International Food and Beverage Management 

Case Study Analysis Template

1. Menu and Wine List Evaluation and Menu Engineering Principles.

1.1 Week #09 - Menu and Wine List Evaluation and Menu Engineering Principles

Issues Surrounding Star Items?

1. Star items which are highly popular and profitable on the menu but may not being adequately promoted and strategized to increase the profitability of
restaurant measures. The cause of this can be indicated in various ways. Firstly, the dishes aren’t potentially being positioned in high visible places
within the menu, hence not exposing it to customers to maximise profitability.
2. The dish specifications, presentation or portion size aren’t consistent which is causing this item to lower is profitability and popularity.
3. Potential too many experiments and inconsistency
4. Too much drastic change in the ingredients of the dishes
5. Not enough promotion

Solutions Surrounding Star items?

1. First solution would be to maintain dishes in the context of presentations, specifications of quality and portion size. This will help with any causing or
existing inconsistency which are causing a detriment to these start items.
2. A second solution would be to position items within visible portions of the menu. The implications this will have is that it will allow for the item to
have more exposure and is research proven that by doing so; top right-hand corner of the menu, customers look at this region first. Therefore, position
such items which are profitable and popular here, will be necessary.
3. The last solution for lowered popularity or profitability of star items, would be to test the price elasticity of star items. Because they are popular, then
these menu items tend to have an inelastic price, therefore getting away with minimally raising prices of these items is still possible as people are likely
still going to buy the item. Especially within high seasons of customer demand and volume.
4. Another solution would be to promote the item regularly. Maybe the item is not promoted regularly enough to have the profitability maximised hence
increasing efforts surrounding this would help significantly.

Issues / what are Ploughorse Items?

1. The issues associated with menu items which are classified as Ploughorse, is that these items yield a low average CM, and a high MM, therefore these
items must me dealt with adequate solution to address this. Reasons needed to address this, is because these items are important to price conscious
customers.

Solutions Surrounding Ploughorse items?

1. The first solution would be to test for the price sensitivity. This is because testing to see if getting away with increasing the prices of these items
without getting customers attention, can help increase the profitability of these items due to the low CM but high MM it has.
2. A second solution would be to relocate the Ploughorse items in a position that is lower profile as this would indirectly discourage the sales of these
menu items and will help push the profitability of menu items which carry more popularity and profitability.
3. A third solution would be to limit the portion size and or replace ingredients of menu item which cheaper alternatives. This will help reduce the food
costs and hence increase the contribution margin.
4. Another solution would be to either combine Ploughorse items with other low cost items and sell this as a bundle and or package and secondly
determining the labour used to make the Ploughorse item. If its too high a solution would be to either increase prices or replace with a less labour
consuming item

Issues Surrounding Puzzle Items?

1. The issues surrounding puzzle items, is that although such items have a high level of C.M, they have a lower tendency to be popular.

Solutions Surrounding Puzzle items?

1. One solution for this item, would be to remove items that have categorised as puzzle. If an item isn’t popular and is taking up too many resources, this
would be a good action or response in dealing with this.
2. A second solution would be to position these items within locations which are higher profile. Since they do not have an element of popularity this
response would be helpful in increasing sales of the dish and would help the exposure of these items towards customers.
3. Another solution would be to limit and or decrease the selling price of these items. This is because since the item is relatively profitable and the
objective surrounds trying to sell more of items which categorise in this area, this would increase the volume of whilst not significantly impacting sales.
4. The last solution would be to use techniques surrounding mechanising. Bu having attractive displays, or having same prior to buying the item this will
help cover the high CM and increase popularity
Issues Surrounding Dog Items?

1. The issues surrounding dog items is that they have altogether a negative. They are unpopular and have a very low CM

Solutions Surrounding Dog items?

