know where they stand. Are you setting expectations at the beginning of what you want from their performance?” says Carrie Luxem, CEO of Restaurant HR Group. “I use analogies like building a sports team. You’re the coach, and you need to be comfortable saying daily where they stand. Sometimes it’s constructive, but you need to be honest.”

2. Create an ongoing two-way conversation. Giving feedback each day creates a dialogue that reduces turnover as well as any surprises at more formal reviews. It also assists in connecting operators and managers with their employees. If your staff knows shift by shift what’s expected, they’ll be more productive and make more sales, which helps your bottom line.

“I think feedback has to be honest and action oriented,” explains Joleen Goronkin, founder and president of People & Performance Strategies. “‘What exactly do I need to do?’

Describe the behavior, not the person. Don’t say ‘you’re lazy’; say, ‘here are three examples of your productivity being less than the standard.’”

Pinthouse Pizza’s director of operations, Kyle Detrick, says their employees love the opportunity to have a constant feedback loop in addition to a way to get information about their performance from up and down the chain.

At Little Caesars Pizza, managers utilize the sandwich method for feedback: say something good, say something to be improved upon and end on something good. For instance, explain that the sheet out looks great, but they need to get it closer to the edge of the pan. By slowing down and concentrating on quality, their speed will come with practice. “We have one of the lowest turnovers and one of the highest dollars-per-man-hour productivity,” says Walker. “Because of our low turnover, we’re able to increase productivity, and that helps us keep costs down for the consumer.”

3. Hold a formal review during an anniversary. Whether it occurs every 30, 60 or 90 days, or at the six-month mark, planning a sit-down review on an anniversary date makes it easier to track and accomplish. If you’re implementing daily check-ins with constant conversation, these more formal reviews could be as short as 30 minutes because your employees know what’s coming. This review isn’t just a form to fill out or a legal requirement. It’s truly about communicating strengths, weaknesses and goals.

“Any time you talk to anybody, listen. Be intent, be focused and give them all of your attention,” explains Detrick. “For us, it works to have a template. It’s very much a living document that we update about every six months.” Crafting a template can speed up the review process, but also provide clear guidelines for operators to give feedback to staff and vice versa.

During the evaluation, owners should be asking questions like the following as well as reinforcing expectations and reiterating the employee’s job description:

• What do you like best here and what would you change?
• What are your goals outside of work?
• What customers can you tell me about?
• Do you have any product or process ideas?
• Is there anything I can do to make your job easier or better?

“The more frequent the reviews are, the shorter and less painful they are,” says Goronkin, “If you have weekly check-ins, ask for their biggest accomplishments, their roadblocks and what they’re working on for next week. If you ask those questions every week, think how much easier quarterly or semi-annual situations are.”

4. Re-think your scheduling. It seems like it takes additional time, but increasing the frequency of feedback means less time spent for all at formal reviews.

Pinthouse Pizza schedules differently when it’s review time. They have a manager-in-training (MIT) who moves around the schedule to create free time for managers to perform one-on-one reviews. Although it costs extra to pay the MIT, it’s worth it because building rapport with your team builds rapport with customers, which leads to increases in productivity and sales.

“It’s more of a mindset the leaders have to have in the restaurant; that they know it’s important to have these conversations,” says Luxem. “Put time and energy into training the people responsible for the team about how important it is to have ongoing conversations and give hard feedback on a regular basis.”

Mandy Ellis  is an Austin-based freelance writer who covers food, health and travel trends.

The post Fire Up the Feedback appeared first on Pizza Today.

How cheese prices are set, why the figure moves so much and strategies to better manage costs

Gary Cooney certainly knows how the volatility of cheese prices can impact a pizzeria.

The man behind Chicago’s seven-unit Waldo Cooney’s Pizza chain, Cooney has seen cheese prices ebb and flow over his 36 years in the pizzeria business, affecting everything from his printed menus to the bottom line. “Sometimes,” he says, “these prices can make or break you.”

Ditto for Dan Collier, owner of the eight-unit PizzaMan Dan chain in southern California. With Collier using upwards of 6,000 pounds of cheese in a given week, even a modest price jump can dampen profitability.

Like gasoline and many other commodities, cheese prices are constantly shifting — and constantly befuddling operators.

How are cheese prices set?

Cheese prices are set by the open outcry spot market occurring from 10:45 a.m. to 10:55 a.m. each weekday at the Chicago Mercantile Exchange (CME). During the 10-minute trading session, buyers and sellers swap 40-pound blocks of cheddar (aged four to 30 days) and 500-pound barrels of processed cheddar. Prices on the CME trading floor provide the barometer for the U.S. cheese market, informing prices for nearly every other variety of natural cheese in the country.

“Fluctuations at the CME reflect the temperament and supply and demand of cheese in the U.S. market as a whole,” says Dave Kurzawski, a senior broker specializing in dairy at INTL FCStone in Chicago.

And even though cheddar represents but a narrow speck of the diverse and expansive domestic cheese market, it remains the commodity’s pricing standard-bearer, an American economic practice some eight decades old.

“This is just the way the industry has done it since the 1930s,” says Eric Meyer, president of HighGround Dairy, a Chicago-based trading firm.

Most suppliers, then, set their prices according to the CME’s spot market, often with lag time ranging from one day to two weeks.

Why are cheese prices so volatile?

Cheese prices are always bobbing and weaving. Last year, block cheddar prices at the CME were as low at $1.32 in May and as high as $1.88 in November. Go back to 2014, however, and prices have ranged from $1.32 to $2.36.

Not surprisingly, supply and demand –– both domestically as well as internationally given the rising amount of U.S. cheese being exported around the globe –– drive price fluctuations of cheese at retail, foodservice and industrial levels. As many a high school economics teacher has preached, prices rise with heightened demand and fall amid an oversupply.

Yet, cheese price volatility can be traced to a host of other factors as well, including regionality and seasonality, supply-side issues such as weather, production shutdowns, new plants coming on board or a Listeria outbreak, macroeconomic issues such as consumption trends and global trade policy, and the perishability of milk.

Traders like Kurzawski and Meyer also remind that psychology, greed and fear come into play as well. It’s not unheard of, Meyer says, for the market to swing on the movement of a mere 100 loads of cheese.

How can pizzerias better manage cheese prices?

• Investigate risk-management programs. Pizzeria operators should always start to manage cheese costs by talking with their supplier. Many vendors offer programs that can help pizzerias address marketplace volatility, including hedging programs and quarterly pricing as well as cost-plus or fixed-forward contracts.

“Ask about these programs and see what you can lock in,” Kurzawski says.

• Adopt the long view. While most want to hit an immediate home run with cheese prices, Kurzawski urges operators, particularly those who “lose sleep” over cheese prices, to embrace a long-term outlook. Specifically, he suggests seizing some certainty by purchasing a defined percentage of the pizzeria’s needed cheese inventory at a fixed cost.

“There might be times you pay more [than the going rate] and times you pay less, but this will help reduce price volatility,” he says. “Wrap your head around what a good price is and then decide if you really want cost certainty around this item.”

• Raise prices. Raising menu prices is typically the action of last resort, but might be necessary, particularly if cheese prices skyrocket.

If per-pound cheese prices climbed 50 cents, Rapid Fired Pizza co-founder Ray Wiley estimates that would increase his food costs on a pizza about one percent. While Rapid Fired’s 14 eateries would likely absorb that kind of rise in food costs, a more substantial increase could spur higher menu prices.

“We always hate to go to the menu board, but sometimes that’s on the table when costs escalate,” Wiley says.

• Address kitchen operations. While operators cannot control cheese prices, they can control their kitchen operations.

Rather than purchasing pre-shredded cheese from his suppliers, a commodity more susceptible to price volatility given deeper connections to labor and shipping costs, Collier favors block cheese that his kitchen staff then grinds daily.

On the inventory side, meanwhile, Collier directs kitchen staff to weigh cheese for every pizza to avoid overuse, while he also completes a weekly ideal cost on every line item, especially cheese.

“Each week, then, we know our over and short on cheese and can manage our cheese process better,” he says.

• Order up. When cheese prices reach a favorable level, Cooney doesn’t hesitate to increase his order size –regardless of any supplier resistance.

“We’ve got numbers we have to hit, too,” Cooney says, reminding his fellow operators to consider storage capacity and to rotate inventory whenever they increase the size of their traditional order.

Chicago-based writer Daniel P. Smith  has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post The 411 on Cheese Prices appeared first on Pizza Today.

Negotiating your commercial lease renewal

It’s finally arrived…your restaurant’s renewal notice date. A date you, hopefully, circled years ago to ensure you negotiate and renew your commercial lease at the proper time. Although you may have gone through this process before, did you use the best negotiation tactics or top resources, like a commercial real estate broker or tenant representative, whose knowledge would’ve helped you seal your ideal contract?

It sounds like additional work, but negotiating your commercial lease renewal could be a difference-maker in your business’ future. “The benefit of negotiating as a restaurant owner is the value of my business,” says Aaron Tofani, co-founder and co-owner of Rance’s Chicago Pizza. “If you ever want to sell, having more lease term is control because you can sell with a guaranteed term, and the buyer has time to recoup their investment.”

Negotiating to stay at your location not only keeps your restaurant open, but helps you stay within your financial limits. Also, after a three-, five-, or 10-year span under the same contract, there may be many items that need to be addressed. “If you’ve been a good tenant and paying your rent, you can renegotiate getting your security deposit back, a lower rate if the market is low, some tenant improvement or some free rent,” explains Nathan Smith, a commercial real estate advisor at Austin Tenant Advisors.

And paying on time and in full is key, as it gives you leverage when negotiating. Plus, if you didn’t renew, your landlord would have to pay for down time, tenant improvement allowances and likely the commission of a broker in order to acquire a new tenant. By spelling out the economics of the situation, they’ll realize they’re better off keeping you than having a vacancy.

If you offer delivery, reviewing your loyal customer base and what zip codes they’re coming from is crucial. A zip code analysis might uncover that a majority of calls are originating from customers who reside at the edge of your delivery zone, and it may make more sense to relocate than negotiate to renew.

After you’ve analyzed your business and decided it makes sense to stay at your location, how do you negotiate your commercial lease renewal? “Start (the process) about a year in advance, gather as much market information as you can, hire a knowledgeable real estate agent and understand what your cost of a build-out would be if you must relocate,” says Mark Chase, president of Restaurant Real Estate Advisors.

One of the biggest mistakes you can make as a restaurant owner is waiting until the last minute. You need to know ahead of time if there’s a better option. Maybe your space used to be the only one available, but now your ideal space is ready to be leased. Being reactive never gets the best deal, but proactive thinking, meaning you have time and a broker on your side, gets you the lease you want.

“Your broker should be like a business partner looking out for your interests,” says Dave Burggraaf, retail commercial real estate broker at Retail Solutions. “Find a broker with retail experience because they’ll have relationships with landlord representatives and landlords, and know the ins and outs of restaurants.” Utilizing a commercial real estate broker taps you into their critical market knowledge while also offering a negotiation buffer between you and your landlord. They’ll know to focus on items that would be addressed for a new tenant, like an updated HVAC system or dedicated parking spaces, in an amicable way as well as look into perks like a pizza restaurant exclusive clause.

With your trustworthy agent’s local market knowledge, you go to the negotiation table with facts as well as reasons why you’re asking for fixes. “Once you’ve looked at the market, you’ve armed yourself with knowledge of what you can negotiate,” says Smith. “At the end of the day, you don’t want to move; you want the best deal possible.” Performing your due diligence, like analyzing base rent, concessions and operating expenses at other retail spaces, lets you know if you’re signing the best deal possible.

“The more leverage you have, the better. Understanding your options, like if there are spaces nearby you could move to, you’re going to have a better chance of the landlord seeing things your way,” says Burggraaf. Create competition between landlords by bringing accepted letters of intent to the negotiating table. Also, beginning talks with other landlords provides you with options if you’re forced to move.

If you become overzealous on terms or ask for more than the landlord’s willing to give, what should you do if the negotiation turns sour? If you’ve secured letters of intent from other landlords, at a minimum, you have fallback locations. “If they have other options, and it makes economic sense to move, they can go down that path,” explains Chase. “Otherwise, they probably have to give in to some terms to stay at their existing location.” He believes that although there are landlords who think their property is worth more than it is, pizza restaurant owners need to understand the market before they negotiate too hard on unrealistic terms.

“To prevent things from going south, start early, explore other options, and let the landlord know, then they’re more cooperative,” Tofani says. If you didn’t start at least a year in advance or look into other locations, your options are few and far between. You can accept your current landlord’s terms, or rush to find a new space, spend several months building it out, and then start up your business again. Ideally, try to be the best tenant possible, like paying rent in full and on time, and maintain a friendly relationship with your landlord where you’re open about any issues to avoid negotiation hiccups.

Mandy Ellis is an Austin-based freelance writer who covers food, health and travel trends.

The post Leasing for Less appeared first on Pizza Today.

Get a grip on financials now, thank yourself later

Let’s talk financials.

For 33 years in this business, I have always maintained up-to-date financial reports. I use these reports to manage my pizzerias, but I am fortunate to have and understand how to use them in the first place. You see, I was forced to maintain accurate financials by two mentors in the business, and that experience has benefited me greatly.

My first mentor was Tom Monaghan, the founder of Domino’s Pizza. Tom’s system for his franchisees included a nightly call-in with food and labor numbers. The managers did a full inventory every day and calculated daily food and labor cost. Each month the franchise owner reviewed the profit & loss statements (P&Ls) with the manager and paid out a bonus based on results.

I moved to Rusty’s Pizza in 1987, where my second mentor, founder Roger Duncan, took up the baton. Every Monday, Roger had each manager do a full inventory and sales analysis, including food and labor cost. Every month, he had me review the P&Ls with each manager and pay a bonus based on results. Roger’s favorite saying is this: “Sales are made in the pizzeria. Profits are made in the office.”

See the pattern?

I was lucky these two men guided me to an understanding of financials. Let’s get you there as well. In order to do that, there are two hurdles you must first get over: how and why.

To address the first hurdle, I say ‘why not?’ Why do some independent pizzeria operators not maintain financials? Simply this: they are not looking to the future, so they do not see the need to maintain accurate records. Receipts for purchases get lost and sales are not accurately entered. The resulting financials cannot be used for current management or for future growth. Trust me. If you don’t pay now, you will pay later. Accurate sales and cost records are the price you pay for admission to what I call ‘The Game.’

Let’s take a look at hurdle number 1, the “why.”

• Bankers: To borrow money for growth, you have to show a minimum of two years of good financials.
• Landlords: To get exceptional locations (location, location, location) those same good financials give you the edge against the ‘big boys’ competing for that space.
• The Government (a.k.a. The Man): As you grow, you will be under more scrutiny. The Man loves accurate financials, and offers great incentives on your tax return.
• Profit: Good financials allow you to manage labor and food costs as well as utility, maintenance and remodel costs. Unfailingly, I have seen a minimum of five percent (of sales) improvement in costs when accurate financials are added to a pizzeria’s operational toolbox. On $500,000 in sales, that is $25,000 in your pocket at the end of the year.
• Employees: When managers’ goals are set based on their ability to understand financials, they blossom. They understand how to lead the employees to accomplish food and labor goals each day.
• Your accountant: Your tax pro can’t do your taxes correctly if you are not providing all of the information. There are legitimate expenses you may be missing.

So we now arrive at the second hurdle — the “how.”

There are many paths to success with financials. Here are my players.

• The Manager: Every Monday, the manager of the pizzeria spends six hours doing weekly paperwork. This begins with an inventory of every item in the restaurant, followed by creating the weekly food order. They complete the daily paperwork, then a weekly sales report showing weekly totals of sales, credit card deposits, bank deposits and cash paid outs. Next is the “cost analysis worksheet.” Food and labor numbers are compared to sales. Sales are compared to last year, last month and last week. Every two weeks a payroll report is created. Once per month, a month-end inventory is created.
• Pre-bookkeeper: All of the manager’s work comes to this person. He sorts the paperwork as follows: Payroll to the payroll company. Placing weekly food orders to the various vendors. Invoices and weekly sales reports to the bookkeeper. Fundraising and donations to the marketing person. Cost analysis worksheets to me.
• Payroll: We use an outside company. There is too much legality to do internally.
• Bookkeeper: The bookkeeper enters all the manager numbers and inputs all invoices using QuickBooks. Each week, all the checks are attached to invoices ready for my review and signature. Monthly P&L statements are prepared by location and monthly bank reconciliations are completed. Monthly and quarterly, sales tax returns are filed.
• Accountant: A professional who reviews the financials quarterly, including the balance sheet, and prepares the tax returns annually.
• Me: I review the monthly P&L statements and provide corrections to the bookkeeper. I review the P&Ls with the managers and pay bonuses based on results.

I have seen many owners make money but who are not able to grow their business because they were lacking good financials. Are you ready to play The Game? Remember my mentor Roger Duncan’s adage: “Sales are made in the stores; profits are made in the office.”

Dan Collier is the founder of Pizza Man Dan’s in California and a speaker at International Pizza Expo.

The post Profits Are Made in the Office appeared first on Pizza Today.

Five ways to enhance the customer experience

It can be tough to fully understand the vast array of tech options available today — let alone implement them into your pizzeria operations.

While technology can help increase sales and boost the guest experience, a third of restaurant operators say their places are lagging in tech use, noted the Restaurant Technology Survey 2016 released by the National Restaurant Association.

To maximize the effectiveness of a technology upgrade at your place, make sure you first comprehend how it works, advises Glenn Cybulski, World Pizza Champion and co-founder of Persona Wood Fired Pizzeria. “Instead of just buying or using something in the restaurant, know how it is going to impact the bottom line and affect profitability.”

Follow these ideas to keep your customers satisfied and coming back for more:

1. Have a mobile friendly Web site.

If you’ve taken the time to build a Web site or improve it recently, you’re headed in the right direction. Making sure your site can easily be seen on a phone or mobile device is the next step.

Young adults spend about five hours a day on their phones, according to research funded by the University of Lincoln. “Chances are, that is how they will discover your pizza restaurant,” points out Jimmy Woodard, chief business officer at Routine Solution. “If your Web site is not optimized to look stunning on a mobile device, then you’re throwing away the biggest opportunity to bring in new customers.”

To upgrade, talk to a Web designer about your restaurant’s brand, target market and goals. Together you’ll be able to create a mobile-friendly site that attracts, and retains, a growing list of clientele.

2. Accept mobile payments.

Just as customers might first learn about your place through their phone, they may also prefer to make a credit or debit card purchase with their mobile device.

“For both efficient service and peace of mind that payments are being transacted with the utmost security, it is imperative that restaurants have payment systems that accept virtually all payment types and are developed with built-in fraud protection,” explains Jim Allen, head of small business solutions at First Data.

If your system isn’t already set up to take mobile payments, talk to your current provider about the possibility. Look for a mobile payment and credit card processing solution that seamlessly integrates mobile wallet applications and cloud-based mobile payment solutions, suggests Allen.

3. Offer a digital loyalty program.

“In addition to providing consumers with a new way to make payments, mobile devices represent a new channel for merchants to communicate with their customers,” explains Allen.

If you give diners the chance to keep track of rewards and promotional offers on their device, they’ll likely appreciate the streamlined, paperless setup.

“We have a very simple loyalty program,” notes Cybulski. After signing up, customers use their phone number to tap into rewards and learn of specific offers.

“We have a 20- to 25-percent increase in sales when we use our loyalty program to incentivize customers to come in to the restaurant,” adds Cybulski.

4. Implement a smart operations system.

“Several years back we had clipboards with prep checklists,” recalls Shawn Randazzo, president of Detroit Style Pizza Co.

“Employees would grab a clipboard and checklist and that would be their road map for the day.”

That all changed when Randazzo opted for a central operations system. Today, “we have an iPad in the kitchen and in the back as well,” he says. The system serves as a central place that contains recipes, training videos, employee handbooks, processes and more.

Employees log in to the system and follow a checklist pertaining to their position. They can mark off tasks as they are completed, follow instructions and make notes as needed. The setup has provided a layer of tracking and accountability that has enhanced the restaurant’s productivity and appearance.

“It’s been really effective for us,” remarks Randazzo. “Times have improved, the store is cleaner and customer service is superb.”

5. Try geofencing marketing strategies.

As its name implies, geofencing refers to setting up a virtual fence around a specific geographic area. When consumers enter that space, they can receive messages, coupons, or other information about your place.

If you use geofence marketing, you might send out directions to your pizzeria or information about an event going on to individuals within a three-mile radius of your restaurant. Consumers who spot the ad may be enticed to come in for lunch or dinner or take advantage of a promotional offer.

Another option: ask those you work with about their technology offerings. “It’s one of the things we look for when we choose vendors,” states Cybulski.

If your vendors have a geofencing setup in place, they can send out discounts and special promotions about your place when consumers are in a specific area. This type of plan may not cost anything for you and can lead to increased awareness and revenue for your place.

Rachel Hartman  is a freelance writer who covers small business, finance and lifestyle topics.

The post Upgrading Tech appeared first on Pizza Today.

Want to become better? Analyze the competition

What’s your mindset when you walk into another restaurant? Do you just want to not think about your place for a little while and decompress? Or, like most of us in this industry, do you compare it to your restaurant? Do you focus in on one aspect of the service, or the ambiance, or the food? Then once you feel it out, what is your inner-monologue saying about this new restaurant? Do you find yourself marginalizing the threat of this place often? In other words, are you looking for a reason why this place won’t last? It’s a natural inclination — who wants to live in fear? Does your competitive nature as a business owner, much like an athlete’s mindset, come into play and you start to visualize winning, which only happens when you assume your opponent will fail? Again, that’s normal. But one thing it is not is productive!

My first day in the Marine Corps at Officer Candidate School they handed us Sun Tzu’s The Art of War along with our field manual on weapons and codes of ethics. It seemed pretty odd that the only literature outside of our manual we received was a book written not by an American, but rather a Chinese general from 2,500 years ago. How could this be relevant? I assumed the book would be super aggressive, but it was actually a very methodical and focused look at leading soldiers. Here is a quote from Sun Tzu that I use today when I think about other restaurants that open right next to me and try to steal my market share: “If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a defeat. If you know neither the enemy nor yourself, you will succumb in every battle.”

Let it be known that I don’t view the competition as my enemy. I do regard the competition as a potential threat, however. As such, it’s my duty to my business and the 200-plus lives of my employees that I take any threat seriously and use it as a chance to reflect on what our failure points are so we can correct them. Sure, I notice what the other place doesn’t do as well — but an ego boost doesn’t keep the lights on.

There are two kinds of people in business: the ones who are never wrong and the ones who openly try to know when they are wrong so they can fix it.

Now let’s talk about owners and upper level managers. Do you find yourself or the higher ups on your team talking down about other local restaurants? Do they do it so often that it’s almost a game to see what they can find wrong about other places? Let’s ditch the “they’re bad, we’re great” mentality. No matter how bad or good a restaurant is, there is always something to learn. Here’s a list I go through each time I go in somewhere new:

1. Is the best member of this staff more attentive and a better salesman than the worst member of my staff? Your goal here is not to be shady and try to steal this staff member for your team, but rather to reflect on what this person is doing right that my staff member isn’t so we can train to get better with definable goals.

2. What about the food is better? Not many people want to admit someone has a better product, but if they have a long line and you have empty seats, then the question has already been answered for you. Your food might appeal more to you than the average person, but what is appealing about this food that is drawing a crowd?

3. What is their call to action, and how does it differ from mine? Is there a great special that is attracting people? How do I create a special that isn’t a blatant copy? Example: This place is packed for a discount slice night; can I do a discount of something else on a different night to attract the same demo?

4. What about the ambiance is more inviting than my location? This is the one that gets overlooked a lot. And the most issues fall under this. Does their soda machine make less noise? Is their lighting near the bathroom nicer? The menu, the font, the forks and knives, the glassware, the mats on the floor, the cleanliness of their vents — take it all in and then self evaluate.

5. Speed and price. How long did they take and how much did it cost? Were they faster than us? Not on your best day, but on your worst … were they faster? If the cost was higher than expected, how did they create the pull for you to order what you did? What was the soda price, average app price, and how much food did you get for it? What are their pizza sizes and amount of slices per pie? Is that kind of price model working or is it too complicated? If it seemed high, did people seem to mind? If it seemed low for the amount of food, where are they making money via their menu mix? Overanalyze everything.

If you walk out of a place and your only comment is about how much of a waste it was, than you are correct. You wasted an opportunity to grow. By downgrading the other guy you only marginalize yourself and seek to conduct no real R&D in regards to your brand. Even in the worst restaurants you can find something to learn not to do. You can’t be in love with yourself and your restaurant if you want others to be. Constant self evaluation and always knowing that you can be better is how you get there.

Mike Bausch  is the owner of Andolini’s Pizzeria in Tulsa, Oklahoma. He is a frequent speaker at the International Pizza Expo family of tradeshows.

The post Know Your Competition appeared first on Pizza Today.

Keith Coffman, owner
Lost River Pizza Company in Bowling Green, KY

Your wait staff and bartenders are going to determine if you successfully sell craft beer. Their craft beer knowledge is vital to your bottom-line beer sales and profitability, so make sure that they know beer. In order to maximize your sales, your staff needs to understand the differences between the different styles of beer and how to describe how they taste (whether they personally enjoy them or not). Your staff needs to be educated enough about beer to be able to help guide your customers to the beer that is best for them. Your customers will ask your staff for recommendations, so make sure that your staff knows your beer selection forwards and back. Your staff should know which beers are lighter; which beers are hoppy and bitter and which beers are more malty and dark. Make sure that your staff knows which beers are brewed locally and has some knowledge about your local breweries, because craft beer drinkers like locally brewed beers. It is also important to communicate and educate your staff weekly and daily on the pricing of the craft beer that you carry so that there aren’t any surprises for your customers when they receive their checks.

The easiest and quickest way to train and educate your staff is to reach out to your brewery and beer distributor sales reps. Ask them if they could conduct training and tasting sessions with your employees. Most sales reps will jump at the opportunity to help you and your staff learn how to better sell their beer. They can bring in samples for your staff to try and point-of-sale info sheets that will make selling your beer easier. Make educating your staff fun and they will be more receptive.

There are hundreds of books about beer that your employees can read to educate themselves. It would benefit you to buy and keep several beer related books on premise that you can loan out to your staff. One of the easier reads that I recommend is Tasting Beer by Randy Mosher. Tasting Beer will walk readers through everything from the history of beer to food pairings. Give your staff incentives, such as free beer, to read the books about beer in their off time.

The Internet has an infinite amount of information that you and your employees can use to discover more about the beers that you sell and about beers that your customers will request for you to carry. The Brewers Association has a couple of great Web sites that you can check out at craftbeer.com and brewersassociation.org that go more in depth on the brewing side of beer. Other sites that will help you find out more about specific beers include beeradvocate.com and ratebeer.com. Beeradvocate.com and Ratebeer.com both allow consumers to submit their ratings on beers they’ve consumed. This info can be helpful when ordering beer that you’ve never tried before.

If you really want to get in depth with beer training and education for your staff, you can have your employees participate in the four-level Cicerone Certification Program online at cicerone.org. Nearly 80,000 people have completed Certified Beer Server Certification.

Educating and training your staff is an ongoing process that will help you be more successful selling craft beer.

Keith Coffman is the owner and operator of Lost River Pizza Company.

The post On Tap: Training & Education are Paramount appeared first on Pizza Today.

If you’ve got a rewards program, here’s how to make it really work

Pitfire Pizza tried printing punch cards for their nine locations — buy 10, get a pie free. They saw their same customers, gave away a few pizzas, but not much else.  Pitfire’s Chief

Operating Officer Mitchell Wong says they haven’t had success with that or any of the several other loyalty strategies they’ve tried. Sound familiar?

The goal of your loyalty program is “frequency, increasing ticket size and motivating cross-menu purchases,” according to Michela Baxter, senior director of Loyalty at HelloWorld.  Read on to find out common mistakes pizzerias make and how you can overcome them.

Mistake 1: Programs that don’t give you data.

Amity Kapadia, content marketing director for Ambassador, a referral marketing company, says: “The goal is to drive new sales. You want a trackable URL, promo code or points system.”

Wong notes that customers are more wary about giving you their contact information unless there is clear value to them for signing up for a loyalty program.

Recent research published in the journal Decision Support Systems finds that “due to the more dynamic consumer preference in online markets, transaction data collected through loyalty programs provides stronger profit incentives for retailers.” Data is the big tradeoff for free product in loyalty programs, and it is best attained online.

Whatever you do for a loyalty program, make sure you have a way to track who’s using it and what their purchase behaviors are. That’s how the system is good for customers and helpful to you as well.

Mistake 2: Offline experience only

Double Dave’s Pizza in Texas and Oklahoma first tried a buffet stamp card back in the 1980s. The program inherently kept customers tied to a particular location due to the use of a paper punch card,” COO Joey Bramwell explains. “While the frequent diner cards for buffet work great, we wanted to reward all our customers in every purchasing format (dine-in, delivery, pickup and online ordering). Our ‘Dave’s Dividends’ program allows customers to earn points for every dollar spent, and they can redeem those points for different options and amounts of food. This loyalty program’s information is Cloud based, so the customer can accumulate points and redeem them at any location in the chain.” With 35 locations, the flexibility offered by a digital program is important to customers.

Assistant Professor Sanghee Lim of the Johns Hopkins Carey Business School has conducted research about online and offline consumer behavior. “Offline stores may be giving away profits when they offer loyalty rewards to customers who will keep coming back anyway, regardless of any discount that’s offered,” she says. “Online shoppers, on the other hand, may use a coupon to revisit a retail Web site even when it’s not one of their preferred sellers.” Online loyalty offers or rewards are a growing way to tap new customers to try your pizza.

Mistake 3: Disconnected from brand

According to research published in the Journal of Retailing and Consumer Service, if customers feel connected to you and your brand, they don’t care how long it takes to earn a loyalty reward.  But if they don’t have a personal involvement, they are less patient.

What does that mean for you? A loyalty plan that feels like an organic part of your brand is important. If the program seems like an afterthought or add-on, customers can tell. Loyalty programs should integrate with everything else you have going on — starting with color scheme and logo to the tone of your establishment.

Double Dave’s Pizza’s Bramwell advises that when integrating your program into existing business, “keep it simple and easy to use,” he says. “Anything complicated will keep customers from participating. Tying the program to a customer’s phone number makes the program easy to use as cards or keychains can be seen as excess clutter. Lastly, train your employees to not only understand the program, but to champion its use! Having an employee who is ambivalent about making someone’s free pizza will take the excitement out of the process.”

Mistake 4: No long-term plan

“The goal of every program should be to reward frequent customers for their patronage,” says marketing consultant Joseph Braithwaite. “You need to show them you respect them for making a choice to come to you.”

Bramwell at Double Dave’s says that you must let customers know you value them.  “As customers can choose any number of places to buy pizza, we wanted to let our customers know that we appreciated their continued business. And the best way to do that is with free food! Discounts are nice, but free food speaks volumes.”

If you are thinking simply of the short term, trying to get more people in the door, a substantive loyalty program will not work. To build loyalty takes time and your business really embracing your customers.

Mistake 5: Lack of Personalization

One reward across all consumers isn’t going to cut it in today’s highly individualized world. As Baxter says: “Consumers expect more personalized offers.” That may have been optional in the past, but no longer. “They feel more positively about a brand when the communications they receive are more personally relevant.” That’s where data really comes into play, when you can tailor your contact based on what customers have done in the past.

“When someone earns that free pizza, that pizza will taste better than the last pizza they bought,” Bramford says. “There is nothing like handing a customer their free pizza and giving them a high-five as a congratulations for achieving their goal of earning a free meal.  You can count on that customer to be back next week to start earning more points.”

Eliana Osborn lives in the desert southwest with her family, where she works as a part-time English professor and freelance writer.

The post Lasting Loyalty appeared first on Pizza Today.

Don’t overlook data protection responsibility

Hundreds of credit cards and debit cards are swiped daily in your restaurant. Add online orders and gift card purchases to that total, and the chance for identity theft, fraud and security breaches are exponential.

Freaked out yet? Ready to toss the credit card payment processor, shut down the Wi-Fi, and run a cash-only establishment?  If only you could…

Your customers expect the convenience of paying with credit cards — swiping, chipping — and they expect when they trust you with their payment, they can trust you with their data security and identity.

And protection starts with your system.

“Lots of places are using machines that are 10 years old, and most major breeches happen on outdated machines,” says Donald Bush, VP of marketing at Kount. “Make sure the hardware you’re using is the latest with the latest, up-to-date software.”

Bush says that, with a computer, you are able to add malware and virus protection, but there isn’t a lot of power on a payment processor.

“When considering an update to the payment processor — ask, ‘can it run the latest software?’ Talk to your payment processor provider annually— at least —and ask, ‘are there any software upgrades? Hardware upgrades? What are your fraud protections and policies?’” Bush advises.

In addition, says Bush, pizzeria owners should ask their payment processing company if they are PCI DSS (Payment Card Industry Data Security Standard) Level I compliant, which is the minimum data security protection level.  And for owners who use online and mobile ordering options, Bush stresses that operators should confirm that their system is capable of handling those payments and has fraud checks in place.

For owners who use only card machines, Charles Lee Mudd, Jr., data security lawyer at Mudd Law in Chicago, advises them to confirm with their provider that the machines do not store any information (and if information is stored, that it has an imposed time limit).

For owners who utilize a computer for payment processing, Mudd recommends that the software only store the last four digits of the card.

“The vendor should attempt to avoid being in a position to ‘use the card on file,’” says Mudd.

Tom Evans, engineer emeritus at Ashton Technology Solutions, advises that store networks should be secured with a high quality and properly configured firewall, and any ATM on the premise should be inspected daily to assure no one has tampered with it by adding a skimmer or altering the network connection with additional hardware.

“The store business network needs to be kept properly secured and completely separate from any service offered to customers,” Evans says. “Allowing customers to access the network that has the business data on it is just asking someone to steal it.”

Robert Siciliano, identity theft expert and CEO of IDTheftSecurity.com, advises operators to back up their data.

“Why? Because when all else fails, and your data and devices have been destroyed by malware, a cloud backup allows you to not only recover all your data, but it helps you sleep at night,” says Siciliano.

Clinton Henry, a leading cyber security and identity theft expert, explains in his article titled “9 Surefire Ways to Lockdown Your Cyber Security” that making sure your data is backed and stored separately from your main repository can help protect from “ransomware” attacks.

Henry explains that during a ransomware attack, “instead of ‘stealing’ data from your organization, these attackers find your critical data and then encrypt it (digitally locking you out of it), making it so only the person with the digital ‘key’ can unlock and access that data.”

To keep data secure, don’t underestimate the access and actions of your employees.

“Do a bond and background check on folks handling payments,” says Bush. “This may reveal problems, yes, but it will put employees on notice. It will make them second guess doing something wrong.”

Evans recommends training employees often on the importance of keeping data like customer details and proprietary company information secure.

“Pizza stores may have high turnover, so this needs to be done frequently to assure everyone understands the importance,” says Evans. “Some thought needs to be given to the use of personal devices in the store by employees as well. Today’s devices are capable of storing a lot of data and performing other functions — credit card swipe with Square device — that can compromise the security of the store and the customers.”

Even though they spend most of their time outside the restaurant, the delivery staff is also key to data security and fraud prevention.

Bush advises that the delivery person ask to see the customer’s credit card to verify that the information on the receipt (typically the last four digits) matches the card presented at time of delivery.

Bush also recommends operators do reconciliations — daily or monthly — in order to identify any fraudulent credit card payments before restaurants are hit with costly charge backs.

Identity theft is a constant threat and data security is an ongoing battle for operators. But installing the right hardware with the most up-to-date software from a trustworthy and compliant provider, keeping your business network separate and protected, training staff on the importance of smart cyber practices and paying close attention to all transactions are steps that operators can and should take to protect their customers and business data.

DeAnn Owens  is a freelance journalist living in Dayton, Ohio. She specializes in features and human-interest stories.

The post Protect & Serve appeared first on Pizza Today.

The Most Important Performance Metrics for Your Pizzeria

What gets measured gets managed. If you don’t keep a solid handle on your sales, revenue, food costs and waste, improving your profits will always be a shot in the dark. Likewise, keeping a close eye on a few specific data points can uncover opportunities you never would have otherwise found.

That said, there’s far too much information to focus on everything. From inventory to order size to

employee productivity, almost everything is trackable nowadays — and a lot of that data is just noise. Following are four of the top performance metrics that really deserve your attention, as well as a few tips on turning that data into profitable policies.

1. Food Costs

Your inventory is the lifeblood of your business, and you’ve got to keep tight control of your costs. “If you don’t know your food costs, you can’t accurately price your menu or maintain good profit margins,” says Chris Barr, a 10-year pizza industry marketing veteran.

In particular, adjusting prices (or at least shuffling around your costs) is paramount to a consistent profit margin. That requires constantly monitoring your major expenses. “Cheese is always a hot topic,” says Barr. “The price can double within six months, and if you don’t adjust menu prices accordingly, you could go from a good margin to no margin at all.”

Fortunately, many distributors are willing to negotiate, and with months of data on costs and sales, you’ll have the upper hand. A little give-and-take between you and your suppliers may allow you to keep your prices and profits level, but that’s only possible if you know how much you can really afford to spend on each item.

2. Marketing Conversions

Consistent marketing is a must for any pizzeria, but many operators don’t track their print ads, email blasts or social media posts. How many leads does each campaign drive through your door? What are your e-mail open rates? How many people try a new product following its announcement? These are the marketing metrics you need to track.

Collecting this data requires tailor-made ads, as well. “Every order should have multiple calls-to-action, and you need to include several different offers in any type of marketing you do so you can split-test their performance,” says Barr. “Eventually you develop a baseline response rate, which you try to improve moving forward.” A few months of split-testing targeted ads can significantly streamline your marketing efforts, allowing you to generate more leads with the same budget.

3. Customer Loyalty

Loyalty is everything … but how do you measure it? For Dave Wood, CEO and co-founder of Firenza Pizza in Fairfax, Virginia, the answer is customer frequency. “Our goal is to have everyone come at least once every two weeks,” he says. Customers’ orders are tracked through Firenza’s incentive program, which features weekly offers with customer-specific codes that tie into the company’s POS system.

Wood uses that frequency data to time advertisements to different groups of customers. “We’re more aggressive with customers that have further to move to get to the biweekly goal,” Wood says. A once-per-month customer receives weekly ads, while higher frequency customers might get two per month.

Anne Pritz, Chief Marketing Officer for Sbarro, uses the same type of data to tailor and market new products. In most cases, they’ll push new products on their most consistent customers, “since they’re more likely to try new products when advertised,” says Pritz. “Whenever we do have a new product, it will also be on the front cover of our monthly insert.”

4. Your Top Line

Almost everyone tracks revenue and sales, but you need more specific data to make informed decisions about your menu, inventory and

labor allocation. “The constant balance of an operator is protecting their service while also protecting themselves from waste,” says Brian Mangerchine, Sbarro Director of

Operations. “Everything that gets rung up into our computer system is going to account for a theoretical food item, and our recipes will say how much ingredient you should be missing based on those details.”

Ultimately, if you know what amounts of each item are selling – and when – you’ll be able to streamline your purchasing and pinpoint areas where you need to reduce waste.

Making it Count

Collecting raw data is one thing. Making use of it is another matter entirely. You’ll need to organize a variety of data points to produce a few key metrics. And, in general, groupings are better than averages. For instance, it’s far more useful to divide customers into two or three categories based on loyalty than to generate a single average ordering frequency. Both are great indicators, but only the former allows you to follow up with targeted marketing.

Finally, even the best tracking system won’t produce results if you don’t combine it with great follow-up and communication. “The most critical step in the whole process is having the conversation after the analysis is complete and following up on behavioral change,” says Mangerchine. Whether you’re trying to reduce waste, complete orders faster or push a particular menu time, the change will come from your employees.

Greater Leverage

4 tips to make better use of your data

1. Build a database. Customers’ names, phone numbers and e-mail
addresses should all be compiled in a single database. “When you go to sell the place, this is the first thing a buyer will want to see,” says Barr.

2. Reboot your menu. Send out updated menus with new prices and offers once every six months (or more). You’ll be able to better control fluctuating food costs, and your customers will always be in the loop.

3. Don’t sweat the small stuff. Operational details such as employee turnover are important, but don’t require close tracking and trend analysis. Save the number-crunching for your inventory, sales figures and marketing data.

4. Divide and conquer. Group your customers based on frequency and order size, and organize menu items according to top performers, underperformers and new products. Information related to specific groups offers more insight than aggregated data.

David LaMartina  is a Kansas City-based freelance copywriter who specializes in the finance, food and health industries.

