Take These 3 Steps to Survive An Unusual Hospitality Holiday Season

The holiday season is usually full of family, friends, and fun—and a lot of profitability for the restaurant industry. In fact, a survey of small business owners found that 47% of restaurants enjoy the most profitability during Q4.

But as we know, 2020 is a year unlike any other, so the holidays are bound to be a bit different than what we’re all used to. Restaurants that are already trying to find ways to cut food costs and optimize efficiency with reduced opportunities for revenue are now asking themselves: How do we thrive during this holiday season?

xtraCHEF has you covered. In this three-step planning guide, we’ll explore the considerations for restaurant owners, managers, and operators who want to survive the holidays and bring joy to customers—and business balance sheets!

Step 1: Benchmark past holiday performance against your current reality

All restaurants are different, and so are the circumstances those businesses may find themselves in this holiday season. In order to assess what is and isn’t realistic this year, first consider how different life is now than it is during a typical holiday season.

Consideration 1: COVID-19

COVID-19 is possibly the biggest factor in holiday planning for 2020. You must contend with a customer base who might be frightened to dine inside, a potential lack of corporate parties, and groups celebrating in smaller numbers to maintain social distance.

Think about the current restrictions in your city and state and how they compare to local opinion about the pandemic. If you’ve been operating at almost full capacity for a while now and customers have been dining in with you frequently, then you may not see much of a change in holiday revenue.

Consideration 2: Weather

COVID-related closures and attitudes toward dining are further complicated by the chilly weather that accompanies the holidays for a significant chunk of the U.S. restaurant industry. Opportunities to expand dining to the outdoors are shrinking, and not every operator will and not every operator will have the free capital to invest in heat lamps or weatherproof coverings.

Restaurants in the South and West likely will not have to think about cold weather; in fact, temperatures may become more appealing to diners who wish to eat outside. But cooler climates, like those on the East Coast or in the upper Midwest, need to think realistically about their capacity when weather becomes inclement.

Consideration 3: Dine-In vs. delivery

Your local weather and pandemic guidelines will have a big impact on your approach to dining methods. Should you focus on the in-house experience or pivot to off-premise options?

For example, if you operate a restaurant in Philadelphia, you’re still not able to open your dining room to full capacity—and even if you have outdoor space, gloomy winter days have already crept into the forecast. You should expand takeout and delivery options for the holidays to make up for that gap.

But in Florida, where humidity has dropped and pandemic-related restrictions have all but ended, restaurant operators may be able to focus on holiday plans as they would any other year. Operators may choose to move forward with off-premise options, but they likely won’t be as vital to success in Q4.

Set realistic expectations

Once you’ve assessed the operating landscape for this holiday season, revisit last year’s performance. How many factors, if any, have changed?

Use this to determine if it’s feasible to expect more, less, or about the same revenue as last year based on your usual holiday approach. You may even choose to use a flexible budgets and forecasting solution to get a better idea of where you’ll stand during and after the holidays.

Step 2: Uncover unique opportunities for revenue

Even if you’re not forecasting a loss in revenue this holiday season, why say no to an opportunity to make even more money? Even if customers can’t come to your restaurants in droves as they used to, they’ll still be ready to celebrate. Meet their needs with these unique revenue-generating opportunities during the holiday season.

Opportunity 1: Special menus

Thanksgiving turkey with cranberry sauce and plenty of sides to go around. Honey-glazed ham with eggnog for dessert. Latkes, latkes, and more latkes—served with applesauce, of course. The holidays have different food associations for everyone. Make sure the needs of your customers are met with what they want to eat!

Offer special holiday menus to give individuals, couples, families, and friends the comfort foods they crave this time of year. If you’ve offered special menus like this at your restaurant before, consider how they performed in the past to decide if you should retain the same menu or make some adjustments.

Use recipe management software to easily and accurately build your special menus so you know exactly how much each item costs to make—including its takeout packaging. Recipe management tools save a significant amount of time from manual plate cost calculations and tell you exactly what your break-even point is so you can price every item to be profitable.