1. The solutions to address this include, removing these items completely from the menu as these item will just incur costs and be of an expense to the
organisation
2. Another solution would be to increase the prices of these items, in the hopes that it achieves the status of puzzle items. This would help the CM aspect
of the dish and potentially the popularity
3. A final solution to this classification, would be to continue to have the dishes of the dog item in stock however remove / not list this item on the menu.
This provides a solution as if customers desire the item they can still purchase it, however the restaurant isn’t pushing to sell the item due to the low
profitability

Issues with menu engineering

- Does not consider labour costs. For example, pizza might be a star item however, it may not consider the labour costs
- making pizza is a time-consuming process and cooking pizza is energy intense because a high oven temperature needs to be maintained throughout the
service period. In many cases pizza is also finished as the order is received into the kitchen so in addition to the preparation time it is labour intensive at
the time of sale requiring the restaurateur to plan labour levels accordingly
- Attaching a level of work output or productivity is time consuming, may vary over time or by staff member. Overhead may be averaged across each
menu item but this may be grossly inaccurate. Ignoring either of these has the potential to be very misleading as the following example suggests

Calculation Strategy / Process

 M enu Item s MM MM% MM Dish S P Dish D ish C M T otal Total T otal CM CM Classification
Category CP Sales Cost C ategory

Chicken 140 20% H 15.50 3.30 12.20 2170 462 1708 L PH

Quail 60 8.57 H 18.50 4.20 1 4. 30 1110 252 858 H STAR

Ribs of B eef 100 14.29 H 15.50 3.50 12 1550 450 1100 L PH

Duck 70 10 H 18.50 4.50 14 1295 315 980 H STAR

Pepper Steak 60 8.57 H 18.50 4.00 14.50 1110 240 870 H STAR

Fillet Steak 30 4.29 L 20.00 4.50 15.50 600 135 465 H PUZ

Seafo od 50 7.14 H 22.50 7.00 15.50 1125 350 775 H STAR

Barram undi 60 8.57 H 15.50 3.40 12.10 930 204 726 L PH

Pork 70 10 H 14.50 2.90 11.60 1015 203 812 L PH

Trout 30 4.29 L 22.50 5.25 17.25 675 157.50 517.50 H PUZ

Lam b Cutlets 30 4.29 L 20.00 4.50 15.50 600 135 465 H PUZ

Total 700 100 9276.50

Part 1

1. MM% relative frequency = MM item / total MM

2. MM category = H or L based on greater than or < > lower than average
3. Average = (100 / no. of items) x 0.70

1.
2. `Dish CM = SP – CP
3. Total sales = Dish 10SP x item MM
4. Total Cost = Dish CP x item MM
5. Total CM = Total sales – Total cost
6. Cm category = Dish CM is greater than or lower than average ; H or L
7. Average = Total CM / total MM
8. Classification = MM category + CM category

MM= Popularity in numbers

CM = Profitability

Read numbers from left to right

HL= Ploughorse

LH = Puzzle

HH = Star

LL= Dog

Week #10 - Staffing Issues in F&B Operations.

 2. Week #10 - Staffing Issues in F&B Operations.

Staff productivity calculations

If no job sharing is involved

1. Rostered time of staff = Number of staff x hours of shifts x 60

2. Standard times for servicing room + miscellaneous time x no. of rooms

Answer = Staff productivity = Time taken to clean rooms / rostered time of staff x 100

Example

Part A: A hotel has two wings, an east wing, and a west wing. Each wing has four ‘room service maids’ working
seven-hour shifts to service the rooms each day. The east wing has 40 standard rooms, 12 deluxe rooms and 5
suites. The west wing has 50 standard rooms and 10 deluxe rooms. The standard times for servicing rooms are as
follows: standard rooms 20 standard minutes, deluxe rooms 25 standard minutes, and suites 40 standard minutes.
In addition, an allowance of 5 minutes per room is given for any miscellaneous jobs, such as collecting extra items for
the room or dealing with customer requests. What is the productivity of the maids?