The post Key Indicators appeared first on Pizza Today.

Labor issues that can trip up restaurant operators ­— and how to avoid them

Push labor laws as a restaurant operator and the pushback can be ferocious.

In August, news broke that nearly 10,000 Chipotle workers were suing the company for unpaid wages. The class-action lawsuit alleges that the burrito-peddling chain routinely required hourly employees to punch out and then continue working until dismissal from management.

While Chipotle has denied wrongdoing in various media accounts, the headline-grabbing revelations certainly cut against the Denver-based company’s cherished positioning as a socially conscious brand invested in more than profits, including the well being of its employees.

For restaurant operators around the country, the Chipotle snafu underscores the importance of adhering to labor guidelines, especially given that a massive lawsuit or mounting government fines can threaten a restaurant’s very existence as well as its standing with employees and consumers.

“It just takes one disgruntled employee or someone in the know to find out and the restaurant opens itself to a potential world of hurt,” says Evie Jeang, founder of the California-based Ideal Legal Group.

For restaurants, labor is often the biggest expense ­— and an ever-rising burden given regulations from the Affordable Care Act to increasing minimum wages that continue to challenge operational sustainability. In working to keep labor costs in check and avoid triggering certain labor thresholds, some restaurant operators might push regulatory boundaries, live in perceived gray areas or overlook regulations to save a buck – or five. Restaurants, for example, might:

• Compel an employee to work off the clock, the precise issue at the core of the Chipotle lawsuit.
• Require an employee to close one night and open the next, a practice called “clopening” that landed Starbucks some negative press.
• Hire undocumented workers or fail to fully vet a prospective employee’s eligibility to work.
• Pay employees in cash to avoid taxes.
• Restrict employees from taking breaks to maximize labor hours.
• Neglect necessary certifications such as ServSafe training.

Whether the labor misstep is the result of improper training, negligent managers, pressure to meet performance targets or even an honest,
innocent mistake, restaurant operators have a responsibility — and, many would argue, an ethical responsibility — to be compliant and do right by their employees. Here’s how pizzeria operators can stay on the positive side of the law:

The more you know…

Though a seemingly daunting exercise, Jeang urges restaurant leadership to educate themselves on constantly evolving labor laws by attending local small business seminars or seeking information from the National Restaurant Association or a state association.

“Education is the best way to protect yourself,” Jeang says. “Many times, operators aren’t trying to rip off people or be unethical, but truly do not know the law.”

Kevin Bray, director of customer success at Deputy, a leading global workforce management solution, points to overtime as one notable example. The popular definition of overtime, for instance, is working more than 40 hours in a given week. Depending on local or state guidelines, however, overtime can apply when staff work more than eight consecutive hours or more than six days during a week.

“You cannot just manage to 40 hours a week and need to know what constitutes overtime where you are,” Bray says.

Leverage technology

As humans are prone to error and lapses in judgment, particularly so when faced with stress-inducing operational burdens, Bray suggests removing humans from the equation and automating the process as much as possible.

Workforce management technology like Deputy, for instance, alerts management when an employee is nearing certain work-hour thresholds or can exclude a manager from scheduling an employee beyond established norms. It can also ensure employees are paid for every hour they work, while delivering accuracy to employers with capabilities such as facial recognition.

“The right technology makes life easier while also helping protect companies from common issues like fraud or, worse, accusations of mismanagement of workers’ time that could lead to a lawsuit,” says James Walker, president of the Americas at Deputy.

The right documentation

Reliable documentation helps mitigate litigation.

When hiring, require completed W-4 and I-9 forms as well as two pieces of identification. Then, create an employee personnel file that includes these forms as well as copies of the identification the new employee supplied.

“Have a system of check and balances to make sure people are eligible to work,” Bray says.

An employee handbook, meanwhile, is another tangible ally, particularly so when it states policies around breaks, meals, overtime, certifications and other pertinent employment issues. Employees should sign and acknowledge receipt of the handbook.

“This helps to keep boundaries from being blurred,” Jeang says.

Transparency

Transparency is another powerful tool to minimize trouble.

Employees, Bray says, should always have access to their timesheet and know what’s being sent to payroll, while employers, Jeang adds, should be connected to their accountant to ensure taxes are being addressed as necessary.

With an employee handbook clearly defining store policies, operators can then reinforce key messages in plain view. For example, signage in an
employee common area that reminds employees to take a break or a schedule detailing when employees might have a meal break.

Chicago-based writer  Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Labor Matters appeared first on Pizza Today.

Are you ready to attract investors?

Chef Anthony Carron holds ambitious visions for 800 Degrees Pizza, the Naples-inspired fast-casual concept he launched in 2011.

With already more than a dozen units in operation, Carron believes his California-based concept can become a big-time player in the ever-swelling fast-casual pizza space. To get there, though, Carron knew he needed a financial boost.

That capital injection came in June when Carron and Cleveland-based Murfey Ventures inked a deal that will help 800 Degrees build the operational infrastructure necessary to fuel growth in new markets.

“This came at a fortuitous time for us,” Carron admits.

Whether a pizzeria aims to become a national player like 800 Degrees or simply looks to open one or two additional units in a given market, capital is critical to secure real estate, outfit restaurants, hire staff and open new stores.

While some pizzeria owners will seek bank funding, particularly looking to score a rigorous SBA loan and its favorable terms, and others will tap into personal savings and credit, equity funding –– when a business owner trades a percentage of company ownership for cash –– remains a common practice in the restaurant industry.

“In our industry, equity funding is the price of doing business,” former restaurateur and current Culinary Institute of America associate professor Bill Guilfoyle confirms.

For smaller operations, friends, relatives and business associates will often be the first target. While this route can be riddled with potential problems, including acrimony from a soured deal, deep personal ties can compel investment when other more traditional avenues prove too costly or complex.

Other equity investment partners include “angels,” such as well-heeled clients, customers or simply local entrepreneurs, as well as venture capitalists, a particularly relevant target for brands seeking large-scale growth.

The money raised can help a brand grow quickly, while also providing a collection of people eager to champion the pizzeria.

“With a vested interest in the restaurant’s success, these people want to talk it up,” Guilfoyle says.

Before digging into the equity investment well, however, Danny Bendas of California-based Synergy Restaurant Consultants urges restaurant owners to examine their needs.

“Carefully consider how much money you need and how much equity you are willing to give up,” Bendas says. “Otherwise, you could be leaving a lot on the table.”

Attracting investment

When 800 Degrees was but an idea, Carron knocked on “every door (he) could think of” to secure funding.

“I talked to hundreds of people and had nothing more to show than a pretty business plan,” he says.

These days, however, Carron says it is easier to generate investment interest. Potential investors can see, taste and experience 800 Degrees firsthand, which Carron calls his most powerful tool to attract investors. In the five years since opening his first unit, in fact, Carron says every investment deal he has completed — or rejected, as the case might be — has come to him.

To wit: Murfey Ventures actually approached Carron about being a potential franchisee. During conversations, Carron mentioned that his company was in the early stages of exploring a fundraising effort to drive development. Murfey was intrigued and talks intensified to the point that Murfey became an investor.

“We never actually got to the point where we actively went out trying to raise capital,” Carron says.

At the root of Murfey’s investment, Carron points out, sits 800 Degrees’ determined push to be best in class.

“We had positioned ourselves as a strong concept with great food, great operations and a meaningful brand identity,” he says. “Ultimately, you get an investment by being good at what you do.”

Save few exceptions, investors — even the most seemingly institutional ones — are not nameless, soulless enterprises, Carron reminds, but rather real people putting their money behind companies they believe will succeed.

“You have to appeal to people,” Carron says, “and if you deliver quality food, service and economics, then the investor types will find you.”

While a pizzeria can attract a potential investor by delivering a fantastic meal and in-store experience, diligent investors will want to see a professional, credible operation before ever signing a check.

Ownership needs to show a fully developed business plan and financial documents showing a track record of success, including a current profit-and-loss statement, tax records and expenses ranging from food and beverage costs to labor and overhead.

“Investors are going to want to look over the details and these need to be buttoned up,” Guilfoyle says.

For the growth-minded concept, it is also critical that ownership presents a thoughtfully crafted development strategy as well as the intact systems that will allow both current and potential restaurants to run effectively. An operations manual with defined guidelines around employee training, food safety and marketing, for example, serves as a blueprint for additional units.

“The concept needs to be something executable and scalable,” Bendas says. “If it’s too complicated, then it’s tough to succeed.”

And above all, ownership needs to present a package that makes sense from an ROI standpoint.

“Try to look at the investment through the investor’s eyes and see that they’re getting a suitable return on their investment,” Bendas says.

Four Common Equity Investment Mistakes

The restaurant world is littered with equity investment deals gone bad. To land and maintain a healthy relationship with investors, avoid these common pitfalls:

Rejecting professional guidance. Restaurant consultant Danny Bendas suggests investment-seeking owners work with a seasoned financial professional like an accountant to determine the value of shares and deal parameters such as payback time and exit strategy.

Making no personal financial commitment. Investors want to see ownership have skin in the game. Risk is best when shared, not one-sided, Bendas reminds.

Thinking investors can wait. Culinary Institute of America associate professor Bill Guilfoyle suggests investors get paid first. “This is something investors will find reassuring and important to building trust,” he says.

Allowing investors to have an operational voice. The shareholder agreement should clearly state that restaurant ownership maintains full say in business operations. “You don’t want to have to rule by committee,” Bendas says.

Chicago-based writer  Daniel P. Smith   has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post The Promise Land appeared first on Pizza Today.

Those with less-than-ideal resumes can still bring much to the table

Even those employers that don’t conduct formal background checks sometimes ask applicants to disclose criminal convictions on their application. Pizzerias are no exception. Even so, President Barack Obama has taken steps to “ban the box” (the criminal history section) on applications for some federal employee jobs to avoid discriminating against ex-offenders.

Private companies can still request a criminal background check, but some pizzerias buck this practice with hiring programs and practices aimed at helping those who’ve struggled with homelessness, drug addiction or incarceration gain stable employment and independence.

Chicago-based pizzeria Lou Malnati’s has operated its Lawndale location as a job reengagement program in partnership with Lawndale Community Church for more than 20 years. Participants in the church’s residential addiction recovery program, Hope House, can learn to prepare food or gain experience bussing tables or serving. “We provide a place for men to come and re-engage in job skills,” says Jim D’Angelo, COO of Lou Malnati’s. “We’re trying to create stability.”

After a six-month training program, men can work in the Lawndale location or one of Lou Malnati’s six other locations. In addition to creating job opportunities, D’Angelo says revitalizing the troubled neighborhood (Lawndale got burned out during the race riots of the 1960s) is another goal. “It’s modeled after a Ben & Jerry’s in Harlem (that sought to) create economic revival in an area that was depressed,” D’Angelo says. “We want to create jobs but also create hope in a sense that if a business can survive in the neighborhood, other businesses would see that.”

With guidance from the church, they’ve opted not to serve alcohol at that location due to alcoholism in the neighborhood. As a result, the economics of the Lawndale location differ from other Lou Malnati’s stores that do serve alcohol, but Lawndale has had some profit two out of the last four years. It donates profits to the church.

Of course, not every hire (traditional or otherwise) works out. In the early days, when D’Angelo was more actively involved in the program, “everybody needed a job but not everybody wanted to work to keep a job. My response was ‘I have jobs. You need to show me why I should give you a job. Show me that you’re serious about this.’”

Some graduates of the program have become long-standing employees. D’Angelo points to a man named Robert who came through the program. “He started in our restaurant working in our carry-out section,” D’Angelo says. “Then he moved to the catering department taking orders and helping guide people through setting up their large corporate accounts. (There have been) bumps in the road, but he brought a decent work ethic and a positive attitude.” Robert has now worked for Lou Malnati’s for nearly 20 years.

In Philadelphia, Rosa’s Fresh Pizza began hiring people who’ve struggled with homelessness following the popularity of its “pay-it-forward” program where customers can prepay for slices for those who can’t afford them. For about a year, Rosa’s has worked with the Philadelphia chapter of Back on my Feet, which offers running programs and job resources for those struggling with homelessness.

“We have way less turnover with the people we hire with a history of homelessness than otherwise,” says Mason Wartman, founder and owner of Rosa’s. “They’re really looking for an opportunity and they’re grateful for it and we’re happy to help.”

Already, several of these hires exceeded expectations by taking on greater responsibility and earning raises in pay. “One guy got custody of his son back and he’s living with him,” Wartman says. “He’s out of a shelter and in an apartment that he pays for. Another one is going to school.”

Wartman says he mainly looks for employees who are punctual and friendly and can be taught to make pizzas. “Making pizza isn’t all that hard,” he says. “You don’t need years of experience. You just need a good attitude. It’s hard to find people with good attitudes using just the Internet. Getting people that are more punctual and friendly leads to better business and a more successful and stable business.”

Meanwhile, MOD Pizza in Seattle has a less formalized approach to hiring those who need a second chance, including the formerly incarcerated (another way to say this without worrying about PC is to say, including hiring those with a criminal record). “As we were building the business, a couple of our team members hired people who fell into that category” needing another chance, says MOD Pizza co-founder and CEO Scott Svenson. “They took a chance with them and as it transpired, (the employees) ended up becoming really positive role models and impactful team members.”

MOD generally doesn’t do criminal background checks on potential employees. Instead, Svenson says they look for “attitude, aptitude and energy. We’re embracing this idea that your past, while it might describe you, it doesn’t need to define you.”

Although some might assume that managing employees from challenging backgrounds requires lots of rules, MOD takes the opposite approach. “We start with the presumption that we trust them,” Svenson says. “I think that brings the best out in people. This is a place that cares about me, trusts me, expects me to do the right thing.”

Not everyone embraces that culture, so some people don’t work out. But as Svenson says, “those that do embrace it really feel inspired and empowered.”

Susan Johnston Taylor covers business and personal finance topics for numerous print and online publications.

The post Hiring: Second Chances appeared first on Pizza Today.

Six steps to a sound management incentive program

Since its founding in 1987, Orlando-based Flippers Pizzeria has grown into a 14-unit enterprise, operating nine of its own locations in addition to five franchised units. A key part of that growth, according to Flippers vice president of operations Ben Richardson: a management incentive program that encourages store-level ownership.

“Having management invested in the business has certainly been –– and continues to be –– important to our overall development as a company,” Richardson says.

Each month, Flippers’ ownership calculates each store’s net profit and 10 percent of that figure serves as the bonus’ starting point. Thereafter, ownership investigates each manager’s ability to hit a range of metrics, including profit-and-loss statement figures like labor and food costs, on-site evaluations and secret shopper results. If managers achieve all of the specific goals, then they earn the full 10 percent bonus; if they fall short on some objectives, then a slice of the bonus pie disappears.

“This incentive program puts our managers in position to take charge of their own compensation and motivates them to do well,” Richardson says.

For any pizzeria operation, but particularly so for those with more than one unit, good management is essential. Just as responsible, sturdy and smart managers can drive store performance, so, too, can dispirited managers weaken a company’s brand equity and bottom line.

As much as every restaurant owner would love intrinsically motivated management, external factors drive many in today’s workforce — and management incentive programs can be just the tool to spur management’s dedicated investment in store performance.

“When you have organization-wide goals that are addressed with incentives like profit sharing, it promotes a spirit that we’re all on the same team and share in the fruits of our labor,” says Kerry Chou, senior practice leader at WorldatWork, a nonprofit association for human resources management professionals.

But creating a successful management incentive program demands strategy and sincerity. Here are six steps to getting it right:

Step 1: Prepare to launch

Before Phoenix-based Spinato’s Pizzeria rolled out its management incentive program three years ago, leadership collected feedback from managers throughout its five-unit system on how the program could be fair and beneficial for both sides. The company also got its accounting in line so each store maintained its own P&L.

Such preparation is key, Chou says, adding that ownership should perform some financial modeling to examine the prospective investment and returns of any incentive program.

Step 2: Define the goals

According to Chou, incentive programs should align with the company’s goals and be focused on results. Are you working to control labor costs or reduce waste and spoilage? Are you looking to increase the check average or improve secret shopper scores?

“You don’t want to be giving cash just because,” Chou says. “Know why you’re offering the plan and where you need to move the needle.”

Culinary Institute of America associate professor of business management Lynne Eddy recommends ownership start with their hoped-for outcomes and work backwards from those targets.

“But think baby steps,” she advises. “You can’t try to tackle 10 things all at once.”

Step 3: Set clear expectations

To drive management buy-in and results, supply simply stated goals that are achievable and readily available for managers to review.

“This is what keeps the managers invested,” Flippers’ Richardson says. “They see our expectations in black and white, understand the targets and know what they need to do to earn that bonus.”

Chou calls this “providing a line of sight” and says plans should be quantifiable, consistent and objective.

“Managers should see that they have control over their incentive opportunity,” Chou says.

Step 4: Seek balance and fairness

Set unachievable targets and employee morale can plummet. Set objectives too low, however, and the pizzeria’s overall financial performance can suffer.

“You want a plan that’s a win-win: employees benefit from their extra effort and the business captures the ROI it needs,” Chou says.

Fairness, meanwhile, includes amortizing costs such as capital expenses or repairs. A manager, for instance, shouldn’t be penalized if store profitability wanes because exterior signage needed to be replaced after a fierce thunderstorm.

Step 5: Evolve and adapt

New competitors arrive, trends develop and regulations occur. The world around the pizzeria evolves, and so, too, should a management incentive program.

Since first rolling out its incentive program three years ago, Spinato’s has undergone three updates. Currently, the biggest bonus piece is linked to reducing employee turnover, which has compelled managers to focus on creating a positive workplace culture. The initiative has dropped employee turnover from 112 percent to nearly 60 percent, Spinato reports, and improved store operations.

“You can’t think you have it all figured out,” Spinato says.

Step 6: Monitor for holes

Even the most well-designed incentive programs hit hurdles.

To wit: in an early iteration of Spinato’s incentive plan, the company did not set a floor for labor costs. Some managers responded by running lean teams or ignoring staff raises. Those efforts increased the manager’s bonus pool, but also threatened employee morale and guest satisfaction. Spinato quickly addressed the flaw.

“Sometimes you just don’t see problems until a policy is in place,” Spinato says.

The Management Incentive Dilemma

Why would I ever pay managers extra for doing their job?

Anthony Spinato remembers his “old-school” father, Spinato’s Pizzeria founder Ken Spinato, posing that exact question as Spinato’s contemplated launching its own management-incentive program.

In an industry notorious for employee turnover, Spinato told his father that an incentive program could help the five-unit pizzeria attract and keep top talent, particularly given the growing ubiquity of managerial bonus plans.

“Larger restaurant chains had such programs in place and we were competing with them for the same talent,” Spinato says. “We had to try and level the playing field.”

Beyond competitive balance, empowered –– and incentivized –– managers can help propel growth. Ben Richardson of Flippers Pizza says his concept has been able to open additional units, including three in 2016, precisely because the company has compelled store management to take greater ownership of their individual stores.
“Micromanaging simply isn’t scalable,” Richardson says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post The Carrot Approach appeared first on Pizza Today.

How to best protect your recipes and trade secrets

New Jersey-based Emma’s Brick Oven Pizza has trademarked several of its menu items.

The headlines alone are enough to seize the attention of pizzeria operators who have toiled to define and distinguish their concept.

“Pizzeria owner sues competitor, saying he stole family recipes,” reads one from The News-Herald in Cleveland.

“Pizza War: Colony Grill owners cry foul over imitators’ use of ‘secret’ recipe” blares another from the Stamford Advocate in Connecticut.

For pizzeria operators who pour their soul into creating and building their business, the thought of a competitor stealing recipes and other trade secrets stands a real worry. With such information in hand, a competitor can then capture market share and strengthen its business while weakening the original eatery.

Frustrating and unfortunate as that might be, the victimized pizzeria might have little recourse. Quite often, the problem is the result of leadership’s own missteps or the expense of litigation makes even warrantable legal action prohibitive. The only real course of action many have is to simply defeat the offender in the marketplace.

“The practical problems that happen after you suspect someone has stolen your intellectual property are what make this issue a real concern,” says Michael Weil, an attorney in the San Francisco office of Orrick, Herrington & Sutcliffe who specializes in trade secret litigation.

One of the most common fact patterns attorney Peter Afrasiabi encounters in litigation is past employees leaving, starting their own business and using perceived trade secrets from their previous place of employment to launch their own venture.

“It’s common across all industries and happens to any business that’s profitable,” says Afrasiabi, a trade secret, intellectual property and copyright attorney with One LLP in southern California. “Employees see margins, owners making money and think they can replicate that, and, frankly, there are things the company could have and should have protected better.”

While a competitor cannot steal something like a business name, Afrasiabi says “softer things” can be vulnerable –– the “secret sauce” of a business such as recipes, customer lists and pricing secrets that give the operation its competitive edge.

“And these can be incredibly valuable,” Afrasiabi reminds.

Both Weil and Afrasiabi urge restaurant operators to take proactive steps to protect their trade secrets.

“Because if you don’t take steps to protect (trade secrets), then you may not have a claim,” Weil says.

He adds that operators should first reflect upon their intellectual property and identify the characteristics that distinguish them from their competition.

“Then, you can understand where to put your resources and how to treat things,” Weil continues, noting that Orrick’s Trade Secrets blog carries information for business owners interested in learning more about trade secrets.

Generally speaking, there are two practical steps operators can take to protect trade secrets: confidentially agreements and treating trade secrets as, well, secrets.

Afrasiabi calls confidentiality agreements a pizzeria’s “first line of defense,” urging restaurants to have employees sign confidentiality agreements acknowledging the specific company elements that belong solely to the business.

“You want people to agree that the processes they learn, the marketing, sourcing, pricing, customer lists and so on are all confidential to the company,” Afrasiabi says.

As every state treats trade secret law differently, Afrasiabi suggests operators consult with a local attorney to craft their confidentiality agreement and also present the confidentiality agreement at the beginning of employment, which Afrasiabi says is “much easier than doing it retroactively.”

In the event of a suspected breach, pizzeria owners can then point to a signed contract and argue that the employee agreed that certain, specified elements of the business were indeed proprietary to the operation.

“A signed contract is a potent pill,” Afrasiabi says. “Without one, (legal) arguments are more difficult and defenses more readily available because there’s greater uncertainty.”

In the event a pizzeria owner wants to claim trade secrets, the law mandates that the business owner safeguard sensitive information. Some go to great lengths to accomplish this, including, most notably, KFC. The New York Times reported that the famed Colonel’s Original Recipe is locked in a company safe and its ingredients “known only to a handful of employees who have signed confidentiality pledges.”

Pizzeria owners must hold their prized trade secrets tight. Practical steps include only disclosing information on a need-to-know basis, having nondisclosure agreements and keeping treasured information in a secure location such as a vault or on a password-protected computer.

“If you don’t take these steps, the law is less likely to see particular things as a secret. You want to be able to point to a historical record,” says Afrasiabi, whose One LLP firm offers three downloadable manuals for small business owners providing an overview of trade secrets and copyright law.

Of particular note, recipes could have trade secret protection if they contain secret ingredients others cannot figure out, Afrasiabi says, though copyright law does not protect recipes as a list of ingredients.

“Recipes are much harder to protect unless there are very unique quantities, rare spices or other unique variations to the method or process of preparing,” Afrasiabi says, adding, however, that the law rarely provides significant protection when a presumed trade secret is “tweaked” for a new use.

Naming Rights: The advantages of securing a trademark for your restaurant name

Given what restaurant owners pay to create signage, menus and marketing materials, attorney Peter Afrasiabi says they should also investigate trademarking their name.

“If it’s worth opening and investing in a restaurant, then it’s worth it to get a name that’s yours,” he says.

A unique name with trademark protection can be secured for under $1,000. With that federal trademark in hand, no one can open a business under the same name anywhere in the country.

On the front end, Afrasiabi says, this pays off as affordable insurance. In the long term, the trademark provides the business, particularly growth-minded brands, something tangible and controllable.

“A name you own and control can be incredibly valuable to the business … and though you might not have plans to get big, you never know what’s going to happen,” Afrasiabi says. “It’s just smart business to protect yourself.”

Chicago-based writer Daniel P. Smith  has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Curbing Copycats appeared first on Pizza Today.

Finding sound advice

Pizzeria operators invest their bodies and souls into their restaurants; but, whether they’re newbies or veterans in the pizzeria business, there are times when finding trustworthy outside help and advice is warranted.

For Mike Monteleone, owner of two Barone’s Pizzeria locations in the Los Angeles area, opening a fast-casual pizzeria on top of his existing family-style concept led him to seek a consultant’s advice. Monteleone hired a consultant after an initial meeting at an expo along with recommendations from peers, followed by an interview.

The consultant assisted with many aspects of the new operation, including finding a location, choosing equipment, changing the layout of the kitchen to support high volume and assisting with the soft opening.

“We got off the ground quickly and did over a million dollars in sales our first year,” explains Monteleone.

He credits this success to his consultant’s advice.

“He knew (what to do) up front so we didn’t have to experiment,” says Monteleone.

Other issues also point operators in a consultant’s direction.

A consultant should be hired “when (restaurateurs) think they’re doing everything right, but they’re still not getting customers through the door or they’re getting customers through the door and they’re not making a profit,” says business expert Christine Corelli.

For Big Dave Ostrander, “The Pizza Doctor” and former restaurateur, operators come for a second opinion, to avert financial crisis or for help with their new start up.

Operators ask him questions like:

• Do you have recipes?
• Can we create a Muslim Halal menu?
• What’s the best way to pay a pizza delivery driver?
• Can you give me some suggestions on compensation programs for managers?

Before seeking help, global restaurant consultant Aaron Allen suggests restaurateurs pinpoint their restaurants’ needs.

“The more clearly that they can define what it is (restaurateurs) need help with, the quicker it is for them to determine if they’ve got the right fit with consultants,” says Allen.

To hone in on specifics, Allen often asks restaurateurs questions including: “What keeps you awake at night? What are you afraid of? What’s giving you anxiety?” says Allen. “Then, also in terms of opportunity: What are you excited about? Where do you see the potential of the company headed?”

Then, he recommends restaurateurs ensure that the consultant’s capabilities and core specializations match these needs.

Paying two to three consultants at once to perform a small scope of work for a test run is also a strategy Allen advocates in the hunt for a consultant. Pay structures vary. Some charge a daily rate; others by the job, for a pre-specified amount of time or a flat price per hour.

Afterwards, continue to evaluate other qualities of an organization to secure a trustworthy consultant.

Look for someone who will keep your information confidential, says Allen. For instance, to maintain confidentiality at Allen’s company, Aaron Allen & Associates, they don’t publish portfolios, client case studies or profiles.

“We find that the relationship between consultant and company requires a lot of trust and sharing a lot of very confidential information,” says Allen. “So if it’s going to feel uncomfortable to do that, you’re not going to be able to get the best results from that consultant.”

Also, Corelli recommends you choose someone who listens attentively, appears to be genuinely concerned about your operation and asks you a lot of great questions. They should also be interested in every detail of your restaurant and appear excited to work with you.

“They say: I really think I can help you, or I know I can help you, but they’re not really aggressive about it and they don’t over promise,” Corelli says.

Checking a consultant’s background along with their references is also essential. If you can’t call a consultant’s past clients, Corelli recommends asking to view their Web sites to ensure they’re really impressive and seek out five good references.

“Of course, we also have to keep in mind that no one –– no consultant, speaker, or service provider –– is going to give you the name of someone who doesn’t like them, but you still have to check references and ask really good questions (like): ‘Did you see bottom line results?’, ‘How long did it take?’, ‘Did you see a big difference within eight weeks?’, ‘What happened?’,” says Corelli.

After you’ve hired your consultant, take a few extra steps to ensure you’ll work together optimally.

When speaking with your consultant, Corelli recommends always preparing a list of questions so you don’t forget to ask everything that’s been on your mind.

Don’t be afraid to ask your consultant if they’d be willing to work with you at unconventional hours –– for example, early in the morning –– if you’re concerned you may not be able to fit them into your 12-hour days.

Further, expect to provide your consultant with preliminary materials before a visit like blueprints, floor plans, menu, last year’s end-of-year profit and loss statements or balance sheets.

“There are many ways to fix an issue. I have to (find) the right one for the right location, for the right kitchen,” says Ostrander.

Signals you should seek alternate advice

If you’re experiencing issues with your consultant, Dave Ostrander recommends chatting with them first to determine whether the problems are stemming from a miscommunication or misunderstanding. Also, ensure you’re doing everything your consultant has advised.

In addition, watch for these signs that you may not be entrusting your pizzeria to the right consultant:

• They make statements like: “Work with me for six months and I’ll tell you what: I will turn your business around,” says Christine Corelli. For Corelli, this demonstrates ego; not the class and professionalism you want to see in a consultant.
• They list being an employee as their experience. Look for a professional with consulting experience.
• “If they haven’t been there and done that, that’s a big red flag,” says Ostrander. He recommends looking for someone who’s been in the kitchen and has the burn marks to prove it.

Carimé Lane is a freelance writer who writes about health and the restaurant business from Vancouver, B.C.

The post Hiring the right consultant for your pizzeria appeared first on Pizza Today.

Scott Wiener
Owner & Operator
Scott’s Pizza Tours, NYC

Think of your favorite sports team. When they’re playing a big game, you get excited. When they win, you take it as a personal victory. When someone speaks badly about their players, you spring to their defense. As a fan, you are an engine of the sports business. In much the same way, your customers are the engines of your pizzeria. While most of your customers simply buy your food, you probably have a dedicated sect that considers themselves fans. Lately I’ve noticed how pizzerias are converting their customers into legions of active fans, armed with tools to voluntarily market on behalf of the restaurants they love.

Anybody who has ever spent time at or near Fordham University in the Bronx knows Pugsley Pizza. It’s an off-campus hangout that gets more action than the university’s actual student center and feels more like a dolled-up living room than a restaurant. At the helm are husband and wife duo Sal and Pina, who treat everyone who walks through their door as the most important person in the room. I’m sure you treat your customers well, but Sal and Pina goes so far as to name menu items after theirs. Handmade signs adorn the counter, advertising specials like The Elisa (one cheese slice, garlic knots, medium side of sauce for $5.99) and The Richie (one cheese slice, one chicken roll, large fountain soda for $6.99). It’s the goal of every Fordham student to lend his or her name to a special. All it takes is a piece of paper and a marker to make someone’s dream come true by including them in the fabric of Pugsley’s.

Customers at Hello Pizza in Minneapolis take photos in a photobooth, which are then posted around the shop.

Pete & Elda’s in Neptune, New Jersey, has a more direct way of helping their customers cross into the realm of fandom. They have a special that rewards customers with a free t-shirt if they can finish a XXL 18-inch pizza all by themselves. The pizza is priced at $16.50, with the cost of a t-shirt already built in. The idea is not to make a difficult challenge but to send customers home with wearable billboards. Shirt designs change every few weeks, so there’s a serious incentive to come back for new editions. The pizzeria recently debuted their 195th t-shirt design and has sold out of all 200,000 shirts printed to date.

One of the strongest bonds I’ve seen between pizzeria and customer doesn’t require signs or t-shirts. Brooklyn’s Paulie Gee’s has cultivated some of the most dedicated fans over its mere six years in business. Paul Gianonne walks from table to table to ask how guests are enjoying their pizza. The act in itself isn’t revolutionary, but the depth to which Paulie engages his customers helps them make the leap into fandom. When he engages customers about their hometowns, favorite music, and other pizzerias, they get a glimpse into how deeply he cares without having to hear it out loud. In one online review, a customer raves about how Paulie offered to personally curate his group’s entire order. Their review ends with a line that really sums up their entire experience: “I’m going to run for vice president of the Paulie Gee fanclub.” Is there any better marketing than an unsolicited endorsement like that?

Think of your favorite pizzeria (not including the one you operate). When someone says they want to check it out, you encourage them. When they’re named on a list of top pizzerias, you take it as a personal victory. When someone complains about a bad experience, you suggest they give it another try. Customers buy food but fans proselytize about it. That’s not the kind of advertising that can be bought, but it’s clearly the most valuable. Think about what you can do to convert your customers into fans so you can help them help your business.

Scott Wiener owns and operates Scott’s Pizza Tours in New York City.

The post Man on the Street: Converting your customers into fans appeared first on Pizza Today.

You have options to cash out of the business without a succession plan

Pizzeria operators looking to get out by selling their restaurants have several routes they can take — although ultimately, the path chosen depends on how financially successful the business is. Dennis Lombardi, president of Insight Dynamics, LLC, a Columbus, Ohio-based restaurant consulting company, outlines the options thusly:

• Selling the restaurant as a going concern. Everything remains essentially the same —the name over the door, the menu, the look (although the new owner may make some minor décor changes). The intellectual property is also sold with the business.
• Selling it as ready-to-operate. Although it remains a pizzeria, the name, menu and brand identification would change. Still, no major back-of-house or front-of-house changes would be required. Intellectual property may or may not be part of the deal, depending on the buyer’s inclination/ability and how well-regarded the food/menu is.
• The restaurant will be adapted to a different kind of restaurant. This requires more capital expenditures from the buyer — for example, BOH changes because of a new menu — compared to the two previous strategies.
• Selling off the components/equipment. “This is the least desirable” outcome, says Lombardi. “You’d be surprised at how little you get for used equipment — think garage-sale prices. Restaurant operators taking this step are doing so because they have no other options,” he continues. “The restaurant is failing and there’s no value left in the brand.”

Unfortunately, this latter situation — selling off what you can and walking away — is probably the more common scenario, says Bill Marvin, a consultant known as The Restaurant Doctor in Gig Harbor, Washington. “If you’re not making money, you don’t have anything to sell. In this case there’s no such thing as goodwill; there’s only the financial reality.”

Setting that unhappy outcome aside, how can pizzeria operators determine which of the three remaining options to consider? And, what are the pros and cons associated with each?

If the restaurant is popular and financially successful, selling it as a going concern might be the most desirable strategy since the seller could command a higher price, says Lombardi; however, he adds that the seller would have to be comfortable with his/her name being over the door, while having no control over operations. Also, if the owner has more than one (identical) location, and is just selling off a single restaurant, doing so as a going concern might not be the best move, since if something goes wrong, it could negatively impact business at the other sites, cautions Marvin.

There’s something else to consider when selling this way, says Annette Fazio, founder of Ground Level Leadership, a Fort Myers, Florida consulting firm to the restaurant industry (among others).

“It’s your ethical obligation to let the new owners know what you did and how you did it,” explains Fazio, who in the past, sold one of her restaurants in this manner. “So, there’s typically a certain amount of training involved in the transition.”

A strong brand name would probably generate multiple offers to sell as a going concern. In absence of this, or in the case where the seller (or buyer) prefers to change the brand identity, while still keeping it a pizzeria, selling as ready-to-operate can also fetch a good price, since the new owner would have to make some physical changes but the BOH could stay as is, says Lombardi. However, selling to adapt it to a different type of restaurant drops the price down considerably, since the buyer will have to make more extensive changes.

“It’s also unlikely that the restaurant will keep all its core customers,” Lombardi says. “So the only real advantage to the buyer lies in the quality of the site itself, along with perhaps some infrastructure and equipment.”

The first steps? Look at the business objectively — who would want to buy it and why, says Fazio. Talk to an accountant to see what he/she thinks about the restaurant’s value. Can it be sold as a going concern or some other way? asks Lombardi. Next, contact several local independent restaurant brokers who could provide insight on how they feel the unit should be positioned for sale, along with some idea of its value, Lombardi adds. If the upshot is selling to adapt to another restaurant, a leasing agent in addition to a restaurant broker, might be consulted. If selling off piecemeal (and the building is leased, not owned), contact used-equipment buyers.

Don’t play financier; your ability to get paid will depend on the new owner making money, warns Marvin. “If he doesn’t make money, you don’t get paid. Or, you’ll end up working in the restaurant trying to turn it around, or you’ll get it back and the value will be greatly diminished.”

Lombardi says one mistake he encounters is disengaged owners hanging on too long before finally deciding to sell. “Consequently, it’s not as desirable of an entity as it could be,” he explains. “If you’re getting tired of running the business that is the time to sell — or to hire a motivated manager — because usually the value of the business won’t be sustained through several years of disengagement.”

Additional Considerations

Thinking of selling your restaurant but unsure if you should or which route to take? Keep the following in mind:

• You can’t protect your name when selling as a going concern, says consultant Annette Fazio, founder of Ground Level Leadership in Fort Myers, Florida. “Consider all the variables out of the new owner’s control that could impact you. This might tilt the scale towards selling it as ready-to-operate instead.”
• Looking for a broker? Find out what he has sold, how he sold it and how long it took, suggests Fazio. “Also, is he proposing a price reflecting its true value, or is he pricing to sell fast?”
• Restaurant struggling? Let go before it’s too late, says consultant Bill Marvin. “Otherwise, you’re just digging the hole deeper and deeper and you won’t have any money left to start over with. If you’re dead, lie down.”

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post First Steps to Selling a Pizzeria appeared first on Pizza Today.

Should you adopt online applications?

Three years after opening Slice of the 80’s in Westland, Michigan, Adam Matt had enough.

Matt tired of the laborious process of managing paper job applications. He grew weary of running off copies each time he needed to refresh his current stack or revise his customized employment application with a more specific question. He hated the risk of losing a paper job application and, potentially, a qualified employee.

So in 2011, Matt went digital. He placed an “apply online” button on his pizzeria’s Web site and hasn’t looked back since.

“The online applications are more efficient, more convenient and just a cleaner, better process all around that helps us look like a more modern and professional operation,” Matt charges.

William Walker knows the paper-to-digital shift as well.

Walker has been accepting online applications at his two Old Shawnee Pizza locations in suburban Kansas City since 2003 –– a relative pioneer in the effort. He considers online applications “seamless.”

“I’ve been doing it this way for 13 years and would never go back to paper,” he says. “I see every completed application and can better assess candidates.”

Here are five reasons operators are ditching paper applications in favor of the digital variety and one big element to consider before making the switch:

• Immediate access to candidates. Every time a new prospect completes an application for Slice of the 80’s, Matt and his three managers all receive the application. That quartet can then flag the best prospects and follow up in quick time.

Erin Powell, business development manager for Snagajob, a human resources tech company for hourly employment, calls the ability to get an applicant’s information immediately into the hands of hiring personnel a key advantage for restaurants.

“When you have a good applicant, you want to be able to move ASAP,” Powell says.

• Deeper applicant pool. Since debuting online applications, Matt reports an uptick in applicant numbers and says he’s been able to cast a wider net for prospective employees, an important edge given the industry’s inevitably high turnover.

“There’s always a steady flow of applications trickling in and I can archive them, interview them or even overstaff if I find a great candidate,” Matt says.

Operators can encourage prospects to apply online by broadcasting the message on pizza boxes, receipts, social media, pizza toppers and more.

“It’s much easier to invite candidates to apply by providing an online link rather than asking them to come in and grab an application,” says

Nathan Shackles, CEO of ApplicantStack, an applicant tracking system designed for small and mid-sized businesses.

• Accurate information. Online applications eliminate legibility issues and many software providers like ApplicantStack flag incomplete data, which allows a manager to avoid scrambling for information himself.

“The last thing you want is to not be able to contact a promising prospect simply because he forgot a digit in his phone number or you misread his email address,” Shackles says.

• Specific questions answered. While operators can certainly get specific with their questions on a paper application, it’s an easier, more convenient process online.

Matt’s Slice of the 80’s application, for instance, features the precise questions Matt wants answered, such as a candidate’s availability, schooling, experience with restaurant equipment and previous employment.

“This minimizes a lot of back and forth and makes sure I’m taking the next step with the right candidates,” Matt says. He adds that he enjoys the fact that he can revise and update his application within minutes.

Owners can also employ what Shackles calls “knockout questions,” basic screening questions, such as whether the applicant holds a valid driver’s license or is over 21, to ensure leadership reaches out to viable candidates. Shackles urges operators to visit their job descriptions and translate each role’s tasks into application questions. (He also suggests operators consult legal counsel to ensure the pizzeria is following all necessary laws and guidelines.)

Similarly, the right questions can show an employee’s eligibility for the federal Work Opportunity Tax Credit, which can provide $1,200 to $9,600 for hiring individuals from certain designated groups.

Yet owners should avoid getting too extensive, Snagajob’s Powell cautions, especially as national unemployment hovers near five percent.

“You want to lower the barriers for applicants so you can get people into the system,” Powell says.

• Onboarding efficiencies. The online application can also help downstream. With the press of a button, operators using ApplicantStack, for instance, can invite promising candidates into the store for an interview rather than sending individual e-mails. The ApplicantStack system can also collect key data upfront so operators can quickly conduct background checks.

• Trading print for digital. For online application’s many benefits, Matt admits there’s an important trade-off in moving from paper to digital.

