OpenTable was fortunate enough to be a media sponsor for the Golden Gate Restaurant Association’s Industry Conference in San Francisco, where we heard from industry leaders on the state of the SF restaurant industry today. We learned about a range of topics including tipping, how the fast-casual category is here to stay, and the importance of branding at your restaurant. Below, five myths that were busted during the two days of the conference.
Myth #1: No one wants to work for a tipless restaurant.
Sabato Sagaria of Union Square Hospitality Group, the restaurant group that is most well-known for eliminating tipping, shed some light on the effect that the big decision had on staffing. Contrary to popular belief, eliminating tipping boosted demand for a spot to work at e of USHG’s restaurants.
“The Modern saw a 250% increase in back of house applications, and 200% increase in the front of house applications,” he said. At USHG, they “view hospitality as a team sport,” as they collectively work towards the same goal.
Thad Vogler of Trou Normand shared that he didn’t have as much luck with staff support: as soon as he implemented no tipping at Trou Normand, they experienced high turnover for lower-level staff. “You really had to be a place where people wanted to work.” said Vogler. He and his team decided to revert back to tipping only two days before Danny Meyer made the decision to go in the opposite direction at USHG’s The Modern.
The recent success that USHG has seen as a result of removing tipping may be an indicator of bigger changes to come.
Myth #2: Great employees have classic training and experience.
Russ Stein and his wife, both of whom are deaf, own Mozzeria restaurant in San Francisco and have made the decision to hire an entirely deaf staff. They understand the value of tapping into a group that may not otherwise get the chance to work at a restaurant. According to Stein, once he trains the staff he believes that they are more loyal because their opportunities to work elsewhere are limited. (He shared that about 60 to70% of deaf people are unemployed.)
Cala, the new SF restaurant owned and operated by Mexico City chef Gabriela Cámara, has a staff that is made up of almost 70% previously convicted individuals. General Manager Emma Rosenbush had worked at the Prison Law Office in Berkeley and then traveled down to Mexico City on a whim to open a pop-up restaurant with friends, which is where she was introduced to the restaurant industry. She saw an opportunity to take advantage of this group of people who really needed work but were having a hard time finding jobs. Similar to Stein, Rosenbush has learned that as a result of restricted opportunity, the staff they eventually hired at Cala has proven to be very loyal.
In both instances, the opportunity presented to these populations that have less opportunity to work results in a staff that is more eager to learn and loyal to the restaurant, further reducing turnover rates.
Myth #3: Restaurant staffing is doomed.
Gwyneth Borden, Executive Director of the Golden Gate Restaurant Association, gave audiences perspective on the state of staffing. “Nationally, the restaurant industry continues to be one of the strongest job creators in the economy, adding jobs at a 3.2-percent rate in 2015, which was more than a full percentage point above the 2.1-percent gain in total U.S. employment.”
Although restaurateurs are quick to note that staffing is among their top business challenges, Borden’s presentation demonstrated how many jobs the industry is still able to provide. She dug further into the data, giving supporting evidence for why this staffing need continues to grow: “According to credit-card data collected by First Data Corp, in San Francisco restaurant sales grew 6.6 percent in 2015, which was higher than 2014’s sales growth, which was 5.4-percent.”
Considering that so many restaurateurs point to staffing as one of their challenges, it was encouraging to hear evidence for favorable industry staffing conditions.
Myth #4: Hiring a PR agency is all you need to do to generate press.
Public relations agencies can garner extra attention and entice diners into the restaurant, but how do you continue to feed that buzz once the diner is there? Lisa Nourse, PR and strategy consultant for restaurants, encourages authenticity of brand throughout the restaurant. “A restaurant is a restaurant, but a brand is a story,” she said. “It’s important to establish that story right out of the gate. This includes everything from your restaurant values down to your menu paper.”
Although Nourse and similar agencies can bring value to your restaurant, hiring a PR agency doesn’t mean they should do all the work for you. According to Nourse, you should be proactive and partner with your agency to get the most out of it. “Know what you want to get out of your PR before you decide how to execute press and branding.”
Plus, buzz goes beyond PR. Think about bringing your chef to the forefront and utilizing your staff to represent your brand. Consultant Liz Subauste leaves brand presence to the people who know know it best. She said, “Empower your staff to be the face of your brand, from greeting diners to posting on social media.”
Myth #5: Restaurants fit into two categories: casual or formal.
The “fast casual” category seems to be gaining popularity and awareness, but what does it mean to the diner? Adriano Paganini, the man behind popular San Francisco spots Belga, Super Duper Burger, and Uno Dos Tacos, explains how the diner doesn’t think about a restaurant’s category; instead, they think about what they’re hungry for.
“The consumer isn’t looking to name the category, they’re looking to fill a need. What is the need of the customer?” He continued, “People want really good food at all times, not just at a fine dining restaurant.”
Restaurateurs speaking about the fast-casual movement were all aligned on the fact that in order for the restaurant to be profitable, they have to appeal to diners on more than one occasion. Charles Bilililes of fine casual SF restaurant Souvla draws the line: “A fine casual restaurant has got to be nice enough to bring a date to.”
Photo Credit: Top image courtesy of Alex Loscher; additional images by Gamma Nine