AVG WORKING HOURS = 4 X 7 = 28 ( X 60) =

= 1680

TIME SPENT ON THE WEST WING = 50 X 25 = 1250 10 X 30 = 300

= 1550

= 92.26

TIME SPENT ON THE EAST WING = 40 X 25 = 1000 12 X 30 = 360 5 X 45 = 225

= 1585

= 94.35

1. 4 x 7 x 60 = 1680
2. 40 x 25 = 1000
12 x 30 = 360
45 x 5 = 225
= 1585 / 1680

Answer = 94.35 east wing

50 x 25 = 1250
10 x 30 = 300
= 1550 / 1680

Answer = 92.26 West wing

Therefore, the east wing has a higher productivity than that of the west wing. However other factors maybe contribute to why west wing’s
productivity is lower than east wing. These include, conditions of the rooms; type of guest market or state of the room like how old compared to
how new the room maybe
Example 2

Part B: Imagine that one of the maids in the west wing wants to job-share with her partner, each working three
hours per day. Her colleagues have agreed to support her and will guarantee to service all the rooms in the west
wing to the same standard each day. If they succeed in doping this, how has it affected their productivity? In your
calculations, productivity should be expressed as a percentage. Also consider other factors that would most likely
contribute to an either high or low productivity of the room service maids

TIME SPENT ON THE WEST WING = 50 X 25 = 1250 10 X 30 = 300

= 1550

If job sharing is involved

1. Number of staff job sharing x split hours of job share

2. Subtracted Number of staff from job share x hours of shifts
3. Answer 1 + answer 2 x 60 = Rostered time of staff
4. Time taken to clean rooms for section / new rostered time of staff x 100

Part B: Imagine that one of the maids in the west wing wants to job-share with her partner, each working three
hours per day. Her colleagues have agreed to support her and will guarantee to service all the rooms in the west
wing to the same standard each day. If they succeed in doping this, how has it affected their productivity?
If job sharing is involved

1. 2x3=6
2. 3 x 7 = 21
3. 21 + 6 = 27
4. 27 x 60
= 1620
= 1550 / 1620

Therefore, following job sharing, productivity has increased and is better than the east wing. This is because through the act of job
sharing, 1 hour has been reduced hence increasing overall productivity

Elements of job design

1. What tasks are to be allocated?

- Task allocation (Dividing the task into smaller parts and is completed by a single person or a team)
Advantages: Faster learning, easier automation, reduces non productive work
Disadvantages: Leads to monotony, results in repetitive stress injuries, not robust, can redue flexibility

2. What is the best methods of performing each job?

- Method study or work measurements

Method study is a systematic examination of current ways of doing a job & then coming up with improved methods
to resolve the problems (setting up a table for dinner, servicing a guest room).

Work measurement (assessing the time taken to complete each part of the job). It helps to reduce the rate of
accidents, complaints & bottlenecks, and achieve productivity improvements.
 3. How long will it take and how many people will be needed?

4. How do we maintain job commitment?

Job rotation - involves staff members to change job roles with another staff member on a periodic basis. It would
reduce the level of monotony, offer job variety & flexibility. E.g. Room attendants to work in the linen room or
laundry. It helps to increase the task identity/skill, variety/autonomy, as staff involved in a wider range of work tasks.

Job enlargement - involves integration and expansion of tasks by increasing the number of complementary tasks
individual performs & reduces monotony. Staff making sandwiches on an assembly line is required to spread butter
AND place filling & salads would be enlarging their job. It can help increase task identity & skill variety by involving
the staff in the whole work task individually or within a group.

Job enrichment - involves the integration of tasks, responsibility & decision making. It needs to consider the
suitability of the job, financial& political implications. This helps in the development of individual. E.g. Getting room
attendants to check their own rooms.

Empowerment

means more than autonomy. It means giving staff responsibility to change how they do their jobs. It extends the
behavioural approach to job design & has 3 levels of empowerment.