“We hire for personality and having a paper application generally allows for direct interaction and an opportunity to feel someone’s vibe before granting an interview,” he says. “Plus, coming in to fill out the paper application shows initiative.”

Walker, too, sometimes laments the absence of direct personal connect, especially since 98 percent of Old Shawnee applicants apply online.

“You definitely lose that dynamic,” Walker admits. “It’s nice to see how someone speaks and carries themselves.”

To combat this limitation, the forward-thinking Walker has contemplated adding a video piece to his online application, an opportunity for him to assess how applicants present themselves.

“It’s a down-the-road idea, but one I’m thinking about because getting a better sense of someone’s personality is important in this business,” he says.

Chicago-based writer  Daniel P. Smith  has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Hiring: Apply Online appeared first on Pizza Today.

How do you add online ordering?

In today’s world, Mo Jallad knows he cannot ignore online ordering.

The owner of Mogio’s Gourmet Pizza, a nine-year-old concept that will grow to six Dallas area locations this year, Jallad says offering customers online ordering –– something boldly highlighted on Mogio’s home page –– positions his eateries to succeed in a competitive, crowded field, bringing ease and convenience to the customer and heightened revenue to the restaurant.

“If we’re not offering online ordering, we risk losing market share,” Jallad says. “Today’s customers want to control the transaction.”

According to the NPD Group, online orders for food delivery continue to rise at an annual clip and have neared a 50/50 split with phone orders. In the year ended May 2015, food delivery phone orders reached 1.02 billion, while online orders topped 904 million, more than double the tally in 2010.

“People are gaining more comfort and familiarity with online ordering and it’s running across all age ranges,” says Mike Ganino, head of restaurant strategy for the online ordering platform ChowNow. “This is how business is being conducted now … and restaurants that don’t catch up will be left behind because the customers crave this convenience.”

Indeed, online ordering has emerged a virtual must in the pizzeria world, particularly given the category’s heavy ties to delivery and carryout. Leon Hartman of Two Boots Pizza, a 16-unit enterprise based in New York City, in fact, calls online ordering the pizza industry’s present and future.

“These winds are coming and online ordering’s an opportunity to get a leg up with customers,” Hartman says.

To launch –– and then foster –– a successful online ordering presence, here are four vital first steps:

Step 1: Figure out what’s important.

In recent years, dozens of online ordering platforms have emerged, ranging from upstart tech enterprises and well-established names such as GrubHub and ChowNow to options powered by point-of-sale systems. As every option holds its own intricacies and value proposition, operators need to discern what’s most important for their establishment.

For instance, do you want online ordering directly tied to your existing POS? Is it important that online ordering is fully integrated into your site as opposed to a third-party offering? Does the provider share customer data so you can send follow-up messages? Do you want a built-in loyalty program designed to spur repeat business?

“You need to get real specific about what you need in your business,” Ganino says. “What’s the bigger strategy and how does online ordering fit into that?”

Step 2: Take your time selecting a partner.

Given online ordering’s surge, it’s understandable operators want to leap into the online ordering game. Be patient, though, and investigate the benefits and drawbacks of every prospective partner.

Some providers charge a direct fee to establish online ordering; some take a commission on each online order; and others toss in some extra perks. Menufy, for example, will either design a new Web site for the eatery or post an online ordering link to an existing site, while it can also deliver consumer friendly elements like Facebook or Google log-in options so people don’t have to memorize another username and password.

Ganino urges patience and analysis, encouraging operators to avoid making a decision out of desperation or cowering to the loudest salesperson.

“You want to pick the platform that you believe is easiest for your consumer to use and best matches your brand,” he says.

Step 3: Align online ordering with operations.

Too often, pizzerias flip the online ordering switch with little consideration for the operational end. How does the order make its way into the kitchen? How is a half-and-half pizza order addressed? How do customers redeem promotions?

“And this takes work,” Hartman admits.

At Two Boots, for instance, an iPad rings with every new order. A manager or counter person then opens the order and inputs it into the store’s POS. There, the order funnels into the kitchen and is processed like any other purchase.

While the manual input is a step Hartman hopes to someday extinguish, it’s an improvement over previous iterations of online ordering Two Boots used that included faxes, verification phone calls and confirmation e-mails.

“I suspect there will be a middleman who develops the technology that links every online ordering platform directly to any existing POS,” Hartman says, “but what we have today is certainly an improvement.”

When the operational wrinkles are resolved, however, Menufy cofounder Ashishh Desai says online ordering can minimize phone time and increase order accuracy, two significant operational and customer-pleasing benefits.

Step 4: Market online ordering.

Hartman says pizzerias should not expect success simply by launching online ordering. Pizzerias must market online ordering by promoting it on sales fliers, takeout menus and table tents; placing stickers on pizza boxes; posting decals on store windows and so forth.

“You need to have a strategy, whether that’s using fliers, print ads or social media,” he says. “You can never rest on the business you have and need to get the word out that this service is available.”

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Online Ordering: Web Sales appeared first on Pizza Today.

Conduct effective team meetings for maximum employee efficiency

From pre-shift pow-wows to drawn-out management conferences, team meetings are a ubiquitous part of the hospitality and retail industries. While some operators appreciate them more than others –– and even though many employees dread them –– productive meetings are an essential management tool for almost every shop.

With that said, no two pizzerias are exactly alike, and ideal meeting strategies differ from one store to the next. From the mom-and-pop shop to the small chain to the corporate franchise, every restaurant needs to tailor its meetings to its employees, management styles and bottom-line concerns.

A meeting’s leadership can be just as important as its content. “There should be three leaders for each meeting –– an initiator, a designer and a facilitator –– and those leaders can be the same person or different people,” says Bryan Mattimore, co-founder of Growth Engine. The initiator determines the meeting’s ideas, content and focus; the designer creates the structure; and the facilitator keeps everyone on task.

Who exactly should fill those roles? “It depends on the type of store,” says Mike Morgan, vice president of California-based Pizza Guys. “If you own the shop but don’t work it every day, have the onsite manager plan it and run the agenda by you.”

Even if the head honcho determines the content of the meeting, however, he or she may not be the best choice for running the show. “You don’t often want the senior manager facilitating the meeting if you want to get new ideas,” says Mattimore. “People often get intimidated and are afraid to speak up or challenge the status quo.”

Another critical consideration is when meetings should be held.  Too often, and they become pointless in employees’ eyes — but infrequent meetings have little impact on product quality, customer service or morale. Meetings also cost money, and few owners can afford to frequently bring everyone in on their off days.

For most shops, the sweet spot seems to be somewhere between once per week and once per month. “Weekly meetings can be important as you’re building a new team and getting everyone acquainted,” says Mattimore. “Once you’ve built a culture in your shop, you probably don’t need them that often.” Monthly meetings are great for addressing concerns, updating processes and receiving feedback from experienced employees.

Other considerations include the type, formality and specific personnel involved. “You might do shift change meetings every day, but they’re short and focused on sales, cleaning projects and a few other immediate action items,” says Morgan. “As far as complete employee meetings where you reiterate your principles and even have a team outing –– those only need to be done about twice per year.”

Still, meeting frequencies and times shouldn’t always be left to individual shops. For franchises and large chains, “there should be a plan from the higher-ups on how to implement meetings at the shop level,” says Marilyn Sherman, a leadership expert and speaker at International Pizza Expo. Company-wide changes and seasonal sales need to be communicated uniformly, and that can only be done when individual stores hold meetings at the same times.

As far as content is concerned, “First ask what is the objective of the meeting,” Mattimore says. “Your main concerns should usually be morale, ideas to save money, better customer service and generating new business.” Specific talking points may include new products, new service practices, marketing ideas and more efficient ways to do routine tasks.

Fewer items are also better than more. “When you’re putting together your meeting agenda, think about what you want everyone to know, and cut it in half. Then cut in half again,” Morgan adds. “You can’t expect people to internalize several different things, and it’s best to stay focused on the three or four most important topics.”

Whatever topics you discuss during the middle of the meeting, it’s always important to begin and end on a positive note. “You want people to walk away motivated,” Morgan says. The only way to improve is to address what you’re doing wrong, but positive affirmations will maintain morale and encourage workers to give you their best.

Finally, even well-planned meetings can fall flat if employees don’t remain engaged. “The biggest problem I’ve seen is the mob mentality,” Morgan says. “People will voice their frustrations, they derail the discussion, and whoever they’re criticizing gets defensive.” The best way to avoid these conflicts is to establish ground rules and common objectives at the beginning of each meeting. After all, a successful store allows for better equipment, better working conditions and raises –– goals everyone can get behind.

Employees also stay more engaged when they feel their feedback is valued. “Honor your workers’ questions and insights, and address topics that are important to them,” Sherman says. “A great way to hold their attention is to get them involved ahead of time.” Ask people to come prepared with positive anecdotes of customers and peers, and ask them what they want to see on the agenda.

Finally, one of the best ways to boost engagement and provide for more effective meetings in the long term is to gather anonymous feedback. “Put a printed copy of links to a survey in everyone’s paycheck, and have them anonymously tell you how they felt about the meeting,” Mattimore says. “Ask the three most important things they took away from the meeting. Whatever those are, that is what you really communicated.”

Meeting Tips

Short and sweet. Quick tips for productive team meetings include:

• Lighten the mood. “Don’t underestimate the power of humor,” says Sherman. “The most effective leaders I know are the ones comfortable enough with themselves to add levity by laughing at themselves.”
• Make it mandatory. Absent employees change the dynamic of a meeting. Further encourage attendance with free food and other incentives.
• Check in. Reinforce new policies with one-on-one check-ins and smaller group meetings.
• Don’t delay. Address unplanned issues head-on as they come to light during meetings. Postponed problems will only make employees feel like their voices aren’t being heard.

David LaMartina is a Kansas City-based freelance copywriter who specializes in the finance, food and health industries.

The post Team Meetings: Coming Together appeared first on Pizza Today.

What’s your employee sobriety responsibility?

Employee drug testing is a hot button for many pizza restaurant operators. Most of the concern revolves around post-hire drug testing; pre-hire screening is typically more straightforward. Although laws vary by state — even by municipality — usually all operators must do to avoid discrimination charges is to make pre-hire screening a final part of the hiring process, create a broad policy and apply it consistently. Post-hire testing, however, ups the legal risk.

“The problems usually boil down to unfairness and violation of privacy — both of which can trigger numerous causes of action,” explains R. Scott Oswald, managing principal of The Employment Law Group, P.C. Headquartered in D.C., the firm represents employees in disputes and negotiations.

Oswald says these can include complaints springing from an employee fired because of a positive drug test but who can argue convincingly the test was a pretext for what was actually a discriminatory/retaliatory firing, or from one who perceives monitored urination as a form of sexual harassment.

There are three categories of post-hire drug testing: post-accident; random and reasonable suspicion, says Todd Wulffson, attorney and partner with Carothers DiSante & Freudenberger LLP, an employment and labor law firm in Irvine, California, representing employers only. Again, the laws around each vary significantly by state/municipality.

Consider post-accident testing. Many states allow this only if there’s reasonable suspicion the employee’s condition contributed to the accident, Wulffson explains. However, says Denver-based Danielle Urban, attorney and partner with Fisher & Phillips, a labor and employment law firm headquartered in Atlanta, other states allow post-accident testing after any accident.

Random drug testing can be a minefield. “In most states you can random drug test, but to avoid legal issues, employers can test a certain percent of employees, all employees, or limit the testing to specific positions,” says Urban. Employers cannot pick on just certain employees; all those qualifying for random screening — like delivery drivers, for example — must at some point be screened. The best strategy for avoiding charges of discrimination/harassment? Have an outside agency do the selection, she says.

However, Wulffson says, although federal law allows random testing everywhere for certain occupations — think airline pilots or interstate truck drivers — many states don’t allow it, except for employees in safety-sensitive positions (according to Urban, many states haven’t defined “safety sensitive,” so this can be problematic).

“But in some states, the requirements are so high they’re easy to violate,” Wulffson says. “My thought is no employer should do random testing without legal counsel.”

Drug testing based on reasonable suspicion that an employee is under the influence works everywhere, says Wulffson. Still, employers must take care. A designated employee should be trained to make the assessment — and be able to do so without violating medical privacy laws — that someone needs to be tested, he says. This should be the same person every time (per shift).

Employers should establish a relationship with a qualified testing facility (some states require using state-licensed labs, says Oswald). The employee should be driven there by another employee to ensure the person actually goes. Plus, someone thought to be under the influence shouldn’t be driving, says Wulffson.

Medical marijuana has thrown a curve into drug-testing, says Urban. “Some states don’t protect the right to use medical marijuana, so employers are free to have a zero-tolerance policy,” she says. “If post-accident or random drug testing reveals the presence of marijuana — and the person must have a medical-marijuana card — he can still be fired, even if he had smoked days earlier.”

However, in other states employers can’t make testing positive for medical marijuana grounds for firing, unless the employee is in a safety-sensitive position, or shows up impaired, or smokes/consumes it while on the job, Urban says, adding that she knows of no state protecting recreational marijuana use. (Testing positive for medical marijuana in these states also wouldn’t necessarily be grounds for rescinding a job offer, unless for safety-sensitive positions.)

Wulffson advises all employers to have a policy defining medical marijuana as an illegal drug — “It’s a violation of federal law everywhere,” he explains — explicitly stating employees cannot possess it or use it on the job, or arrive to work under the influence and that if they do so they’ll be fired. This policy should additionally state that the improper use of prescription drugs or OTC medications won’t be tolerated.

Oswald says employers should always seek counsel before implementing any screening program to ensure it’s reasonable and legal. The plan published by the Substance Abuse and Mental Health Services Administration (SAMHSA) is one many employers follow, he says.

Oswald also recommends:

• Putting the program in writing. Explain it clearly. Have employees sign they understand it. Also post in common areas.
• Training managers to implement the program appropriately. Ensure they’re not using screening as a way to harass/punish employees (testing on reasonable suspicion is easily abused by managers, he cautions).

Wulffson believes it’s in employers’ best interests to have a drug-testing policy in place. “Without this, you can’t test at all,” he explains. “And it needs to be zero tolerance. If an employee is under the influence at work, you need to fire him.”

Creating Drug-Free Environments

Dr. Indra Cidambi, medical director/founder of the Center for Network Therapy, a Middlesex, New Jersey, outpatient drug program, says the food service industry has among the highest rate of illicit drug use. A factor is the stressful nature of the job, which can encourage self-medicating/drug abuse, says Cidambi. Restaurant operators/managers can lessen the likelihood of this happening by:

• Being mindful of what employees are facing; offer support.
• Cross-training employees and rotating jobs, preventing burnout and boredom.
• Staffing appropriately; bringing on more employees during rushes, reducing their numbers during downtime.

What not to do? “Don’t turn a blind eye to a problem or condone the behavior,” Cidambi says. “You cannot be a part of it. And don’t worry about the consequences of forcefully addressing the problem.” By failing to do so, restaurant operators are potentially placing other employees, customers and even their business at risk, she says.

Pamela Mills-Senn  is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post Post-Hire Drug Testing appeared first on Pizza Today.

Under Review

Execute effective employee performance reviews in the restaurant space

When The New Yorker and later Inc. Magazine questioned the validity of employee performance reviews this past summer, wondering aloud if the formal appraisals sparked more anxiety and annoyance than actionable information, Eric Greenwald thoughtfully considered the argument.

Ultimately, though, Greenwald wasn’t convinced.

“Performance reviews help us make sure that our people are aligned with our mission … and make our company stronger,” says Greenwald, president and COO of Arizona-based Grimaldi’s, a 39-unit chain with pizzerias spread across nine states.

Though commonplace in industries such as healthcare and education, many restaurant owners reject performance reviews, discarding them as a waste of time and energy.

That’s a mistake, says Lynne Eddy, a human resources management instructor at the Culinary Institute of America in Hyde Park, New York. Performance reviews, she contends, are even more critical in the restaurant space given its notoriously high turnover.

“Sometimes we think of entry-level employees as widgets who simply come and go in six months, but performance reviews can help curb that and create stronger employer-employee partnerships,” Eddy says.

Performance reviews, she continues, help management develop successful employees, reinforce quality performance, set expectations, institutionalize two-way communication and cultivate retention.

“You want employees to be proud of themselves, to have confidence and to feel valued,” Eddy says. “Performance reviews, when done right, help produce those results.”

Here are six ways operators can make employee performance reviews count:

1. Consistency and commitment. David McClaskey, who runs the Kingsport, Tennessee-based Pal’s Business Excellence Institute (BEI), a renowned training ground for restaurant operations inspired by the 27-unit Pal’s Sudden Service quick-service chain, suggests keeping employee reviews focused on each individual’s key contributions.

“Performance reviews are very feasible to do, but you don’t want to make them overly complex,” he says.

It’s important as well that operators evaluate all staff, full-time and part-time included, and use the same format. At Grimaldi’s, for instance, all staff — from the cooks to the servers to the shift supervisors — receive biannual reviews from their direct supervisor based on the company’s “8 Slices of Culture,” a list of values including communication, integrity and accountability.

“Commit to the process and follow through because you’ll have problems if you only review some but not others,” Eddy says.

2. Set the stage. Two weeks prior to a formal performance review, Eddy recommends operators hand employees a blank form and instruct them to do a self-evaluation. This not only acquaints employees with the appraisal criteria, but also affords them an advance opportunity to reflect on their own performance, career objectives and job satisfaction.

McClaskey says self-evaluations prompt a rich discussion around employee development and help team members work with management to identify their own paths to improvement, which often heightens buy-in and engagement. Together, then, employee and manager can set attainable goals for the future.

3. Honesty and accuracy. While many supervisors fear low, albeit judicious ratings will hamper employee motivation and engagement, accuracy fosters improvement.

Grimaldi’s eschews the traditional number system in favor of “strengths” and “opportunities.” With employee strengths, Grimaldi’s supervisors discuss ways the employee can further enhance an asset. With opportunities, supervisors are directed to be business professional, but to avoid sugarcoating potential areas of improvement.

“I preach accurate information because that’s the way you move forward and improve the business,” Greenwald says.

4. An ongoing process. While Grimaldi’s runs two formal sit-down performance reviews each year, Greenwald says employee evaluation is an ongoing process, including regular “stay interviews” — a counter to traditional “exit interviews” — that help store leadership understand why employees continue working at the pizzeria. It’s a savvy move given how difficult, if not impossible, it is to assess a year’s worth of action and information in one sitting.

Eddy suggests operators create a “short form” every three months to assess employee performance and spotlight opportunities for growth. Operators might also keep an ongoing record of employee performance, which can help minimize personal bias, limit the penchant to only evaluate recent activity and prove helpful should litigation ever arise.

5. Wait on the pay raise. Both Eddy and McClaskey suggest separating the performance review from a pay increase, saying it’s important to let the evaluation results settle.

“When you talk about improvement and pay raises at the same time, the employee only hears about pay,” McClaskey says. “Once those two are linked, you can’t get improvement on the agenda.”

At Pal’s, a pay hike might come two months after a successful performance review, which McClaskey says provides employees ample opportunity to “up their game.”

6. A strong close. At Grimaldi’s, it’s a common practice to invite employees to share their input on the restaurant and job satisfaction.

“This helps you evaluate priorities and the environment you’re creating for your employees,” Greenwald says. “If we see weaknesses, we take it seriously and move on it.”

Then, Greenwald adds, it’s important to close every review with a sincere thank you and to help staff see a path to improved pay or a new position in the restaurant.

“We want to let our people know we value their efforts and that there are growth opportunities here,” he says.

Cutting ties

Grimaldi’s president Eric Greenwald says employee performance reviews provide management a chance to pause from the daily restaurant madness and assess each employee’s fit with Grimaldi’s company culture in a one-on-one setting.

“‘Do they align with who we are?’” Greenwald says. “If not, then they don’t fit with us.”

Ideally, restaurant management should know an employee’s work performance without the formality of a performance review, but it’s the employee appraisal, Pal’s BEI president David McClaskey says, that helps employees avoid management’s radar.

“If an employee can’t pull his weight, then he can’t keep his job,” McClaskey says. “They need to be a contributor.”

Some employees, however, might never make it to their employee review, firing themselves by repeatedly ignoring expectations. In that case, CIA human resources management instructor Lynne Eddy says, employees “own that result.”

“You want to get the dead weight out because they’ll bring down your good performers,” she says.

Chicago-based writer Daniel P. Smith  has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

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Real Estate Concerns — Commercial Leasing

Between business plans, marketing and capital collection, new restaurateurs have plenty on their plates — and they often put property on the back burner. While location is a common concern, inexperienced owners frequently fail to account for the hurdles and pitfalls of the commercial leasing process.

Commercial contracts are far different from residential leases. Amenities, space requirements and other logistical matters require solid documentation and legal protection. For the first-time shop owner, the following considerations are critical to a successful startup:

• Logistics. Will a property serve your shop’s needs? That should be any restaurateur’s first question, and location is a top concern. Aside from visibility and foot traffic, you’ll need to consider demographics, local preferences and the habits of nearby shoppers. “If you’re in a commuter area, for instance, think about the average time people are getting home, and how that overlays with your business,” says Mike Morgan, Pizza Guys VP of Operations.

Just as importantly, you’ll want to find out who occupied the space before you — and why they left. “Look at why previous businesses failed in that same location, as well as the reputations of your neighbors,” says Rick Davis of Rick Davis Legal. Whether they failed or expanded, their reasons for leaving could impact the terms of your lease.

From square footage to patio space, you’ll also need to keep a long list of business requirements in mind. Depending on what types of pizza, side items and extras you want to offer, these requirements may include existing ovens, cold storage and grease traps.

Last but certainly not least, always check the roof and plumbing. “If old roofing fails on you, you’re on the hook for all the square footage underneath,” says Morgan. The same is typically true for HVAC and electrical systems, so make sure you conduct a thorough inspection.

• Legal Hurdles. An ironclad contract will protect those logistical considerations for you and your lessor. One of the most important elements is the non-compete. “It may be vague or specific, and not getting enough detail leads to issues later on,” says Jeff Grandfield, Commercial Lease Consultant at The Lease Coach. A pizzeria might be barred from offering wings or subs, for instance, because a nearby shop features the same items.

A well-planned lease will also spell out which party is responsible for existing appliances, as well as allowances for installations and renovations. Who has to pay for freezer repairs? Can you install a brick oven? Is the existing grease trap up to spec? These are the types of questions that need to be answered before anyone signs on a dotted line.

Provisions for the end of your stay are just as important. “The number one legal problem is trying to leave your space before your lease is up,” says Morgan. “If a sub-lessee goes out of business, you’re usually still on the hook for the remainder of your lease.” Clearly state who is responsible for paying rent once you’re gone, as well as the conditions in which you’re required to leave the space.

Ultimately, though, everything is negotiable — even the requirement to pay rent. “It’s pretty seldom we’re not negotiating for free rent or a tenant allowance,” says Davis. “If you’re not looking for it, you’re leaving money on the table.” Commercial leases lack the rigid rules and consumer protections of residential contracts, and the more you know about the lessor, property and surrounding area, the more creative you can get with your responsibilities and requirements.

• Roadblocks to Rental. Even if you take all of these considerations into account, you may still be denied by potential lessors. Landlords are betting on your budding business, and they want to see a history of financial strength and dependability.

Fortunately, there are plenty of ways to instill confidence. “The biggest red flag is not adequately planning for risks, and most business plans are overly optimistic,” says Grandfield. “Don’t show your borrower business plan to the landlord. Show them the plan that says what will happen if you’re operating at 50 percent.”

Aside from a realistic business plan, great credit and adequate working capital go a long way. It takes time to ramp up a business, and you’re more likely to get a lease if you’ve built up enough cash to make it through a slow start.

• The Right Representation. Finally, getting the best possible terms all but requires third-party representation. “You really have to get your own real estate agent, and not because leasing agents are untrustworthy,” says Morgan. “The landlord’s objective is to get the deal done as quickly as possible, and you need someone who’s willing to slow the process and have uncomfortable conversations on your behalf.” Large property holders will also only offer the spaces they need to fill, while an agent will consult several landlords to find the best fit for your business.

The same is true for legal representation. “Tenants often glaze over contracts, which are often close to 50 pages in length and may include favors to the landlord,” says Grandfield. Paying an attorney to run a fine-toothed comb through a lease may seem like an unnecessary expense, but it could very well lower operating costs and legal fees in the long run.

Often Overlooked

Keep the following costly commercial leasing considerations in mind:

• ADA requirements. You and your landlord are responsible for your restaurant’s handicap accessibility. Parking lot problems are among the most common causes for lawsuits.
• Ventilation. Good or bad, your shop’s odors may impact neighboring businesses. Plan accordingly for vents, hoods and fans.
• The personal guarantee. An LLC won’t remove all personal liability. “Almost any commercial landlord will require a personal guarantee from the lessee,” says Davis.
• Seating limitations. Zoning laws dictate how many customers you can seat in your restaurant and on your patio. The ratio of kitchen space to public space may matter more than total square footage.
• Delays. Finding a property and drafting a lease is a months-long process. “We recommend a minimum of six months to find a location, negotiate a lease and get ready to open up for business,” says Grandfield.

David LaMartina is a Kansas City-based freelance copywriter who specializes in the finance, food and health industries.

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Is third-party delivery the way to go?

Tony Gemignani
World-champion Pizzaiolo and Pizzeria Owner

I have a forecast that one day our industry will not have delivery drivers who are directly employed by our restaurants. Instead, I believe third-party companies will soon be nationwide. This started with a small group of companies way back in the day. One of them, which is still going, is called Waiters on Wheels. Now it’s moving in our industry like a speeding bullet. Companies such as Caviar, Postmates, UBER Eats, Eat 24 and so many others are jumping into this arena. With so many of these start-up companies popping up nationwide, you will soon see the in-house delivery driver gone from many pizzerias.

I use a couple of different ones in the same restaurant. Just think about it: no more delivery insurance, no labor, no order taking, no more counting out or reconciling, no more purchasing of delivery bags, no marketing expense. Would you offer a five-percent delivery fee that would go to that one third-party person and give that company 10 percent off that order? Or just 15 percent off and give it to that company?

I would and I do.

Just think about having three, four, six of these companies out there hustling for you and advertising for you. These contracts can be structured and all of them can work for you. Trust me, it’s coming and it’s even getting bigger than this. Try bulk orders where companies such as those listed above buy 30 to 60 (even 200 at times) orders from you at a set price. These are pre-determined meals like three meatballs and garlic bread for $8 (valued at $9.50 in your restaurant) that they pick up at 11 a.m. before you even open. The third party delivers them all at one time to several companies. This type of gorilla ordering has already been set three weeks prior so you can be ready on that particular day for such a large bulk order.

Would that be helpful to your business?

Try the 24-hour pre-order catering menu that they have sold for you the day before for $500 to $1,000. And this order was delivered to companies all over your area by this third-party company. They work on commission and that 10- to 15-percent mark up or discount, however you structure it. These guys are working for you. If it’s not right you fix it. It’s so detailed that you get daily reports on performance and monthly meetings on how to make it better. It’s such a detailed report that you will know everything from pick up rate, ready and delivery efficiency and things like customer feedback (including graphs and pie charts). They are on our side.

Many drivers will move to working for these companies, meaning drivers that may have worked for you are starting to get jobs elsewhere. It’s very much like the impact UBER has had on taxi and limo drivers.

There have been some issues with this, but the evolution and detailed development has gotten better and better. It has started in California and New York. I’m seeing it in San Francisco, Sacramento and Las Vegas. When there have been problems, I have seen things get addressed and fixed immediately. Changes are coming. Be on the lookout.

RESPECTING THE CRAFT features World Pizza Champion Tony Gemignani, owner of Tony’s Pizza Napoletana in San Francisco and Pizza Rock in Sacramento.  Tony compiles the column with the help of his trusty assistants, Laura Meyer and Thiago Vasconcelos. If you have questions on any kitchen topic ranging from prep to finish, Tony’s your guy. Send questions via Twitter @PizzaToday, Facebook (search: Pizza Today) or e-mail jwhite@www.pizzatoday.com and we’ll pass the best ones on to Tony.

The post Respecting the Craft: The Future for Pizza Delivery appeared first on Pizza Today.

Lasting Loyalty

If you’ve got a rewards program, here’s how to make it really work

Pitfire Pizza tried printing punch cards for their nine locations — buy 10, get a pie free. They saw their same customers, gave away a few pizzas, but not much else. Pitfire’s Chief Operating Officer Mitchell Wong says they haven’t had success with that or any of the several other loyalty strategies they’ve tried. Sound familiar?

The goal of your loyalty program is “frequency, increasing ticket size, and motivating cross-menu purchases,” says Michela Baxter, senior director of loyalty at HelloWorld. Read on to find out common mistakes pizzerias make and how you can overcome them.

Mistake 1: Programs that don’t give you data. Amity Kapadia, content marketing director for Ambassador, a referral marketing company, says: “The goal is to drive new sales. You want a trackable URL, promo code or points system.”

Wong notes that customers are more wary about giving you their contact information unless there is clear value to them for signing up for a loyalty program.

Recent research published in the journal Decision Support Systems finds that “due to the more dynamic consumer preference in online markets, transaction data collected through loyalty programs provides stronger profit incentives for retailers.” Data is the big tradeoff for free product in loyalty programs, and it is best attained online.

Whatever you do for a loyalty program, make sure you have a way to track who’s using it and what their purchase behaviors are. That’s how the system is good for customers and helpful to you as well.

Mistake 2: Offline experience only. Double Dave’s Pizza in Texas and Oklahoma first tried a buffet stamp card back in the 1980’s. “The program inherently kept customers tied to a particular location due to the use of a paper punch card,” COO Joey Bramwell explains. “While the frequent diner cards for buffet work great, we wanted to reward all our customers in every purchasing format (dine-in, delivery, pickup and online ordering). Our ‘Dave’s Dividends’ program allows customers to earn points for every dollar spent, and they can redeem those points for different options and amounts of food. This loyalty program’s information is Cloud based, so the customer can accumulate points and redeem them at any location in the chain.” With 35 locations, the flexibility offered by a digital program is important to customers.

Assistant Professor Sanghee Lim of the Johns Hopkins Carey Business School has conducted research about online and offline consumer behavior. “Offline stores may be giving away profits when they offer loyalty rewards to customers who will keep coming back anyway, regardless of any discount that’s offered,” she says. “Online shoppers, on the other hand, may use a coupon to revisit a retail Web site even when it’s not one of their preferred sellers.” Online loyalty offers or rewards are a growing way to tap new customers to try your pizza.

Mistake 3: Disconnected from brand. According to research published in the Journal of Retailing and Consumer Service, if customers feel connected to you and your brand, they don’t care how long it takes to earn a loyalty reward. But if they don’t have a personal involvement, they are less patient.

What does that mean for you? A loyalty plan that feels like an organic part of your brand is important. If the program seems like an afterthought or add-on, customers can tell. Loyalty programs should integrate with everything else you have going on ––starting with color scheme and logo to the tone of your establishment.

Double Dave’s Pizza’s Bramford has advice on integrating your program into existing business. “Keep it simple and easy to use,” he says. “Anything complicated will keep customers from participating. Tying the program to a customer’s phone number makes the program easy to use as cards or keychains can be seen as excess clutter. Lastly, train your employees to not only understand the program, but to champion its use! Having an employee who is ambivalent about making someone’s free pizza will take the excitement out of the process.”

Mistake 4: No long-term plan. “The goal of every program should be to reward frequent customers for their patronage,” says marketing consultant Joseph Braithwaite. “You need to show them you respect them for making a choice to come to you.”

Bramwell at Double Dave’s says that you must let customers know you value them. “As customers can choose any number of places to buy pizza, we wanted to let our customers know that we appreciated their continued business, and the best way to do that is with free food! Discounts are nice, but free food speaks volumes.”

If you are thinking simply of the short term, trying to get more people in the door, a substantive loyalty program will not work. To build loyalty takes time and your business really embracing your customers.

Mistake 5: Lack of personalization. One reward across all consumers isn’t going to cut it in today’s highly individualized world. As Baxter says: “Consumers expect more personalized offers.” That may have been optional in the past, but no longer. “They feel more positively about a brand when the communications they receive are more personally relevant.” That’s where data really comes into play, when you can tailor your contact based on what customers have done in the past.

“When someone earns that free pizza, that pizza will taste better than the last pizza they bought,” Bramford says. “There is nothing like handing a customer their free pizza and giving them a high five as a congratulations for achieving their goal of earning a free meal. You can count on that customer to be back next week to start earning more points.”

Eliana Osborn lives in the desert southwest with her family, where she works as a part-time English professor and freelance writer.

The post 5 common mistakes pizzerias make with their rewards program appeared first on Pizza Today.

Artisan pizza offers unique marketing opportunities

More pizza makers liberally use the word, “artisan,” to describe their pies, which presents a real dilemma for those offering the real deal. You may have the most authentic artisan pizza in town, but how do you stand out? Sure, your food quality should speak for itself, but you have to take things one step further.

First, project a consistent image, or brand, so people will choose you first.

The folks at Pyro’s Fire Fresh Pizza in Memphis, Tennessee, know all about that. Their “brand” revolves around the customers’ palates, says co-owner Kirk Cotham. Diners crave Pyro’s, because they customize their own pizza –– made with fresh toppings, sauces and cheese –– before it’s baked in a homey wood-fired oven. “We believe everyone should get their pizza the way they want it,” Cotham says.

The customer-centric branding approach is working, too. In just two years, Pyro’s opened its fourth store last Black Friday. Social media is frequently abuzz about customer creations, as people post photos of “their” pizzas on Instagram, Facebook and Twitter, Cotham says.

“We don’t ask a group on social media to ‘help us get up to 100 customers,’” he says. “It’s about interaction with guests and fans so that when they go out to lunch, they’ll automatically think, ‘Pyro’s,’” he says.

Your artisan pizza brand can attract the same recognition. Here’s how, with tips from Cotham and Gannon Mendez, owner of The Saucee Sicilian in Oklahoma City, Oklahoma:

• Emphasize imagery. “Imagery” covers everything from photographs on Instagram, to a recognizable logo, to even the font style on your Web site.

Don’t underestimate the power of social media photo sharing, Cotham says. “The fact is that when we have images and can see the ingredients, it’s more powerful than the word, ‘artisan,’ or ‘custom,’” he says.

When someone sees a photo of an appetizing pie, they will invariably respond or tweet back, “Where did you get that?” The result is that you don’t even have to work hard to brand yourself as “artisan.” Your customers do it for you, Cotham says.

Logos and Web site style also send strong silent brand messages. The Saucee Sicilian’s logo is that of a “cartooned” Mendez with three arms — one holding a ladle, one holding a wooden spoon and one holding a pizza slice. It adorns his Web site, T-shirts and the side of his food truck. The ladle and spoon represent the time needed to create tomato sauce for pizza and meatballs — two days. If customers wear the T-shirt to his pizza truck, they receive $2 off each pizza, plus a free dessert.

The Saucee Sicilian also heavily emphasizes Mendez’s grandmother’s recipes to differentiate its pizza from competitors. As a result, its Web site is designed to look “old world.” The colors and font style have all been carefully thought out to reflect “old-fashioned” branding.

• Build on the imagery using words. The Saucee Sicilian’s image is linked to Grandmother Lena’s secret recipe. So the business slogan is “Getting sauced since 1903.” Mendez also uses Twitter hashtags like #TheSauceeSicilian and #WoodFiredPizza, to generate recognition for the brand and discussion.

And get verbal. When someone orders meatballs drenched in the sauce, everyone on Mendez’s truck yells, “Saucee Sicilian!” When the order comes through the window for the person to pick up, they yell that again. The result: People wonder what it is, so they talk about it in line. “If we have one order come through, then 10 more will order it right after that. It’s guaranteed we’ll have a run on it,” Mendez says.

• Get personal. The more you connect with the customer personally, the more they’ll remember your brand name, Cotham says. Pyro’s encourages staff to try to remember regular customers’ favorite pizzas. They also encourage people to share Instagram photos of their “creations.”

“No one leaves a traditional pizza place and says, ‘This is MY pizza.’ But here, they do. They actually tweet, ‘This is MINE.’ And what they mean by that is, ‘I made it,’” Cotham says.

Artisan pizza may not be the usual first choice for picky eaters. But because of Pyro’s branding its pies as customizable, kids love going there. “Parents are like, ‘All they talk about is Pyro’s,’” Cotham says.

“We’re also big on names. A lot of adults don’t call kids by their names. But by using their name, it has made them feel part of the process. And face it, a lot of times they don’t have the same choices we do and are not really treated the same. The kids can put whatever on it that they want, and they’re not ordering off of a kids’ menu. To them, it feels like empowerment,” he says.

Evoke a memory. Mendez features old black-and-white photos of his Grandmother Lena on his Web site and also places them around his food truck. She died at age 107 and at one point was the oldest person in Colorado. “People will ask me, ‘Who’s that?’ I reply, ‘That’s the inspiration. These are her recipes. She is our inspiration –– my Nonna –– and who I cook for,” Mendez says.

His mother also plays a huge role in making people feel like they’re getting a home-cooked meal. “Mom is the first person you see. She loves to talk about the meatballs and that the sauce takes two days to make. People ask how long she’s been making the next batch when they know that. Then they bring more people into the discussion, like their friends. The customers help us with the branding,” he says.

Brand Yourself with the Kids

Kids have a huge role in determining where a family will eat, so make sure your brand resonates with them. Pyro’s hired marketing firm Simmer Group to create a “Back to School” night for its youngest customers in August.

The company engaged the Pyro’s audience by creating fun visual assets that incorporate the Pyro’s brand and food into various school subjects and well-known historical references. From basic arithmetic math involving the counting of pizza pies to challenging the audience to identify the artist of Pyro’s Mona Lisa, the content further developed Pyro’s as a relevant and interesting brand within their geographic region.

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

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Talent pool suffers in a strong economy

Tony Gemignani
World-champion Pizzaiolo and Pizzeria Owner

As a follow up to last month, let’s examine other reasons for high turnover:

• Higher housing and rising inflation. The fluctuation and increase in rent in big cities where the housing market has skyrocketed hasn’t helped employees at all. In fact, more potential employees have moved out of big cities and into markets that are more affordable. Now that contractors are building again and more restaurants are opening in suburban towns you see less and less of the bridge-and-tunnel employee coming into big cites for work. This has made it very difficult to find management positions where the cost of living is too high. Some $50k and even $70k salaries are meaningless. Very sad and very scary.

• Fewer employees. Lower unemployment rates means fewer employees coming in to apply. Typically, you get a group of employees that are called leftovers — the small percentage of people who don’t get hired. Usually they are not the best employees or they’re just in the wrong industry without any applicable skills. I have asked restaurateurs and chefs in California and other areas about this problem. It seems that it’s slim pickings for all of us — and we’re all hiring!

The leftovers, like I mentioned, are easy to figure out from their references and short-term employment elsewhere. I’m not a fan of an employee who has worked at eight restaurants in two years. Nope!

• Wrong concept for the age of the employee. Fast causal is gaining more and more momentum each year. So many pizza places are trying to copy the Chipotle concept. Well, as Chipotle has grown, I personally have noticed a very big change in their employees. The biggest difference I have noticed is their age. I frequent Chipotle and have seen more teenagers to 22-year-old employees working. Just a few years back I typically saw employees who ranged in age between 30 and 50 years. In my opinion, as the company has grown, this model has been labeled “fast casual”. This concept draws in a younger employee which, in turn, could mean a higher rate of turnover. In the pizza business, when you have a slice concept and/or fast casual you will see your staff become younger and younger. It’s not necessarily a bad thing, don’t get me wrong, but when you see more employees applying down the line they will be younger. I see this at my Slice Houses where my employees range from 18 to 25. It’s a rarity I will get someone that’s middle aged. I wish it could be more of a mix but it’s not, typically 90/10. I always look for long-term employees and sometimes when we build our restaurant into a fast-casual concept we attract a fast-casual employee. Hope and pray they stay with you for a while. The more of these concepts that we build the more saturated the pizza industry gets, which means less employees to choose from.

• ‘Help Wanted’ sign not enough. Sometimes you really get some bad applicants from putting a sign in your window or running an ad in the paper or on Craigslist. Sometimes you may get lucky and other times it can be a nightmare. Internet companies such as Proven, Indeed, Poached and LinkedIn have been great sources for locating employees geared for our industry. These companies are way more advanced and you can work with a representative to tailor an ad to your needs.

If you are experiencing high turnover, you may not be doing something wrong. There could be a lot of variables involved. We can treat our employees like gold and it still may not be enough. Or in other cases we do all the right things and everything is golden.

