THE

Restaurant
B U S I N E S S
8.1 INTRODUCTION

THE NATIONAL RESTAURANT

ASSOCIATION'S FIGURES INDICATE THAT
AMERICANS ARE SPENDING A LOT OF
FOOD DOLLARS AWAY FROM HOME AT
VARIOUS FOODSERVICE OPERATIONS.

8.2
CLASSIFIICATION
OF REATAURANT

THERE IS NO SINGLE DEFINITION OF THE VARIOUS CLASSIFICATIONS OF

RESTAURANT,SINCE BECAUSE IT IS AN EVOLVING BUSINESS.MOST
EXPERTS WOULD AGREE,HOWEVER THAT THERE ARE TWO MAIN
CATEGORIES;INDEPENDENT RESTAURANT AND CHAIN
RESTAURANTS.OTHER CATEGORIES INCLUDE DESIGNATIONS SUCH AS
FINE DINING,CASUAL DINING,FAMILY RESTAURANTS AND QUICK-
SERVICE RESTAURANT.
 1.Fine Dining
Fine dining is one where a good selection of menu items is offered. All the food being
made on the premises from scratch using raw or fresh ingredients.
Most fine dining restaurants serve haute cuisine, which means elegant dining or 'high
food'. And many of the restaurants are based on French or Italian cuisine, which are
considered by many Westerners to be finest in the world.
In recent years, fine dining has become more fun because creative chefs offer guests
fine dining as an art. Many cities have independent fine dining restaurants that offer for
occasion.

Celebrity Restaurants Steak Houses

Generally have an extra zing to them - a The steakhouse segment is quite

winning combination of design,
atmosphere, food, and perhaps the thrill of
an occasional visit by the owner.
Celebrity-owned restaurants have been
growing in popularity. Some celebrities
such as Wolfgang Puck, come from a
culinary background, whereas others, such
as Naomi Campbell do not.
buoyant despite nutritional concerns
about red meat. The upscale
steakhouses such as Fleming of
Chicago, continues to attract the
expense account and 'occasion' diners.
Some restaurants are adding additional
value-priced items such as chicken and
fish to attract more customers.
 2.Casual Restaurants
Casual restaurants is relaxed, and could include restaurants, from several
classifications:chain, or independent, ethnic, or theme. In example; Hard Rock Cafe, TGI
Fricday,s and Romano's.

In example of Houston's, is American leading casual restaurant with $5.5 million average per
unit sales a year. Its menu is limited to about forty items and focuses on American cuisine.

Many dinner house restaurants have a casual, electric decor that may promote a theme. TGI
Friday's is an American bistro dinner house with a full menu and a decor of bric-a-brac that
contributes to the fun atmosphere.

Family Restaurants Ethnic Restaurants

Family restaurants evolved from the coffee shop
style of restaurant. In thisw segment, most
restauranta arec individually or family operated.
They are generally located in or with easy access to
the suburbs.
Most offerc an informal setting with a simple menu
and service designed to please all the family.
Usually, there is a hostess/cashier standing near the
entrance to greet and seat customer, while food
servers take the orders and bring thebplated food
from the kitchen
The majority of ethnic restaurants are
independently owned and operated. The
owners and their families provide something
different for the adventurous diner or a taste of
home for of the same ethnic background as
gthe restaurant.
Theme Restaurant
Many theme restaurants are a combination of
sophisicated specialty and several other types of
restaurants. They generally serve a limited menu
but aim to wow the guest by total experience. This
is achived through decoration and atmosphere.
3.Quick-Service Restaurant

QSR consist of diverse operating facilities whose slogan is 'quick food'. The
following food include burgers, pizza, chicken, sandwiches, and delivery
services. In recent years, home meal replacement and fast casual concept
momentum that drives the industry.

QSR offers limited menus and customers order their food at counter, under a
brightly lit menu featuring coloured-photographs of food items. Customers are
even encouraged to clear their own trays, which helps to reduce costs.
8.3 Developing A Restaurant
The successful operation of a restaurant is dependent on a number
of factors, which are;

8.3.1 Operating Philosophy, Mission, Goals and Objectives

The philosophy the way the company does business. It is an expression of the
ethics, morals, and values by which company operates.
Many companies have formal mission statements that explain their reason for
being in business.