• Suggestion involvement- Simply getting staff to make suggestions related to their work (see only suggestion,
not definitely adapting suggestions).

• Job involvement- Here staff are involved in altering the make up of their job with defined guidelines in terms
of resource implications & productivity levels (see here it is more definitive in their involvement).

• High involvement- Involving staff in the long-term planning & future direction of the business. Self-managed
teams (staff can define the problem, allocate resources & implement solutions).

Team work – staff, often with overlapping skills, collectively perform a defined task and have a high degree of
discretion over how they perform the task.

Flexible working- is becoming increasingly important. Whilst it is not always possible for staff members to work away
from F&B outlets, there are three main types of flexibilities to keep in mind:

5. What technology is available and how will it be used?

6. What are the environmental conditions of the workplace?

Reasons for job share

- Relative and innovative schedules can be designed to meet the needs of the job sharers and the department.
Job-sharing arrangements can be 50/50, 60/40 or any similar combination. The schedules may also overlap
 as needed or desired. For example, if an employee calls in sick, or has had a baby and needs a flexible
working arrangement.

Some examples of Ideas to motivate cleaning staff.

1. Provide flexible working arrangements ‘scheduling staff around their personal commitment.
2. Promote 2-way communication.
3. Provide staff uniforms, good quality equipment and materials.
4. Feedback on the standards of cleanliness, reward, and recognition for good work
5. Develop camaraderie among staff, possibility work in teams.
6. Get involved with his/her staff and organize social activities.
7. Gratitude

The reason as to why organisations would want to do this, is because training is expensive. So if an organisation has
a high turnover rate amongst their employee in cleaning related jobs, more expenses are going towards something
which could be prevented.

Week #06 - F&B Operations Quality Management.

Issue / cause of issue in the context of SERVQUAL
Tangibles (four items)

Tangibles. This dimension, which is defined as the physical appearance of facilities, equipment, staff, and written
materials. It translates to the restaurant’s interiors, the appearance and condition of the cutlery, tableware, and
uniform of the staff, the appearance and design of the menu, restaurant signage and advertisements (Zeithamal et
al., 2006). Tangibles are used by firms to convey image and signal quality (Zeithaml et al., 2006).

Examples include

1. Restaurant has modern-looking equipment

2. The physical facilities are visually appealing

3. Employees are neat appearing

4. Materials associated with the service are visually appealing

V1 - Visually attractive parking areas and building exteriors

V2 - Visually attractive dining area

V3 - Clean, neat and appropriately dressed staff

V4 - Restaurant’s decor typical to its image and price range

V5 - Easily readable menu

V6 - Visually attractive menu

V7 - Comfortable dining area

V8 - Clean rest rooms

V9 - Clean dining areas

V10 - Comfortable seats in the dining room

Reliability (five items)

is the ability to perform the promised service in a dependable and accurate manner. The service is performed
correctly on the first occasion, the accounting is correct, records are up to date and schedules are kept.

Examples include.

5. When the restaurant promises to do something by a certain time, it does so

6. When a customer has a problem, the restaurant shows a sincere interest in solving it

7. The restaurant performs the service right the first time

8. Services are provided at the time the restaurant promises to do

9. The records are error-free

V11 - Service at the promised time

V12 - Quick correction of wrong service

V13 - Dependable and consistent restaurant

V14 - Accurate bill

V15 - Error-free served order (food)

Responsiveness (four items)

the readiness and willingness of employees to help customers by providing prompt timely services, for example,
mailing a transaction slip immediately or setting up appointments quickly.