RESPECTING THE CRAFT features World Pizza Champion Tony Gemignani, owner of Tony’s Pizza Napoletana in San Francisco and Pizza Rock in Sacramento.  Tony compiles the column with the help of his trusty assistants, Laura Meyer and Thiago Vasconcelos. If you have questions on any kitchen topic ranging from prep to finish, Tony’s your guy. Send questions via Twitter @PizzaToday, Facebook (search: Pizza Today) or e-mail jwhite@www.pizzatoday.com and we’ll pass the best ones on to Tony.

The post Respecting the Craft: Staffing and Retention appeared first on Pizza Today.

A better economy means good help becomes hard to find

Tony Gemignani
World-champion Pizzaiolo and Pizzeria Owner

I am sure you have noticed lately it’s been getting tougher and tougher to keep and hire employees, especially in California. With the unemployment rate getting lower and the economy getting better it has become increasingly difficult for us to keep staffers. We are getting busier, contractors are building again, our credit is getting stronger, the housing boom is back, minimum wage is at its highest — yet we are struggling to keep employees. It’s not always you, especially if you’re a busy or semi-busy restaurant, and below are some reasons why.

• The grass is always greener. As the economy gets better and more restaurants and companies are building and opening around us, we’ve gotten an influx of employees who think the grass is always greener somewhere else (and sometimes it could be). These employees tend to jump ship. More places are new and hiring and less places are going out of business, which means a lot of opportunity for workers. Because of this, you will get an employee that tends to bounce from place to place. I hate that, especially when you went through the trouble of training and spent time for development and then all of the sudden they leave. What ever happened to hard work and loyalty?
• Minimum wage. The employees who make minimum wage, like dishwashers and bussers who don’t make tips, will tend to look around for other jobs. This is especially true when you’re a busy restaurant. Why would anyone work twice as hard when they can make the same pay and do half the amount of work? These positions can be the hardest to fill and keep.
• Important for the resumé. It’s funny when you find a previous employee bragging about where they worked and/or using it to their advantage in getting another job. We have seen this a lot at a couple of my restaurants. We’ve seen employees come through who work for three months just so they can say that they’ve worked at one of my places. I cringe when this happens. Trained chefs tend to do this a lot, especially right out of culinary school. Or, they just want to stage. This isn’t such a bad thing when the flip side is going through the process of hiring and firing. Be aware of any new employees. Always check references. They may be working for the guy down the street and they want more insight on your day-to-day operations. A 90-day probationary period can also be to your benefit if you get an employee that just doesn’t work out. This can save you from a lot of headaches down the road when it comes to letting an employee go after finding out they don’t fit. An ND (non-disclosure) agreement may also protect you and scare away some possible
  employees that have other intentions.

There are other reasons as well, and I’ll continue with Part II of this article next month where we will examine some other causes of employee turnover, such as housing costs, rising inflation and even how your concept impacts your hiring.

RESPECTING THE CRAFT features World Pizza Champion Tony Gemignani, owner of Tony’s Pizza Napoletana in San Francisco and Pizza Rock in Sacramento.  Tony compiles the column with the help of his trusty assistants, Laura Meyer and Thiago Vasconcelos. If you have questions on any kitchen topic ranging from prep to finish, Tony’s your guy. Send questions via Twitter @PizzaToday, Facebook (search: Pizza Today) or e-mail jwhite@www.pizzatoday.com and we’ll pass the best ones on to Tony.

The post Respecting the Craft: Employee Turnover appeared first on Pizza Today.

Are you up to speed on child labor laws?

Minor employees often bring plenty of positives to the job. Although they’ll likely require a fair amount of rope-showing and schooling in workplace etiquette, young people are generally enthusiastic and eager-to-please –– a nice counterbalance to their lack of experience. However, minor employees come with labor regulations that differ dramatically from those applying to of-age employees — restrictions that complicate scheduling, work assignments and other aspects of operations.

All employees, minors included, are covered by the Fair Labor Standards Act (FLSA), the federal law addressing wage, hour and working conditions, explains attorney Ron Sollish, a shareholder with Maddin, Hauser, Roth & Heller, P.C., a multi-specialty law firm based in Southfield, Michigan. But additionally, says Sollish, the FLSA sets specific restrictions on the times minors can work, the hours they can work when school is in and out of session, and establishes 16 as the minimum standard age of employment for most jobs (the restrictions on 14- and 15-year-old employees are even more exacting).

“On top of the FLSA standards, each state has its own child employment laws and standards for how and when minors can be employed,” Sollish says. “Other laws also affecting minors’ ability to work include compulsory school attendance laws and licensing restrictions based on age.”

What constitutes a minor and what they can do varies. For example, with 34 franchise locations across Texas (and one in Oklahoma) DoubleDave’s Pizzaworks has about 680 employees, says Joey Bramwell, director of operations. In Texas, says Bramwell, anyone under 18 is considered a minor. The youngest they’ll hire is 16; Bramwell estimates about 10 percent of their workers are under 18 years old.

Employees under 18 are restricted in what tasks they can perform. They can’t be delivery drivers, they can’t use power-driven bakery machines or even clean the machines, and they can’t operate a cheese slicer because it’s comparable to a power-driven saw, says Bramwell. Most importantly, they can’t handle, pour or deliver alcohol (their restaurants serve beer; some serve wine).

“If someone orders a beer at the counter, the minor has to call over an older employee to pour the beer and hand it to the customer,” says Bramwell. “They can’t even bus a table if there’s beer or wine on it.”

Even so, says Bramwell, there’s much that minor employees can do, so despite these restrictions, their restaurants remain “very open” to hiring younger workers. All it takes is a bit of strategizing, such as knowing when it’s going to be a heavy beer-ordering night and therefore not putting a minor at the counter or on the register.

In Colorado, anyone under the age of 19 is a minor and consequently faces labor restrictions, says Mike Scruggs, director of operations for Colorado Pizza Investments Inc., Colorado-Springs based owners of seven Little Caesars pizza franchises. They have approximately 140 employees. Of these, 11 are 16 to 18 years old and considered minors. There are no employees younger than 16.

In addition to restrictions on the machinery they can operate, such as dough mixers, minor employees can’t work more than 40 hours a week or more than eight hours a day, says Scruggs. “When it comes to breaks, they must be given a compensated 10-minute break for every four hours worked, and a 30-minute off-the-clock-break if their shift exceeds five hours. We try to keep their shifts to less than five hours to avoid having to schedule that break.”

Minor employees are also typically scheduled for weekends, with one or two early shifts during the week, because of school and homework, he adds.

Scruggs says regulations are too numerous and complicated for them to even consider hiring anyone younger than 16; managers have enough to contend with and this policy makes their jobs a little easier.

Safer, too, since running afoul of child labor restrictions — even inadvertently — can have punishing consequences for restaurant owners/operators. According to Sollish, violations can subject employers to civil penalties up to $11,000 for each minor employee, and up to $50,000 for each violation that causes a minor serious injury or death.

“Known violations can cost an employer double and can include criminal sanctions,” he adds. “On top of these, each state has penalties, fines and other enforcement guidelines.”

And violations aren’t that uncommon, says Ryan Holdan, president/founder of Paymasters, Inc. Located in Birmingham, Michigan, the company provides payroll, HR, and time and attendance solutions for the restaurant industry.

“Typically, what happens is a restaurant is audited by the Department of Labor for some other labor violation,” says Holdan. “Then, during the auditing process they uncover child labor law violations.”

How to avoid problems? Know the rules, says Holdan. Make sure managers know and follow them. Conduct monthly audits. Get the paperwork right. Keep compliance top of mind.

“Child labor violations are serious,” says Holdan. “Owners can be held criminally liable. For example, if a minor drives — under federal law, employees under 18 cannot deliver pizzas using a motor vehicle — and is hurt or injures or kills someone the owner could go to jail. And in the majority of states, owners can go to jail for a first offense.”

Minor Survival Strategies

Ron Sollish, a shareholder with the law firm of Maddin, Hauser, Roth & Heller, P.C. (Southfield, Michigan), says pizzeria operators should avoid problems by:

• Not allowing minors to self-monitor their hours. “Employers must be certain to restrict their young employees to the hours set by law.”
• Knowing what dangerous equipment minors are prohibited from operating.
• Securing state-required work permits/certifications. Many states require such documentation from schools/principals as a condition of employment. But some employers merely state this in their handbooks, never following through on obtaining the documentation.

And if you’re employing a minor (or suspect someone is one), require a state-approved proof of age, such as a birth certificate, says Ryan Holdan president/founder of Paymasters, Inc., a provider of payroll, HR and other solutions for the restaurant industry (Birmingham, Michigan). “Federal law says anyone under 18 must provide the employer with an acceptable form of age documentation.”

Pamela Mills-Senn  is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post Minor Employees: Fountain of Youth appeared first on Pizza Today.

Do you know how to maximize your local marketing?

Clayton Krueger has no shortage of opportunities to spend money.

As the director of marketing for Farrelli’s Wood Fire Pizza, a 20-year-old, seven-store chain in the Tacoma, Washington, area, Krueger regularly hears pitches from advertising reps –– newspapers, radio, television, billboards, team and event sponsorship and more — seeking a piece of Farrelli’s marketing budget.

“By now, we’ve heard it all,” Krueger says.

Which isn’t to say Krueger minds. He knows, like so many others, that local advertising is necessary to maintain community relevancy.

“If you want to survive, you need to stay top of mind with your local audience. And local advertising is an important piece of that equation,” reminds Randy Lopez of Synergy Restaurant Consultants. “Locals must know you’re a part of the community.”

Determining just where to place those local advertising dollars, however, can be a tricky feat for pizzerias, particularly given abundant opportunities and finite budgets. Here’s how savvy operators get it done:

Step #1: Understand the purpose. Farrelli’s has participated in everything from local sports posters to team card fundraisers. Though such initiatives boost Farrelli’s standing as a kind-hearted community neighbor, they don’t necessarily accomplish the company’s mission of neighborhood nourishment, Krueger says.

Instead, Farrelli’s has increasingly prioritized direct community involvement, efforts that place the brand actively in front of consumers and help it fulfill its mission. The chain has served as the beer garden vendor at a local food truck festival and is currently crafting plans to launch a Northwest-style pizza festival on Tacoma’s waterfront next summer.

“At the end of the day, it’s about where you want to see your brand and where it makes sense,” Kruger says. “We need to know what we want for our business.”

Eager to build brand awareness? Outdoor advertising such as billboards promise that. Want to spur impulse buys with a tech-savvy clientele? Consider location-based advertising.

“Always know what you’re trying to accomplish,” instructs Bill Guilfoyle, associate professor of business management at the Culinary Institute of America in New York.

Step #2: Get intentional. In a competitive industry with numerous players battling for share of stomach, pizzerias must be intentional and specific.

If Farrelli’s leadership, for example, identifies a specific concern –– say, languishing lunch business at a particular unit – Krueger’s team unleashes a purposeful advertising program to turn the tide, such as a direct mail piece to customers within a defined radius. Krueger will ensure staff know the promotion has been released, what it looks like and how the team can enhance ROI, such as signing up new visitors for the chain’s internal marketing channels.

To avoid aimless, random spending, Lopez suggests operators avoid approving advertising expenditures on an as-they-come basis. Rather, collect requests throughout the month, review them at a single time and define which ones fit the brand and carry the greatest ROI potential.

Additionally, Lopez urges operators to create a 12-month marketing calendar that includes key monthly events, such as Mother’s Day promotions in May.

“A calendar will help you be proactive, organized and thoughtful with your spending,” Lopez says. “Plus, you can then replicate success on a year-to-year basis.”

Step #3: Trial different options. Unfortunately, marketing requires some trial and error to learn what resonates with local consumers.

“There is no magic wand, so you have to try different advertising vehicles,” says Deborah Masse, vice president of operations for Michigan-based Cottage Inn Gourmet Pizza, a 50-unit chain with locations peppered across Michigan and Ohio.

To that point, Cottage Inn recently picked test markets to trial an aggressive move from print to digital advertising. Some test units even pulled print advertising altogether in favor of digital venues such as Pandora Internet Radio.

“What we learned is that print still matters and matters heavily in some markets,” Masse says, “but that’s not something we would’ve discovered without some experimentation.”

With modest, calculated investments into various advertising options, operators can determine what works best and where. In some of Cottage Inn’s store communities, for instance, Masse has found that direct mail produces the most positive response; in others, though, the local “penny saver” publications deliver impressive results.

Step #4: Measure and assess. Whether leveraging point-of-sale software or using a pen-and-paper log, restaurants must have some tracking mechanism to evaluate a given campaign’s success.

While digital and mobile advertising returns can often be tracked via an online code or online ordering, the ROI on more traditional advertising mediums can prove more elusive.

Pizzerias might require customers to bring in physical coupons or share an associated word or phrase to earn a deal. Staff, meanwhile, might ask customers what brought them in and tally those responses.

“Whatever the method, staff and managers need to stay on top of it,” Masse says.

At the minimum, operators should maintain records on the advertising spend, when and where it was placed and match the investment against sales.

“Examining the data helps you determine if you’re spending money in ways that drive business,” Guilfoyle says.
When assessing ROI, however, Lopez reminds operators to consider more than just the investment in the advertising medium.

“You must factor in the cost of the product or the discount because that’s part of the marketing investment as well,” he says.

↓ Four ways to earn added credibility with your local audience

1. Charitable involvement. Getting involved with local nonprofits or helping organizations with fundraising efforts deepens community relationships and places the pizzeria’s name in front of new audiences in a more personal way.
2. Local food bloggers. The positive review of a local food blogger can heighten a pizzeria’s reputation while the online link can also boost search engine optimization (SEO).
3. User-generated content. Inviting people to share memories from the establishment in conjunction with an anniversary or running a photo contest heightens personal ties to the pizzeria. Publish the content to a dedicated website page as well as social media.
4. Spotlight staff. An indirect way to promote the restaurant is to share its special people with the local media, such as the high school employee who recently won a regional culinary contest or the long-time employee who beat cancer.

Chicago-based writer Daniel P. Smith  has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Marketing: Keep it Local appeared first on Pizza Today.

Relationships are invaluable to a restaurant’s success.

It is a no-brainer that the relationships between management and staff, staff and customer and restaurant and supplier need to be strong in order for a restaurant to keep its doors open.

And relationships require work. They require communication and, sometimes, resolution. They require time and effort from both sides.

And most of the times, relationships require a contract, especially if operators want to prevent disasters or solve problems with their distributors or suppliers.

“In determining whether or not a supply agreement is required with a particular vendor, consider their historical performance, the value of business you do with them, as well as how easily you would be able to locate an alternate source in the event this relationship ends suddenly,” says Devon Smiley, a negotiation coach and consultant in Montreal, Canada. “The more reliant you are on a vendor, and the fewer high-quality options exist in your market, the more important it will be to have an agreement in place.”

If the idea of creating a contract is overwhelming, operators need not stress. Chances are, they may be better versed than they think.

“Whether or not operators know it, they almost always do have ‘supply agreements’ in place with their suppliers,” say Sarah K. Rathke, a partner at Squire Patton Boggs (US) LLP in Cleveland. “The reason is that any written communication –– a purchase order, an order form, an order acknowledgement –– that arranges a purchase constitutes a ‘contract’ under the law of contracts and is enforceable. Therefore, no matter what form the written communication takes, it is important to recognize that it most likely is contractually binding, and to make sure that it contains all the terms you need to protect your interests.”

Although an agreement’s form can vary, it should always cover a restaurant’s best interest.

“If you are worried about the price of a particular ingredient or supply increasing to a point that it threatens your business, you will want to lock in prices for as long as possible in the supply agreement/purchase order,” Rathke says. “The form the agreement takes is not as important as that it contains all of the protections you need. What operators need to ask when negotiating a supply agreement is: ‘What is important to me? What are my business needs? What are the risks that I am most worried about? And how do I protect myself from those risks?’ ”

Whether or not operators are comfortable with contracts, there is always room for improvement when negotiating terms of an agreement.

Ryan B. Opel and Jonathan T. Hasebe with the law firm of Gallagher & Kennedy in Phoenix offer these seven tips to keep in mind when negotiating a supply agreement or contract:

• Don’t ignore the fine print. Too often, buyers focus solely on the pricing terms of a contract. Make sure you understand your entire contract before you sign it, especially those dreaded “boilerplate” provisions.
• Seek pricing stability. Supply agreements often provide an opportunity to achieve long term pricing stability. Beware of price fluctuation clauses, especially automatic price increases that can be triggered without your consent.
• Carefully describe what you are buying and include warranties that back it up. Make sure the contract carefully describes your products, specifying the exact nature, type, quality and condition of the goods you are buying with as much detail as possible. Then make sure your supplier backs it up with a warranty that, at the very least, promises that the goods sold will conform to those precise specifications.
• Beware of disclaimers and other efforts to minimize supplier liability. Smart suppliers go to great lengths in their supply agreements to minimize and even eliminate their liability with disclaimers, limitations and clauses. Be on the lookout for these clauses and don’t be afraid to haggle.
• Be prepared for disputes. A good supply agreement will have a detailed dispute resolution clause that dictates the method for resolving disputes, the location where dispute resolution will take place and the rules of law that will govern the dispute. Think carefully about which method of dispute resolution is best for your restaurant business and focus on location.
• Have an escape clause. When supply relationships do not work out, carefully review the term and termination provisions of your contract. Try to negotiate appropriate ways to terminate your contract early, both for convenience and for cause.
• Remember that you are not alone. Do not hesitate to consult your trusted professional. Supply agreements are often lengthy and intimidating legal documents. Done well, a supply agreement can provide invaluable benefits by promoting stability and limiting risk.

Finally, sign with a supplier or distributor whose reputation of quality and success precedes them.

“You need to ensure that the relationship will last long enough to become maximally profitable, and to do that, you need to be sure that the distributor has the qualities and resources needed to perform its part of the deal. You should ask for financial statements sufficient to give you comfort that they can weather any ramp-up period with you or any down times without negatively impacting your business,” Rathke says.

Mistakes inevitably will happen, and Smiley advises using them to your advantage.

“I encourage operators to review their past six month’s performance, and highlight any areas of their supply chain that fell short of expectation –– late shipments, slipping quality, onerous payment terms, etc.,” Smiley says. “Each of these pain points, no matter how small, represents a potential feature in their new supply agreement. Learning from past frustrations and including coverage for those situations in future agreements helps ensure smooth operations.”

For relationships to last, they cannot be entered into lightly or quickly. By doing their homework, finding the right supplier to work with, and negotiating a contract that protects in detail their business interests, operators will ensure a relationship of success.

DeAnn Owens is a freelance journalist living in Dayton, Ohio. She specializes in features and human-interest stories.

The post Vendor / Supply Agreements: Coming to Terms appeared first on Pizza Today.

Honing marketing efforts to a geographic radius reaps rewards

Loyalty is not given, it is earned. You gain frequency with the quality and consistency of your product, your customer service and your overall dining experience.

Your approach to marketing can make or break your brand loyalty in your community. The people in your backyard may hold the key to your longevity. Neighborhood marketing, also known as local store marketing (LSM), creates awareness and initial trial. LSM focuses marketing efforts within a three- to five-mile radius of a restaurant, says Linda Duke, CEO of Duke Marketing, a full-service marketing firm in San Rafael, California. “By focusing on your three- to five-mile radius, you can reach your potential guests most cost effectively and is the perimeter where 90 percent of the restaurant customers will come from,” says Duke, who has specialized in restaurant marketing for 25 years.

Craig Mosmen, owner of The Couch Tomato, drew his radius even closer in densely populated Philadelphia. “We mass mail our menu to every resident within a 1½-mile radius from our location at least once a year,” he says.

With two locations in small towns, Old Town Pizza’s marketing efforts encompass Auburn and Lincoln, California. “The bulk of our marketing efforts remain directly in our community, so roughly four-five miles,” says Marketing Director Russ Yeager.

“Obviously our reach is further than that because of social media and contests that we have won, that encompass the Greater Sacramento area.”

Unlike traditional advertising, neighborhood marketing positions your pizzeria as a fixture in your community. “The key to local store marketing is to get out in the community and build your brand by talking with people, building trade area relationships and having your restaurant actively involved in the community,” Duke says.

Be forewarned, this is a marketing strategy that requires your time and patience. “LSM is work and requires a commitment that pays off over time,” Duke says.

But the payoff can be huge. “Those operators who do LSM well spend less on advertising and more time being the place the whole community is inspired to go to,” Duke says.

LSM starts even before the pizzeria opens. “You must begin this process from the moment you sign your lease,” Duke says. “If you do not live within three-five miles of each specific location and understand all the specific variables of the trade area, you will need to actively engrain yourself in obtaining full knowledge of your community, your competitors and your potential marketing partners.”

The Couch Tomato blends community involvement with a loyalty program, mailers and a new-mover program that have provided a high ROI. “We are very aggressive in supporting our local charity and non-profit organizations,” Mosmen says. “We set aside a significant annual budget and always support the charities within our market area, along with a few others for which we have a strong support like the local children hospital and LUNGevity. These organizations all know to count on us every year to help with monetary, food-related or auction item donations, and we’re always happy to help out! It likely increases our exposure, but most importantly it just feels good to help support the local non-profits and give back to the community.” Old Town Pizza’s LSM strategy also revolves around supporting its communities. “We market by giving back and being heavily involved with the neighborhood,” Yeager says.

“We support organizations that support youth, seniors, schools, animals, arts and local business. Examples of organizations include Rotary, Lions, Soroptimist, Boys and Girls Club, Chambers of Commerce, SPCA, parks and rec, Seniors First and more. We donate gift boxes and do fundraiser days for local organizations. If their event fits into our rules we try to never say no. We also support the local community newspaper and are heavy users of social networking. We have the same philosophy at all locations.”

Just as you have a strategic business plan, planning and organization are vital to a successful LSM program. Duke suggests, “Create a community diary. Develop a list of those businesses and organizations in your restaurant’s local three-five mile radius. Create a list of names and phone numbers in categories such as: local government officials (chamber and city members), police and fire departments, schools, religious organizations, non-profits, car dealerships, hotels, shopping centers, apartments, banks, etc.

“Once complete, keep them in a binder at the restaurant to use for future reference. Include local key influencers in your community such as government officials, news reporters and key business leaders. Your local chamber of commerce can provide a list of all the businesses in your area for your diary. Join as a member and the cost for the list is generally less.”

Duke outlines nine how-to steps to a successful LSM program:

1. Plan. Do your due diligence; determine your local store marketing promotions and tactics and what program or event will be tested.
2. Create. Diary of contacts, timeline, materials and tools.
3. Communicate internally. Meet with GMs, area managers and staff to determine what has worked in the past, and gather information regarding store area, customer profile, etc.
4. Communicate to guests. Put up a banner, signs, flyers, table tents or check presenters. Send out a direct mailer and e-mail blast. It is also important to send out a press release to the local media.
5. Coordinate. Put together a communications plan for the LSM activity and communicate to staff and coordinate with partners.
6. Train. Provide training for execution and implementation of programs.
7. Test. Create a test program. Analyze test and adjust for all store roll-out or another date with added details to enhance the program.
8. Execute. Local store marketing promotion plans per store and area.
9. Evaluate. Measure results and determine next steps.

Failing at LSM derives from lack of consistency and commitment. Remember, neighborhood marketing is an ongoing strategy that should be retooled as your community changes or grows. You will also need to refocus your tactics to reach patrons and potential customers as their communications methods change. Become a fixture in your community.

Denise Greer is associate editor at Pizza Today.

The post In Your Backyard: Local Store Marketing appeared first on Pizza Today.

Do you have the right insurance coverage for your operation?

Owning a business is an act of calculated risk. To make the most of your investment, proper insurance coverage is absolutely necessary. Without it, a customer who breaks a tooth or a fire in the kitchen can spell disaster very quickly.

There are significant differences between the insurance you need in your personal life and your role as pizzeria operator. Consider all the policies you hold: life; auto; health and home. Each aspect of your business needs to be insured, just like the different segments of your life. Neglecting one kind of coverage, whether to save money or just because you didn’t know you need it, is a costly mistake.

Keith George at Pizza Pro Insurance says coverage for a small start-up pizza restaurant isn’t as expensive as you might think. Premiums depend on your volume of sales, number of employees and other factors, but he estimates a yearly cost of just $2,000. That amount doesn’t include coverage for delivery drivers or specific natural disasters, such as flood or earthquake, and assumes you’re renting the physical space.

Any time your business changes you need to meet with your insurance agent to review coverage. More employees? You may need more workers’ compensation. Increased alcohol sales? That changes some of your liability issues. Keeping current with your insurance means you have the right policies for taking care of your business no matter the circumstance. Cheryl Downey, senior vice president of EPIC Hospitality Group Programs, reminds owners to ask questions before choosing a plan. “Cheapest does not mean the best, especially with insurance, ” she says.

Let’s talk first about physical property. You’ll need coverage for your building and all the contents –– kitchen equipment, seating, even wall treatments. It is important to make sure your policy covers replacement costs, not depreciated values. A typical payout pays for what an item is worth, based on when it was purchased. That value decreases over time since the object is used. With replacement cost coverage, you’ll receive the dollar amount it will take to buy something new in today’s market. That can mean a huge money difference.

Business personal property coverage is essentially everything inside your business, no matter what happens to it. If you are just starting out, keeping track of every item you purchase for the restaurant can make a claim much easier in the long run. Otherwise you can make a video walking through the space, narrating what is contained in the space. Without some kind of documentation it can be hard to remember all the small items that add up to big costs when you try to replace them.

You also need workers’ compensation coverage. This ensures medical care and lost wages for employees hurt on the job. “If you have a small business, if you don’t have x amount of employees, you may not be required to buy workers compensation,” George notes. Each state has different requirements so your agent can give you guidance on when you need coverage and for what amounts.

Liability is another type of coverage that involves the people in your business. If a customer is injured coming in to pick up a pizza, you are responsible for the medical expenses. Premises liability and general liability are used interchangeably and mean the same insurance. “Someone may slip or trip and get injured on the premises. Another example would be somebody chips a tooth or gets food poisoning, that’s covered on your general or premises liability,” explains George.

Liability is what is involved in the horror stories of businesses being sued for millions of dollars. There are basic dollar limits on each policy, depending on the size of your business, but you can always buy more. Downey says, “I have seen small business owners become much more involved in buying the right insurance after they have a fire or liability claim.”  That is the worst possible scenario to be avoided up front before a problem occurs.

Another provision you want to consider is one you hope to never need: theft and employee dishonesty. One dubious worker can cause a lot of loss through theft, so a rider can be added to cover that situation.

When you send someone out on the road to deliver your pizza, the whole situation changes. Your other insurance policies covering the people and property of your business simply don’t apply. Separate coverage is needed and it is costly. If you don’t already do delivery and are thinking of adding this new service, the costs and hassle involved may not be worth it.

If delivery is crucial to your business model, you’ll need something called non-owned auto liability. Non-owned because the driver is using his own vehicle, not one owned by the company. You are employing him, though, so his personal auto insurance stops being valid while he’s doing his job. Roads are infinitely more dangerous than a brick and mortar store that doesn’t move, so this insurance involves more risk for your policy holder.  Downey reminds owners, “The wrong time to find out if you have enough insurance is after you have a delivery claim.”

Delivery drivers won’t be able to be insured if they have poor driving records, so you’ll have to be diligent about whom you hire. Your non-owned auto liability will cover auto damage caused by the driver, as well as property damage and medical expenses. The more drivers you have, the higher your rate. George estimates a cost somewhere between $3,000 and $4,000 for limited delivery.

There are specific riders available to cover almost any eventuality: employment practices liability, in case of a discriminatory hiring lawsuit, or business interruption coverage to make up for money losses if you are unable to open.

A good insurance agent you feel comfortable with can explain the legal requirements in your area, as well as other coverage you can consider. We all hope to avoid making insurance claims, but having adequate coverage — just in case — can protect your investment for the future.

Insurance Vocabulary

(courtesy National Association of Insurance Commissioners)

Liability: A certain or probable future sacrifice of economic benefits arising from present obligations of a particular entity to transfer assets or to provide services to other entities in the future as a result of a past transactions(s) or event(s).

Rider: An amendment to a policy agreement.

Policy: A written contract ratifying the legality of an insurance agreement.

Premium: Money charged for the insurance coverage reflecting expectation of loss.

Claim: A request made by the insured for insurer remittance of payment due to loss incurred and covered under the policy agreement.

Eliana Osborn lives in the desert southwest with her family, where she works as a part-time English professor and freelance writer.

The post Insurance: Get Protection appeared first on Pizza Today.

Do you know the law when it comes to hiring immigrants?

Hiring a worker who is not legally authorized to work in the U.S. is likely only to bring hassles for pizzeria owners.

Those costly and time-consuming troubles could include an audit, which many businesses have faced in recent years. Immigration and Custom Enforcement has audited more than 8,079 employers and imposed $87.9 million in fines for businesses hiring unauthorized workers since 2009, according to a 2013 report by the Migration Policy Institute.

While the majority of U.S. employers are not currently participating in E-Verify, many are using it to confirm their new hires are legally able to work in the U.S.

E-Verify compares information from the worker’s Employment Eligibility Verification (I-9 form) against millions of government records. It is a free, Internet-based system administered by the U.S. Department of Homeland Security, U.S. Citizenship and Immigration Services and the Social Security Administration.

If the information matches, the employer receives an Employment Authorized Response for the new hire from the system. If the information does not match the employee is designated as “tentative non-conforming” and is given the chance to resolve the problem. If an employee cannot provide the correct documentation or does not contest the non-conforming result then the employee must be terminated.

USCIS reports that 500,000 employers nationwide are using E-Verify, and 1,400 new companies a week are participating. Angelo Amador, vice president of labor and workforce policy for the National Restaurant Association, says restaurants, too, are among the users of E-Verify even when it is not required by law in the states where they operate.

“It’s becoming more common. A lot of restaurants are using it. Some companies are even requiring it in their franchise agreements,” Amador says.

Use of E-Verify may be mandated across the nation under proposed federal legislation.

Martha Potvin, manager of office administration for America’s Incredible Pizza Company, says her company has used E-Verify for the past seven years to confirm the employment eligibility of her company’s 600 workers.

During that time she says there have been only a handful of occasions when an employee’s documents did not pass muster. When that has happened she says an employee must present the proper paperwork within a designated time frame or be terminated.

“We’ve had a few times where we weren’t able to confirm the paperwork,” she says. “Usually if they can’t provide the legal documentation the employee just doesn’t come back.”

Potvin, whose company has five stores in Missouri, Oklahoma, Texas and Tennessee, says it was easy to learn how to use E-Verify. Katie Harlan, human resources director for Spinato’s Pizzeria, which has five locations in Arizona, agrees. “It’s fairly easy –– the whole process is to log in, put in the candidate’s information and then the system tells you fairly quickly whether the information makes them eligible to work in the U.S.”

According to USCIS, it takes just three to five seconds for the system to provide a response once the information is entered.

Harlan says online training for E-Verify also was easy. “They go through it and explain it. Then you have to pass a test before you can use it,” she says.

Spinato’s Pizzeria has one person who is trained and designated as the lead user of E-Verify and another employee who serves as a backup when that person is on vacation or out of the office.

“We run it all through one person. We find it’s easier to follow up,” Harlan says.

That person follows up with store managers when a new hire receives a tentative non-conforming response or there are any other questions that need to be addressed.  Store managers are required to get the proper documents from the employee and review them.

“The manager still needs to verify that the documents look authentic,” Harlan says, adding that she thinks E-Verify could be improved if simple mistakes, such as misspelling an employee’s name or mistyping a social security number, were easier to fix.

“It’s be nice if you could just click (and correct) what you sent rather than go back through the whole thing,” she says.

When an employee at America’s Incredible Pizza Company is terminated for not being authorized to work in the U.S. Potvin says it represents a loss for the company because it has already trained and made other investments in the new hire. “It doesn’t happen a whole lot,” Potvin says. “It’s a chance you take because the person did well in the interview.”

Despite those problems Potvin and Harlan say they are happy that their companies are using E-Verify.

Harlan says using E-Verify makes her feel like the responsibility of confirming an employee’s authorization to work in the U.S. does not just fall on her or another person’s shoulders. “I think it takes the burden off the individual,” she says.

Potvin feels more confident about the work status of the employees her company hires, and that affects the whole business environment. “It makes for a calmer, more peaceful business,” she says.

Paperwork Pitfalls

No system is perfect and E-Verify, though it boasts high user satisfaction, could be improved, says Angelo Amador, vice president of Labor and Workforce Policy for the National Restaurant Association.

If a federal law is passed that requires businesses across the country to use E-Verify, Amador says the association wants to make sure that businesses are not penalized for clerical errors.

Audits of I-9 forms have become more common which is one reason why the proposed law is being scrutinized by the association. “There have been a lot more audits so we’re asking for more safeguards and clarity,” he says.

Amador says businesses that are audited should be allowed to fix clerical problems without fear of penalties or fines. “If it’s merely a paperwork violation. If there are no unauthorized persons working — just let them fix it and move on,” he says.

The restaurant association also recognizes that not every restaurant is comfortable with an online system, and wants other options for them.

“We understand that they might have to create a paper-based system with a phone number that you’d call,” he says.

Annemarie Mannion is a freelance writer living in the Chicago area. She specializes in business and health stories.

The post Bases Covered appeared first on Pizza Today.

Remote monitoring can reduce losses, heighten efficiencies and increase the bottom line

Suspect an ongoing issue with internal theft, shrinkage or sweethearting?

Curious if staff members are following store procedures around closing, food handling or cash management?

Have a hunch that energy use is much higher than it should be?

Remote monitoring –– the ability to supervise one’s pizzeria 24/7 to bolster security, operational efficiencies and, ultimately, the bottom line –– might not be the singular answer, but it can certainly be a key piece of the solution.

“Issues around risk management, food safety and operational efficiencies, those are all red flags that remote monitoring can help address,” says ADT Business President Luis Orbegoso.

From video images, operators –– particularly those with multiple units who cannot physically be in numerous places at one time –– can access from a mobile app or Web site sensors that track, automate and update everything from water and energy use to lighting and doors. Remote monitoring provides pizzeria operators the opportunity to manage their restaurants anywhere, anytime.

“Operators used to have to be at the restaurant to understand what was happening, but technology now allows operators to keep tabs on what’s happening from the front door to the back door each and every day,” says Matt Moulton, marketing manager for Monnit, a remote monitoring solutions provider headquartered in Utah.

With video, operators can check to see if the kitchen is being cleaned after closing, if staff are performing the necessary prep work for a large catering order or if the rear door is being propped open to accommodate a flurry of delivery drivers or something more unseemly.

The mere presence of video cameras, Orbegoso reports, has been shown to deter theft by as much as 30 percent. He says having a camera aimed at the cash register can enhance security and reduce sweethearting, while also affording operators the opportunity to review video and gather important facts any time the register opens without a transaction occurring.

Furthermore, video can also drive employee compliance by allowing operators to assess procedures around cash handling or prep work and, subsequently, identify areas that might require staff education or warrant a strict conversation. Video can also deliver added oversight of training, a particularly important aspect in an industry with notoriously high turnover, as operators can peer in from a mobile device to see if a new employee is being properly trained or left to wander.

“There’s nothing like seeing what’s going on to corroborate what you think is happening,” Orbegoso says.

On the automation side, operators can improve the bottom line by driving efficiencies with major appliances, reducing spoilage and using the real-time or historical data remote monitoring technologies provide to proactively address equipment maintenance or repairs. Operators can even set up a remote monitoring system to turn on appliances at pre-determined times, which can help drive process efficiencies in the kitchen.

Monnit offers about 50 sensors measuring conditions ranging from dry-contact sensors on the front door to high-temperature sensors for pizza ovens and infrared motion sensors. The technology then provides text, email or voice alerts when anything, such as the temperature on the walk-in cooler rising, runs outside of a pre-set range.

“Operators can get alerts instantaneously to minimize any problems, which can prove incredibly valuable,” Moulton says.

Orbegoso recalls one pizzeria owner who consistently ran his air conditioning on full blast to compensate for the heat his massive wood-burning oven generated. By placing his air-conditioning unit on an automated schedule, the operator reaped immediate savings that paid for his monthly investment in the remote monitoring system.

“Even a one- to two-degree change in temperature settings can reduce energy usage five to 10 percent,” Orbegoso says.

Leveraging remote monitoring technology, operators can also allow or restrict employee access. If an employee needs to get earlier access to the restaurant to fulfill a large school order, for instance, the owner can open the door remotely from a mobile device rather than hustling to the store simply to unlock a door.

“It’s like always being at the store’s keypad panel,” says Don Hsieh, director of commercial and industrial marketing for Tyco Integrated Security, a Florida-based firm that provides mobile security management to restaurants across the country.

Yet more, operators can then manage authority, such as who is able to go where within the restaurant. They can bypass particular zones or partition off others, such as permitting employee access to the kitchen, but not the back office during specific times.

Given their risk management and operational benefits, remote monitoring systems continue to rise in popularity among restaurant operators. About three years ago, only about 10 percent of ADT’s commercial customers had any type of automation, Orbegoso says. Today, that number hovers near 50 percent.

“Our customers quickly find out that they get a heightened sense of security alongside operational efficiencies,” Orbegoso says.

Tip: Considerations when investigating a remote monitoring system

When investigating a remote monitoring system, operators should first identify the specific problems they are trying to mitigate or solve. While cash handling might be a mild concern, product theft from the kitchen, sweethearting at the cash register or energy use might be consistent issues impacting the operation’s performance and its bottom line.

“When operators understand the issues they have, they can then work with their vendor to craft the right solutions and produce the right ROI,” says Don Hsieh of Tyco Integrated Security.

When assessing vendors, operators should ask if the system was designed for and exists in commercial environments and, more specifically, restaurants.

“You want to make sure you’re getting reliable and durable equipment that can hold up in restaurants, which can often be harsh environments,” Hsieh says, adding that ease of use is also important.

“You shouldn’t need a 100-page manual to operate the system. It should be something rather intuitive to use,” he notes.

As for the investment, operators should expect initial charges for equipment –– costs that vary widely based upon one’s needs –– as well as monthly fees. According to ADT Business President Luis Orbegoso, the basic ADT packages begin at about $50 per month, while total monitoring systems top out at about $80 per month.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Outside Looking In appeared first on Pizza Today.

Merchandising matters, so choose wisely

Scott Wiener
Scott’s Pizza Tours, New York City

I realized last week while folding a load of laundry that at least 80 percent of my t-shirt collection is pizza-related. Some have catchy phrases or images and others are from pizzerias I’ve visited over the years. But it doesn’t end there; my tiny apartment is a warehouse for every kind of pizza swag you can imagine. It’s quite a change in décor from the rock band posters and t-shirts of my high school and college years, but the idea is the same. I love showing my support for things I enjoy, and your pizzeria is one of them. Help me flaunt my fandom by taking advantage of merchandising opportunities that will bolster your bottom line.

You can get your pizzeria’s name printed on just about anything, but I tend to prefer the simplest options. Magnets and stickers are great because they’re inexpensive and take up almost zero real estate in your shop. Customers will keep them on their refrigerator or inside their locker at school, providing a constant reminder of whom they can call for pizza and wings this weekend. The marketing potential is enormous, especially when compared with paper menus that get lost in piles of junk mail. The longer an item survives before hitting the trashcan, the more eyeballs will see it and the greater your return on investment.

I’ll never pay for a pizzeria magnet, but have no problem dropping $20 for a cool t-shirt. Cost is usually around $5 to $7 per piece (depending on shirt quality and print quantity) so there’s definitely room for profit. Rizzo’s Fine Pizza in Astoria, New York, sells t-shirts for $5. For the customer, such a low price makes the purchase a no brainer. For your pizzeria, a net loss of zero dollars is a pretty great price for a mobile billboard that will expose thousands of people to your brand.

My first pizza t-shirt remains one of my favorites because I earned it. Carmen’s Pizzeria in Neptune, New Jersey, is famous for their XXL pizza challenge. Long before “Man vs. Food,” Carmen’s offered a free t-shirt to any customer able to finish a XXL pizza in under an hour. The best part is the pizza is extremely thin, so even my grandmother could take it down. I remember sitting at a table with at least five of my friends, each of us devouring our own XXL pie. The promotion increases the pizzeria’s average check while creating a frenzy of free advertising. The best part is the t-shirt design changes every year, so there’s incentive for repeat attempts.

Your pizzeria’s unique identity could be ripe for possibilities beyond the standard apparel, just be sure you know your audience. Branded sunglasses might not sell in a Seattle pizza shop but they’re a good bet at a touristy beachfront location in southern California. If you feature craft beer, a branded bottle opener could be the perfect take-away. Don’t waste time, space and money on branded bobble heads and board games just because they’re available. Think about what you’re known for and you’re likely to find some matching merchandise.

Scott Wiener owns and operates Scott’s Pizza Tours in New York City.