8.3.2 Restaurant Market

The market is composed of those guests who will patronize the restaurant. A
respective restaurant owner will analyze the market to determine whether
sufficient demand exists in a particular market niche, such as Italian.

A good indication of the size of the market can be ascertained by taking a

radius cof from one to five miles around the restaurant. The distance will vary
according to the type and location of the restaurant.

The demographic of the population within the catchment area is analyzed to

reveal age, number of people in various age, sex, ethnicity, religion, income
levels, and etc.
8.3.3 Restaurant Concept

Successful restaurant concepts are created with guests in mind. The

challenge is to create a restaurant concept that fits a definite market,
a concept better suited to its market than that presented by
competing restaurants.

The image appeals to a certain market-casual, formal, children, adults

,ethnic and others. The concept should fit the location and reach out
to its target market. A restaurant's concept, location, menu and decor
should intertwine.
8.3.4 Restaurant Concept
The location should appeal to the target market (expected
interests).other things being equal, prime locations cost more, so
operators must either charge more for their menu items, or drive
sufficient volume to keep the rent/lease coast to between 5-8% of sales

The key location criteria include the following:

Demographic- how many people in catchment area.
The average income of the catchment area
Zoning, drainage, sewage and utilities
Convenience access to the restaurant
Parking spaces adequacy and accessibilities
The typical location of a restaurant, are:
Stand-alone restaurant
Cluster or restaurant row
Shopping mall
Shopping mall-freestanding
Downtown
Suburban
8.3.5 Restaurant Ambiance

The atmosphere that a restaurant creates has both immediate

conscious and unconscious effects on guests. The immediate
conscious effect in the customer's decision-making process in selecting
a restaurant a restaurant; in example, noisy or table arrangements.
The unconscious effect in affected by mood, lighting, furnishing and
music.

The most noticeably atmospheric restaurants are those with a theme.

The theme will use colour, sound, lighting, decor, texture and visual
stimulation to create special effects for patrons.
8.4 Developing A Restaurant

The average meal daily has a shockingly large carbon footprint,

by which each meal created produces 275 pounds of waste a
day, making restaurants the worst aggressors of greenhouse gas
emissions in retail industry.

Green Restaurant Association (GRA) was founded with the

mission of reducing waste and carbon footprints of restaurant
operation. GRA strives to simplify things because it realizes that
restaurateurs have enough on their plates without worrying
what kind of paper towel to oder, or where they'll get next
month's supply of eco-friendly dish soap.
There are six types of menus:
A la carte menus- These menu offer items that are individually priced.
Table d'hote menus-Offer a selection of one or more items for each course at a fixed price. This type of menu is
used more frequently in hotels and in Europe. The advantage is the perception guests have of receiving good
values.
Du Jour menus-Menu that offers special of the day.
Tourist menus- These menus are used to attract tourist's attention. They frequently stress value and food that is
acceptable to tourists.
California menus-These menus are so named because in some California restaurant, guest may order any item of
the day.
Cyclical menus-Menus that repeat themselves over a period of time.

The many considerations in menu planning attest to the

complexity of the restaurant business. Considerations
include the following:
1. Customer Preferences

8.5 Menu Planning In planning menu, the needs and desire of the guest is what important, not what the
owner, or chef thinks. In customer preferences, there are several factors included in
considerations.