Examples include

10. Employees tell customers when services will be performed

11. Employees give prompt service to customers

12. Employees are willing to help customers

13. Employees are never too busy to respond to customer’s requests

V16 - Maintaining speed and quality of service during busy times

V17 - Provision of prompt service

V18 - Extra effort for handling special requests

Assurance (four items)

The knowledge and courtesy of employees and their ability to convey trust and confidence

Examples include

14. The behaviour of employees instil confidence in customers

15. Customers feel safe in their transactions

16. Employees are consistently courteous

17. Employees have the knowledge to answer customer’s questions

V19 - Employees can answer questions completely

V20 - Comfortable and confident feeling

V21 – Staff provide information about menu items, their ingredients, and

method of preparation

V22 - Feeling safe

V23 - Well-trained, competent, and experienced

Empathy (five items)

 the provision of caring, individualized attention to customers

Examples include:

18. Restaurant gives individual attention to the customer

19. Employees give personal attention to customers

20. Restaurant understands specifics needs of its customers

21. Restaurant has customer’s interest at heart

22. Operating hours are convenient to all customers

V25 - Employees provide individual attention

V26 - Special feeling

V27 - Anticipation of customers’ individual needs and wants

V28 - Sympathetic and reassuring employees

Service recovery methods

Compensatory responses

included (a) providing the retailer’s offering for free (gratis);

(b) offering the customer an immediate, on-the-spot discount; / replacing

(c) providing the customer with a coupon that would reduce the customer’s cost in a future exchange.

(d) providing a free upgrade to the customer (e.g., a better room); and

(e) providing free ancillary services (e.g., free use of the mini bar).

Apology responses

(a) Apologizing for bad service

(b) Allowing the customer to view perceived bad service as not a nom

Also ensuring that within the service recovery process, there is distributive, justice and procedural justice

Interactional justice: Was there consideration and empathy

A service guarantee is a marketing tool used to reduce consumer risk perceptions, signal quality, and
differentiate a service offering. By delivering service guarantees companies entitle customers to an easy-
to-claim replacement, refund or credit, when service delivery

Week #04/5 - F&B Service Area (Restaurant) and Food Production Area Planning and Design.

Formula

1. Formula = Total cost of item (COST PER AVG KG) AVG KG x TOTAL COST per KG / trimmed or drained or
usable weight of item in kg x multiplied by portion of item in decimal

If there are guests

2. Number of guests / (useable kg of material / portion in decimal)

If there aren’t guests

3. (useable kg of material / portion in decimal)

Step 1 - calculate all the ingredient / food costs (by timesing the unit cost with the quantity)

Step 2 – get the total cost of the food or ingredients and divide it by the number of portions

Step 3 – get the portion cost and divide it with the food cost percentage and times by 100

Step 4 - add the GST to the to the answer on step 3

Step 5 – get the selling price and modify it. Then justify your modification
 *comparing 2 
*has a yield  
*only has individual kg 
* if it has the yield, both yield percentage and portion service are whole numbers 
 
ACTIVITY #03 
Peeled Tiger prawns cost $500/10kg box. Similar quality whole green prawns (unpeeled) cost $24/kg
and on average has a yield of 56%. The portion size of garlic prawns is suggested to be 250g. You are
required to calculate: 
 The cost of a 250g portion of peeled prawns and whole green prawns. 
 Recommend: should ready peeled prawns or whole green prawns be purchased? 

step 1 part 1: the cost of a 250 gram portion of peeled prawns  

 
 
Formula = Cost per kg multiplied by portion grams  
 
1. Cost per kg 
 
= 500 / 10 
= 50 
 
2. multiplied by portion grams 
 
 
= 50 x 0.250 
= 12.50 per 250 gram 
Step 2 Part 1: 250 gram portion for whole green prawns  
 
 
Formula = Cost per kg divided yield by portion  
 
 
= 24 / 560 x 250 
= 10.71 per 250 grams  
 
 
 

ACTIVITY #05 
On an a la carte menu, Tasmanian Salmon is to be featured. The average weight of whole Tasmanian
Salmon is 3.5kg and
costs $33/kg. The trimmed weight of salmon fillets is 2.75kg and the portion size of uncooked salmon pie
ce is 200g. You are required to calculate: 
 The cost of a 200g portion of salmon piece. 
 How many portions can be obtained from a 3.5kg unprepared salmon? 
 