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Don’t make these Department of Labor mistakes

In the May issue of Pizza Today we discussed how easy it is for pizzeria operators to run afoul of Department of Labor (DOL) regulations, despite all good intentions to the contrary. With DOL audits on the upswing, restaurants have been on the receiving end of heightened attention from the agency, hence the need to put your operations under exacting scrutiny. Ryan Holdan, president and founder of Paymasters Inc., says there are five areas where pizzeria operators tend to make mistakes that could get them into trouble with the DOL. Holdan, whose Birmingham, Michigan, company provides payroll, HR and time and attendance solutions for the restaurant industry, lists these as the under-reporting of tips, minimum wage violations, overtime wage violations, I-9 violations, and poor or non-existent recordkeeping/HR policies. We covered the first two in the May article. In this one, we examine the remaining three.

• Overtime wage violations. There are two mistakes Holdan frequently sees. The first is using the tipped rate of pay to calculate overtime. For tipped employees whose pay rate falls below minimum wage, rather than multiplying the tipped rate by 1.5 to arrive at the overtime rate, pizza restaurant operators must instead use the minimum wage as the base rate to calculate overtime. Example: the current federal minimum overtime rate is $10.88 ($7.25 x 1.5). Next, they need to calculate and subtract the effective tip credit from the overtime rate of pay, multiplying that figure by the number of overtime hours.

The second error is failing to use a weighted average rate when calculating overtime rates for employees with multiple rates of pay. “If an employee has two rates of pay, you cannot use only the pay rate in which the overtime hours were worked,” Holdan explains. Instead, operators must calculate a weighted average rate of pay to determine the correct overtime rate.

• I-9 violations. Here, poor record keeping can put pizzeria operators right in the line of DOL fire. There are exacting requirements when it comes to correctly managing I-9 files, says Maria Dwyer, an attorney with Clark Hill, PLC. The nationwide, full-service law firm, headquartered in Detroit, includes a team of attorneys specializing in the food, beverage and hospitality industries. These files must be:

• Kept separate and away from other records.
• Created within three days of the employee’s hire.
• Retained for three years after hire or one year after termination.

“Also, when completing a Form I-9, the employer representative must be in front of the person/potential employee to verify the required two pieces of identification provided,” Dwyer says. “In some cases, an applicant attempts to turn in this form via fax or e-mail and this method isn’t acceptable for Form I-9 completion.”

Pizzeria operators must be able to produce I-9s and supporting documents for every employee, says Holdan. This can be challenging for restaurants in general because of the industry’s typically high turnover, along with absent or inadequate HR procedures that would facilitate better record keeping.

“Owners and managers also tend to rush the paperwork process, and therefore they fail to get the I-9 forms and get them from everyone,” Holdan says. “But they need to because if they can’t produce these documents, the fines can be ruinous for a business.”

• Poor or absent HR policies. It’s common for restaurants, especially smaller ones, to lack even the most basic HR policies, record keeping or documentation, says Holdan. This can place a restaurant at a huge disadvantage if audited by the DOL or the IRS, especially where it concerns tip policies and tip payouts.

Rose Bolzan, owner of a Jet’s Pizza franchise located in Lawrenceville, Georgia, believes this is a real danger area for restaurant operators. Consequently, with the help of an attorney and the company managing her payroll, she developed an employee manual addressing all aspects of her operations.

Some of the areas covered in the manual include the tip policy (employees must report all tips, cash or credit card sales); uniforms/appearance; social media; cell phone use (not allowed and if used during work, grounds for immediate dismissal); behavioral expectations; discipline policies; employee food purchases; workplace safety; rest and meal policies; equal opportunity; sexual harassment and more.

The manual is given to each employee at the point of hire, and either Bolzan or one of her managers reviews it with the employee, highlighting certain sections in particular. Employees are required to sign specific pages, among them the I-9 form. Bolzan turns to the manual regularly. If she makes a verbal request and the employee doesn’t respond appropriately, she uses it to reiterate her expectations and the employee’s obligations.

She also believes in documenting. For example, employees are alerted to any policy changes via messages placed on the POS system. Before an employee can punch into this system, which starts their time clock, they must read the message; the POS system then documents that the message has been read.

“I can see how, if I didn’t have this manual and document like I do, how vulnerable my business would be,”
says Bolzan. “Especially since for most of my employees, this restaurant is their first work experience.”

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post Labor Woes appeared first on Pizza Today.

What restaurants need to know about EMV and the looming liability shift

Take notice, pizzerias, the EMV liability shift deadline looms.

This October, restaurants must be equipped to accept EMV cards –– an acronym for Europay, MasterCard and Visa –– or risk financial responsibility for any point-of-sale fraud that occurs in their stores.

Unlike traditional magnetic-swipe cards, EMV cards, also called smart cards or chip cards, use an embedded chip to create a unique impression for every purchase, which heightens security and reduces the likelihood of fraud.

“EMV is designed to protect the integrity of the physical card … (and), ultimately, this is really about helping merchants,” says Mark Schulze, co-founder of the mobile POS system Clover, a First Data company.

Though EMV has captured headlines of late, many small merchants, pizzerias included, remain unprepared for the EMV liability shift if not completely unaware of the matter.

Though the global standard for much of the world, the United States is a latecomer to the EMV game. Many of the globe’s other leading markets, in fact, have been using EMV for the better part of a decade, a reality that has made U.S. businesses a fraud target. According to The Nilson Report, the U.S. is responsible for nearly 50 percent of the world’s card fraud despite accounting for less than one-quarter of its sales.

“As the rest of the world has gone toward this enhanced standard (EMV), we’ve found a narrowing of fraud” centered on the United States, Schulze says.

As criminals favor easy targets, Schulze says it’s not unrealistic that fraudsters will target merchants, including restaurants, relying on easily replicable mag-stripe cards.

“It’s logical to assume that if you’re lagging behind, the criminals will start frequenting your store,” Schulze says. “The impact of fraud … is a very real risk.”

In years past, card issuers took the hit when a criminal passed a manufactured or counterfeit card to a merchant. “The card issuers basically said, ‘They foiled our security, so this is on us,’” Schulze says.

Come October’s EMV liability shift, however, liability for fraud due to card theft resides with the party using the least secure technology, says Mike English, vice president of product development at Heartland Payment Systems. For instance, if a merchant continues using a magnetic-stripe terminal, then he will be responsible when a counterfeit magnetic stripe from a chip card or a lost or stolen chip card is used on that magnetic-stripe terminal.

Contrary to some alarmist headlines, EMV is not mandatory. There is no government requirement here, no regulatory mandate.

Merchants can choose to implement EMV acceptance or continue relying on magnetic-stripe card transactions. At present, card issuers are continuing to provide smart cards that also carry a magnetic stripe, so merchants – at least for the foreseeable future – will be able to accept payment either way.

Switching to EMV is a rather simple process, albeit one requiring time and money.

Immediately, a restaurant will need to purchase an EMV reader and, quite possibly, additional software. If a restaurant only needs a stand-alone terminal, costs can range from $250 to $500. If a restaurant already has a POS system, however, the costs to upgrade software and add an EMV-ready peripheral will vary widely among providers. (It’s worth noting that American Express’ Small Merchant EMV Assistance Program allows eligible merchants to earn a one-time $100 reimbursement from American Express on the purchase of an EMV terminal.)

Operators will also need to devote time and resources to training. Unlike swiping, the current norm in American society, consumers and restaurant staff alike will need to get accustomed to dipping. With EMV cards, chips cards are inserted, or dipped, into a reader and, much like an ATM visit, remain there throughout the transaction to allow communication between the reader and the card.

David Gilbert, president of hospitality group at Heartland and a longtime restaurant operator, suggests operators begin reaching out to their payment processors and POS providers now to gather information on equipment and software needs as well as costs.

“This is not just flipping a switch,” Gilbert says. “This process requires an investment and procedures, so better to get moving sooner rather than later.”

According to last October’s American Express EMV Preparedness Survey, more than a third of the small merchants surveyed said they would not upgrade their payment terminals to EMV or were undecided on doing so.

Undoubtedly, some operators will run a cost-benefit analysis, calculating the cost of purchasing new EMV terminals or retrofitting an existing POS terminal against the potential liability, particularly by reviewing information on the restaurant’s current chargeback write-offs due to counterfeit cards. That math will likely leave some on the sidelines — at least until smart cards become the national norm and consumer expectations force the shift.

Others, however, will make the move concerned that any breach will cost them customers or that ignorance to EMV will only put their restaurant further behind the payment technology eight ball, especially with NFC (near-field communication) and contactless payments on the horizon. Heartland’s Gilbert calls EMV “a building block of security technology for restaurants.”

“As consumers begin to understand what EMV means to them, restaurant operators will need to be aware of this and coordinate their movement accordingly,” Gilbert says.

EMV is only one piece of the security puzzle

EMV is not the end-all, be-all solution to card fraud, but rather one piece of a multi-layered approach that also includes encryption and tokenization.

In such fraud-reducing transactions, the EMV card is inserted into the terminal, encrypted and sent to a PCI-compliant data center, where the data is then decrypted, authorized and returned to the merchant as a single-use token.

While EMV and encryption remove a criminal’s ability to monetize card data, the encryption and tokenization combination removes card data from the business environment.

As operators investigate EMV equipment and software with their payment processors, Heartland’s David Gilbert suggests they also inquire about encryption and tokenization measures as well.

“Complying with EMV is a great opportunity for restaurants to simultaneously incorporate these other key security measures to nearly eliminate any risk of breach,” Gilbert says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post EMV Uncovered appeared first on Pizza Today.

How to avoid unwanted attention by the Department of Labor

There’s good attention and then there’s bad attention, and getting noticed by the Department of Labor falls under the latter category, which is why most smart pizzeria operators take pains to stay on the right side of this government agency. But despite the best good-faith efforts it’s still possible to unwittingly fall out of compliance with DOL regulations, inviting unwanted scrutiny and potentially ruinous fines. Adding to the concern is the fact that DOL audits are “most definitely on the upswing,” and the restaurant industry makes an attractive target, says Maria Dwyer, an attorney with Clark Hill, PLC. The nationwide, full-service law firm headquartered in Detroit, includes a team of attorneys specializing in the food, beverage and hospitality industries.

“The restaurant industry is very susceptible to audits by the (DOL) because of the complex payment of wages issues, such as minimum wage for tipped employees and misclassification of employees as salaried exempt when they are in fact, hourly,” explains Dwyer.

Another reason for the increase in audits is that under his two terms, President Obama has regularly added additional enforcement officers to the DOL team, says Dwyer, resulting in greater manpower being directed towards these kinds of investigations.

Ryan Holdan, president/founder of Paymasters, Inc., is seeing the same. Located in Birmingham, Michigan, the company provides payroll, HR, and time and attendance solutions for the restaurant industry. According to Holdan: From 2009 to 2014 the number of DOL restaurant industry audits went up six percent year over year. However, the wages the agency collected have risen from $17 million to $34.5 million, more than doubling, amounting to a 15-percent growth rate year over year.

The DOL is increasingly taking the investigative initiative rather than just acting on employee complaints. Directed investigations of the restaurant industry have increased from 35 percent to 45 percent. In a growing number of these investigations, adds Holdan, they’re finding violations.

Holdan says there are five areas of operation where pizzeria operators tend to make mistakes, running afoul of DOL regulations. These are; under-reporting of tips, minimum wage violations, overtime wage violations, I-9 violations, and poor or non-existent recordkeeping or HR policies. In this article, we’ll examine the first two, covering the remaining three in the June issue.

• First, let’s look at under-reporting of tips. It’s the employer’s responsibility to accurately report all wages and tips to the IRS; if they don’t the IRS can hold the employer responsible, says Holdan. The problem for pizzerias is that generally, they don’t have the processes in place to ensure employees are reporting 100 percent of their tips.

“The biggest myth in the industry is that you only have to report eight percent of the sales as tips,” says Holdan. “And restaurants set up their POS systems in this way, giving employees no opportunity to accurately report their tips. And this is violating the law.”

Another common misunderstanding he finds among pizzeria operators is thinking that if they pay their delivery drivers minimum wage or above, the drivers don’t need to report their tips. But these employees still need to report 100 percent of their earnings just like any other employee, says Holdan.

What to do? Holdan advises that employees keep a daily tip journal, reporting the amount they’ve received (on cash and credit card sales), how much they’ve tipped out and to whom. This can be done through the POS system, or employees can fill out the IRS Form 4070 (“Employee’s Report of Tips to Employer”). Employees must verify and sign the journal or document that they’ve accurately reported all tips and this should be done prior to payroll processing.

Taking this approach to tip reporting demonstrates that pizzeria operators are doing all that they should be doing — short of reaching into employees pockets to verify their tips — thereby potentially reducing their vulnerability in the case of an audit or investigation.

• Minimum wage violations are also a common occurrence. When it comes to minimum-wage employees, pizzeria operators cannot take involuntary deductions from their paycheck that are for the primary benefit of the employer, such as for uniforms or register shortages. “This happens a lot,” says Holdan. “It’s very common for restaurants to do this. You can’t drop these employees below minimum wage. Even a one-cent deduction could put an employer in violation.”

Delivery drivers represent another problem area, many of whom aren’t being appropriately reimbursed for the company’s use of their private vehicle. Some restaurants take the approach of paying a flat delivery fee on top of the driver’s wages. But this isn’t a good system, says Holdan, and it could make the pizzeria operator vulnerable to legal issues (“In fact, delivery drivers are suing because they’re not being properly reimbursed,” he says).

For one thing, not every delivery driver is driving the same distance, resulting in inequitable treatment of employees, Holdan says. A better and safer way to go is doing a normal mileage reimbursement. Drivers should be required to keep mileage logs to ensure proper reimbursement, protecting restaurant operators in the process.
Look for a discussion of overtime wage violations, I-9 violations and the problems presented by poor or nonexistent recordkeeping/HR policies in the next issue.

Dos and Don’ts Recap

Ryan Holdan, president/founder of Paymasters, Inc., in Birmingham, Michigan, suggests that pizzeria operators:

Do require every employee, including delivery drivers, to report all tips from cash or credit card sales.

Do have employees keep a daily tip journal, recording the amount they received, who they tipped out to and how much. This can be done through the POS system or by having employees fill out the IRS Form 4070.

Do have employees verify and sign that they’ve accurately reported their tips.

Don’t pay delivery drivers a flat delivery fee to cover the company use of their personal vehicle. Instead do a normal mileage reimbursement. Have them keep a daily mileage log.

Don’t forget that for minimum-wage employees, taking involuntary deductions that drop the employee below the hourly minimum wage and are for the primary benefit of the employer, could put you in violation of DOL regulations.

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post In Too Deep appeared first on Pizza Today.

How will minimum-wage increases affect pizzeria operations?

On January 1, Rhode Island’s hourly minimum wage jumped from $8 to $9.

The Ocean State’s third minimum wage increase in three years, the New Year’s Day mandate sparked a hefty sigh from Bill Kitsilis.

“It’s not that I think the minimum wage shouldn’t get raised, but it’s a steep burden when it keeps climbing at such a robust clip,” says Kitsilis, who runs Angelo’s Palace Pizza in Cumberland, Rhode Island, a restaurant his immigrant parents opened in 1978.

From the nation’s smallest state and clear across the country to its largest state, Joe White knows how Kitsilis is feeling.

The president of Uncle Joe’s, a 22-year-old operation based in Anchorage, Alaska, White has watched Alaska’s minimum wage climb at a furious pace: from $7.75 at the start of 2015 to $8.75 on February 24. On
January 1, 2016, the rate increases another dollar to $9.75. For the full-time worker, that increase will cost White and other Alaska-based employers about $4,000 each year per employee.

“That’s a lot of money that has to come from somewhere,” says White, who employs 65 individuals across his four restaurants.

This year, 23 states and the District of Columbia enacted (or will enact) a higher minimum wage. Some are modest jumps tied to en vogue indexing proposals; some are driven by anxious state legislatures compelled to act as the nation moves further away from the last federal increase in 2009; and some are the result of aggressive efforts by organized labor to push minimum wage initiatives onto state and local ballots, a movement to thrust union rates higher.

“Some of (the minimum wage increases are) the normal course of doing business and some are the result of a concerted campaign to push wages upward,” says Scott DeFife, executive vice president of policy and government affairs for the National Restaurant Association (NRA).

Amid the rising costs of goods, the rollout of the Affordable Care Act and other bottom-line draining realities, minimum wage hikes, particularly hefty rate increases like those occurring in Rhode Island and Alaska, remain a source of great concern for the entire restaurant industry, which provides employment to about 10 percent of the nation’s total workforce, according to NRA data. With food and labor generally representing about two-thirds of a pizzeria’s costs, anything that dramatically increases one of those inputs challenges a pizzeria’s ability to thrive, if not survive.

“You have no choice but to adapt,” Kitsilis says.

And a minimum wage jump, operators know, impacts far more than the entry-level worker.

“When the minimum wage goes up, most others expect a raise, too,” White says. “The floor’s been raised and nobody wants to have their feet on the ground.”

Adds Kitsilis, who pays minimum wage to very few of the 70 employees in his 170-seat restaurant: “We typically look at raises every six months or so, but the question now is will those raises need to be bigger than usual to account for the minimum wage increase.”

Bemoaning the subject, however, is neither productive nor a sound use of time and energy, White and Kitsilis remind. Instead, operators must respond to the evolving labor climate by maintaining the bottom line without impacting customer service or product quality, often by employing a multi-pronged approach to help ensure a sustainable operation.

• Strategy No. 1: Raising prices. Most frequently, the cost of doing business gets passed onto the consumer, an often scary proposition for restaurants who know that higher prices might send customers elsewhere.

Indeed, price sensitivity is a finicky thing, something many operators address by raising prices on select items rather than employing an across-the-board increase that shocks customers. At Uncle Joe’s, for instance, White is considering adding 50 cents to one pizza size, hoping that small increase alone will offset the increased labor.

“It’s a tough call when you’re an independent not running $9.99 pizza specials,” he says, “but these are decisions that have to be made.”

While George Rice of Revenue Management Solutions, a Florida-based restaurant advisory firm, acknowledges that there is price sensitivity to nearly every item on a restaurant’s menu, he urges operators to investigate which items customers generally order regardless of a modest increase and, conversely, which items they might shun.

“Understanding your customer’s ordering habits is essential,” Rice says.

• Strategy No. 2: Adjusting the labor schedule. To address rising wages, some operators will have fewer workers in the restaurant charged to do more; others might shift their labor model, perhaps trending more toward the streamlined fast casual set up; and still others promote sound time-clock management policies as an antidote.

Rice suggests operators cycle around each hour of their business, analyzing key information such as the average number of customers per hour and the number of customers that can be handled by a single employee. Then, operators can schedule hours that match customer demand on an hour-to-hour basis, which Rice says will help a restaurant manage customer service during its busiest times while avoiding overstaffing during slow periods.

“You have to dig into the numbers and make logical decisions rooted in data,” Rice says.

• Strategy #3: Menu analysis. Kitsilis and his kitchen team have had frank talks about the menu and, specifically, eliminating certain items. For instance, Angelo’s has long served fish and chips. Though popular, Kitsilis acknowledges that the labor-intensive item might be worth ousting to reduce manpower. Kitsilis has also led discussions around pulling the shop’s small-sized subs in favor of the single large size, which should reduce labor and boost check averages.

“These are the types of discussions that become necessary when labor costs increase the way they have,” Kitsilis says.

• Strategy #4: Leveraging technology. From ordering efficiencies like table tablets to productivity-saving automated machines in the kitchen, technology can help operators counter heightened labor costs.

Years ago, Angelo’s switched from deck to conveyor ovens and that investment reduced the need for one kitchen employee. Already with an automatic pizza saucer and spiral dough mixer at Angelo’s, Kitsilis is now investigating spending anywhere from $7,000-$30,000 on a divider-rounder machine.

“It’s a simple cost-benefit analysis,” he says.

• Strategy #5: Savvy purchasing. To control inventory costs, White intends to embrace “the basics” – reinforcing proper portioning, reviewing the sales forecast to inform purchasing, reducing on-hand inventory to minimize waste and seeking rebates from vendors.

“Frankly, it’s stuff we should be doing all along and, in many cases, do, but now we need to go back and double check,” White says, calling such a review necessary to survival. “If you’re not going to do the little things like this, then you might not be around to serve customers anyway.”

A look at state minimum wage increases in 2015

State                2014        2015
Alaska                $7.75        $8.75
Arizona                 $7.90        $8.05
Arkansas                $6.25        $7.50
Colorado            $8.00        $8.23
Connecticut            $8.70        $9.15
Delaware            $7.75        $8.25
District of Columbia        $9.50        $10.50
Florida                $7.93        $8.05
Hawaii                 $7.25        $7.75
Maryland             $7.25        $8.25
Massachusetts             $8.00        $9.00
Minnesota            $8.00        $9.00
Missouri                 $7.50        $7.65
Montana            $7.90         $8.05
Nebraska            $7.25        $8.00
New Jersey            $8.25        $8.38
New York            $8.00        $8.75
Ohio                 $7.95        $8.10
Oregon                 $9.10        $9.25
Rhode Island            $8.00        $9.00
South Dakota            $7.25        $8.50
Vermont                $8.73        $9.15
Washington            $9.32        $9.47
West Virginia            $7.25        $8.00

Source: National Conference of State Legislatures

Is an increase to the federal minimum wage in the works?

President Barack Obama weighed in on the federal minimum wage during last year’s State of the Union. President Obama championed higher minimum wages, specifically citing a Congressional bill that proposed lifting the federal rate from $7.25 to $10.10 per hour and pegging the rate to inflation. The President even hailed a pizzeria operator, John Soranno of Minneapolis-based Punch Pizza, for starting his wages at $10 per hour.

“To every mayor, governor and state legislator in America, I say, you don’t have to wait for Congress to act,” Obama challenged, adding that “profitable corporations like Costco see higher wages as the smart way to boost productivity and reduce turnover.”

While the aforementioned Congressional bill faces a reportedly uphill climb to passage, the tremors of the legislation, and what it could eventually deliver — say, an increase to a $9 hourly rate — threatens to derail the industry’s upward employment trajectory, which has outpaced overall employment growth for the last 16 years according to the NRA.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

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Hiring, scheduling and retaining a predominantly part-time staff

Are your part-time employees as productive, reliable and loyal as your full-timers? With so many workers holding down multiple jobs, younger employees balancing work and school and the economy making it tough to provide full-time benefits, a predominantly part-time staff is often a pizzeria’s best bet. “The healthcare law is also making it more feasible to hire part-timers right now,” says Jan Ferri-Reed, president of Key Group, a Pittsburgh-based consulting and management training company. While you may not be able to provide the bulk of your staff with healthcare, paid time off and other pricey perks, you can improve their satisfaction –– and your bottom line –– by treating them with the same respect and expectations as your full-timers.

Building a great part-time staff begins with the hiring process and Ferri-Reed says “most employers make mistakes when they approach part-time employees. They tend to be lax when it comes to punctuality and commitment, but all the high performance standards to which you hold full-time employees should be just as stringent for part-time employees.”

Mike Morgan, Pizza Guys vice president and franchisee, agrees. “The part-time person is still going to affect the service of the store the same way a full-time person would,” he says.

Still, over-qualification can be just as big a problem. “The cornerstone for hiring part-time workers is to not hire people who need a job, but people who need this job,” says Morgan. “I’m not going to hire a more qualified person who’s looking for something more than I can offer because they’re not going to be happy in the long term.” Overqualified part-timers may do a great job at first, but their performance often wanes as they focus more on new career opportunities than the tasks at hand.

Also, while age can influence an employee’s attitude and experience, it can’t provide a complete picture of a candidate. “Don’t think about age so much as performance and work ethic. You have to ask everyone some hard questions,” says De Sawa, human capital services manager at TriNet, an HR solutions provider. Part-time candidates’ long-term goals may differ from full-timers’, but hiring them is still a matter of matching their skills, experience and expectations with your shop’s requirements and culture.

To that end, a discussion of scheduling requirements and available hours should also begin during the hiring process. “Newer managers have a perception that part-time schedules can be more malleable, but the reality is these people need stability, too,” says Morgan. Part-timers’ second jobs, families and other responsibilities require consistent workdays and hours, and irregular changes will inevitably lead to call-offs. On the other hand, “Providing steady hours leads to loyalty,” says Sawa. Turnover can be high among part-time employees, but you can prevent it by providing steady schedules with hours that don’t fluctuate so much there are weeks they can’t rely on a paycheck.

If that seems unfeasible, consider cross-training. “It’s a great way to provide consistent hours and allow those part-time employees to feel like they fit within the organization,” says Sawa. As tempting as it may be to use part-timers to fill in irregular schedule gaps, employees trained on a variety of tasks can prevent those gaps from forming in the first place. Instead of scheduling several part-timers for brief, narrowly focused shifts, you can have a few of them perform wide varieties of tasks for longer hours.

Aside from cross-training for specific tasks, overall career development is also more important for part-timers than many managers realize. “It’s a mistake to treat them differently in terms of training and development, and you need to approach every employee as if they’re the most important person who’s ever worked for your company,” says Morgan. In an industry where 20-hour-per-week jobs are easy to find, you can avoid turnover by helping part-timers develop the skills critical to their careers later in life. “Many individuals are in the restaurant industry for the short term, but they can be trained to enhance their professional growth, particularly in customer service,” adds Sawa.

Even with a well-trained, reliable group of part-timers, there are still a few management challenges to overcome when they comprise the bulk of your workforce. “It’s already a challenge to share information between shifts, and sharing that info among a larger group of part-timers is even more difficult,” says Ferri-Reed. Changes in procedure and equipment must be communicated clearly through the chain of command, and written policies can go a long way in keeping everyone compliant.

Maintaining a sense of community can also be more difficult. “A lot of pizza shops have embedded themselves in their communities and have built families of employees, and it’s easy to lose some of that team spirit,” says Ferri-Reed. To maintain the culture established by management and other full-time employees, she recommends crossover shifts and team meetings to ensure everyone in the shop gets to know each other and the regular customers.

Despite these challenges, a mainly part-time staff isn’t just feasible for most pizza shops –– it may actually be preferable. “The pizza business is inherently heavy at certain times of day, and most of us have a high threshold of people we need to be part-time,” says Morgan. “If you’re honest with your part-timers and treat them as well as your full-time employees, they’re going to work hard for you.”

Full-Time Loyalty

A primarily part-time workforce shouldn’t lead to poor performance or high turnover. With the right management strategies, you can gain the same loyalty from your part-timers as you enjoy from your full-time employees. A few pointers:

• Play the numbers game. You’ll need to sift through several prospects to find a part-timer who suits your business. “We try to get an interview to hire ratio of seven to ten,” says Mike Morgan, Pizza Guys vice president and a franchisee.
• Explain the benefits. With so many part-time restaurant jobs available, transferable job skills, customer service experience and other ancillary benefits are necessary to retain top-quality employees.
• Provide perks. Your part-timers probably aren’t getting healthcare or vacation time, but shift meals, free drinks, gift cards and other small rewards can go a long way in keeping them happy.
• Don’t skimp. Relying heavily on part-timers means you might need to pay them more than other restaurants in your area. “Your pay scale should be slightly higher because these individuals can jump ship very quickly,” says De Sawa, human capital services manager at TriNet.

David LaMartina is a Kansas City-based freelance copywriter who specializes in the finance, food and health industries.

The post Managing Part-timers appeared first on Pizza Today.

Is there still room for cash handling in a plastic world?

In today’s tech-charged payment society, cash may no longer be king, but the Washingtons, Lincolns and Jacksons haven’t exactly been overthrown, either.

According to a 2014 retail point-of-sale report from Javelin Strategy & Research, cash accounted for 20 percent ($788 billion) of POS transactions in 2013. Though Javelin expects that number to drop to 17 percent by 2019, cash transactions are still projected to exceed $700 billion.

“We’ve been hearing for years that we’re going to be a cashless society, but we’re not there yet,” says Ed Walsh, senior vice president of national accounts for Dunbar Armored, a leading armored car and cash logistics provider.

Pizzerias, long havens for cash transactions, remain so –– and not without good reason. A recent Federal Reserve study reported that the average value of cash transactions sat at $21, a sum that fits neatly into the sweet spot of a pizzeria’s average check.

At Russo’s New York Pizzeria, a Houston-based chain of more than 40 pizzerias, owner Anthony Russo says cash transactions account for 15 to 20 percent of his sales, a number in line with national figures.

“People still pay with cash and that’s not changing anytime soon,” Russo says.

Though accepting credit and debit cards has become a way of life at many of the nation’s pizzerias, cash transactions remain commonplace and how restaurants handle the currency they accept stands critical to a restaurant’s bottom line. A 2013 study by Tufts University found that U.S. businesses pay about $55 billion a year to manage currency, more than 70 percent of which is due to loss and theft –– or, as Walsh calls it, “unauthorized profit sharing.”

For operators like Russo, strict cash handling procedures cannot be overlooked. Operators must ensure that sales are recorded, cash is securely stored and deposits are accurately and safely made at the bank.

“We work too hard to be short” on cash, Russo says.

Giselle El Biri, senior manager at BDO USA, a national accounting firm that specializes in the restaurant industry, urges restaurants to reconcile their sales on a daily basis. While a point-of-sale (POS) system might streamline this process, she says even most old-fashioned registers show cash transactions.

Russo’s restaurants, in fact, reconcile twice each day –– once after the lunch rush and a second time at closing –– to minimize error and increase accountability. In addition, each cash drawer is assigned to a specific person, which limits the hands touching cash and heightens accountability.

“Doing it this way helps ensure accuracy and minimizes finger-pointing,” Russo says.

El Biri also suggests restaurants undergo a monthly bank reconciliation to ensure that deposits match daily sales. She further recommends that the person making the deposits and accounting for cash on a daily basis should not be the same person doing the monthly reconciliation.

“This is part of having a comprehensive check-and-balance system that ensures all cash makes it into the bank,” El Biri says, who also suggests that the manager closing at night should not be the same one opening the next day.

“When you’re disciplined and consistent, cash handling errors will be less prevalent,” she says.

El Biri favors daily cash deposits at the bank, which minimizes cash on hand and puts cash where it belongs.

That’s the philosophy at Russo’s, where a store manager makes bank drops each morning. The morning drops, Russo says, allows managers to get a deposit receipt and also minimizes the risk of carrying cash at nighttime. The bank receipt is then sent to corporate, which verifies that the amount deposited matches the previous night’s closeout statement. Managers then attach the deposit slip to the day’s closeout statement before storing that paperwork on site.

“All our documentation is then handy should we ever need it,” Russo says.

Also, since most restaurants keep about $500 cash on hand, a figure that might rise to $2,500 depending on the size and scope of the operation, it is wise to have a safe on the premises to safeguard cash.

Eateries are increasingly turning to validating safes, a new-wave option that functions like a reverse ATM. Validators placed on top of the safe verify and store the incoming currency. This technology reduces deposit prep time, enables communication between the restaurant and its bank, validates against counterfeits and reduces in-store cash exposure.

Finally, El Biri says a pizzeria owner sets the tone for his or her establishment when it comes to cash handling procedures. If owners expect staff to follow established cash handling policies, then they must do the same themselves.

“This should not be a do-as-I-say, not-as-do environment,” El Biri says. “If it is, then employees will feel they can have a piece of the pie, too.”

The owner’s adherence to set standards should also extend to filing all necessary documentation with government agencies, namely the Internal Revenue Service.

“Don’t be late on payroll taxes or sales taxes because that’s the type of action that will draw scrutiny to your business,” El Biri says.

Currency’s New Wave

Beyond credit and debit, cash continues welcoming new competitors into the ring, including solutions from tech heavyweights like Google and Apple.

Google Wallet, which debuted in 2011, functions like a virtual wallet on a wide range of Android devices. Using near field communication (NFC), consumers merely wave their phones at a compatible payment terminal to finalize the transaction. Apple Pay, meanwhile, released last fall to rampant headlines, similarly uses NFC hardware to facilitate purchases.

Other players in the digital payment world include Square, Coin and Venmo as well as restaurant-specific offerings Cover and TabbedOut, mobile payment apps that allow diners to pay and leave a tip at participating restaurants sans the back and forth with wait staff.

According to a recent Javelin Strategy & Research report, smartphone-directed transactions are expected to jump to $53 billion by 2019, pushing payments to the background, shining a spotlight on the retail experience and providing consumers the convenience and speed of non-cash transactions.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Cash Transactions: Way to Pay appeared first on Pizza Today.

What’s your information sharing style?

In today’s analytics-driven environment, information is everywhere –– even pizzerias, which run sales through point-of-sale (POS) systems, count inventory, record waste and collect customer data.

Among multi-unit operations, specifically company-owned stores, how much of that information should be shared –– and with whom –– has emerged an increasingly pertinent issue. Should information be distributed among stores or should each unit function as its own entity?

Leaders of multi-unit pizza chains are asking themselves that very question, seeking a balance between collaboration-driving transparency and the discretion that minimizes security risks and controversy.

Information sharing among locations can spotlight company-wide trends and challenges, highlight the best practices of top performers, foster a culture of accountability and spark healthy competition among units that, ultimately, drives performance. Such an open, transparent culture can also help the company set realistic goals, while empowering store-level management to uncover solutions in a collaborative environment.

“Rather than waiting on the corporate office, managers at the individual restaurants can address their problems individually, maybe calling the manager of a unit that does well with labor percentages or its menu mix to solicit strategies to improve,” says Robert D’Ambrosia, CEO of Ctuit, a California-based analytics company that offers back office support to multi-unit restaurant chains. “By sharing information, there’s an opportunity to learn from one another.”

NYPD Pizza founder Paul Russo shares everything from Yelp reviews to profit and loss (P&L) statements with the general managers of his two corporate-owned stores in Orlando.

“Other than debt service, I share just about everything,” Russo says. “If you’re truly trusting your managers to run the business, then you need to help them understand how the pennies make the dollars.”

Russo believes such transparency strengthens his brand, helping the company establish optimal operations with informed leadership.

“I feel educating people is always for the better and that this openness inspires confidence,” Russo says. “Our managers work with the numbers and understand why they matter.”

Each week, Wisconsin-based Toppers Pizza shares information across its system on key indicators such as sales, food and labor. On a quarterly basis, meanwhile, Toppers brings together the 20 managers of its corporate-owned stores to investigate each store’s P&L line by line. Toppers Vice President of Marketing, Scott Iversen,s calls it an “awesome experience” that spurs collaboration and results.

“As we see it, we’re all on the same team trying to achieve the same goals … and these honest conversations are what drive our business forward,” Iversen says, noting that Toppers overall sales jumped 18 percent in 2014.

Both Iversen and D’Ambrosia note, however, that ownership must build context around the numbers. For instance, one store might be impacted by a disruptive road construction project at its door, while another might now benefit from the completion of a nearby office tower.

“These are not always apples-to-apples comparisons and you have to add context around the numbers,” says D’Ambrosia, adding that percentages, rather than raw numbers, often create more meaningful comparisons.

Though the rationale for sharing information is compelling, D’Ambrosia says the compartmentalized approach remains the more common practice, largely
fueled by tradition.

“The ability to share data so easily is a rather recent development … so the compartmentalized approach fits in the comfort zone of many,” D’Ambrosia says.

Partitioning information allows managers to be singularly focused on their own unit, prevents unrealistic comparisons between restaurant locations and limits the number of people in the organization who have their hands on detailed performance information or proprietary practices (something companies with a sharing mindset generally address with confidentiality agreements). Additionally, many contend that sharing information can become a distracting and time-consuming practice.

“Managers might spend more time looking at others’ numbers rather than their own,” D’Ambrosia says, adding that the less similar restaurants are in operations and geography, the less likely data sharing will provide actionable insights.

Transparency can also deliver a false sense of security or even complacency. Store managers at high-performing units might not have the fire to improve, while managers at struggling units might become despondent. In addition, the ultra-transparent approach can become complicated when the company shows significant profit, especially since few fully understand ownership’s debt load or initial investment.

“There’s a concern when sharing that people will put out their hands and ask for a piece of the action without having the full picture,” Russo says.

As sharing and partitioning information each possesses its own benefits and drawbacks, some champion a hybrid approach in which ownership shares a limited set of information. Ctuit’s RADAR restaurant management software, for example, allows ownership to specify which managers can access which data sets, providing relevant information without overwhelming with unnecessary facts. For example, kitchen managers might see product mix data, but not labor related data, while owners might share percentages around upsell conversions, waste or promotional activity with store management.

“Rather than bottom-line numbers, those are the types of things you might share with little downside,” D’Ambrosia says.

Whatever a pizzeria’s decision, D’Ambrosia reminds that action should be the overriding goal with any data sharing.

“Information without action is more distraction then help,” he says.

Information sharing within franchised systems

Among franchised concepts, Ctuit CEO Robert D’Ambrosia says information sharing is generally governed by the franchising agreement’s privacy and disclosure terms. That reality, he says, typically makes the hybrid model the safest approach, as corporate offices can define the specific information they will share, generally favoring ratios over final numbers.

With its 45 franchised units, Toppers Pizza shares an aggregate of its 20 corporate-owned stores, which allows the concept’s franchisees to benchmark their performance. Russo’s New York Pizzeria founder Anthony Russo, meanwhile, shares a general P&L with defined parameters and averages with his four franchisees.

“I think the franchisees need to have a goal and providing some basic percentages in specific categories helps,” Russo says.

D’Ambrosia contends, however, that information sharing becomes less useful in franchised systems that provide operators significant leeway.

“When each restaurant is allowed to do its own thing, there will be a bigger variance with performance,” he says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

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Unlike automobiles or homes, assigning a value to any business, let alone a restaurant enterprise such as a pizzeria, can be a biased, meandering task filled with subjectivity, high emotion and figure-swaying details.

It’s anything but concrete. A.J. Edelstein of The Restaurant Brokers, a Tempe, Arizona-based commercial real estate firm that specializes in restaurant deals, calls the valuation process “multi-faceted” and quite often results in a slanted number based on market conditions and perspective.

“In reality, anybody can assign any amount of value to a business that they want, but, like virtually everything else in this world with a price tag, the business is only worth what you can sell it for. Market value is a big determining factor,” Edelstein says, adding that common sense must be applied to any valuation.

While a sale of the business remains the most common reason operators order a valuation, there exist various other instances in which an operator would need a credible valuation, such as refinancing, estate tax, a partnership split, the addition of new investors, insurance or divorce. Having a solid grasp of a pizzeria’s value would also arm an operator with key information to begin planning the right exit strategy –– even if that reality existed years down the road.

As a baseline, Edelstein says a restaurant valuation is typically anywhere from two to three times the adjusted cash flow, a number that rarely matches the cash flow number listed on the restaurant’s P&L since so many operators place various expenses on the business –– cars, cell phones, life insurance, and the like –– to maximize deductions.

“We’ll take away all of those discretionary expenses to reach the adjusted cash flow, which is a more honest representation of the restaurant’s success,” Edelstein says. “Then, we apply the multiplier.”

In Edelstein’s experience, the numbers get “twisted, twirled and contorted” to reach a final valuation figure that respects market conditions, operational ease, location, lease terms and an assortment of other factors.

For instance, a pizzeria might only receive a multiple of two if it sits in a crime-ridden neighborhood or only does delivery. By contrast, a pizzeria might receive a more favorable multiple, such as three or even 3.5, if it has an established catering business, a large dine-in space that boasts a highly profitable beverage program, or a direct, easy-to-execute menu.

True to the subjective nature of appraisals, other professionals tout different formulas.

Steve Mize, a partner with Tampa, Florida-based GCFValuation, one of the country’s leading independent business appraisal firms, says he typically sees restaurants sell for a multiple of the “seller’s discretionary earnings,” which is calculated as adjusted EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) plus the owner’s compensation plus the owner’s benefits, or “perks.”

William Bruce, a business broker, appraiser and Accredited Business Intermediary (ABI), takes a non-multiplier approach. He says the rule-of-thumb valuation guideline for valuing independent, non-franchised pizza shops is 35 percent of annual sales plus food and liquor inventory. Among franchised shops the guidelines range from 28 to 55 percent.

“However, and this is important as a reality check, the bottom line discretionary cash flow of the business must support the above valuation formula,” says Bruce, president of the American Business Brokers Association.

Subjective as the valuation can be, there remain a number of universally accepted guidelines for what appraisers will or will not include in the valuation.

Inventory and fixed assets, including equipment, are factored into the price because those components are required to run the business. In many cases, the pizzeria’s valuation will fall if the equipment is assessed to have an abundance of deferred maintenance.

In the event that the pizzeria owns its real estate, that physical asset is almost always evaluated separately from the business.

“A lot of it comes down to salvage value,” Edelstein says. “If a buyer closes the business upon his purchase, the real estate still has value.”