Go one step further and offer specialty holiday items, like panettone or sufganiyah, that customers can add onto their holiday meals or order individually. These foods hold special significance this time of year, but a lot of customers might not have the time, know-how, or desire to make them themselves. Give them the opportunity to buy from you instead of a big-box grocery store!

Opportunity 2: Offsite catering

While we’re talking about the lack of time or desire to do holiday cooking, we have to bring up catering. If you’ve never offered catering before, now would be a great time to start: a survey from U.S. Foods and Technomic showed that 31% of consumers expect to order from a restaurant for “significant” holiday meals.

Adapt your saved recipes for larger yield so you can easily make family-sized portions of your regular or special holiday menus. Explore offering family meals sized for 4-6 people instead of 10 or more to reflect the smaller gatherings that are anticipated across the country. Recipe management solutions are immensely helpful in catering to help maintain consistent flavor and retain those margins.

Take another step toward controlling the cost of catered meals by using a procurement tool to make sure you’re getting the best prices available from your vendors. Track how they’ve changed the price of ingredients over time to make sure you aren’t getting overcharged and to make sure you’re making the most profit possible on each menu item.

Opportunity 3: Marketing and promotions

When you set your holiday menus and special items, make sure that they get in front of the right eyes! After all, you can’t generate revenue if no one is ordering your food. At the very least, use platforms like your Google MyBusiness and social media pages to promote the new items. These free tools are an absolute must to spread the word about your restaurant, now and every other quarter.

Consider reaching out directly to your regular customers or customers who have come to you during past holidays to give them a heads up about what’s coming this holiday season. You may even choose to give them a small discount if they order a holiday item by a certain date, or even if they promote your menu on their personal social media channels.

If this sounds like marketing 101 to you, know that there are plenty of other ways to promote your restaurant and expand your reach! Solutions like Lunchbox help restaurants with digital marketing outreach and growth hacking tools to bring in brand new business while redirecting orders from third party delivery platforms into a restaurant’s native ordering app.

As an additional boost to revenue, promote gift card sales during the holidays! They generate immediate cash flow, boost brand visibility, expand your customer base, and encourage repeat visits from customers.

Step 3: Staff up smart and celebrate your team

With your menu set and your promotions plan in place, it’s time to assess what that means for staffing. Focusing mostly on off-premise meals? You won’t need much front of house staff. Preparing for big indoor parties? You’ll want to staff the way you usually would during the holidays.

Tip 1: Streamline scheduling for success

Restaurants that are preparing to expand off-premise ordering while maintaining full capacity onsite must ensure there are no hiccups in the schedule so orders can be completed quickly and correctly.

Consider a tool like 7shifts to simplify scheduling and reduce your labor costs! Their platform gives you each employee’s availability along with templates for recurring schedules so you can ensure your restaurant is never under-staffed.

Tip 2: Implement on-demand staffing for flexibility

If regular staffing is a struggle in your market due to labor shortages, or if you simply don’t have enough information to determine what your short-term staffing needs are, look into an on-demand staffing solution like Qwick.

The service provides staffing on an as-needed basis in select markets across the U.S. Each person on the Qwick platform has had their experience vetted through face-to-face meetings so you can rest easy knowing the people coming into your restaurant already know what they’re doing.

Tip 3: Show your appreciation

When the holiday season ends, don’t forget to thank the people who helped you get through it! Even if you can’t throw a party—whether that’s due to social distancing or budget—make sure your employees know they’re valued at the end of the day.

Consider something like a gift card exchange with another local restaurant so the staff members at both businesses can get something special without a lot of upfront cost for you or the other business owner. Something small like this can go a long way in retaining staff.

Take control of food and labor costs year-round with xtraCHEF

Become more profitable any time of year with xtraCHEF! Restaurants of all sizes and service levels use our industry-leading AP Management to fuel productivity and make more informed purchasing decisions. Food cost management reporting and analytics make it easy for operators to make sense of their books and shave percentage points off their prime costs.

Request a demo with one of our Product Specialists and see why people like Brian Keefe from Okay, Cool Hospitality recommend our software to “every restaurant in the country.” We can’t wait to hear from you!