 
 
 
 
 
Total cost of item / trimmed or drained or usable weight of item, x multiplied by portion of item in decimal 
 
 
115.50 / 2.75 x 0.200 = 8.40 
 
 
 
 
 
 
 
Usable kg /  portion in grams 
 
2.75 / 0.200 
 
13 rounded  
 

The unpeeled prawns are cheaper than the peeled prawns. Unpeeled prawns can be prepared by
trainee/apprentices during slack or non peak periods. Unpeeled prawn peelings could be further utilised
for stock and flavouring. However, if that option is undesirable in a f&b context, choosing the peeled
prawns would be more suitable and cheaper. This is because, overhead costs such as labour is used when
unpeeling the prawns and if this is too time consuming, is would be much more preferable to do the
opposite

 
 

 
 if I’m given the average weight and cost per kg and trimming percentage / kg 

ACTIVITY #04 
A conference organizer has requested for roast leg of lamb to be featured on the banquet menu for 200
guests. Average
weight of leg of lamb is 3.25kg and costs $20.50/kg, and bone, trimmings and cooking loss is approximat
ely 52%. The portion size is 225g of cooked meat. You are required to calculate: 
 The cost of 225g ready portion of cooked roast leg of lamb. 
 The number of legs of lamb that should be purchased. 
66.625 
 
 
 
Formula = Total cost of item / trimmed or drained or usable weight of item in kg x multiplied by portion
of item in decimal 
 
 
Step 1: 
 
Multiply kg of legs with cost per kg 
 
3.26 x 20.50 = 66.625 
 
Step 2:  
 
Multiply kg of item with the remaining yield after loss in decimal 
 
3.25 x 0.48 = 1.56 
 
Step 3: 
 
 
66.625 / 1.56 x 0.225 = 9.61 
 

Week #11 - F&B Operations Marketing.

Week #11 - F&B Operations Marketing.

Product life cycle

1. Introduction: Costs at this stage are high: research and product development; stock levels to be set; advertising
and sales promotion costs for the launching of the new product; managerial time and resources, etc. Sales are from
first-time buyers and will be significantly affected by the success or failure of the promotional campaign. Profit is
minimal, if any, owing to the high financial commitment at this stage. Losses are common. Competition is also
minimal; the new product is at its infancy and many competitors choose to sit back to see the outcome.

2. Growth: Costs are lower as marketing research and the high initial publicity costs are more a feature of the
introductory phase of a new product. Sales growth is rapid as the market expands – first-time buyers may become
repeat purchasers. Profitability can be at its highest owing to increased sales and the overall reduction in costs.
Depending on the success of the product launch, competition may now enter the market which has the effect of
enlarging the total market for the product due to their additional advertising and promotion.
3. Maturity : Costs in the maturity stage may increase again, particularly in terms of promotion as the organization
seeks to retain its market share. Sales gradually level out as competition from products of other companies take a
share of the total market, and the growth of the organization slows. As the sales levels stabilize, so do the profits –
prices are reduced in order to compete, promotional costs erode profitability levels and total demand for the
product stabilizes.

4. Decline: As the market becomes further saturated with products, some organizations may leave the market
altogether. Costs become disproportionately high in an attempt to hold the company ’ s position in the market. Sales
and profit levels fall as too many products compete for an ever decreasing percentage of the market, demand falls
while supply remains in abundance.

5. At the decline stage a company may reinvent its strategy or create some innovative products or even a new
promotional campaign could reinvigorate sales and spurt a new growth for the sales of the company. Understanding
at which stage of the product life cycle the operation is can be crucial as different strategies would be adopted for a
mature organization as opposed to one that is in its introductory stage.