In some cases, potential earnings, sometimes referred to as “blue sky” by appraisers and brokers, will enter the valuation as well. For instance, if the current pizzeria business has three stores in a local area but the potential to have as many as seven to eight local units because of its brand strength, the valuation’s multiple might rise given those encouraging prospects.

“If the valuation process is subjective, so, too, is blue sky,” Edelstein says, adding that a single-unit restaurant will rarely see blue sky factored into the valuation.

Compared to other restaurant ventures, Edelstein says pizzerias stand in a favorable valuation position given that most pizzerias contain straightforward, simple operations with generally favorable margins and food costs.

How often should owners get a valuation?

The question of how often a pizzeria owner should order a professional valuation remains an issue of debate.

Steve Mize, a partner with GCFValuation, for example, says owners should get an appraisal every two to three years, if not on an annual basis.

“The business owner’s largest asset is typically going to be (his or her) ownership in the business; therefore it’s important to know the value of this asset and have it updated annually or every few years,” Mize contends.

Yet, A.J. Edelstein of the Restaurant Brokers isn’t convinced routine valuations are necessary and, moreover, practical for many operators, particularly the many mom-and-pop pizzerias humming along throughout the U.S.A. professional valuation might run $3,000 to $5,000, a sum many operators cannot justify spending.

“Unless you’re in a situation with bank covenants or you see something coming down the road, like the addition of new partners or a break with an existing partner, I’m not sure you need to have a valuation,” he says. “Most operators choose to spend that money on something that will help the business grow or operate more efficiently.”

Bruce says experienced business brokers can typically offer a quality valuation, while Edelstein urges operators to ask trusted advisors for references, particularly in the case of a divorce, one of the most common reasons — outside of a sale of the restaurant — that owners need a valuation.

“Unfortunately, divorce among a husband-wife business owner team is a common scenario, so that attorney should be able to offer some professional recommendations,” Edelstein says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post What’s My Pizzeria Worth? appeared first on Pizza Today.

When it comes to inventory management, Brian Coli of Georgio’s Chicago Pizzeria & Pub, a 13-year-old, two-store operation in Chicago’s northwest suburbs, knows he can’t afford to slip up.

“Cost of goods sold makes up roughly one-third of our total expenses,” Coli says. “If we’re not paying attention to our inventory, it can become a problem. You always want to use everything you’ve paid for.”

For any pizzeria, after all, small inventory mistakes can mean loads of lost money.

“Most mom-and-pop independents work on a five- to 10-percent profit margin and little bits here and there will quickly eat that up,” says Laura Dreesen, associate professor of business management at the Culinary Institute of America in New York.

In high-volume pizzerias churning out hundreds of pizzas each week, meanwhile, bungled inventory –– ranging from waste and spoilage to theft and loss –– can easily roll into the tens of thousands of dollars, ultimately threatening an establishment’s survival.

“As one of a restaurant’s prime costs, inventory can make or break the business,” confirms Dreesen, who is also the author of Math for the Professional Kitchen.

Cristine Ham, an account manager with Boston-based CrunchTime, a web-based, back-of-the-house solution for restaurant inventory and purchasing, says many operators grind day after day, often assuming that operations are humming along, yet ignorant to potential inventory management changes capable of improving the restaurant’s efficiency, profit level or guest experience.

“There’s a real opportunity to be a better operation if you look at how goods come into your shop and how those goods then move throughout the establishment,” Ham says.

To create a more tightly controlled inventory management system, follow these four steps:

Step 1: Appoint dedicated inventory personnel.

Ideally, a restaurant should have a specialized employee accepting all incoming inventory, ensuring that the quantity, price and quality of the receivables all match the purchase order. In some cases, product should be refused or an immediate price adjustment negotiated if defined specifications are unmet.

The designated inventory employee should always sign for the product, noting any renegotiated terms, before bringing the product into the shop, storing it according to safety standards and stamping it with the received-on date and expiration date.

“Inventory management is much more than carrying and counting boxes,” Dreesen says, recommending operators limit the hours that vendors can deliver product to times when the store’s appointed inventory leader is present. “Ultimately, your food is your responsibility and items that go into storage need to be rotated or stored in a certain way to ensure safety and profitability.”

Management might also name a defined storeroom clerk –– perhaps the same person receiving the inventory –– charged with monitoring inventory levels and requesting new product when counts reach a pre-determined threshold. The storeroom clerk would receive any inventory not headed into production and distribute goods to production staff on an as-needed basis, always recording what has flowed from storage into the production cycle.

Step 2: Institute documentation and controls

A receiving journal will carry all pertinent information of a given purchase, including: vendor; date; delivery time; item name; quantity; unit price and total price. A distribution journal, meanwhile, will indicate where the product went in the restaurant.

Even in a grab-and-go kitchen, Dreesen touts the diligent, check-and-balance benefits of receiving and distribution journals.

“If you don’t rule your habits, then your habits will rule you,” Dreesen says. “Recording these details brings attention to detail and accountability.”

Furthermore, expensive products, particularly alcohol, should be locked away.

“So much of managing inventory is setting up the kitchen in a way that you can monitor it even in a fast-paced environment,” Dreesen says.

Step 3: Establish standard recipes

Standard recipes, including the precise quantity of ingredients required to produce each menu item, are central to a sound inventory management system. Operators should know how much mozzarella goes on a large pizza, how many glass servings a bottle of wine produces and so forth. Production areas, meanwhile, should have a waste log to
account for any unused or rejected goods.

While some operators immediately jump to theft when inventory levels are off, Dreesen calls over-portioning a more common culprit. Either restaurants do not possess the proper measuring tools or managers fail to train and hold people accountable to prescribed standards.

“The standards are what all operators need to shoot for,” Dreesen says.

Step 4: Leverage technology

Operators might use bin cards to keep an ongoing tally of inventory items. It’s a low-tech solution, but effective. Others, however, use spreadsheets or leverage an existing POS system to manage inventory. Still others, such as Georgio’s, invest in dedicated inventory software to manage counts, highlight purchasing needs and identify items to be prepped on a daily basis.

By using an inventory system, Ham says, operators can identify specific opportunities down to the product level. With daily counts, for instance, an operator can pinpoint loss to a certain shift or even staff member and then determine if the issue of dwindling inventory is due to theft, waste or training.

“When you’re on top of inventory on a daily basis, it’s much easier to find opportunities for improvement,” Ham says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Four steps to better inventory management appeared first on Pizza Today.

Owning a restaurant means incurring debt — it goes with the territory. But not all debt is created equal; certain kinds can move you forward, other kinds can tilt you towards disaster. What spells the difference between good debt and bad?

“Debt isn’t inherently bad or good,” explains Chris Alberta, senior managing director of Conway MacKenzie, Inc., a Detroit-based consulting firm providing turnaround/crisis management services. “It depends on the intent of its use. Debt used to mask deficiencies in the operations is bad, but debt taken on as growth capital to expand a profitable concept can be a very good thing.”

Fred Wolfe, who drives the operations and executive leadership team for Orange County, California-based Synergy Restaurant Consultants, says good debt doesn’t exceed low income expectations. Debt turns dangerous when paying it back depends on maximum cash flow and everything going right.

“This raises the risk level substantially and increases the likelihood of a default,” he explains. “Bad debt also carries a high interest rate because of risk or lack of a financial history. Leveraged debt always carries an inherent risk and can be exemplified by the high number of restaurant company bankruptcies.”

When undertaken sensibly to move the business forward in a planned way, and there’s a sustainable way to pay it back, taking on debt can work in your favor, says restaurant consultant John T. Self, a professor at the Collins College of Hospitality Management at Cal Poly Pomona. Bad debt is unplanned and unsustainable. Depending on the circumstances it can be a mere annoyance or it can become catastrophic, he adds.

Nick Sarillo, owner of two Nick’s Pizza Pub restaurants located in Illinois (one in Crystal Lake and one in Elgin), knows firsthand how quickly debt can turn surly. Sales at both sites were strong, so good that he began the process of opening a third location. However, around 2007/2008, business started to roller coaster, especially at the Elgin location (where the dips hit the double-digits). At times, Sarillo says he couldn’t cover the mortgage or overhead.

To keep the business going he tapped into a line of credit. His predicament worsened. The third restaurant didn’t pan out, thanks to a change of lenders, and he lost over $300,000. The opening of a Super Wal-Mart across the street from the Elgin site was delayed, depriving Sarillo of an anticipated boost in traffic. He began offering steep discounts on Monday and Tuesday nights, running this program for almost two years. This initially helped profitability, but when it began eroding the weekend business he ended it.

By 2011, thanks to severe winter storms and disruptive road construction at both locations, things were dire. Barely hanging on, this September Sarillo emailed a letter to the frequent diners in his database explaining his situation, asking for their support. It posted on Facebook within minutes. His phone began ringing and customers poured in. Now, says Sarillo, they’re about 75 percent out of the woods.

But Sarillo isn’t banking on this alone to keep him going; he started taking a different approach to running his business. He began monitoring operating costs. He reduced overhead by streamlining his management staff, which he had kept too high in anticipation of opening more locations. And he hired a consultant, who pointed out a major error — Sarillo hadn’t been looking at the balance sheet as a whole, looking instead at each restaurant’s individual performance. Consequently, he hadn’t realized how negatively the Elgin site was impacting the entire business.

By not analyzing the contribution each store was making to the corporate overhead, Sarillo made a common error. Alberta says restaurant owners/operators often fail to look at every aspect of each site’s performance — what he calls doing a “four-wall” analysis. With this data it’s possible to compare one location to another and identify problems before more debt is incurred and profitability is further eroded.

“If on a store-level basis, the operations are cash-flow negative, new debt would be unlikely to improve the overall cash flow and could compound the cash-flow problem,” Alberta says. And “if they’re not generating a positive cash flow on a four-wall basis, adding new stores could actually lead to decreased profitability.”

The biggest mistake Self sees owners make is not having a budget income statement. “They don’t do inventory, they don’t do cost of sales or food costs, they don’t do P&Ls. They just sense they’re losing money but they don’t know how much or where.”

They also fail to plan — and save — for debt, maintaining sufficient cash reserves to handle equipment breakdowns or replacements, Self says. Instead of being proactive, they react — never a good strategy.

“Another error is failing to do a cost/benefit analysis when they need to purchase something, asking why they’re taking on the debt and how they’re
going to pay for it,” he says.

Perhaps the biggest downfall is being overly optimistic in their sales forecasts and/or cost management, says Wolfe. Sarillo says he did this, but no longer.

“Now I’ve started operating as the two-restaurant business we are rather than as the five-restaurant business I wanted to be,” he says. “I got real.”

The post Critical Issues — Financial: Debt Management appeared first on Pizza Today.

How pizzerias are finding free money to boost the bottom line

Dave Brackett, owner of Pizzeria Rustica in Colorado, capitalized on $35,000 in tax credits.

It’s been five years since Dave Brackett has paid state income tax in Colorado.

Brackett’s no scofflaw, though, but rather capitalizing on a Colorado state program that provides tax credits for small business owners developing in designated areas throughout the state. In Old Colorado City, the Centennial State’s former territorial capital where Brackett’s seven-year-old restaurant, Pizzeria Rustica, resides, Brackett’s work to provide jobs and improve his property has resulted in about $35,000 in tax credits since 2009.

“The credit against my Colorado state income tax has just rolled over year to year,” Brackett says.

In readying Pizzeria Rustica for its 2008 opening, Brackett invested $150,000 in constructing his pizzeria, a former gallery space. He estimates that roughly 70 percent of the build out work, including installing specific appliances and a grease trap, qualified for the enterprise zone tax credit he received. Initially unaware of the incentive, Brackett later refiled his taxes to capture the benefits.

“A lot of people don’t know these incentives exist, but there are enterprise zones all over the country and opportunities for pizzerias to save money,” Brackett says.

From tax abatements and municipal grants to incentives from utilities for energy-efficient operations or design, there’s free money in the marketplace pizzeria owners can access to improve their financial standing and their shop’s bottom line.

Such opportunities are always on the mind of Atlanta restaurateur Keiran Neely.

When Neely purchased Pizzeria Vesuvius in Atlanta’s historic Edgewood District in 2012, he did so well aware of the city’s plans to reignite development along Edgewood Avenue, once one of the city’s most grand strips.

Buoyed by a $47 million check from the federal government, Invest Atlanta –– the city’s economic development arm –– set aside specific funds for local businesses to refresh the exterior of their properties, pledging to supply $2 for every $1 qualified businesses invested in exterior upgrades. Neely completed his application and sent in the $250 application fee.

“If the city is offering you a slice of the pie, then why not take it?” Neely says.

In early 2014, Invest Atlanta approved Pizzeria Vesuvius’ application and Neely entered the due diligence process. He provided Invest Atlanta a number of requested particulars, including architectural renderings and financial statements, and hopes to have final approval in hand sometime early this year. Thereafter, he will rejuvenate his shop’s façade with fresh paint, new windows and an awning.

“Our exterior is not run down, but there’s not much pizzazz to it,” Neely says. “This project will certainly help that.”

In addition to the facade upgrade funds, Neely also earns a tax break for being in an Atlanta Empowerment Zone. Specifically, for every new employee he hires, he receives a tax credit against that individual’s payroll taxes.

“Emerging areas often have funds set aside to drive improvement in economic development, so the incentives are there if you’re willing to do the work and take some of the risk,” says Neely, who also owns a barbeque restaurant and a gastropub in other developing Atlanta neighborhoods.

Brian McMahon, executive director of the New York State Economic Development Council, an organization that represents economic development professionals throughout the nation’s fourth most populous state, says there are rich opportunities for small businesses across the country to take advantage of tax abatements, municipal grants, utility credits and other development programs aimed at revitalizing communities, delivering jobs and sparking broader economic development.

McMahon says most cities and towns have local development corporations that administer both loan and grant programs for small businesses, while utilities often support small retail businesses with grants or incentives for facility upgrades. New York’s Main Street Revitalization Program, for instance, provides matching grants to commercial adaptive re-use projects and renovation of commercial or mixed-use buildings less than 100,000 square feet.

“Some utilities also provide a lower rate for electricity for businesses located in urban revitalization zones,” McMahon adds, noting that utilities often have “significant economic development resources.”

Mirroring other programs across the country, the State of New York also maintains a local real property tax abatement program that provides a 50-percent abatement on property improvements when the investment exceeds $10,000. The reduction decreases five percent each year over 10 years.

In addition to local development corporations and utilities, McMahon suggests pizzeria owners contact their local industrial development agency, which is typically the lead economic development organization in a county, city or town. He also calls the local office of economic development and the chamber of commerce great resources as well.

“Chambers don’t always administer economic development programs, but they are good referral organizations,” McMahon says.

Four steps to securing incentives, grants and
other free money

1. Make it a priority. Owners should either designate specific time to pursue these opportunities or assign a motivated employee to explore potential programs and gather pertinent details.“A lot of us are buried in the trenches, but we can’t ignore these opportunities,” Pizzeria Vesuvius Owner Keiran Neely says, reminding that many programs set strict deadlines.

2. Be proactive and inquisitive. Connect with other restaurateurs, small business owners and vendors to discover prospective incentive programs. During a chat with his health care provider, for instance, Pizzeria Rustica owner Dave Brackett learned he qualified for tax credits for the health insurance he provided his full-time employees. Thought not subject to the Affordable Care Act mandate, Brackett’s decision to pay 60 percent of his employees’ health insurance resulted in a tax credit that nearly offsets his costs.“Nothing ever happens by sitting on your hands,” Brackett reminds.

3. Work with professionals in the know. Accountants experienced in dealing with small businesses and entrepreneurs are often aware of financial incentives, Brackett says, and their insights can help owners as they plan a new unit or renovation, consider hiring additional employees or refresh their business plan.
4. Follow directions. To secure these funds, owners must comply with all directives and provide a complete and detailed application or filing that shows the pizzeria as a credible, professional operation.“You get the reward by following the directions and leaving no doubt that you know what you’re doing,” Neely says..

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Money Chase — Business Grants and Tax Credits appeared first on Pizza Today.

If you haven’t taken the time to show your employees how things really work, now’s the time. The economy has tightened. Cheese prices are high. Gas prices are high. The minimum wage has increased. You don’t have much to show for every dollar you bring in. If your employees are careless about waste — or if their thieving — you are not making any money. Take a good look at the graphic that accompanies this article. Cut it out and hang it up for your employees to see just how little is left over for you at the end of the day.

Roughly, before taxes, the average pizzeria operator has a 7 percent net profit.

Here’s a breakdown of the average operator’s expenses:

• Food and Beverage, 30 percent
• Labor & Benefits, 35 percent
• Occupancy (rent, taxes, insurance, phone, supplies, common area maintenance, etc.), 20 percent
• Administrative, 8 percent
• Net profit before taxes, 7 percent

Gone are the days of the 10- or 15-percent profit margins. You aren’t getting rich off of each sale, so let your employees know that. It will make a difference.

The post Operator Expense Breakdown appeared first on Pizza Today.

Making a schedule that actually works takes time and effort from management and staff

Putting together the pieces of a scheduling puzzle requires flexibility, time and the ability to see into the future.

Operators need to balance the demands of their restaurant’s customers with the availability of their employees, handle last-minute staff requests and make sure every area of the restaurant is covered –– and all on a daily basis.

It can be a complicated juggling act, but with practice and a few key rules in place, operators will find their way to scheduling success.

“A lot of managers’ train of thought is to give equal time to closing and opening. I tend to disagree with that thinking,” says restaurant consultant Ron Santibanez of Profit Line Consulting in California. “There are special skills that I need my opening crew and closing crew to have. I like to stay on schedule with people; I like to have a bit of order in my schedule.”

For Brad Vinton, owner of Toppers Pizza in St. Paul and Burnsville, Minnesota, thinking ahead makes sense in scheduling.

“I train my people to look more into the future — that’s what I talk about a lot with my management,” Vinton says. “Servers look at 12 p.m. and think 12:05 p.m., but I want them to look at 5 p.m. and see into the future more. Let’s make sure we’re scheduling appropriately for events and outside events that are affecting our business to make sure we are staffed appropriately and people are making money.”

For most operators, scheduling begins early with potential staff and often caters to their needs.

“During the interview process, we know their availability and that can determine who we hire,” says Mike Sims, owner of Your Pie in Jacksonville and Fleming Island, Florida. “If someone can’t work the hours we have the most demand for, we might not be able to make the hire.”

“We schedule by more personal preferences,” Vinton says. “The biggest part is that staffing is at appropriate levels. We don’t require everyone to work a certain number of shifts.”

With every new hire, Sims uses a schedule availability worksheet that is updated along with quarterly reviews.

“We start with an understanding of our associate’s needs,” Sims says. “We try our very best to accommodate their long-term scheduling needs or things that come up. You have to be rigid in some respect, but we try to be as flexible as we can. It’s a two-way street — being flexible with scheduling is like an employee benefit — it makes the work environment a better place without costing any money.”

By paying attention to individual preferences, Mac Ryan, owner of Mac’s Pizza Pub in Cincinnati, Ohio, can customize staff recognition.

“The great majority of our servers and employees in general are students,” Ryan says. “We have very little turnover as we try very hard to accommodate their schedules. That means that the reward system that most people use is harder to apply here as we are primarily based on individual availability. Naturally, we do the math, and we know what servers ring in the higher sales and when the need arises to choose who gets the prime shifts we use that data. In my experience, the best reward I have found is to offer some bar shifts to the servers who we feel are stepping up. They feel rewarded for two reasons: the money, but also it is perceived as the proverbial ‘pat on the back’ from management, and they always like the recognition.”

Scheduling a young staff presents unique issues. “We have a young staff and we sell beer and wine. You have to have an 18 year old on duty all the time. Eighty-five percent are high school students. We have a handful of 18 year olds to do it — sometimes I schedule more hours than I need to,” Sims says.

For Vinton, whose staff includes a lot of college students, the biggest challenge is the accountability factor. “If you can’t work a certain shift because of a final or class, make sure you let us know ahead of time,” Vinton says.

“With a young staff, having to work is not a necessity to survival,” Santibanez says. “You will have those employees where work is not their first priority.” Utilizing a technology tweak to his schedule allows Vinton’s young staff 24-hour access.

“One of the things we did to fix the problem of calls into the restaurant asking about the schedule is that we made a shift to a Cloud-based scheduling system. It can be accessed by any smart phone or computer. It has everyone’s number, e-mail address and day-off requests — which still have to go through manager’s approval, but it puts the responsibility on them, not on us,” Vinton says. “It really helped us make the next kind of leap with scheduling issues with our younger staff.”

Waiting to finalize the schedule can decrease last minute changes.

“We put out the schedule a few days before the schedule starts; we hold off as long as we can to accommodate day-off requests,” Sims says. “We send out a weekly newsletter to all of our associates that has a link to the schedule and time-off requests.”

Finding the right scheduling formula is tasking for any operator.

“My goal is I want people busy, but not over busy or over crazy because service will suffer. It is a sweet spot and it’s difficult to do,” Vinton says. “We want our best people to get the best hours. When we’re slower, we try to cut. We know how many deliveries our drivers will have during a shift, and we schedule accordingly.”

Santibanez says there is no magic way to find that balance.

“Eventually you’ll know the flow of sales and understand the maximum number of servers and kitchen staff to get the highest level of efficiency. You’ll know it when
you see it; it’s an intuitive thing that managers will develop over time,” Santibanez says. “I recommend to operators to develop a master schedule and try to keep it stable and to use an online tool.”

DeAnn Owens is a freelance journalist living in Dayton, Ohio. She specializes in features and human interest stories.

The post Scheduling: Pencil Me In appeared first on Pizza Today.

Do you know how to factor loss into your financials?

Shrinkage, spoilage, breakage, over-use of ingredients, unrecorded sales, incomplete order deliveries, unanticipated repairs, turnover, even outright theft — there are countless ways to lose money in the restaurant business, says Aaron Allen, founder and CEO of Aaron Allen & Associates, an Orlando-based restaurant industry consulting firm.

“All along the chain of custody, from ordering, receiving, storage, preparation and accounting for it all, there is the potential for loss,” says Allen.

And almost always when it comes to loss, restaurant owners are caught off guard, Allen says. “In a lot of cases, they know something is happening but they don’t know how to pinpoint it or stop it,” he explains.

Bill Marvin, a Seattle-based industry consultant for The Restaurant Doctor, says the same. “Most of them are surprised,” he says. “They want to believe that everything is fine, and since there can be pretty good profit margins in pizza, this can cover up a world of sins, but most have no idea of what they could be doing.”

One of the problems, says Marvin, is that there isn’t a national median specifically for pizzerias, rather than for restaurants in general, by which to benchmark and compare costs and expenses. Getting a handle on the full range of loss scenarios that can happen poses another difficulty, says Jesse York, director in the New York office of Conway MacKenzie. Headquartered in Birmingham, Michigan, the firm provides financial, operational and strategic services.

“It’s easy to understand large cost drivers, like ingredient costs and labor rates,” York explains. “But it’s difficult to separate out scrap, inefficiency and other short-terms changes in costs from historical results and to forecast them correctly.”

Although pizzeria operators shouldn’t passively tolerate loss, a certain amount will occur. “You’re never going to have 100-percent yield on inventory,” says Allen. As such, some loss should be worked into the operating budget, particularly since doing so will help restaurant operators identify how much loss is occurring and where.

“If you can’t measure it, you can’t fix it,” says Allen. “One of the biggest holes that exists is that restaurant operators don’t know their theoretical costs — if there isn’t spoilage, breakage and so on, what should this be costing — and actual costs.”

In order to determine what their food costs should be and how far from this they are, pizzeria operators should have standard recipes for all their products, and standard preparation methods as well, says Marvin.

“You need to itemize what every ingredient costs and then you will know what your food costs should be, allowing you to compare them to what they actually are,” he explains. “But doing these calculations isn’t anyone’s idea of a good time, so it typically doesn’t get done.”

However, without the ability to establish detailed budgets, track metrics, determine their costs and measure them against the budget, identifying loss is difficult, says York, and valuable time and resources may be wasted in the attempt to identify and adjust.

It is a tedious and exacting endeavor, and it requires drilling down in minute detail, says Allen. “For example, does the recipe call for 10 pepperonis, and are employees putting on 10, or are they actually putting on 14?”

Or, consider free-tossing cheese. “This kills pizzerias,” Marvin says. “You need to standardize, you can’t just leave it up to the whims of the troops. Instead, you can use cups, such as one cup of cheese for a small, two cups for a medium and so on.”

Allen says that generally, food costs run around 30 percent, although he’s seen restaurants — very troubled operations close to going out of business — where food costs have been as high as 70 percent. Food and labor combined generally should run around 60 to 65 percent. He’s found, again generally, that preventable loss hits around one to five percent of the budget, although this is for a well-run operation.

Marvin likes to see less than a one percent difference between what food costs should be and what they really are. “Some loss is inevitable, but I don’t accept it. I note it and correct for it continually. It’s not ok to accept it because it’s taking money away from the owner and the business.”

Address loss through training, improving processes and tightening controls, says Marvin. Consistency is also essential. Otherwise, he explains, there will be too much variance in production costs and profits — not a good restaurant or business practice, he adds.

Operators should manage loss to the targets established for food, labor and other variable costs, says York. “If one item goes up, like ingredient costs, the operator needs to tweak pricing, efficiency or product composition to continue hitting those targets,” he says. “Having defined metrics and an eye towards continuous improvement are key traits of successful restaurant operators.”

But don’t overlook one important concern in the process, cautions Allen. “Remember the guest experience. You need to control for loss and make a profit, but it’s not about being really cheap with the pepperoni — you can’t compromise the guest experience. If you do, that guest will go somewhere else.” And that’s the real loss concern.

DoubleDave’s Loss Control

With 35 franchisees and plans to open more locations, Austin-based DoubleDave’s PizzaWorks Systems, Inc., keeps a close eye on loss, reacting swiftly to maintain profitability.

“Loss in almost every category can be identified by store counts, including regular cash audits, inventory counts and daily walkthroughs to identify lost dining room items,” says Joey Bramwell, director of operations. Their loss-control strategy also includes:

• Double-counts on all cash drops (register and delivery driver funds)
• Weekly inventory counts, comparing against previous weeks with similar sales for variances
• Checking inventory against vendor invoices for input errors
• Regular maintenance on major equipment to help avoid repair bills

“Based on our known food costs and retail price, we don’t like to deviate more than a few percentage points,” says Bramwell, referring to the percentage of loss contained in their operating budget. “More than that is a trigger for retraining and better operational control.”

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post What a Loss appeared first on Pizza Today.

Use POS data to reinvigorate relationships with disengaged patrons

You have heard it said that if you ‘want a friend, be a friend.’ We all need relationships for our lives to be complete. The same is true with our businesses. It depends on the relationship developed with the customer. “The most practical, beautiful, workable philosophy in the world won’t work — if you won’t.” — Zig Ziglar.

The “lazy customer” is a customer who hasn’t ordered from your pizzeria in the last 90 days. What has happened to this relationship? Is it fair to label the customer as “lazy”? A relationship is a two-way street and selling is essentially a transfer of feelings. I want my customers to feel they want me, need me and love me. Have you conveyed your feelings to this “lazy” customer, or have you been the lazy one in this relationship?

Your POS provides you with mountains of data regarding who your customers are and how often they order from you. Maybe they stopped coming in or calling in because there was a problem with their last order that you don’t know about. Maybe bad service drove them away. Or maybe they have just been busy and you haven’t been on their mind. Regardless, your goal is to get them back. Do the work. If not, these customers who have not bought from you for 90 days are probably looking elsewhere for pizza.

So, is it worth the work? Consider that there are fundamentally only three ways to increase your business: attract more new customers, entice them to spend more each time and increase your check average or direct them to buy more frequently. Most pizzerias exhaust the majority of their resources foraging for new customers, and then they do it all over again. While an occasional mass mailing or such can be a positive part of your marketing mix, it is estimated that finding one new customer costs seven to 10 times more than to get a previous customer to return.

What is needed is a marketing modification. Ziglar once said: “Discipline yourself to do the things you need to do, when you need to do them, and the day will come, when you will be able to do the things you want to do, when you want to do them!” We have established that we have the tools to produce income. Now we need to discipline ourselves to get it done and be ready to reap the rewards.

“Thanks to the database mailers recommended to me at Pizza Expo, our Cheyenne store is now the number two store in sales in the Mr. Jim’s Pizza chain,” says Mike Gire, owner and operator of the Mr. Jim’s Pizza franchises in Cheyenne and Laramie, Wyoming. “December is up 17 percent and January is up 15.2 percent. It’s incredible how the database mailer works. I got numerous redemptions. I was even able to cut off a few non-performing bulk mailings. Our Laramie store is up eight percent in December and six percent in January.”

Gire owns two Mr. Jim’s Pizza stores, one in Cheyenne — opened in 2005, and the other in Laramie Wyoming — opened in 2010. International Pizza Expo motivated Gire to begin a database marketing program, as well as a rewards program. “I realized how much I was missing by letting lazy customers who already knew us go without some communication to come back,” Gire says.

Most of Gire’s marketing budget goes toward existing and lazy customers. “Most POS programs allow you to market to your database and also have a lazy customer module included,” he advises. “A rewards program will automatically market to these people if you install that. In our case, we use both since not all our customers are rewards customers yet.

“The lazy customer is defined by us as someone who has gone 30 days without visiting us and is tracked in our POS. Once a customer has not eaten with us in 30 days, they get a postcard by USPS mail enticing them to a free side item or pizza with any large pizza purchase. This happens again at 60 days and again at 90 days with the ‘We Really Miss YOU!’ and a free pizza offer.”

Customer buying habits are also tracked in Gire’s rewards program. “Those who have not eaten with us in 30 days get an e-mail offer ‘We Miss YOU’ enticing them to a free medium one-topping pizza with a medium or large pizza purchase,” Gire says. “The e-mail frequency happens at the actual 30-60-90-day time frame with offers getting increasingly aggressive.”

Rewards members already know and love your product; all they need is to know you care. It should also be noted that, along with desirable offers, many operators will send out surveys to especially help them pinpoint the bona fide reason for a customer becoming lazy. Surveys are usually rewarded with a complimentary offer.

Gire’s staff monitors this on the customers’ home page screen when customers call. His POS shows if they are a new customer, existing customer, the last time they ordered, frequency of orders and if they have voiced any concerns or complaints right away. “We have a few ‘manager specials’ for lazy customers once we identify them in the order process,” Gire adds.

“Response rate is good as we tag a 30-day expiration date so they come in soon. We are close to a 65-percent response rate with the lazy offers we send out in 30 days and that goes up as the 60- and 90-day offers go out with a more aggressive offer. Postcards cost about 10 cents when printed in bulk and costs about 30 cents to mail out. Our rewards customers get e-mail notifications and we have unlimited e-mail as part of the cost of the rewards program. We get a report as to how many lazy customer offers are sent so we can track the ROI. The lazy customer program has a high redemption result because we are just pointing them back in our direction with a free item.” Compare this redemption rate with the lifetime value of a regained customer and you see an impressive ROI.

Loyal customers are the key to long-term profitability, so taking care of guests familiar with your brand should be top priority. The data in your POS is a gold mine of information that guides you to successful marketing. Reports such as lazy customers, single-order customers, new customers and spending patterns are at your fingertips. Build on this and let your POS collect information for other marketing, such as birthdays or anniversaries. This will allow you to have even more ways to connect with the customer and increase their dining frequency.

Initiate a marketing approach using your database. Simple targeted offers show best returns. You must establish a continuing marketing program/relationship that delivers a consistent message and builds loyalty. It is a practical, beautiful, workable philosophy — so work it!

Scott Anthony owns Punxsy Pizza in Punxsutawney, Pennsylvania. He is a marketing consultant and International Pizza Expo speaker.

The post Marketing to lazy customers appeared first on Pizza Today.

Seeking to grow without entering the franchise game a tricky feat

Peter Taylor recognizes his strengths and his limitations.

A nationally renowned restaurant operator, Taylor knows he can make a mean pie, but acknowledges he’s not the man to scale a concept.

“I know pizza, but that doesn’t make me the guy capable of growing a concept to 150 units,” says Taylor, who owns two Wood Fired restaurants in Florida’s Tampa-St. Petersburg area.

For many ambitious pizzeria owners like Taylor, large-scale growth only comes after inviting others to the party.

Often in the restaurant game, that means franchising.

Frequently touted as the quickest and most cost-effective way for restaurant concepts to push large-scale expansion, franchising allows brands to pursue rapid growth and a larger geographic footprint with significantly less capital investment compared to opening additional company-owned units, the other most common way restaurant brands increase store count. Franchising, many contend, allows companies to build a stronger brand by creating momentum, name recognition and consistency.On the down side, however, franchising comes with a sizable investment of time and money. Owners need to comply with a strict regulatory environment and must build the corporate infrastructure –– from site selection and marketing to training and operations –– capable of supporting franchisees.

Though costly, Boston and Portland, Maine-based attorney Michelle Grenier says owners typically invest in franchising because they believe the franchise system’s revenue and brand expansion prospects outweigh the investment in franchising compliance and, perhaps even more pertinent in the restaurant space, they see maintaining control of their brand as vitally important.

“The value of most restaurants is in the name and the goodwill and reputation the restaurant has built up over time … and (franchising) brings controls that allow you to protect that,” Grenier says.

But to evade franchising’s heavy legal hand and the considerable investment in infrastructure that franchising requires, some pizzeria owners –– specifically those uninterested in launching additional company-owned units –– pursue other means of expansion, including licensing.

In a business opportunity license, an owner provides his system and collects a fee, but does not permit use of the name. On the plus side this allows the owner to escape franchising’s costly requirements and can produce fees and royalties without triggering franchise laws.

On the downside, the brand is not being expanded because the name is not being used. As a result, there is no ability to do mass advertising and owners might, in fact, be birthing their competition. Furthermore, even though the trademarked name is not being shared, poor operations in a licensed unit could potentially harm the parent concept if consumers connect one with the other.

At the turn of the century, for instance, Nebraska-based Sam & Louie’s –– then called New York Pizzeria –– inked two $20,000 business opportunity licensing agreements in which licensees received New York Pizzeria’s operational guidelines alongside help in restaurant design, outfitting and training. As the stores carried a similar look and product, customers frequently equated New York Pizzeria with their licensing counterparts, which was not much of a problem until operational standards at the licensed stores waned.

“We needed to have some control, so we switched to franchising,” current Sam & Louie’s director of franchising Michael Nolan says.

He adds that Sam & Louie’s, which currently has 20 units –– including 18 franchised restaurants –– across five states, now enjoys more direct control over operational standards, execution and, ultimately, the brand’s marketplace reputation with its franchising deals.

“That’s key as we grow,” Nolan says.

Pizzeria owners might also potentially investigate a trademark license. In these deals, the licensor collects fees and grants use of the trademark, but does not provide the systems. According to Mark Siebert, head of the iFranchise Group, an Illinois-based franchise consulting firm, it is “nearly impossible” to do trademark licensing in the restaurant environment.

“As a licensor, what would you think about letting someone else run your business without defined controls and standards to ensure a consistent brand experience?” Siebert asks. “And as a licensee, what restaurant would you want to buy in which you didn’t receive access to proven recipes, vendors, training and the like? That’s why the trademark license is such a tough sell.”

Complicating licensing matters further is the ease in which an owner can step into franchising and its federal regulations, specifically in trademark licensing deals.

“Even the most well-intentioned companies can unknowingly cross into franchise law,” Grenier says, calling such deals “a complicated area of law.”

Siebert says expansion-minded pizzeria owners considering licensing must ask themselves four central questions:

1. Do I want a third-party channel of distribution?
2. Do I want the additional units to be branded?
3. If all the units will share the same name, will they all follow the same established systems?
4. Will I collect fees, such as royalties or fees for training, advertising, accounting, construction or renewals?

If the answers to all four questions are yes, Siebert says, then business owners will “almost certainly” be franchising and subject to franchising’s regulatory environment.

“When you have the name, system and fee altogether, then, like it or not, it’s a franchise,” he says. “Many people want to be a license because it’s easier, but you can’t just say it and it’s true. At the end of the day, you are what you are.”

What about a branded joint venture?

A branded joint venture is a profit-sharing relationship in which an established pizzeria owner grants use of the restaurant name, its recipes and its intellectual property — the documented systems and processes to operate the establishment — to the joint venture business. In exchange, the owner receives an equity stake in the business and profits.

While a joint venture offers limited means of growth, it can be a cost-effective and strategic way to test a concept’s scalability and secure additional revenue from existing holdings — the trademark and intellectual property. The principal challenge, according to the iFranchise Group’s Mark Siebert, is that the owner of the parent pizzeria shares in the liability as well and does so without any guarantee of profit.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Franchise Dodger appeared first on Pizza Today.

Employee ownership can boost productivity

Operators want to reward their best workers, but there are only so many promotions an employee can earn. One way to keep key employees is to offer them ownership in the company. That can mean anything from shares of stock to franchise ownership. It’s a good way not only to reward employees, but to help make sure the company succeeds.

“There is a ton of evidence that an employee-owned company, as a rule, is more productive and more sustainable,” says Michael Keeling, president of the ESOP Association, the Washington, D.C.-based trade association for employee stock ownership programs. According to the Employee Ownership Foundation’s 23rd Annual Economic Performance Survey, which was conducted among ESOP Association members in the summer of 2014, 76 percent of respondents said the ESOP positively affected the overall productivity of the employee owners. Also, 70 percent of respondents said revenue increased in 2013, and 64 percent of respondents reported that profitability increased.

Keeling says there are several options for business owners to impart ownership of the company to employees. If the goal is to reward key employees, some operators offer a compensation plan that includes stock, so that the person owns a small percentage of the company. There is also the stock-option route, which Keeling notes was popular among technology companies in the 1990s. Over time a company’s share value goes up, and the stock option enables that executive or other key employee to purchase shares at the lower, old price.

If the goal is to instill an ownership culture company-wide, the operator can set up an ESOP. The employer sets up a trust, makes contributions to it and then allocates the contributions to different employee accounts. The program has to be available to all employees, and the company can set up different levels of allocation based on how long the person has worked there.

That’s one way Concord, California-based Round Table Pizza offers ownership to its employees. Round Table Pizza is a private, 100-percent employee-owned company, which means employees can participate in the ESOP after they have worked for the company for one year or 1,000 hours. “When they go into the program, each year there is a percentage of their compensation that they earn in stock, and that is put into a retirement account,” says Jim Robertson, vice president of human resources and franchise operations. “The people that own the most shares are the people that have been there the longest time.”

ESOP programs and other retirement programs such as 401(k) plans are similar because they are regulated by federal laws including the Employee Retirement Income Security Act of 1974, or ERISA. Robertson says the difference is the 401(k) typically invests funds in various companies, while an ESOP invests in one company.

Robertson says employee ownership has another benefit. “We enjoy exceptional employee retention,” he says. “A piece of that is due to pride of ownership versus pride of employment.”

Franchising is another way to own a piece of a pizza chain. Of Round Table Pizza’s 450 locations, 70 are corporate and the rest are franchises. Among those, 17 franchisees are former employees who own a total of 80 Round Table Pizza restaurants. Some own one location, either the one where they worked or one in another city where an opportunity arose. Others own several locations.

“We have rigorous qualification standards,” Robertson says. “We know these individuals. They are typically in manager roles or area manager roles, and we know their competencies. It’s the proverbial win-win situation.”

It might not be win-win for every situation. An operator should consider certain points before offering ownership to an employee, says Robert Zarco, founding partner of the law firm Zarco, Einhorn, Salkowski & Brito P.A. in Miami, Florida. For example, a franchisee who wants to give someone a percentage of the unit ownership should first check with their franchise agreement to see if the franchisor allows that.

An independent operator who wants to give a key employee part ownership should make sure the worker is not simply a reliable, hard-working pie-maker but also a person with business acumen. “You may be launching someone into a business venture they cannot afford if they do not have the financial wherewithal, or they do not have the background or personality or stamina or drive to operate it,” says Zarco, who represents franchisees in litigation. “There are a lot of issues that go into this.”

The operator and the would-be part owner should do some math. Say a manager is granted a five-percent ownership stake. If the business suffers a slow year, and the person figures out that they would have earned more money if they had remained a salaried employee, morale may suffer. Also, if trouble arises, it is more difficult to end an agreement with a part owner than it is to terminate an employee.

Not that Zarco is discouraging anyone from becoming a business owner. “I am totally in favor of entrepreneurship,” he says. “The reality is the most important element of keeping great employees is to treat them with complete respect and give them a tremendous amount of autonomy.”

TIP: Think ahead

When Persona Pizzeria opened in Santa Barbara, California in 2013, the company was already thinking ahead — having many more locations nationwide, and keeping some early, key employees.