The menu planning may be the most important ingredient in arestaurant's menu
must agree with the concept; the concept must be basedb on what the guest in the
target market expects; and the menu must exceed those expectations. The type of
menu will depend on the kind of restaurant being operated.
i. Nutritional Requirements- When planning menus, managers can also implement a
wide range of strategies that recognize the nutritional concerns:
a.Reduce fat and cholestrol in menu items by offering lean fish, chicken, turkey and
veal alternatives.
b.Reduce sodium by reducing the use of salt in recipes (guest who desire salt can add
it a table), offer sauce and marinades in low sodium varieties.
c.Use strategies to reduce sugar by reducing in baked items without sacrificing taste
and offering fruit desserts instead of sweet desserts, providing sugar-free beverages.
ii.Food Habits and Preferences
a.Intrinsic Factors; include certain influence directly associated with food, such as appearance,
color, odor, texture, temperature, flavor, and quality. The manner in which food is presented,
the way food is arranged on the plate, and the temperature at which it is served all have an
impact on food preferences.
b.Extrinsic Factors; include direct external factors that can affect food preferences, such as:
the environment where it is served (e.g.:homes, restaurants, and clubs), situational
expectation (e.g.:social,ritualor religion occasions), advertising (as to attract customers), time
and seasonal variations (temperature and the availability of certain foods).

iii. Food Characteristics-The characteristics of food itself, which include their sensory properties, play an important role in
their acceptance.

a.Color- Colors have pshcological impact on customers. They emphasize the variety available of the selection and serve
as an eye appeap and appetite stimulator. Natural food colors as found in the foods and vegetables are generally
preferred. Garnishing, plate decorations, and attractive color displays add color and should also be considered in menu
planning.
b.Texture and Shape-The texture and shape of foods also effect customers' preferences. "Soft", "hard", "crispy",
"crunchy", "chewy", "smooth", "brittle" and "granny" are some of the adjectives used to describe food texture. Foods in
different shapes or vegetables and fruit carving add to the attraction of ythe menu as well as to create an eye an appeqal
when the foods are served
2.Capability of cooks.
The capability of the cooks must also harmonise with the menu and concept. An appropriate
level of expertise must be employed to match the peak demands and culinary expertise
expected by the guests. The length and complexity of the menu and the number of guests to be
served are both factors in determining the extent of cook's capabilities.

The equipmengt capacity and layout affect menu and the efficiency with which the cooks can
produce the food.Some restaurants have several fried or cold items on the appetizer menu
simply to avoid use of stoves and ovens.

3.Equipment Capacity and Layout

Purchase the right equipment to achieve maximum production
efficiency. Many establishments plan the equipment according to
the menu.

Efficient layout which will determine the systematic flow of items

from receiving clerk to guests assures operational efficiency.

Avoid over use- Too many menu items requiring one piece of
equipment may slow service.
4.Nutritional Value
Tjis is due to the greater public awareness of healthy food and individual
wellness. Trends are showing demand for healthier items like chicken and fish
increasing.

The changes in type of cooking oil, types of cooking process also are shown in
lieu to the health awareness in using oils in cookery.

5.Menu Analysis
Should be a balance between a menu too high in food cost and toolow in food cost.
Menu engineering-Best menu items are those with the highest contribution margin 6.Menu Design

per unit and highest sales. The design og menu can be range from one to several pages, and can
be consist of variety of shapes. The size can be generally 9inch x

It is recommended to analyse by: 12inch or 11inch x 17inch.

Individual menu items

Categories of menu offering Printing and artwork should harmonize with theme of the restaurant.

Meal periods or business categories The wordings shall be easy to be read and understand and have
strong focal points.
 8.6 Trends in The
Restaurant Business
1. Demographics-As the baby boomers move into middle age and retirement, a startling statistic is
emerging: 45-64 years old (the age group with the highest income) will make up almost 1/3 of
the U.S population. Simply put, the largest demographic group will have most money and will
offer oppurtunities for restaurant that meet their needs.
2. Branding- Restaurant operators using the power of branding,both in terms of brand-name
recognition from franchising viewpoint and in the product utilized.
3. Alternative Outlet-Restaurants face increased competition from convenience stores and home
replacement outlets.
4. Globalization-Cooperation will continue the transational development of restaurant.
5. Diversification-Diversification within the various dining segments will continue.
6. Shared Location-Restaurants will open more twin and multiple locations; such as Pizza Hut and
KFC will share locations.
7. Point of Service-Restaurant develop more point of service such as at gas station or using third-
party delivery service such as GrabFood or FoodPanda.
Thank You