Marketing research

1. Primary information : Primary information is new information that the organization will usually have to go outside
of its own confines to gather. Professional marketing research companies may be used, or the organization can
tailor-make its own. Primary information is more expensive and time consuming because the data first has to be
collected in the fi eld before it can be analysed.

2. Secondary information : Secondary information is information that has previously been collected either within the
organization itself or it already exists externally. Within the organization ‘ desk research ’ often highlights a number
of areas that have stored information useful to marketing research, for example.

- Reservations made in a restaurant, recording client and contact name, address and telephone number,
method of reservation, frequency of usage and special rates given
- Sales records, identifying products, quantities sold, sales cycles, average spends, methods of payment, cash,
or credit
 - Purchasing documents, percentage of convenience and fresh foods being used, food and beverage costs and
budgets compared, shortfalls, pilferage, and wastage.
- Staff meetings held between management and staff. Food and Beverage Management

Outside the organization, there is a wealth of information available.

● Government publications and statistics.

● Professional trade associations, publications, conferences, and meetings.

● Educational establishments.

● Other publications, guides, journals, newspapers, and television.

Branding

Restaurant’s branding starts with the following

• Brand strategy
• Brand positioning
• Concept development
• Naming
• Physical design
• Interior design
• Website design
• Menu design
• Various systems design

Advertising

Internet Marketing: Internet provides an opportunity for global exposure. A restaurant card featuring the
restaurants web address can enable customers to check the menu before they arrive, they can have virtual tours of
the business or even book a table online and take advantage of special promotion

- Even at that stage a website can be a supplementary tool that directs customers from a business card to an
area that can provide more information about your business

Advertising ‘ Any paid form of non-personal presentation and promotion of ideas, goods or services by an identified
sponsor ’ . Its purpose, as defined by the Institute of Practitioners in Advertising (IPA) is ‘ to influence a person ’ s
knowledge, attitude and behaviour in such a way as to meet the objectives of the advertiser ’ .

- Benefits include:
- To create awareness of the product.
 - To create desire for the product.
- To influence customers attitudes to the product.
- To create brand loyalty.
- To persuade customers to buy.
- To persuade customers to visit an operation in preference to a
competitor ’ s.
- To remind customers to buy.
- To inform the market about a product.
- To provide reassurance about the product.
- To be ethical.

Forms include

- Newspapers
- Magazines
- Guides
- Trade advertising
- Electronic guides and magazines
- Radio
- Television
- cinema

Merchandising

What is it:

- Merchandising is the art in which the brand or image from one product or service is used to sell another?

Example:

- McDonalds will often feature toys from recent cartoon characters with their kids’ meals. By featuring a
favourite character from a recent cartoon as part of the deal kids choose to buy burgers from that chain
rather than another.
- Another example is that of Wagamamas, who have a range of merchandise such as T-shirts, cookbooks and
even gift vouchers. The merchandising of catering operations involves the point of sale promotion of their
facilities using non-personal media. Unlike advertising it is not a paid for form of communication, but like
sales promotion is more concerned with influencing customer behaviour in the short term.
- producing their own labelled bottles of wine, or coffee shops selling their own brand of coffee to customers.
- Hats, T-shirts, coffee mugs and other promotional materials can both help with extra income into the
business and at the same time strengthen the operations brand.
- Include place mats, which in coffee shops may contain the breakfast menu with a reminder that the
operation is open throughout the day for snacks
 - napkins; doilies; and pre-portioned condiments which all add to the operation ’ s sales message
- In the bars giving away cocktail sticks, matches and drink mats also enables a small part of the operation to
be carried out of the establishment and may act as a reminder to customers of their meal experience several
days or months later

Through all aspects of an organization ’ s merchandising approach, there is a very real need for it to complement its
advertising campaign. Advertising the facilities will hopefully have stimulated customer interest. The role of
merchandising is to convert that interest into purchases and increased sales.