“We already thought about employee incentives for ownership options,” says Glenn Cybulski, chief operating officer.

From the beginning, he says, Persona Pizzeria gave two key employees incentives such as bonuses and, over the next few years, the ability to earn fractional ownership of the company, based on meeting certain performance goals. “You have to map out that vision for the employee,” Cybulski says. “You can say, ‘You are a phenomenal GM but you need to get to this next level.’” The next level might be area manager of several states, and the employee could earn a percentage of the profits of those locations, for example.

The key, Cybulski says, is to plan this ahead of time. His advice: keep 20 percent of the ownership of the company in a trust. “Set that aside for future employees who want fractional ownership,” he says. “You are incentivizing these employees to stay with the company and grow.”

Nora Caley is a freelance writer specializing in food and business topics. She lives in Denver, Colorado.

The post Act like they own the place appeared first on Pizza Today.

Chris Ransom, owner and manager of Grand Avenue Pizza in Laramie, Wyoming, was having trouble getting customers to come in during the week. “This is a college town, so it’s kind of hard to get anybody out except on weekends,” he says. “We were doing the majority of our business just on Fridays and Saturdays.” The local movie theaters offered Tuesday night student discounts, so Ransom decided to make Tuesday night Couples Night. Two people can order one appetizer, two entrées and one dessert for $20. “Now you can have dinner and a movie, so it completes the whole night,” Ransom says. Couples Night was a success. “We are full most every Tuesday night.” He promotes Couples Night with table tents, Facebook and on the restaurant’s Web site. He adds that the key is to make the theme night welcoming. “It has to be something that appeals to a wide range of people, not a small demographic. You can’t have a Star Wars night, because then you alienate customers,” Ransom says. Not only can theme nights bring in people on a slow day, but they can also attract new customers.

Doug Fricano, who owns Fricano’s Pizza near Grand Rapids, Michigan, says he started Tuesday Cruise Nights in 2004, a year after he opened the restaurant. People who arrive in a classic car get a free soda and a parking space in a roped-off, but very visible, area of the parking lot. “People drive by and they can’t help but come in and see what is going on,” Fricano says. The crowd of Baby Boomers and car enthusiasts mill around, listen to the DJ play oldies, and, inevitably, sit down and order Fricano’s pizza. Fricano gets the word out by distributing fliers at car shows.

“West Michigan is known for gear heads,” he says. Cruise Night has grown from about 15 cars the first year to 150 or more cars now. The evenings also include raffles for prizes such as synthetic oil, shop towels and other items that Fricano buys before the event. Anyone can participate in the raffle, even if their car is technically not a classic. “The hot rodders see a 2004 Corvette and say, ‘Don’t let him have a raffle ticket,’” Fricano says. Frato’s Pizza, in Schaumberg, Illinois, hosts Wednesday Cruise Nights. Michael J. Kudrna, president of Frato’s, says motorcycles are allowed, as are all classic, muscle, and antique cars. Attendees get discounts at Auto Zone, and free ice cream at Frato’s. Kudrna decided to bring back Cruise Night as a car and bike night when he purchased Frato’s Pizza a few years ago.

The previous owners had let the theme nights dwindle, so Kudrna hired Fuzzy Dice Automotive Events to organize and promote the weekly event. “You have to choose the right DJ,” Kudrna says. “It has to be someone who takes it seriously and is a professional.” Kudrna gets the word out about Cruise Nights by calling local car clubs and by posting information on Frato’s Facebook page. He also does e-mail blasts that are tied to the online ordering system. Now sales are up 10 to 12 percent on Wednesdays, and Frato’s has more than 1,000 likes on Facebook. Also, carryout orders are up during Cruise Nights.

Some customers do not want to be bothered with all those cars, Kudrna says, so they pick up their pizza to eat at home. The events happen over the summer, but he sees long term benefits. One car enthusiast placed a large catering order. “You are trying to create buzz. It’s more about marketing than helping the bottom line for that day,” Kudrna explains. “If we make extra money, great, but we also make sure we establish relationships.” Car nights are popular, but some operators say offbeat theme nights work well, too.

Chubby Ray’s Original Louisville Pizza Company in Louisville, Kentucky, hosts cornhole nights on Thursdays during the summer. Cornhole consists of tossing a beanbag into a hole in a wooden platform. Participants pay a $5 entry fee and play in a tournament for first, second and third place prizes. “In Kentucky you can’t charge for games of chance,” says Ray Perkins, the owner of Chubby Ray’s.

“But cornhole is considered a game of skill.” Perkins promotes cornhole nights on the restaurant’s Facebook page. “It’s inexpensive,” he says. “We’ve got 5,000 followers.” Chubby Ray’s Original Louisville Pizza Company also hosts Monday Poker Nights, which Perkins says are similar to the televised tournaments, but on a smaller scale.

He might discontinue Poker Nights though. “Too many people are doing them now,” he says. “Everyone jumped on the bandwagon.” He might start a trivia night instead. The key to any theme night is to keep it fresh. “You have to introduce new things to customers,” Perkins says. “Our food is great but dining out is not only about the food. You have to give them something different that you can’t get other places.

There are Rules

Sometimes you have to set down certain rules to make sure the theme night goes smoothly for everyone. At the classic car events at Fricano’s Pizza in Grand Rapids, Michigan, car enthusiasts are not allowed to perform smoky burnouts, or the wheel spinning that causes the tire rubber to burn, in the parking lot. “It is a spectacle to behold, but I had to put the kibosh on that last year,” says owner Doug Fricano. He also has an internal rule: all employees must work on Tuesdays during Cruise Night season, which runs from Memorial Day weekend through Labor Day week. He makes sure as early as April that all 22 employees are committed to working those events.

Nora Caley is a freelance writer specializing in food and business topics. She lives in Denver, Colorado.

The post Marketing Theme Nights appeared first on Pizza Today.

Kentucky Jobs for Justice, an organization that advocated for the workers, said at the time that tip pooling was inconvenient for the workers and that the policy violated Kentucky state law. The restaurant countered that tip pooling was for the workers’ benefit, making it easier for them to file taxes and buy into insurance. But after reviewing the very-public complaints, it abruptly served its last meal and shut its doors for good.

Tip pooling is a common practice in which owners collect tips from all employees and redistribute them among the group. While servers like those at Lynn’s Paradise Café are crusading against it nationwide, the National Restaurant Association takes no position on tip pooling. That said, it behooves each restaurant owner to know their individual state’s law on tip pooling before making a business decision on it, says Peter Kilgore, chief legal counsel for the National Restaurant Association. Otherwise, like the folks at Lynn’s Paradise Café, your pizzeria could see problems spiral before you know it.

Before you can understand the legalities and ins and outs of tip pooling, you first have to understand the difference between tips and service charges, Kilgore says.

A tip is a gratuity a customer voluntarily gives in recognition of services performed, Kilgore says. But if the restaurant mandates (on the menu or otherwise) that an “automatic gratuity” of a specified amount will be added to the customer’s bill, that additional amount in law becomes a service charge. With a service charge, the customer’s discretion is eliminated. The customer has an obligation to pay the gratuity, with the legal ramifications that result.

And what are those legal ramifications? Under federal tax laws, the gratuity belongs to the business, not the employee, Kilgore says. “It becomes part of the establishment’s gross receipts for tax purposes and is considered under federal tax laws income to the restaurant; it allows the restaurant, like other gross income, to decide whether to retain the amount itself or give all or part to any employee (not just tip employees), and if the employer does so, the gratuity is treated as wages paid by the employer to any employee to whom it is given,” he says.

However, if the gratuity is deemed to be a service charge, the business can’t use it as a tip credit. And a tip credit enables employers to set a minimum wage for tipped employees. The employees can be paid less than minimum wage by the employer, as long as they receive enough in tips to make up the difference.

Most states that permit a tip credit do allow employer-mandated tip pools, Kilgore says.

What about the legality of tip-pooling? The U.S. Department of Labor has for decades put out guidelines on mandatory employer-imposed tip pools, Kilgore says. They cover:

• Categories of jobs that will and will not be considered legally eligible for tip pooling.
• The concept of “customary and reasonable” as to what servers may be required to contribute to the tip pool.
• The legal approach, and that server permission to participate is not required and may actually be mandated by the employer.
• Absent any employer involvement, tip employees may decide how to share tips among themselves.

Although the law permits employers to impose mandatory tip pools, you have to decide whether it makes sense both as a business decision and for employee relations, Kilgore says.

One criticism of tip pooling is that servers feel they are subsidizing the work of “slackers” if a tip pool is forced by the employer, says Paul Paz, co-author of “The Professional Server: A Training Manual” and owner of Waitersworld.com. Employee morale is a major consideration if you are trying to prevent turnover, he says.

“Tip pooling is not well received,” Paz says. “If I can deliver that service better than someone else, why not get my credit for it? There’s also the concern they won’t get as many shifts because things have to be divided equally.”

He adds customers develop a psychological connection with their servers, especially the regulars. If you switch to a team service approach to a table –– meaning more than one person waits on it and the tip is pooled –– there is a “disconnect,” he says, because customers don’t really understand who is their server and who deserves the tip.

Kilgore notes, however, that as part of an employer-mandated tip pool, the employer has input into the share each pool recipient will receive.

“Certainly, if an employee participating in an employer-mandated tip pool is not performing the job adequately, the employer may handle the ‘slacker’ as it deems appropriate,” he says. “Employers may also factor in an employee’s work ethic as to the share the employee may receive from an employer-run tip pool.”

Tracking the Tip Pool

Tip-pool tracking is essential to protect your organization against audits that fall on sample periods chosen by the IRS, says John Marshall. He’s president of GrataSoft Solutions, which has three patents pending on tip reporting software. Marshall is working with Heartland Payment Systems to bring the next generation of tip management to Web, tablet, POS and BYOD platforms.

Say you have three bartenders working a single register. The person who opens the drawer “owns” the tips. “Often, they throw tips in a pot and split it in equal thirds. What’s missing is the reporting side. Whether you’re delivering pizzas or serving at a bar, there’s a lot of cash with no accountability,” Marshall says.

If the bartender gets audited, they would disclose that their tax filing only reflects one-third of the tips in the register. That could ultimately set you up as a target for audit. “The IRS doesn’t care if the tips were shared. The house has deep pockets. So they may say, ‘We’ll go back 60 months and will take a robust month, like December, and that’ll be your sample period. They gouge your eyes out,” Marshall says.

Heidi Lynn Russell specializes in writing about the issues that affect small business owners. She is a regular contributor to Pizza Today and lives in Wilmore, Kentucky.

The post Tip Pooling: Can you legally mandate it in your pizzeria? appeared first on Pizza Today.

Stolen credit cards. Data security breaches. Identity theft and fraud. When customers come to your restaurant or place a phone or Web order, these issues are probably not even on their radar, but they should be on yours. If you’re not careful, your customers, employees, even your business could be at risk of experiencing a ruinous data theft.

Restaurants’ unique characteristics make them particularly vulnerable, says Jon McDowall, president/CEO of the Fraud Resource Group, an international consulting and expert witness firm headquartered in Bettendorf, Iowa. The workforce is generally young and transient, he says. The workload and pace is demanding and the compensation isn’t always commensurate. Orders are coming in over the phone or Web, with payments made remotely (even when dining in, credit cards typically leave the customers sight, sometimes for relatively extended periods).

Also, “the consistent segregation of employees’ duties and managerial oversight found in many other businesses may not feasible,” McDowall adds. “Let’s face it; many pizza establishments have the potential to be a risk-manager’s nightmare.”

Lest you think that there’s nothing you hold of interest to ID thieves, think again, advises Joseph Steinberg, cyber security expert and CEO of Green Armor Solutions, a Hackensack, New Jersey-based provider of information security software. Along with the aforementioned credit card data, there’s sensitive employee information, such as social security numbers and payroll information, he reminds. Don’t forget things related to running the business –– not just processes, but recipes,
e-mails from corporate and so on.

“Then there are those customer loyalty programs that collect information like addresses, birthdates and e-mail addresses,” Steinberg addds. “All this information can be used by a criminal for nefarious purposes.”

Data theft and breaches happen in numerous ways. For restaurants, skimming — the theft of credit card information used in an otherwise legitimate transaction — is a particular concern, says identity-theft prevention expert, Johnny May, owner of Security Resources Unlimited in Bloomfield Hills, Michigan. “It’s huge,” he says. “The restaurant is the one place where you lose sight of your card.”

Skimming can involve an employee writing down a customer’s credit card information, or photocopying the card, or using an electronic device (“skimmer”) to steal the data and make a clone card, says May.

“A large percent of data theft is committed by dishonest insiders,” May says. “Companies are often focused on outside attacks but really, the biggest percent comes from inside.”

Dumpster diving is another way data theft happens, says McDowall. Which is why, under Federal law, every U.S. employer, regardless of the size of the business, must destroy sensitive data
before tossing it—this includes credit card information, customer names,
addresses and so on, he explains.

“The most common means is shredding and employers need to have functional shredders in convenient locations so they’re used every time,” McDowall says.

Credit card processors can pose a risk if not handling information correctly, says Steinberg, mentioning that a recent breach involving a Texas eatery may have occurred at a third-party processor. He advises restaurants to verify their processors follow PCI Standards (Payment Card Industry Data Security Standards) and to also follow them.

Then there are data breaches caused by keyloggers, worms, Trojans and malicious codes, says McDowall. “Links, photos, attachments, website content and many other common online items can be seeded with malicious code, allowing the code’s handlers to steal sensitive identifying data, banking and credit card data, and to convert this into profit.”

The fixes aren’t necessarily complicated. In addition to implementing layered computer security — for example installing software that protects against malware, viruses, spyware, and offers intrusion detection, and so on — Steinberg advises encrypting all sensitive data; easy to do and inexpensive.

He also suggests that digitally connected, multiple-location operations take precautions to ensure a breach at one site won’t lead to breaches at the others (this may require IT assistance). Also, employees logging into the restaurant’s computer system should have their own personal identification and should only be able to log onto those things that concern them, Steinberg says. For example, a chef should not have access to credit card information or to employee personal data.

“This will help protect against breaches and thefts caused by disgruntled employees and will also limit damage in the case of a leak,” he explains.

McDowall suggests having separate computers for order taking that don’t allow for surfing or e-mailing. He also advises that restaurants establish written policies — and train on them — for how credit card information is handled, including compliant disposal of that information.

Offering free wi-fi, increasingly common, exposes you to a “whole new level of risk,” says Steinberg, mentioning that this should never be provided on the same network as the restaurant operates on.

“One of the easiest ways for a criminal to figure out if they can attack the restaurant is to go in and use the wi-fi to nose around,” he says, adding that it’s not difficult to set up a separate network.

The best protection is awareness, says McDowall. “The most important step
involves acknowledging that a number of risks exist and ownership and management committing to being as secure as possible,” he says. u

One of your first lines of defense when it comes to warding off internal theft is the background check, says Johnny May of Security Resources Unlimited. He reminds operators that employees typically pose the biggest threat to data security. He also suggests restaurants:

Consider video monitoring, especially over registers and where orders are taken. Monitors can prove effective deterrents.

Store employee data in locked cabinets and limit access.

Think about using wireless credit card technology that allows customers to pay at the table. “It’s a simple fix but many restaurants don’t use it,” says May.

Keep audit trails to document and determine who has accessed what and when. There are software programs that will allow you to keep audit trails.
Jon McDowall, president/CEO of the Fraud Resource Group, recommends exercising caution when considering new technologies. “Make sure you’ve explored and adequately understand the security implications. You may want to delay rollout to see how others fare.”

Pamela Mills-Senn is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

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Purchasing is the second leg of the profit triangle

What is the first question you ask your sales rep every week? I’ll bet it isn’t weather or family related. I’d bet it goes like this: “How much is cheese this week?” I stopped asking the big question in 1989, after I was educated on a term that changed the entire way I bought all of my food from that day forward.Your sales rep has very little control over the prices that show up on your invoice. DSR’s (Direct Sales Reps) have to sell their food and supplies under high scrutiny. They answer to their district managers, then to the sales manager, then all the way up the to the corner office. Food distribution companies must cover four areas of expense before the final lowest cost price is set and reflects on your invoices.

They are:

• Product costs: What it costs the supplier to buy the products from their manufacturers. The higher their volume, the lower their costs are.

• Delivery and handling costs: This is much the same as how we charge for home delivery. What is the cost per drop to your restaurant? This cost has skyrocketed for your distributor in the last year because of diesel fuel, insurance, wages and depreciation of tractor-trailers.

• Selling costs: The cost of servicing your account and processing orders. The more you order determines how far these fixed costs can be spread over your total sales dollars. Special orders, delivery frequency and credit terms are factored in here.

• Profit on account: This is the percentage of mark-up or gross profit (sometimes referred to as margin) that needs to be made to consider your account profitable, after considering the above factors and potential volume of your account.

Did you ever wonder why publicly held chain restaurants are two to three time more profitable than independents? One of the big reasons is they don’t buy their food like we do. Every single one of them uses one primary supplier to buy 80 to 100 percent of all of their food and supplies. I’m convinced that this issue alone accounts for a huge reduction in their annual food cost percentages.I was taught to be an adversarial buyer. I was very good at it. I used guilt trips, lies, and threats to get the lowest cost possible from my DSR. I spread my orders over three to four distributors (not including the produce guy and soft drink distributor) to keep them honest. I made them sweat for my order. I must have said, “How much is it for XYZ?” a million times.” They shot me a price and I started the adversarial dance of, “Sorry, you’re 10 cents too high.” Little did I know I wasn’t getting their lowest prices. It was a very time consuming power trip. They still had to factor in the four equations described above. My monthly food purchases were about $25,000. I was spreading my orders between 3 distributors. Each one of them was getting around $100,000 a year. They were paying around $80,000 for the food they sold to me. Their gross margin was close to 20 percent. That wasn’t profit. They still had to subtract selling and administration costs, delivery, handling costs and profit.Then I met Ty Troy, DSR extraordinaire. After cold calling me for six months I gave him his first mercy order, just to get him out of my hair. He showed up every week, sometimes twice. He was like cancer and just wouldn’t go away. He kept on telling me all of the ways his company was the only choice and how he would blow me away with service and price. He was so genuine and his references checked out, so I decided to give him a try. After a rough start (I was disorganized and accidentally bounced a few checks to him) we settled in and got down to business. After the honeymoon period we started to trust each other. I told him what my worries were and he shared his. Then we did something very extraordinary. We made a solemn vow to never lie to one another. He told me what he was looking for in a customer.

He was a four million dollar man (eventually grew his route of 100 miles of lonely Lake Huron shoreline to 6 million) and didn’t have time for customers who weren’t:

• Going to pay their bills on time
• Totally honest
• High dollar accounts
• Loyal, even with low ball offers from competition
• Going to refrain from guilt trips and adversarial buying games
• Organized and have the order ready. (time is money)
• Going to regard the relationship as win-win
• Reasonable in their expectations I shared my thoughts too.

I was looking for a supplier who:

• Stocks the right ingredients in their product mix
• Can deliver food on time, at agreed pricing amounts
• Will work out agreeable credit terms
• Is totally honest
• Knows their product line inside and out
• Suggests money saving ideas without compromising the food quality
• Will suggest, track, and monitor manufacturer rebates and special pricing
• Is comfortable on a cost plus arrangement
• Will cover me if I screw up and forget to order a product.

He suggested that we might want to try a non-binding Prime Vendor Agreement for six months. He knew my potential volume was appealing to him and his company. I would buy all of my food from him and he would set me up on a cost-plus program. He would much rather cut his margin almost in half to get all of my business. After all, 12 percent of $300,000 is better than 20 percent of $100,000. From that day on I never asked him the price of cheese or anything else for that matter. My cheese price was directly tied to the Chicago Mercantile Exchange (CME) Block Cheddar price, and all of my other categories were indexed off of cost-plus percent over their invoices. He organized my purchasing and created customized order forms, par levels and was always informing me when my food ingredients were on sale or when they expected costs to go up.This type of arrangement is based on trust and goes both ways. Other suppliers tempted me with better prices on specific items, but in the long run it’s not wise to cherry pick. I was finally able to spend the three to four hours a week of newly found extra time on more productive areas (like training, guest service, finances, and marketing), and eventually delegated the entire ordering process to one of my high school employees.Bottom Line: my annual food costs went down 8 percent. I gained over 200 hours a year for more productive management. My invoice paper clutter was slashed. My DSR was my advocate and was always watching my back.Does this make sense for your pizzeria? Give it a shot.

The post Power Purchasing appeared first on Pizza Today.

If a restaurant partnership is similar to a marriage (as many will attest it is), then dissolving a partnership must be very much like going through a divorce — which should be a scary thought for anyone contemplating such a move.

“Unfortunately, partnership split-ups are like family divorces,” says J. Philip Kirchner, an attorney with Flaster/Greenberg PC. The law firm’s main office is in Cherry Hill, New Jersey. “They are, in most cases, acrimonious and nasty, with both partners making decisions based on negative emotions rather than good business judgment.”

Taking the low road can prove ruinous for the restaurant and the lives of those involved, says Aaron Allen, founder/CEO of Aaron Allen & Associates, an Orlando-based global restaurant and hospitality consulting company. He recalls one situation that resulted in a protracted, years-long lawsuit that included death threats, physical assault and the need for security. Having something in place, like a buy-out agreement, may have prevented this outcome or at least shortened its duration, says Allen.

Partnership agreements covering all aspects of the relationship — including dissolution — are essential and should be established from the start, says Kirchner, adding that the true danger lies in having no agreement in place, or a very weak one.

“In such cases, unless the parties can reach a private amicable resolution — very difficult to do in most partnership ‘divorces’, the parties will almost certainly end up in court in a lawsuit,” he says.

But even with a solid agreement in place, partners might do well to pause and consider if such a dissolution is really necessary, says Dennis Lombardi, executive vice president of foodservice strategies for WD Partners, a Columbus, Ohio-based design and development company for chain retail/hospitality.

There are often good reasons to dissolve a partnership, such as illness, retirement, loss of a lease or unsustainable unit economics, he says. Irreconcilable operational differences in philosophy or style that are negatively impacting the business can also make splitting up the best option. Other good reasons include when there’s been a change of passion or focus, when one partner wants to grow and the other doesn’t or if one of the partners has pending legal or financial liabilities that could threaten the business, says Allen. However, both consultants agree, too often partners are motivated by the wrong (and potentially fixable) reasons, such as personality conflicts, pride and ego.

“Ego is the worst, and it’s a more common driver than people want to admit,” says Lombardi. “One partner starts thinking he can do it better, or that he’s doing all the work and doesn’t need the other partner. But the reason they came together in the first place is that they had some synergies.”

Before boarding the train to splitsville, the partners should examine if their differences are actually undermining the operation, says Lombardi. If not, then perhaps attempting to work things out might be the best option. Other questions he suggests exploring include:

Can the restaurant, and its employees, survive the process?

• Will the parties be better off than before?
• Will the costs turn a plausible/good decision to separate into a bad one? “For example, you may have to hire a GM to replace the partner” Lombardi says. “Or the partner who leaves may have important connections.”
• Will key people leave?
• What are the strengths of the surviving partner? What are his/her weaknesses and how will he/she compensate for these?

If the decision is to divide, expect surprises, says Allen. “The other partner may have been doing more than you thought — we find this a lot,” he says. “Also a surprise sometimes is who the vendors, employees and other (nonfinancial) partners side with.”

Other unanticipated issues can include hidden liabilities, such as the threat of a lawsuit the remaining partner didn’t know about, cooked books, over- or under-valuation of the business –– even things like company passwords, contact lists or accounts, Allen adds.

Seeking professional help (in addition to an attorney) during the process is generally required. “Start with a professional valuation of the business,” says Allen. “Have audited financial statements and have this facilitated by a third party.”

Consultants can help keep “hotheads” away, keep the situation from escalating, and also assist in separating duties, he continues. “You’ll also need an accountant and in some cases a transition team, or someone who can come in and play a leadership role.” (If there are serious differences/disagreements, consider calling in an executive coach or conflict resolution coach, says Lombardi.)

Allen suggests explaining what’s happening to vendors and employees. They can sense something is amiss, he says, which can quickly unravel morale and the restaurant’s health.
This is the time to calmly think about the other person’s needs, not just yours, says Lombardi.

“Try becoming the other partner’s advocate,” he suggests. “What are her concerns? How do I protect him? If people come at it for their own gain, the legal fees will be prohibitive.

“Keep the process as fair and practical as possible. If you can try to get consensus without browbeating, if each person isn’t completely happy, then it’s likelier to be a fair deal.”

The Partnership Agreement

A solid, comprehensive Partnership Agreement (or LLC Operating Agreement or Shareholders Agreement) can make a break-up less painful, says attorney J. Philip Kirchner. Although he says there are numerous other provisions an agreement can include, the following provides an abbreviated listing of the most typical ones specifying:

• Who will own the business (in what shares) and who will manage it?
• How voting deadlocks will be handled.
• What happens if/when the partnership needs additional capital?
• How profits will be calculated and distributed to the partners (Guaranteed salary? Draws against profits? Etc.).
• How financial records will be kept, and who will keep these.
• What other reports will be run and who’s in charge of these. Also, who will receive them?
• A “tax matters partner” charged with overseeing filing company tax returns, etc.
• The procedure for admitting a new partner and the voluntary/involuntary withdrawal of a partner.
• The mechanism for resolving disputes.

Pamela Mills-Senn  is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post The Big Break-Up appeared first on Pizza Today.

Nick Sarillo, owner of Nick’s Pizza and Pub, takes home $120,000 a year, and he doesn’t care who knows it, including –– and perhaps most importantly –– the 200 full and part-time staffers who work for him.

Sarillo, who operates pizzerias in Elgin and Crystal Lake, Illinois, has an open books policy, which means he makes available to his employees every detail of how his business operates financially, from daily sales information to how much paper napkins cost to how much he and his managers earn and how much it costs to rent space.

Ian’s Pizza, which has four locations in Madison and Milwaukee in Wisconsin and Chicago, also follows an open books policy.

“We find it breeds a culture where employees take a bigger interest in the company and have a bigger interest in the success of the company,” says Nick Martin, general manager at one of Ian’s two locations in Madison, Wisconsin.

Since establishing open books in 2002, Sarillo says his business has seen profitability increase from an average of between 8 and 9 percent to between 12 and 16 percent. At its highest, pre-recession point, he says profitability was 18 percent.

“The average net profitability in the restaurant industry is three percent. With open books, profitability goes through the roof,” says Rudy Miick, president of Miick and Associates in Boulder, Colorado, which worked with Nick’s to put open books in place.

The policy allows employees to see and understand financial information, to take a role in trying to push those numbers in a positive direction, and to have a share in profits or in some other way reap a reward from the company’s success, such as with a party or a salary increase, says Miick.

The main cost centers around which information is shared, and which have the most potential for being moved in either a negative or positive direction, include food, beverage and labor costs. Other information on money going out also is shared, but is not as variable, like the cost of renting a business space, Sarillo says.

When instituting the policy, Sarillo also established a daily cost system that provides up-to-the-minute numbers and started holding weekly meetings for staff that he calls huddles, at which they review financial information and set goals.

Each employee takes responsibility for a line item such as lunch sales or average amount of check per guest. The employee reports previous data on that line item, such as how the restaurant fared the week, month or year before on that day of the week; looks at what factors might affect that number, such as an impending snowstorm or a weekend homecoming game; and forecasts a goal.

“We have everyone from 16 year olds to 40 year olds involved in our numbers,” Sarillo says. “It energizes the team. It gives them something where they feel like they have a real impact on the business.”

Sarillo says he has white boards at the meetings on which important financial information is outlined. “If there’s any area that needs attention, we’ll put it on the board,” he says.

Knowing how much the owner earns also dispels any misconceptions employees may have that a business just opens its doors and the owner rakes in the dough.

“When the team comes in and sees that a pizzeria is really busy, they think those pizzas, at $10 a piece, is pure profit,” says Miick. “This takes away any sort of misunderstanding from the team and we get to deal with real, hard data.”

It also helps staff better understand why when a shift is slow, the restaurant may need to send some employees home.

“It energizes our people to be the best crew and do the highest number of sales they can,” says Martin. “They’ll say, ‘Look at all the sales we did with just this few number of people.’ And any employee can punch in their employee code and see what our labor costs are. They understand why they’re being cut on a slow night.”

Both Martin and Sarillo agree that the most challenging aspect of the open books policy is putting in the time and effort to educate staff in what those financial numbers mean.

“There is a big teaching aspect to open books. Employees get a crash course in bookkeeping and finance,” says Martin. “We hire a lot of college students, and for a lot of them it’s their first real job. It’s great for them to see how a real business operates.”

“It’s a matter of getting in the habit of having those weekly meetings,” Sarillo adds. “The hard part is getting started and you have to be disciplined to not give up.”

Armed with knowledge, employees are more likely to make better financial decisions even in small details, advocates say. “They aren’t going to grab a stack of paper napkins when they just need two,” Miick says.

Another challenge of the policy can be assembling a management team that is willing to share information. “You need to have managers who aren’t afraid to be open and transparent,” Sarillo says.

Employees at Nick’s are rewarded with the potential for profit sharing that can range from as little as $2 to up to about $120. “Every four weeks there’s a potential for a bonus,” says Sarillo.

Those amounts are paid based on how many hours an employee works and other factors in their control such as taking additional leadership training classes offered by the pizzeria or getting a certification.

“A server who wants a pay raise goes after a certification to be a bartender and that makes them more valuable to the restaurant,” says Miick.

Sarillo adds that even during trying economic times, he has found open books to be a benefit. “When things are down it’s almost like you don’t want to tell anyone,” he says. “But having more heads working on a problem are better than one. The team rallies together.”

For people used to playing their financial numbers –– representing either increased or decreased performance –– close to the vest, Miick says embracing the concepts behind open books may be hard, but worth it. He says: “It’s counter-intuitive, but it works.”

Annemarie Mannion is a freelance writer living in the Chicago area. She specializes in business and health stories.

The post Out In The Open appeared first on Pizza Today.

Hiring the right people can make or break your business

For reasons well known to pizzeria operators, finding great employees, particularly for entry-level positions, is often “throw-up-your-hands” frustrating. But despite the challenges it’s entirely possible to staff your restaurant with people you can count on to show up, perform to (or exceed) your expectations and keep your business running smoothly and customers returning.

The first step in the hiring process begins with creating clearly defined job descriptions, as well as identifying the skills and characteristics each position requires, says Jan Ferri-Reed, president of Key Group, a Pittsburgh-based HR consulting and management training company. She suggests observing the people who are performing well in their jobs. Along with asking their input on what their position entails, determine what qualities/characteristics these employees have that make them successful. Then, write the job posting and develop the interview based on this information. As for the interview process, Ferri-Reed advises taking a deliberate approach.

“Don’t just wing the interview,” she says. “Follow a standardized format based on the position. This also transmits the expectation of taking the job seriously because the applicant sees that you, the operator, are approaching the hiring process in an organized way.”

Avoid asking yes or no questions, Ferri-Reed cautions. Instead, ask applicants to explain and describe, using scenarios (“Tell me about a time when you…”) to elicit more detailed, revealing responses, which also has the added benefit of discovering how articulate the job seeker is.

Take your time, says Michael Shepherd, owner of Michael Shepherd Consulting, LLC in Belle Center, Ohio. Shepherd, who also owns a restaurant — Six Hundred Downtown, in Bellefontaine, Ohio — says his hiring process starts when someone brings in an application and hands it to the host or manager.

“Were they polite? How were they dressed? Did they smell of smoke? Come in alone? And then we ask all the staff if they know the person, to get some detailed background on them,” says Shepherd.

Other strategies include scouring the application for red flags, such as job-hopping laterally, poor grammar and spelling, school conflicts and so on, he says. Personal references are called and if the applicant survives to this point, the next step is a phone screening to determine basic skills and scheduling availability.

“Then we generally do two interviews; one with the assistant manager to get a first impression and then onto the general manager or myself,” he says. “The questions are designed to get them to open up and talk a lot. We want to know if they’ll be a good match for us and if the job will be a good match for them.”

Some of the questions posed to his applicants include:

• Tell me about yourself.
• What is the funniest thing that has ever happened to you?
• Tell me about a time you had a disagreement with a coworker; how did you resolve it?

Ann Farrell, director of development for Farrelli’s Wood Fired Pizza, a six-location operation headquartered in Tacoma, Washington, says their applicants always undergo at least two face-to-face interviews conducted by different people.

“Professional image is important to Farrelli’s so we want to see if they’re on time and show up each time looking their best,” she explains. Also “develop interview questions that align with your organizational values and culture so you can make sure the personality is a good fit.”

Integrity and doing the “right thing” are essential core values for them, Farrell says. Consequently, one of their initial interview questions is: “Tell me about a time in your life when doing the right thing was not necessarily the easy thing.”

Growth is also important. Their question designed to uncover this core value is, “Tell me about a time in your life you were challenged to do something you weren’t sure you could do. How did you rise to the occasion and what did you learn about yourself?”

“These are big questions and require thoughtfulness; a trait we desire,” Farrell says. “Then, depending on the answers, we can see if the person has the character we’re looking for.”

Farrell says their best staff members provide one of their most effective recruitment tools — “good people know good people”— she explains. Other recruitment possibilities include colleges and high schools, culinary programs, vocational schools and veterans (“If you’re close to a military base, see if they have a program to help get veterans back to work and integrated into civilian life,” she says).

Look for people who respond well to stress, Shepherd says. “A restaurant is a pressure-cooker filled with stress, sweat and different personalities. Everyone must have basic people skills so they can get along well. Everyone also needs to multitask well.”

Don’t try to build your staff with different types of people, he cautions. Doing so could unwittingly result in different “classes” of workers that could pit, for example, servers against cooks, or servers against dishwashers, or dishwashers against cooks.

“Everyone needs to be a people person,” Shepherd explains. “I can train skills like making a pizza, serving or washing dishes. What I can’t do is train intrinsic abilities like multitasking, a good attitude, the ability to learn and common sense.”

Making Incentives Count

Incentives can keep great employees motivated but a thoughtful approach is required. TJ Schier, president of Incentivize Solutions, a hospitality consulting and training company in Flower Mound, Texas, advises operators to:

• Link incentives to business results or performance/behavior improvements. Example: reward employees with a cents-per-hour bonus for lowering food costs or for every incremental sales dollar they bring in (also encourages suggestive selling).
• Regularly evaluate performance. Depending on the position or business/performance objective, this should occur daily, weekly or monthly.
• Ask. Don’t assume you know what employees want. Instead, discover what drives each employee (Schier does say that for most, this will be cash or gift cards).

“Incentives should never be used for paid-to-do things like showing up or coming in full uniform,” says Schier. Don’t think “incentives will get below-average employees to perform better. Incentives will never get the wrong people to do the right thing.”

Pamela Mills-Senn  is a freelancer specializing in writing on topics of interest to all manner of businesses. She is based in Long Beach, California.

The post Finding Greatness appeared first on Pizza Today.

The Greek poet Euripides said: “One loyal friend is worth 10,000 relatives.” Think about the truthfulness of that statement. Friendship is a relationship we are not born into but still choose to cherish. In the hospitality industry, we form relationships with our customers and treat them like dear friends. We reach out, listen and react to their needs in a sensitive manner. In time we win them over as a friend and loyal fan, not just an acquaintance. This relationship like all others must be nurtured.

The fact of the matter is that:

• 66 percent of adults surveyed by the National Restaurant Association (NRA) said they’d be more likely to patronize restaurants offering customer loyalty and reward programs.
• The restaurant industry is poised for growth as 40 percent of adults surveyed said they are not using restaurant services as much as they’d like.
• It costs between eight and 10 times more to attract new customers as it does to keep existing customers coming back.

It stands to reason that focusing on a fan club or loyalty marketing is a great tool to increase customer loyalty, spread positive word of mouth and improve customer satisfaction. It also gives you a competitive edge, as the NRA reports that only about 30 percent of restaurants use such a program.

Why are so many restaurants not using loyalty marketing? Many programs are set up to only incentivize the next sale but not with thought to bringing benefits to both parties involved. For example, you build a fan club, and then send them all the same offer — $2 off a large pizza. Aren’t these people the ones who were already buying that pizza at full price? You got them to come back and spend less! Jay Siff of Moving Targets adds: “While I do agree with having a club to help keep your customers loyal, I believe a business needs to think very carefully before they commit to starting a program that constantly gives discounts to their customers. In addition, having to keep track of people’s points, etc. can be cumbersome. And how do you ever end such a program without upsetting customers?”

Manny & Olga’s Pizza, a 15-unit chain located in the Washington, D.C. metro area, has successfully built their fan club. “It’s a good way to have a closer connection to your customers and gives you an extra edge in the pizza wars when the customer is choosing who to buy from,” says Haralambos Athanasakis, president of Manny & Olga’s Pizza Systems Inc. To keep his edge, Athanasakis advises operators to be consistent and make offers appealing to your customers — not take a one-size-fits-all approach.

When customers opt in to fan clubs, operators have the opportunity to gather information such as birthdays, the anniversary of their first order, menu preferences, favorite sports teams etc., Operators can then be specific in your marketing. While Athanasakis could do this himself, he advises against that — at least initially. “Don’t do it yourself in the beginning,” he says. “Get a company to do it for you to get a feel for it, and then you make a decision what is good for you.” A dedicated company can help you to create a professional branded design template and coach you on offers and copy that get results. They also have resources to help you collect information needed for your database, such as adding online registration forms to join a club or sign-up sheets for in-store use. Reports provided by the service can help you determine the appropriate frequency for sending out messages to your fans.

Fan clubs allow you to do more than make a financial transaction. A good friend of mine made me some cinnamon rolls and when she packaged them up, she included a family newsletter. As I ate my cinnamon rolls, I read the newsletter and felt all good inside. Why? She made me feel special and she made me want to reciprocate. I loved the cinnamon rolls and her newsletter let me know of the new business she was starting — Grandma’s Doggie Day Care. The cinnamon rolls got my attention, the newsletter bonded us, and I will now always think of her when I need a dog-sitter. Your fan club can work the same. Today, I received an e-mail from Tutta Bella in Washington. They introduced a new pizza and made an offer for me to try it. They also paired it with a wine. And to seal the deal, their executive chef told a love story of when he first tasted this particular pizza in Naples. Fan Clubs utilized in such a way can get customers to try new things and to up-sell them on other complimentary products. This helps to give them a reason to increase their frequency to your establishment and raises the check average.

Athanasakis follows the same path, “We send out mostly coupons or offers two times a month and announcements, new menus items, stores openings, etc. We try to keep it fresh with new and rotating coupons.” He is able to track effectiveness through a monthly report of how many were sent out and how many were opened all the way through. A POS system makes it easy to track who is eating at your restaurant, when and how often. “Let the business decide who, how and when they want to offer rewards,” Siff adds. “And in behavioral psychology, it’s recognized that variable reinforcement is more effective than constant reinforcement. So the customers feel special for joining but the business controls the rest.”

Recall the old German saying: “Whose bread I eat, his song I sing.” With loyalty marketing they will be eating and singing right out of your hand.

Scott Anthony is a Fox’s Pizza Den franchisee in Punxsutawney, Pennsylvania, and a marketing consultant in the pizza industry. He is a frequent guest speaker at Pizza Expo.

The post Loyalty Programs: In the Club appeared first on Pizza Today.

Through Oct. 26, the company will collect donations inside its more than 6,300 restaurants across the country and online at PizzaHut.com, with every dollar raised to benefit the WFP’s fight against hunger. Even the smallest donation can make a big difference, as $1 feeds four children, $3 can feed two children for a week, $5 feeds a child for a month and $10 feeds an entire classroom for a day. Through donations, Pizza Hut has helped raise more than $12 million since the initiative began in 2007 and last year alone, the pizza company helped raise $2.9 million which served over 10 million meals to hungry children. More information about the campaign can be found at pizzahut.hungertohope.com, where customers can also make instant donations.

“As we embark on our eighth World Hunger Relief campaign, we are reminded by the astounding global hunger statistics and the severity of this issue,” said David Gibbs, President, Pizza Hut, U.S. “Our theme this year is ‘Together We Can Deliver Hope,’ which serves as a call to action for thousands of Pizza Hut Team Members nationwide and our millions of passionate customers to join forces in the fight against hunger.”

Customers can donate inside their local Pizza Hut by simply adding to their order when dining in or carrying out.  Online customers have the convenient option of adding $1, $3, $5 or $10 at the end of their orders at PizzaHut.com.

Pizza Hut parent company Yum! Brands’ World Hunger Relief effort is the world’s largest private sector hunger relief initiative, spanning more than 125 countries and territories, over 40,000 KFC, Pizza Hut and Taco Bell restaurants and 1.5 million associates. Yum! has raised more than $185 million for WFP and provided 740 million meals in all corners of the world.

