Chapter 2

1. Chapter 2 Kinds and Characteristics of Restaurants and Their Owners

2. Objectives • After reading and studying this chapter, you should be able to: • List and describe the various kinds and characteristics of restaurants • Compare and contrast chain, franchised, and independent restaurant operations • Describe the advantages and disadvantages of chef-owned restaurants • Identify several well-known celebrity chefs • Define centralized home delivery restaurants

3. Kinds and Characteristics of Restaurants • Segments: • Chain or independent (indy), and franchise restaurants • Quick-service (QSR), sandwich • Fast/quick casual • Family • Casual • Fine dining • Other

4. Chain or Independent • Chain restaurants • Some advantages and disadvantages over independent restaurants • Advantages include: • Recognition in the marketplace • Greater advertising clout • Sophisticated systems development • Discounted purchasing

5. Chain or Independent (cont’d.) • Independent restaurant advantages: • Relatively easy to open • Restaurateurs can “do their own thing” • Concept development, menus, décor, etc. • Potential for growth • Some will grow into small chains while larger companies will buy them out

6. Franchised Restaurants • Involves fewer risks: • Restaurant format has been tested in the marketplace • Less likely to go belly-up • Training is provided • Marketing and management supports are available • Several requirements: • Franchising and royalty fees, advertising royalty, and substantial personal net worth

7. Franchised Restaurants (cont’d.) • Franchisors: • Help with site selection and review • Assist with design and building preparation • Help with preparation for opening • Train managers and staff • Plan and implement pre-opening marketing strategies • Conduct unit visits and provide on-going operating advice

8. Sandwich Shops • Characteristics: • Simple to open and operate • Little or no cooking required • Hot and cold sandwiches, soups, and beverages • Limited kitchen equipment needed • Examples: • Jimmy John’s gourmet sandwich shop • The Sandwich Shop in San Francisco • Subway

9. Quick-Service • 1870s: Plate House • First known quick-service restaurant • Served a quick lunch in about 10 minutes • Characteristics: • Many precook or partially cook food • Goal is to serve maximum number of customers in a minimum amount of time • Food is paid for before service • Limited menus

10. Quick Casual Restaurants • Defining traits: • Use of high-quality ingredients • Fresh made-to-order menu items • Healthy options • Limited or self-serving formats • Upscale décor • Carry-out meals • Inclusion of bakery-cafés

11. Family Restaurants • Characteristics: • Grew out of coffee shop-style restaurant • Frequently located within easy reach of suburbs • Informal • Simple menu • Service designed to appeal to families • Some offer wine and beer • Most offer no alcoholic beverages

12. Casual Restaurants • Characteristics: • Fits societal trend of a relaxed lifestyle • Signature food items • Creative bar menus or enhanced wine service • Comfortable, homey décor • Examples: • Applebee’s, Outback, Chili’s, etc.

13. Fine-Dining Restaurants • Characteristics: • Expensive and leisurely • Average check of $60 or more • Very low table turnover • Can be less than one and evening • Customers: special occasions and business • Restaurants are small • Usually less than 100 seats • Proprietor- or partner-owned • Rent can be high

14. Steakhouses • Characteristics: • Limited menu caters to a well-identified market (i.e. steak eaters) • Service ranges from walk-up to high-end • High food costs (as high as 50%) • Low labor costs (as low as 12%) • Majority of customers are men

15. Lore of Steak • Steaks vary • Types include: • Tenderloin: most tender and runs along backbone • T-bone: cut from the small end of loin • Porterhouse: T-bone and tenderloin • New York Strip: compact, dense, and boneless • Delmonico: small, often boned steak, taken from the front section of the short loin • Sirloin: comes from just in front of the round, between the rump and shank

16. Seafood Restaurants • Colonial America • Seafood was a staple food in the taverns • Characteristics: • Many are independently operated • Red Lobster is the largest chain • 682 restaurants • Farm-bred fish • Changing the cost and kinds available

17. Ethnic Restaurants • Mexican restaurant characteristics: • Menu is often built around tortillas, ground beef, cilantro, chilies, rice, and beans • Relatively inexpensive • Labor costs are also low • Menus, décor, and music are often colorful and exciting • Menus may include tasty seafood items and spicy sauces

18. Italian Restaurants • Characteristics: • Hold largest number of U.S. ethnic restaurants • Offer an array of opportunities • Owe their origins largely to poor immigrants from southern Italy • Pizza is native to Naples • Many American soldiers, during World War II, learned to enjoy it • Chain operators are spreading the pasta concept (e.g., Olive Garden)

19. Chinese Restaurants • Characteristics: • Small percentage of restaurants in America • Historically owned by hardworking, ethnically Chinese families • Cooking revolves around the wok • China is divided into culinary districts: • Szechuan, Hunan, Cantonese, and the northern style centered in Beijing

20. Theme Restaurants • Characteristics: • Built around emphasizing fun and fantasy • Glamorize sports, travel, or eras in time • Celebrities are central to many • Comparatively short life cycle • Do well outside major tourist attractions • Locals tire of hype when food is poor • Most profits come from merchandise • Costs are high • Capital costs and operations

21. Theme Restaurants (cont’d.) • Martin M. Pegler: Theme Restaurant Design • Theme restaurant categories: • Hollywood and the movies • Sports and sporting events • Time: the good old days • Records, radio, and television • Travel: trains, planes, and steamships • Ecology and the world around us

22. Coffee Shops • Characteristics: • Long part of our culture and history • Originally created based on Italian bars • Modified to include wider variety of beverages • Meet the tastes of consumers • Chain or independent • Requirements: • Good name and location, permits, coffee and espresso machine, limited kitchen equipment, tables, chairs, and some decorations

23. Chef-Owned Restaurants • Characteristics: • Part of American tradition of family restaurants • Papa is the chef and mama is the hostess • Publicity is key in gaining attention • One of the best-known husband-and-wife culinary teams is Wolfgang Puck and Barbara Lazaroff • Chef-owner should have a good backup person • Share in management, food preparation, and marketing • Husband-and-wife teams are subject to divorce

24. Women Chefs as Restaurant Owners • Characteristics: • Numerous examples • Typical restaurant manager of the future may be a woman • Those with stamina and ambition may be better suited than men with similar backgrounds • It is agreed that female restaurant owners are more concerned with details, sanitation, and appearance • Female restaurant owners are more likely to be sensitive and empathetic toward customers

25. Celebrity Chefs • Bigger today than ever before • Emeril Lagasse • Rachael Ray • Suzanne Goin • Alice Waters • Marc Vetri • Barbara Lynch

26. Centralized Home Delivery Restaurants • Characteristics: • Reduce costs of order-taking, food preparation, and accounting • Marketing costs may not decrease • Home delivery centers verify and process credit card information • Computers used to perform accounting • Can be done at any location connected to the Internet, locally or internationally

27. The End