And here’s why…
Macy Walp: In your article, Restaurants are so screwed, you talk about reducing your labor costs as a way to increase profit margins. What are some of the ways that you can do this without affecting your food or your service quality?
Joelle Parenteau: This all comes down to optimizing and, of course, you can only optimize so far before it starts to cause issues. But in our case, it was really just playing with the schedule to make sure that we had everybody we needed there during rush times and not too many people during slow afternoons. That is really key for us though, especially in Ottowa here, where weather can have a great impact. Oh, it’s a polar vortex one day and no one came in but you still have people on schedule.
So a lot of that just comes from starting to know your patterns and scheduling appropriately. The other part of that is cross-training your staff so that you only think you minimize the amount of people you need and make sure they’re efficient. Can we get three people on the line to do what four people used to do?
You can only take that so far before you crush your staff. It’s a give and take and you really need to find the balance and not compromise too much.
Macy Walp: Back to that article again, the key takeaway from this first article was: people should be paying adequately for restaurant meals but competition tends to drive these prices so low, staying alive as a restaurant owner is a challenge. How can a restaurant maintain healthy margins without losing out to competition?
Joelle Parenteau: The easy answer to that is to differentiate and to provide undeniable value. In Ottowa, well for right now, we are the only doner shop in town, which helps, but people love the brand and they love the quality.
They tell us they see the value there. It’s a big sandwich. It’s a full meal. You need to make sure that you have that value and then the value equation makes sense, or else you don’t have a business. At the end of the day, if you can’t charge what you need to make a living then that’s just not a good business model.
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Macy Walp: Third-party delivery platforms have received some negative backlash over the past few months, but many understand that these platforms can help a restaurant keep their doors open. What are some of the key benefits to third-party online ordering platforms?
Joelle Parenteau: They’ve been huge for us, we are doing 75% of our orders online, and what we did, the key to making the business model makes sense, is that you have to adjust your pricing.
So yes, they do take 30%. That’s what it costs for them to actually make that happen, to bring doner from your store to your hungry customer, it doesn’t just happen with the flick of the wrist.
The value for us is that we instantly have a delivery team that comes within three minutes any time, any day. They also introduced us to thousands of new customers and for our loyal customers that maybe can’t get to us all the time, it’s more convenient.
You know, our store is not the most convenient location. It’s in Center Town. There’s no parking, customers have kids at home. They’re busy. They want to eat at their desk while they’re still working. There’s a thousand reasons maybe our customers are not able to come in to see us, but they can just go on Uber and pay a little bit more and get it delivered right to them. And that’s what they want. Who am I to say “No, I don’t like Uber, so you don’t have that option. You have to come to me”. That’s kind of where I think the discussions are really strange to me right now.
I keep hearing these business owners saying “no, order on my website and come and get it because that’s what’s better for me as a restaurant owner”. What point did this become what’s better for us versus what our customers actually want? If they want to order delivery, I say: okay it costs a little bit more, did you still want it?
They always say yes, so who am I to not give them that option?
It’s been extremely profitable for us now that we’ve adjusted our prices and it’s actually really what’s keeping our sales going right now.