This year, Yum! announced a new “Pass The Red Cup” challenge that is designed to drive awareness and inspire donations. Multi-Grammy Award winner, Christina Aguilera is leading this effort by challenging media outlets, celebrities, influencers and her fans around the world to share #PassTheRedCup on their social channels. More information about the campaign is available at HungertoHope.com.

WFP is the world’s largest humanitarian agency fighting hunger worldwide. Last year, WFP reached more than 80 million people in 75 countries with food assistance. For more information, visit www.wfp.org.

About Pizza Hut
Pizza Hut, a subsidiary of Yum! Brands, Inc. (NYSE: YUM), delivers more pizza, pasta and wings than any other restaurant in the world. In 2014, Pizza Hut was named the Harris Poll Equitrend® Pizza Brand of the Year, garnered a top score in customer satisfaction among limited-service restaurant chains in the country from the American Customer Satisfaction Index (ACSI), and was the recipient of the Innovation and Leadership in Advertising Award from the American Advertising Federation, 10(th) District. The only pizza company to be named a top ten franchise in 2013 by Entrepreneur Magazine, Pizza Hut began 56 years ago in Wichita, Kansas, and today operates more than 14,000 restaurants in more than 100 countries. Pizza Hut also is the proprietor of the BOOK IT!® Program, which is a long-standing children’s literacy program used in more than 620,000 classrooms nationwide. To order online from Pizza Hut, visit PizzaHut.com.

The post Pizza Hut embarks on annual World Hunger Relief Campaign appeared first on Pizza Today.

Got social media? Here’s how to use it right

I’m so glad I don’t have to write another column about why everyone should be active on social media. You already know how vital it is to your pizzeria’s marketing plan and posting had become a part of your routine. Now that you’re a social media expert with thousands of likes, friends and followers, I feel it necessary to point out some ways you’re abusing the system.

The most common mistake I’ve noticed is one of pace. A burst of posts is a dead giveaway that you suddenly remembered you have social media accounts to populate. Not only is it annoying for users to see their feeds flooded by a single pizzeria, it’s also a waste of impression time. If you post five photos on Instagram within one minute, I’m going to read it as a single point of contact. By spreading those photos over three hours (pre-lunch through post-lunch) you’ll create five distinct points of contact. I know it’s a pain to remember to post when you’re in the middle of a busy service, but there are tons of third-party apps that will let you schedule updates in advance. You’ll be able to load up all your content and schedule distribution in one shot!

Once you have content, it’s easy to link all your accounts and blast a single message across all platforms with the push of a button. The only problem is that a photo on Instagram doesn’t necessarily read well on Twitter and a post on Twitter is often inappropriate for Facebook. Every social media platform has a unique language, so be sure you understand the messaging capabilities of each before you cross-populate all your profiles with the same post. Tailoring your messaging to each platform also gives your followers variation so they don’t get bored from redundant information. If you’re posting the same thing on Twitter, Facebook and Instagram there is no reason for me to follow you on all three. Give me a reason!

Now that you’re crafting an effective social media plan, be sure your content is relevant to your brand. That’s my nice way of begging you to maintain separation between business and personal! I absolutely support your right to blab about your political views but please keep them off your company accounts unless they directly relate to your business and accurately reflect your entire organization’s opinion. The same goes for vacation photos, birthday parties, graduations and the like. If it reinforces your brand, go for it! Otherwise, leave it on your personal page.

When I follow a restaurant on social media, I expect content about their food. So why on Earth would you post stock photos instead of your own dishes? I know this sounds crazy, but I recently had to point it out to a pizzeria on Instagram because they posted an image of pizza that looked nothing like their own –– it looked much worse!

You’re proud of your food and social media is the easiest way to remind your customers you exist with fun and informative updates. Just remember that delivering an appropriate message will lead directly to you delivering more pizzas.

Scott Wiener owns and operates Scott’s Pizza Tours in New York City.

The post Man on the Street: Socially Awkward appeared first on Pizza Today.

We’ve found five other significant reasons why employees chose to not stick around to make and serve your pizzas:

Work isn’t fun. It’s not possible to have fun all the time, but if work is a place employees dread going to, they’re likely to leave.

“People quit because the energy level and the excitement in the store is not something they look forward to,” says Al Newman, director of training for Hungry Howie’s Pizza in Madison Heights, Michigan, which has more than 550 restaurants in 20 states.

Charlotte, North Carolina-based Brixx Wood Fired Pizza runs occasional games or contests to bring fun to its 21 stores. The company rotates job functions for kitchen workers on slower days to keep things interesting and for cross-training purposes.

“Employees have fun when they are succeeding and it is our job to make sure they have what they need to succeed,” says managing partner Jeff Van Dyke. It’s so important to have fun that at Nick’s Pizza & Pub in Crystal Lake, Illinois, it’s one of the core values. “We create an environment of team work, which relieves stress,” says owner Nick Sarillo, who also penned the book A Slice of the Pie: How to Build a Big Little Business. “We have games and contests every night and big celebrations when someone accomplishes something positive,” he says.

Ensuring your employees have fun is pretty easy, says Larry Vivola, owner of Inline Business Advisors, a business coaching company based in Phoenix, Arizona. “Have contests, themed days at work — favorite sports jersey day, Halloween in July, etc.,” he says. “This makes work fun, plus engages the customers and fosters more conversation.”

Employees are poorly trained.

“When employees are not trained properly they don’t feel good about the job they’re doing and feel incompetent,” explains Vivola.

If all employees are thoroughly trained it’s easier for everyone to work together since they’re all on the same page and all pulling their weight, says Joe Liguori, owner of four-unit Pizzeria Valdiano, in Winter Park, Florida. “It makes sure everyone is working as a team and creates a positive work environment,” he says.

Nick’s Pizza & Pub is very thorough with its training. New hires have a two-hour sit down with a trainer before starting work and they receive a package that spells out the company’s expectations of them. And finally, they work with a trainer until the trainer believes they’re ready to work on their own.

Managers at Nick’s also talk with new hires at the end of each training shift about what they think went well, what they could have done better. “What is essential about this first step is that it builds a relationship right from the start,” Sarillo says.

Failure to train your staff undermines their personal security and delivers a message that they are not very important to the success of your organization,” says Bill Marvin, a restaurant consultant based in Gig Harbor, Washington. “If you don’t care, why should they?”

Employees feel unappreciated. In the fast pace of pizza restaurants it’s easy to focus on what employees are doing wrong, but that’s a mistake.

Managers at Brixx are proactive about showing their appreciation of workers. “We ask them to keep score every day to make sure they positively enforce each employee once or twice,” says Van Dyke. “So they have a little scorecard and when they catch an employee doing something they like, they praise them, preferably in front of everyone, and put a check mark privately on their card. I think that goes a long way.”

Nick’s Pizza & Pub celebrates the little behaviors every day. “What motivates (employees) is the recognition from myself and the leaders,” Sarillo says. “It’s a high-five, it’s verbal recognition in the moment, focusing on the positive.”

“Notice even the small things your employees do,” says Marvin. “As a
manager you don’t manage people; you inspire people. If nothing else, your job is to be a cheerleader.”

Poor communication from management. You have to communicate with your employees in the way that most resonates with them and Newman has found that most of Hungry Howie’s workers are in the Generation Y age group.

“They don’t like long drawn-out processes for communication,” Newman says. “They like it short and sweet and to the point.” Another aspect of Generation Y employees is that they need feedback, reassurance and recognition regularly. “But they’re often not getting it because Baby Boomer bosses think they want them to be hands-off,” Newman says.

Hungry Howie’s will give recognition verbally in the moment, in a team meeting, or mention employees in a blog or newsletter. “And when we award monthly bonuses, we perform presentations in front of the entire management team,” Newman says.

But simply communicating — actually talking to your employees — is the most important thing, since it makes them feel important and involved in your company, says Marvin.

“We ask our leaders to be coaches not cops,” says Sarillo. He also asks his managers to provide direct feedback during shifts. “We are coaching in the moment and giving feedback,” he adds. “There’s no need for annual reviews when everyone knows where they are with their performance every day.”

Not fitting in. Working with people you don’t get along with can really be a drag. And if your employees are unhappy with their colleagues, they’re going to look for another opportunity. So what’s vital, says Van Dyke, is that owners and managers hire the right personalities for the right jobs. At least two Brixx managers interview job candidates and often an hourly worker will meet them too, “which gives a broader picture of that candidate,” Van Dyke explains.

The right personality is the most important thing to look for during the interview, says Newman. “It’s not so much about skills because you can train skills.” And to make it fair for all candidates, Hungry Howie’s has a list of standardized interview questions to follow.

Sarillo takes a different tack: “We interview for value alignment — do they align with our values because those are the personalities we are looking for. That means they also align with the other employees — they all have similar belief systems.”

There’s a simple way to ensure employees will fit in, Vivola says: “Make sure that team members are part of the hiring process, since the current staff now has a vested interest in the new hire working out.”

Amanda Baltazar is a freelance writer in Anacortes, Washington

The post Why Employees Quit appeared first on Pizza Today.

Nearly 80 percent of U.S. pizzerias offer delivery. What does delivery mean to you as an operator?
a) An additional avenue of revenue?
b) A selling proposition?
c) A daily challenge of overseeing drivers and deliveries?
d) All of the above

You probably answered “d.” Today’s diners regard pizza and delivery as going hand-in-hand. Many of our patrons echo the sentiments of Tiger Woods: “And I don’t cook, either. Not as long as they still deliver pizza.” Thus, more than 1 billion pizzas are delivered each year and every single one of them is transported to its destination in an unpretentious yet precisely designed cardboard box or bag.

King Umberto and Queen Margherita had the privilege of getting the first known pizza delivered in 1889. Raffaele Esposito, the most famous pizzaiolo in Naples, Italy, made a pizza honoring the Queen and offered it to her. It was a hit. Imagine the scenario. How do you think Raffaele presented the pizza to royalty? How did he present himself? If we assume the pride and diligence of Raffaele then we will have a marketable delivery service to offer.

Pizza came to North America with the arrival of Italian immigrants in the late 19th century, but did not gain popularity until mid-20th century. At that time men returning from WWII created a demand for pizza and the advent of the car culture impacted the retail industry. Enter Tom Monaghan. This American entrepreneur saw a need and an opportunity. Monaghan, founder of Domino’s Pizza, is commonly credited with establishing pizza delivery as a profitable enterprise. Domino’s Pizza used this marketing strategy to become one of the fastest growing franchises in history simply by positioning themselves as the delivery experts. “Free pizza delivery” and Domino’s Pizza became synonymous. In fact, their entire business was initially fueled by the slogan: “Fresh, hot pizza delivered in 30 minutes or less, guaranteed.” With the nation watching, other pizza store owners discovered that it was essential to incorporate delivery as an important marketing tactic. Soon, nearly every pizzeria offered free delivery.

With rising energy costs over the last two decades, a delivery charge was instituted throughout most of the industry to offset the rising costs associated with delivery service without raising menu prices across the board. Today, delivery is not an amenity, but a service rendered for a fee. Therefore it needs to have value in the eyes of the consumer to be marketable.

The value of delivery service is the convenience of being able to have fresh, hot pizza at your doorstep in a reasonable amount of time.

What Would Raffaele Do (WWRD)? Raffaele himself delivered his pizza to make the best possible representation of his craft. Today, pizzeria owners should ensure that drivers are properly trained, licensed and insured.

Follow a checklist before you send out someone to represent you in your neighborhood:

• Personal appearance is neat, clean and uniformed.
• Drivers and delivery equipment visibly marked with your logo.
• Vehicles are marked safe and well maintained. Having these things checked will keep your driver accountable to the public as he performs his duties. I feel there is a need and advantage to cross train drivers. Once they understand how products are made and packaged it will reduce deliveries with missing and mishandled items. This also empowers them with considerable knowledge of your product, enabling them to handle customer inquiries on home deliveries.

A few incidentals to optimize your delivery service:

• Flashlight –– reading house numbers at night.
• Pen –– essential for credit card payment.
• Street map –– getting lost is costly.
• Mobile phone –– considered necessary to contact the store or householder for clarification.

If you really want to go the extra mile, supply drivers with hospitality mints, parmesan cheese or red pepper packets or even doggie treats. A good driver will pick up signs from the householder and appropriately offer such items for that special touch of service.

Delivery service starts with the order placement. So WWRD? In 2013, Raffaele would have a POS designed for pizza and delivery. This will enhance and quicken the order-taking process. The order taker must have a working knowledge of the anticipated preparation and delivery time. If the time you quote customers is off, the result will be late deliveries and customer dissatisfaction. The order taker can additionally help expedite the delivery by asking customers to turn on the porch light, calling back and verifying late night orders and writing down special instructions for hard-to-find places. Meeting customers’ expectations keeps them calling.

An able pizzaiolo like Raffaele will put effort into finding the right packaging for his pizza so that it is properly supported and vented during transport. Boxes, bags and delivery pouches are vital to the home presentation and must provide strength, heat retention, and product protection.

Your POS makes it easy to obtain statistical information on your staff’s performance such as the number of late deliveries, out-the-door time and on-the-road time. Be proactive and monitor delivery service so you can make corrections to badly quoted ready times, kitchen inefficiency or under-performing drivers. Things we can’t control, such as weather or traffic, can generally be handled with patience and honesty in dealing with the customer on the initial call. You’ll increase productivity and efficiency while cutting down on waste and redundancy. That means better customer service and more money in your register.

Problem on delivery? Item missing or pizza smashed? WWRD? Handle it immediately. A replacement item with due apologies should go to the customer’s house with the very next delivery run. If no orders are ready or all the drivers are out, delivering it yourself will show the customer how much you care.

Delivery can be a profitable venture for you. First, remember that it is a service to your customers and do all you can to make it a positive experience. This is a service created by customer demand. Look for opportunities to market your delivery service. Late-night delivery service, hotel deliveries that include silverware and napkins, New Year’s Eve and events where people are glued to the TV are but a few times that you can underscore the consumer benefits of delivery.

Scott Anthony is Fox’s Pizza Den franchisee in Punxsutawney, Pennsylvania, and a marketing consultant in the pizza industry. He is a frequent guest speaker at Pizza Expo.

The post Delivery as a marketable service appeared first on Pizza Today.

Explore how to make a 20 percent profit margin

I recently learned that a profit margin of 7 percent is the average for the pizzeria industry. So, for every dollar in sales, only seven cents is left over to take home as profit. This means for every $10 pizza I sell, I should only get to keep 70 cents.

My first thought was: This must be wrong. Who gets out of bed early in the morning, goes in and makes dough, makes pizza all day long, deals with customer complaints, employee issues, equipment breakdowns, taxes and regulations, all while working until close with the ever-looming fear of a random lawsuit, just to take home a mere 7 percent profit?

I just could not come to terms with this figure. If this statistic holds true, it means that a typical pizzeria that is doing $10,000 in sales per week for $520,000 in annual sales will only generate $36,400 in profit. Wow, my mid-level managers make more than that!

I had a pretty good grasp of my profit margin already, as I do the majority of my bookkeeping myself.

But I wanted to be sure. So I sat down and recalculated my profit margin, then double-checked triple-checked. Obviously, I am making a mistake in my math somewhere, I thought to myself. My numbers can’t be right. 

But after verifying all of my math and numbers, my original estimate of my profit margin was verified: 20 percent. That’s correct, my pizzerias generate an average of 20 percent in profit.

My small-town carryout-only pizzeria with sales of $286,000 makes more than 20 percent in profit. My small-town dine-in, delivery and carryout pizzeria with sales of more than $700,000 makes a profit in the high teens. And my newest location, which is primarily a full-service pizzeria with sales topping a million per year, makes well over 20 percent in profits.

Keep in mind that, even though my pizzerias are generating over 20 percent in profit, I am not taking home 20 percent in income. Taxes, debt service and business reinvestment eat up a portion of those profits. But I am certainly keeping a bigger piece of the “pie” than most operators. So, what am I doing differently? And can every operator knock down 20% profit?

One of the first things that I did was to reach out to my colleagues in the pizza industry to see what they are achieving profit-wise. What I found was that the 20 percent profit margin was not unique to me. Many other operators are successfully operating near or above that mark. Operators I asked from Ohio, California, Washington and Alabama were having similar success. At the same time, however, I found that many operators I would have expected to be largely profitable were barely making a profit at all, or were just breaking even. After a good solid comparison and contrast review, I was able to identify these common denominators of high-profit margin operations.

Build Your Business Backwards

Much as solving a maze puzzle by starting at the end is easier than starting at the beginning, I prefer to start at the end of a business rather than the beginning. I always start with the amount of money that I want to make, and then move back to fixed costs, variable costs and sales numbers. By knowing the amount of profit I want, I can determine the amount of sales that I need. I am then able to tailor my menu to the food cost percentage that I need, not the other way around. I know how much I can spend in labor dollars before I even open my doors.

Location, Location, Location

The old cliché rings very true when trying to engineer profit. Having enough potential customers available, having a need and want for your concept in the community, and having low fixed costs are all part of the recipe for profit. A small Midwestern town of 20,000 people can have a higher profit potential that trying to shoehorn another pizzeria into New York or San Francisco, even though there are millions of potential customers.

Systems

Each one of my pizzerias is built to run 100 percent without me in the picture. I could disappear off the planet and my staff would probably not notice, except on payday. I built my systems so that every single task has a procedure, checklist, recipe or some other guide in place to explain how, why and when to do it. When your staff know how and why to do something, you can usually count on them to produce.

Outside the Box

Just about everything that I do is outside the box. My marketing budget is zero, so anything that I spend on marketing is over-budget. Most, if not all, of my marketing is completely nontraditional. I spend virtually no money on radio, newspaper or direct mail. My objective is to make people talk about me. Word of mouth is the most powerful marketing tool and you don’t get word of mouth by running coupons in the newspaper. My marketing strategy can be summed up by paraphrasing a popular saying: “ I don’t care what people think, as long as they think about me.” However, I hope they usually think good things.

I Don’t Care

I do things the way that I want and I don’t care what anyone thinks. I do it my way. I choose to lead rather than follow. Everyone is usually certain that I will soon be going out of business because of the way that I do things. They have been telling me this for the 17 years that I have been in business for myself. I still get the random email, phone call or letter from another local business owner expressing concern for the way that I operate my business and giving me some advice on how to keep my doors open. I don’t care what they think. I do it my way and it works.

Michael Shepherd is a four-time World Pizza Champion who owns and operates three unique brick oven-style pizzerias in Northwest Ohio. Over the past 17 years he has grown his small-town locations into a multi-million-dollar company.

This Pizza Expo Exclusive is part of a continuing series leading up to the International Pizza Expo at the Las Vegas Convention Center. Seminar speakers and demonstrators provide professional advice on their area of expertise.

To Learn more about International Pizza Expo, visit www.pizzaexpo.com.

The post I Make a 20 Percent Profit Margin, and So Can You appeared first on Pizza Today.

In both distance and mindset, Grand Forks, North Dakota, is far from the dreamy-eyed, tech-charged ways of Silicon Valley.

This reality does not escape Tyler Kuenzel.

“There’s a lag in technology in North Dakota and it takes a while for something to move to adoption,” says Kuenzel, co-owner of Deek’s Pizza, an 18-year-old concept with locations in Grand Forks and Fargo. “Even so, that doesn’t deter us from trying to be ahead of the curve with technology.”

To wit, Deek’s unveiled a smartphone app in late 2011 convinced the tool would boost sales and brand loyalty. “It’s another way for us to get orders into the system. Plus, it’s a great marketing tool; people look down and they see our logo,” Kuenzel says.

According to global research firm Nielsen, about 50 percent of U.S. mobile subscribers own a smartphone and an accelerating number of those folks rely on the device for everything from banking and driving directions to entertainment, shopping and dining.

For pizzerias, apps can be a cost-effective tool to stand out in a crowded marketplace and jumpstart sales.

“Having an app signals you’re a player in the market and ready to compete,” says Laura Gaudin, product manager for Revention, a Houston-based company that develops mobile apps and other restaurant management solutions.

Compared to Web sites, apps are more efficient, streamlined and easier to navigate on a smartphone. The most effective restaurant apps include:

a full menu with tempting photos alongside pricing; routinely updated specials, something that can be automated through a shop’s POS; location information, including a map; loyalty program link-in and payment functionality.

“If you’re missing any of these elements, you really need to ask yourself if you’re giving something of value to your customers,” Gaudin says. “You want to keep them with you rather than sending them to other sites, such as Yelp or GrubHub, where they’ll encounter different choices.”

Apps provide the customer greater control, result in more accurate fulfillment as orders typically travel from the smartphone directly to the kitchen, and, some data suggests, encourage higher tickets since the customer sees images of the food, has time to review the menu and pays with plastic rather than out-of-pocket cash.

Such benefits led Shawn Randazzo to launch a mobile app for the Detroit Style Pizza Company in mid-2012.

“We’re not answering phones, but making pizzas, and our customers can explore the menu and browse every category. No one’s feeling rushed,” says Randazzo, the 2012 International Pizza Expo World Champion Pizza Maker who oversees three Detroit Style locations in metro Detroit.

Before starting the app-development process, Scott Hirsch, CEO of Appsbar, a free app-building tool, says operators must ask themselves if the app will meet the basic needs of the business. In the pizzeria world, apps are most appropriate for carryout and delivery spots where guests utilize advance ordering.

“At the end of the day, the app’s a business tool and it’s one that needs to make sense for your specific restaurant,” Hirsch reminds.

Many app developers charge a small fee to create the app (from $100 to well north of $10,000) and/or a monthly fee ranging from $10 to $100. Additional costs frequently apply to post the app on a distribution platform, such as the iPhone’s App Store or Android’s Google Play, while routine maintenance fees can heighten one’s investment.

Gaudin suggests operators ask app developers: What’s the all-in cost? “You need to know what this technology comes with. It’s easy to get hooked on price alone, but there’s more to it,” says Gaudin, adding that many restaurants employ the store’s online ordering provider to develop the app since there is significant carryover between the two services.

Hirsch, meanwhile, advises business owners to visit iTunes or Google Play to review a developer’s apps and ratings.

“Each business has it’s own intricacies, so you want any developer to understand your business, which is different than a dry cleaner or a car wash,” he says.

As online ordering continues gaining acceptance, apps are expected to gain significant traction, particularly since they can store payment information directly on the smartphone.

Currently, Randazzo’s three shops capture about 100 online orders each week, about 20 percent of those coming via the store’s app. He anticipates that number climbing and hopes online and app orders eventually represent 50 percent of company sales.

“Everyone has their phone in their hands these days, so those numbers are going to go up,” he says, adding that downloads of the Detroit Style Pizza app increased when the chain began touting the app on its homepage. “If we keep promoting it, we think it will keep growing.”

At Deek’s, Kuenzel believes app orders could follow the trajectory of the shop’s long-established online ordering platform, especially as Deek’s unleashes continued promotions to spur downloads. At first slow, Deek’s online orders graduated from a few each week to a few each day, soon notching month over month increases.

“Online’s progression gives us hope that apps will similarly take off,” Kuenzel says. “Our hope is that mobile app orders reach about 15 percent of our intake within the next two years.”

Operator-friendly apps
As intriguing as smartphone apps might be as a consumer friendly marketing tool, apps can also help operators run a more cost-efficient and profitable pizzeria. Notable apps include:

• GoPayment. By downloading this app onto a smartphone and then attaching the mobile card reader, restaurants can take secure credit card sales at off-site locations, such as festivals, sporting events or parades.
• Cashier Live. Like GoPayment, Cashier Live allows pizzerias to accept off-site payments via smartphones. Users can also run reports and manage inventory with this portable, web-based POS.
• MobileBiz Pro. This Android app allows restaurants to send invoices and create reports for sales, tax and profitability.
• Freshbox. The Freshbox app allows users to record the shelf life of goods and later pushes out reminders to use the products before expiration.
• Pair It! Wine-serving pizzerias can point upselling-motivated servers – or thirsty patrons – to the Pair It! app, which features over 20,000 food and wine pairings.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post Why should a pizzeria launch a smart phone mobile app? appeared first on Pizza Today.

How well do your customers know you personally?

Last week, I witnessed an interesting conversation between two roommates in the Williamsburg section of Brooklyn. They were grumbling about a price hike at the local smoothie shop. Roommate No. 1 said: “They’re probably just taking advantage of the neighborhood’s growing popularity.” It was a fair –– and likely accurate –– observation. But far more interesting was the follow-up comment made by Roommate No. 2: “Yeah, and I wonder if it’s owned by someone local or if the money’s just going to some anonymous mega corporation in New Jersey.” I wasn’t shocked that 20-somethings in Brooklyn are more interested in supporting local businesses than they are in funding huge companies, but what excited me about the comment was that they seemed more willing to accept the price increase if they knew more about the identity of the smoothie shop’s owners.

It makes sense that we identify more with individual owners than we do with huge branded corporations. After all, most of the earliest pizzerias in the U.S. were named for their proprietors. Lombardi’s (Manhattan), Papa’s (Trenton), Totonno’s (Brooklyn) and Frank Pepe’s (New Haven) were all small businesses within their respective communities when they opened. It was easy to remember where Totonno’s pizzeria was located because there was just one Totonno in the neighborhood. We’re so accustomed to this naming structure that people often incorrectly make pizzeria sound possessive when they’re not even personal names to begin with (Mario Batali’s restaurant Otto in NYC is named for the Italian word for “eight” because it’s located on 8th Street, yet people often call it Otto’s.)

Just yesterday I was enjoying a black and white cookie at Amy’s Bread on Bleecker Street when I mentioned to the cashier that the cookie was iced in a unique way. She explained the reason for their diversion from tradition and told me that Amy herself was in the building if I had any more questions. I instantly felt that everything was in its right place, simply based on the presence of the owner. At one of my favorite pizzerias in Brooklyn, the owner is legendary for greeting every table and personally checking on his guests’ meals. Besides fixing problems the server may not have caught, he’s also giving his guests a chance to connect with the person behind the business. It’s such a powerful tool that almost every single one of his Yelp reviews mentions it.

Making yourself visible as an owner isn’t just about justifying price increases –– it’s about personally backing up every decision you make as a business that will directly affect your customers. It’s hard to compete with the ridiculous pricing and gigantic national ad campaigns of the big pizza chains, but independent pizzerias have the market cornered when it comes to personality. You’re not just a business –– you’re a member of your community with a name and a personality. Use that to your advantage because I’m far more interested in supporting a business when I know who stands behind it. n

Scott Wiener owns and operates Scott’s Pizza Tours in New York City.

The post Man on the Street: Cult of Personality appeared first on Pizza Today.

It exists — so what are you doing to make your workplace safe?

With all the attention bullying is getting these days, you’d think it would be easy for pizza restaurant operators to pick up on incidences of workplace bullying. But in fact, most bullying is very subtle, says conflict resolution specialist Tara Fishler, founder of Westchester, New York-based Customized Training Solutions. Consequently, bullies can often wreak their havoc unchecked; that is until the damage starts showing up in high turnover, absenteeism, declining morale and poor staff performance, she says.

Carmelo LaMotta, chef/owner of LaMotta’s Italian Restaurant & Pizzeria can attest to this. Located in Fort Myers, Florida, the family owned and operated restaurant has eight employees.

“We had a server who was a bit of a bully,” LaMotta recalls. “She was a nighttime closer, not even a manager, and she was having the staff do all the dirty work, tying them up while she waited on tables. We didn’t know anything about this because the new servers were afraid to complain.”

After several months, LaMotta noticed that some of his new staff was quitting. Others said they didn’t want to work with the server. He also discovered they didn’t seem to know the menu well. “They weren’t waiting tables but were instead kept busy folding napkins or cleaning bathrooms,” he explains. LaMotta investigated, confronted the bully and cut back her hours. Shortly thereafter, she quit.

Contributing to the issue of detection is that the bully’s targets are frequently reluctant to come forward out of fear of retaliation or looking like a complainer, explains Beverly Flaxington, principal of The Collaborative, a consulting firm based in Medfield, Massachusetts.
“The number-one reason is almost always a fear of losing their job,” she says. “This is why workplace bullying is so insidious. A person literally feels trapped. They feel abused and unhappy but may feel, for financial reasons, they don’t have other options. It’s especially hard to report bullying on a boss because the person may have to continue working for that individual.”

However, coming forward about bullying to those in a position to respond doesn’t necessarily assure action, Flaxington continues. In some cases, the bully’s behavior is minimized. Other times the person in charge might not know how to respond or may also be afraid of the bully. Companies may be concerned about the legal ramifications of admitting that bullying has taken place, or may be reluctant to lose a valuable employee. Consequently, says Flaxington, many times the desire not to confront the problem outweighs the desire to fix it.

But companies ignore bullying at their peril, says Kelly Kolb, an attorney with Buchanan Ingersoll Rooney. Kolb, who works out of his office in Fort Lauderdale, says bullying can pose particular dangers if the target is a member of a protected class, such as female, gay, older, person of color, or disabled.

“And many of these are the typical victims of bullying,” he says. “If the boss doesn’t respond, then the boss has a problem. Liability can arise from the fact that you know something is happening and you didn’t take action.”

Kolb says pizzeria operators should treat bullying as they would instances of sexual harassment, for example. “Take it seriously, investigate, interview people. Promise the victim there will be no retaliation, and then take appropriate action based on the outcome.”

He suggests employers “slightly tweak” their anti-discrimination and hostile workplace policies to include bullying, defining this as best they can. Flaxington advises developing a written “Code of Conduct,” or “Ground Rules,” outlining the appropriate workplace behavior.

LaMotta developed an employee handbook listing all the rules, regulations and duties, along with the grounds for being written up, which include bullying. He also installed a locked suggestion box —he has the only key — where employees can drop in notes about issues/concerns, along with ideas. The result has been greater harmony and productivity — “We’re like a family again,” he says.

Warding off bullying behavior requires creating an environment where employees can communicate and have conversations around their differences, says Fishler, since bullying often results from misunderstandings of cultural or personality differences or preferences. Fostering a sense of teamwork can also serve as a deterrent, she says.

This is the approach taken by Joey Bramwell, director of operations for Austin-based DoubleDave’s Pizzaworks. Staff “is taught to not only seek out ways to help their teammates, but to rotate difficult tasks so that no one shoulders any burdens alone,” says Bramwell, also owner of two DoubleDave’s franchises. “We also promote a positive-attitude environment in the kitchen while we work. If someone is disturbing that environment through any kind of negative behavior, we ask that they immediately correct their attitude or leave their shift.”

Bramwell says they train managers to stay aware of the task assignments daily to ensure even distribution of the workload. He also regularly checks in with individual crew members at his units about how they feel they’re being treated.

“Employees who feel bullied or picked on will not perform to their potential,” Bramwell says. “This creates a problem for the employee, the team that counts on their assistance, and ultimately the customer who visits our business.”

Pamela MIlls Senn is a freelance writer based in California. She specializes in business writing.

The post Workplace Bullying appeared first on Pizza Today.

And the delivery business, Mueller contends, is nothing but nuance and complexity.

While running delivery service looks easy to many, it remains a convoluted array of local, state and federal directives, including how drivers — who can be employees paid an hourly rate or tip-credited wages — are compensated, as well as how they are reimbursed for use of their own vehicle.

Adrian Sawyer, a San Francisco- based attorney with Kerr & Wagstaffe LLP who defends nationwide employment class actions, says there are various pitfalls to employing delivery drivers, including the requirement that employers report tips — a process simplified given the rise of credit card purchases and online ordering — as well as regulations in some states that prohibit an employer from applying tips toward a driver’s wage.

Further problems can arise if operations pay their drivers under the table or compensate drivers as independent contractors.

“You have to be careful drivers are being paid the appropriate amount or you can end up violating federal labor laws,” Sawyer says. “The balance here is complying with the law, which imposes significant burdens and requires attention to detail that isn’t readily apparent to everyone, while simultaneously controlling expenses and running a profitable business.”

Under federal law, restaurants are required to pay delivery drivers $2.13 per hour if they utilize the tip credit, though gratuities must push each driver over the $7.25 federal minimum wage. In the event that the $7.25 hourly rate is not met on a workweek basis, an employer must make up the difference.

For instance, an employer using the federal tip-credit rate of $2.13 per hour would pay his driver $31.95 for a 15-hour workweek; yet, that driver’s tips for the week would need to total $76.80 or more to ensure that the operator was meeting the minimum wage requirements ($7.25/hour) of the Fair Labor Standards Act (FLSA).

“If that driver only received $70 in tips, then the operator would need to add $6.80 to the pay period to meet federal requirements,”American Payroll Association (APA) Director of education and Training Jim Medlock explains, adding that many computerized payroll systems compute weekly minimums at the federal and state level to secure compliance.

In addition, Medlock reminds that drivers working more than 40 hours in a given workweek would also need to be compensated at the standard overtime rate of time-and-a-half.

Beyond driver wages and tips, there also remains the issue of reimbursing drivers for use of their own personal vehicles, a particularly thorny subject as fuel costs rise.

Operators can reimburse delivery drivers in one of three ways: mileage logs; a flat-rate policy; or to set the base pay high enough that the minimum wage will be covered even as expenses are accounted for on the paycheck.

According to the internal Revenue Service, the standard rate of driver reimbursement is 55 cents per mile, a tally that addresses fuel, repairs, insurance and automobile depreciation.

Mueller’s RPM Pizza reimburses its drivers by the mile and shifts the number on a weekly basis according to local gas prices from AAA and a third-party agency familiar with local mileage reimbursement rates for food delivery. he says clarity and transparency is key.

“You can’t just be tossing out arbitrary numbers,” Mueller says, adding that state restaurant associations can often direct operators to sound advice on local reimbursement rates. “Our drivers want to know how mileage rates are set and how they will be reimbursed… and appreciate that we’re doing our best to be fair.”

Rather than logging miles and compensating at a per mile rate, operators might set a flat rate for mileage reimbursement that considers the typical distance a driver travels for a delivery and the average tip he receives. A flat rate, Sawyer says, offers operators predictability and maintains fairness to employees.

“Involve drivers in this process, as they know how far they’re going and what they typically get for tips,” Sawyers says.

Furthermore, Sawyer suggests operators also have a policy in place for additional “unexpected” expenses, such as a flat tires or lockouts. While smaller operations might deal with unforeseen situations on an as- needed basis, larger chains might have a defined policy in an employee handbook.

“The idea here is clarity and predictability,” Sawyer says, noting that unpaid driver expenses could spark problems with FLSA compliance.

Finally, there is the lingering issue of delivery fees, which customers can easily — and mistakenly — confuse with a driver tip and, in doing so, bring unnecessary pressure upon operators. Sawyer suggests all pizzerias have a clear message on their menus, Web site, and receipt that details the difference between the delivery fee and the driver’s gratuity.

As one example, delivery kingpin Domino’s shares this message on its homepage: “Any Delivery Charge is not a tip paid to your driver. Please reward your driver for awesomeness.”

Compensating the cross-trained delivery driver

At nine-unit Colorado-based pizza chain Borriello Brothers, management considers drivers back-of-the- house staff who also deliver.

“Our drivers aren’t just drivers and we train them accordingly,” say Borriello Brothers Operations Specialist Adam Rickett. “They’re able to prep food, jump on the register, take phone orders, and so on.”

Rickett says cross-trained drivers builds operational cohesiveness and enhances customer service. For those benefits, however, such job swapping throughout a shift can also leave an operation susceptible to FLSA violations as the tip credit can only be applied to certain staff positions.

To avoid any errors, Borriello Brothers requires its staff to clock in and out for individual jobs. Though sometimes tedious, the APA’s Jim Medlock calls that practice the “safest way” to ensure appropriate employee compensation.

“In clocking in and out, operators know how many hours a staff member worked in different positions of the restaurant that have different pay rates,” Medlock says.

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

The post The Driver’s Paycheck appeared first on Pizza Today.

Within the first year, DiSilvestro had a revelation. Neither he nor his wife could maintain the breakneck pace. He promoted one of his delivery drivers, an entrepreneurial young man with promise and a responsible nature, to manager, asking the newly installed leader to motivate employees, enforce store policy, and learn all areas of the business.

“In the beginning, it was tough to let go, tough to let someone else close the store and make decisions, but … I had to trust,” says DiSilvestro, who still didn’t take a full day off until the store’s fifth year.

The decision to hire a manager was central to Ynot’s success then and now.

In 1996, the DiSilvestros opened a second location. In 2010, they opened a third. A fourth spot opened earlier this year. All locations have a general manager who oversees a team of operational managers (driver manager, server manager, counter manager, bar manager, and so on) and up to 80 staff members.

“These managers are in the trenches every day and their presence has freed me up to do big- picture thinking,” says DiSilvestro, who holds weekly meetings with his managerial team.

For many independent pizzeria owners, DiSilvestro’s early plight is a familiar one. The owner- operator model, though invigorating to some, can leave one wearied and absent the gusto to pursue new opportunities, a reality making a managerial hire an important — even critical — step as the business seeks growth and prosperity.

“As an owner-operator, you just can’t work all the hours,” says Adam Goldberg, who opened his first of five Fresh Brothers in southern California in June 2008. “If the business was going to go where we wanted it to go, we knew we’d have to bring someone into the store to give the daily tasks undivided attention.”

When hiring a manager, many owners insist on previous restaurant experience. Goldberg’s first managerial hire was a longtime server. Subsequent managers at Fresh Brothers have come from other front- and back- of-the-house positions at chains and independents. Jill Mather of Trifecta Management Group, a California- based agency that helps restaurant concepts maximize their operational efficiencies, sees benefits in experience on both fronts.

“Those from the independent climate often have a spirit of entrepreneurship and self-guided work history, while applicants from a corporate structure have experience reporting and responding to a higher up. The challenge is to then figure out what and who fits with your business,” says Mather, who recommends creating hypothetical scenarios and asking managerial applicants for their response.

Mather will also assess the longevity of one’s employment in previous positions. In Mather’s world, “job hoppers” lose points.

“You’re putting a lot of investment and responsibility into this individual’s hands,” she says. “You want to know that they’ll plug away at the work.”

DiSilvestro hires most of his managers from within, which not only allows him the opportunity to learn their character and show them growth opportunities in the business, but also grounds them in the Ynot system and culture.

Hiring from within “allows managers to learn in our trenches and understand what we’re about,” DiSilvestro says. While the owner will handle big-picture issues and financial decisions, the manager directs the operation’s daily tasks, being visible to both guests and team members throughout the shift to troubleshoot, lend a hand where necessary, coach staff, and promote restaurant opportunities, such as parties, fundraising, or catering.

Managers at Ynot, who can receive 401k contributions as well as health care, must be focused on details, treat others with respect, have a rapport with fellow staff members, and motivate the restaurant team. DiSilvestro leans on his various operational managers, most overseeing eight to 10 employees, to manage labor costs, uniform discipline, policy upkeep, and provide hands-on training for team members. He then wants the general manager to be a hands-on, jack-of-all- trades type able to jump in or delegate responsibility as needed.

“They’re cutting pizzas, walking the floor and filling beverages,” DiSilvestro says of his GMs. “When the store’s on fire, you need someone who can fill any position.”

Mather wants a manager to embrace what she terms the Four Fs: first, to demonstrate skills and communicate to team members what needs to be accomplished; firm, by enforcing rules and protocols without exceptions; fair, in treating team members as equals and not playing favorites; and flexible, in understanding the uniqueness of individual situations and respecting the lives and responsibilities staff have outside of the restaurant.

“You want managers to feel as if that restaurant is their own when they’re on duty,” says Mather. “You want them to share in your vision.”

Adds Goldberg, whose new managerial hires endure several weeks of training and a 90-day probationary period: “They need to know our heart, mind and temperament as well as they know our product. It needs to be a good fit because we’re going to lean on them to do the right thing.” u

Chicago-based writer Daniel P. Smith has covered business issues and best practices for a variety of trade publications, newspapers, and magazines.

WHAT TYPE OF MANAGER DO YOU NEED?

The general manager is a direct extension of the owner and, quite often, the key cog in a restaurant’s development. An excellent communicator and motivator, the GM is eager to train staff members and develop talent. Needing to write checks and maintain the restaurant’s numbers, the GM also possesses financial knowledge.

Operational managers oversee specific areas of the restaurant. A kitchen manager, for instance, is often a culinary-trained individual who understands quality standards and performs the hands-on kitchen work, including training and directing back-of-the-house staff. The kitchen manager monitors inventory, examines margins and handles the kitchen’s immediate and long-term tasks.

Similarly, operational managers in other areas of the pizzeria environment, such as the bar, delivery and customer service, possess the narrow job description, frontline experience, and know-how to direct employees in their specific area with complete focus and attention. Depending on the restaurant’s structure, operational managers report to the GM or owner.

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