Sales promotions

What is it:

Sales promotion is a form of temporary incentive highlighting aspects of a product that are not inherent to it. Sales
promotion may be aimed at customers, distribution channels and sales employees. It does not necessarily occur at
the point of sale, although in many instances it does. Sales promotion (SP) uses special short-term strategy to
persuade customers of certain market segment to engage in buying behaviour. As F&B operations is subject to
seasonal fluctuations, SP can help to stimulate demand using the following broad means-

Reasons / advantages for using it

1. To increase the average spend by customers and thereby increase the sales revenue

2. To promote a new product or range of products being featured by the operation, for example offering a new
flavoured milk shake in a take-away facility at a reduced price.

3. To influence impulse purchasers towards a certain product or range of products, for example featuring Australian
wine at a special discount price.

4. To aid as a reminder during a long-term advertising campaign, for example on long established main menu items.

5. To help ‘ level ’ peak activities of business, for example offering a free glass of wine to customers ordering their
meal before 18.30 hours.

6. To celebrate a special event, for example the New Year, Thanksgiving Day Dinner, etc.

7. To ‘ package ’ together menu items at an attractive price, for example steak and strawberries. Such ‘ packages ’
are seasonal in nature but aid in directing a high proportion of customers ’ choices towards items of a low
preparation labour content ( Figure 10.12 ). 8. To clear slow moving stock, for example pricing specifi c cocktails at
two for the price of one.

- Build customers’ awareness of products / service

- Create interest
 - Provide information
- Stimulate demand
- Reinforce brand name

Types of Sales Promotion

1. Customers
- Sales promotions aimed directly at customers include money-off coupons
- discounts,
- special prices during off-peak periods
- free chicken meals for families
- a free bottle of wine for every two adult meals ordered, etc.

Special events and promotions may be communicated to the customer by

- advertising,
- direct mail,
- telephone
- posters
- tent cards.

2. Distribution channels: Promotional techniques aimed at incentivising third party agents

- include free restaurant meals
- free gifts
- competitions and the use of the hotel ’ s leisure facilities

3. Sales employees: Sales promotion incentives are similar to those listed above and include commission
related sales
- competitions,
- token and points systems occurring over an extended period to encourage an ongoing sales commitment by
the sales force.

Sales promotion is a marketing tool in its own right and should be planned, monitored, and evaluated as such. It can
be initiated either by the operation itself or by an external organization, and as with all other aspects of the
marketing mix must be in line with the marketing objectives of the organization

Summary

Food and beverage marketing is the focus of this chapter. Because of the nature of services marketing for food and
beverage operations can differ greatly from that of products, and although the basic concepts of segmentation mix
and life cycle remain the same the intricacies of marketing for food and beverage are explored
Digital marketing

Digital marketing is divided into five types

 Display advertising- web banners or blog to drive traffic to increase own website’s product and service
awareness.

 Search engine marketing (SEM) seeking to promote websites by increasing visibility in search engine.

 Search engine optimization (SEO) the process of improving the visibility of a website in search engines.

 Social media marketing- the process of gaining traffic in websites using Facebook, Twitter

 Email marketing- directly marketing a message to a group of people using email.

How to / process of digital marketing

1. Develop suitable strategy. Differentiate your restaurant’s concept. 

2.  Develop an effective website. Ensure your website is superior to your competitors. 

3.  Attract targeted customers to the website. Customers will either come direct or find through in the search
engines. 

4.  Assess websites performance and make continuous improvements. The internet offers unique capabilities for
monitoring.

Advantages

• Digital marketing is inexpensive.

• Companies can reach a wide audience.

• Consumers can be researched to purchase products and services conveniently.

• Businesses can experience results quickly.

• It helps to measure statistics easily and inexpensively.

• Businesses can determine which messages are more appealing to the consumer.

Disadvantages
Ethics is still often missing.

Pyramid schemes are prevalent.

Lacks in human touch.

Security of personal information is an issue