Creativity to Reduce Churn

Restaurant work isn’t easy. It doesn’t matter what segment you play in, employee retention is a hot topic and one that is driving operators to think and act more creatively. While pay is always a leading factor, and getting more interesting as employers are proactively meeting and exceeding minimum wage requirements, employee benefits are quickly evolving to attract and retain workers.

WHAT’S HAPPENING?

A lot of turnover. 85% of restaurant employers reported half of their staff turning over annually on average, according to a recent Harri survey.[1] There are more options for workers, and it is easy for them to find an alternative job that offers more than simply a paycheck. Plus, the competition for hourly employees spans outside the foodservice landscape as unemployment rates remain low.

WHY DOES IT MATTER?

stats about the issues restaurant operators face in dealing with employee retention

Last week at the IFMA Marketing & Sales Conference, we learned that 3 of the 4 top operator concerns were around this topic, namely: minimum wage increases, cost of healthcare benefits, and high employee turnover.[2] With a rapidly changing environment on many fronts – delivery, technology, increasing competition, government regulation – operators have a lot of moving pieces to manage to remain competitive. Without the right people, addressing these opportunities is nearly impossible. This all makes identifying a strategy to combat the retention challenge more important than ever.

HOW ARE OPERATORS RESPONDING?

Many are developing some pretty compelling incentives that align with their specific business challenges. The Blue Plate Restaurant Company offers a range of benefits for their employees based on a culture that understands that their staff is the front line in providing the brand experience for guests. In a recent conversation with Casey Saeger, HR Director for Blue Plate, she shared that they are kicking off a “Blue Plate Wellness Committee” that will bring together staff from different areas within the company to ideate on what really matters to its employees when it comes to benefits that extend beyond the “basics”. They already offer a competitive medical plan, meal discounts at all of their unique local restaurants and a 401K match up to 6%, which is pretty unheard of in the industry. Still, they know that the landscape is continually changing and listening to employees will help shape how to best retain them.

From a chain perspective, Chipotle has historically promoted 95% of its managers from within but turnover is making that more difficult in today’s environment. That, combined with an increased focus on customer experience at the store-level, leadership identified a new incentive that hits on both business objectives. They will award bonuses at the end of each quarter to employees whose stores meet their sales goals that are the equivalent of a week’s worth of pay. The expected result? 145% reduction in annual turnover rate and an improved guest-facing brand experience.

WHAT’S NEXT?

The topic of retention is both old and new – historically a challenge in the restaurant industry, the broader competitive set of employer options is forcing us to think about incentivizing employees differently. It still starts with business strategy and objectives – in order to design a retention program that makes sense for your business, it has to align with the goals and the culture of the organization.

 

[1]“Restaurants Sweeten Pay and Perks to Find Scarce Workers.” Wall Street Journal. Haddon, Heather. July 21, 2019.
[2]“IFMA Marketing and Sales Conference” IFMA. Chicago. August 2019.

Superior Switchel + JTM Scale

If you’ve been tracking with us this summer, we’re in the midst of a series that focuses on the local Minnesota food and beverage start-up scene. This time around, we feature Superior Switchel and its founder Melina Lamer, the recipient of the inaugural JTM Scale Award. Over the past year, we had the opportunity to partner with this local entrepreneur to identify ways to propel the brand forward.

WHAT IS SWITCHEL?

The product itself is a key factor in Superior Switchel getting “the W” last year. Switchel is a refreshing, thirst-quenching beverage that is based on simple ingredients: carbonated water, ginger, apple cider vinegar, and a natural sweetener like maple syrup or wildflower honey. Lamer’s take on the 17th century recipe is unique and flavorful, with three variations that suit replenishment for many occasions—Honey Cinnamon Kick, Orange Maple Splash, Lavender Lemon Lift.

In addition to taste, Superior Switchel plays in the rapidly growing functional beverage category. As consumers continue to look for ways to use food as medicine, Superior Switchel offers a number of health benefits: it boosts recovery by replacing electrolytes, supports immunity, digestion and can help promote energy. As we’ve seen Kombucha take over the ready-to-drink (RTD) space on shelf, the broader category of shelf-stable functional beverages is $3.3 billion in sales, an increase of 11.7%. And Superior Switchel is shelf-stable, with the added perk of being delicious both hot and cold!

PARTNERING TO PROPEL

We were both new to this approach to partnering, and we spent time early on to identify how to best leverage the $75K JTM Scale award to impact the Superior Switchel business.

Brand work can be tough for an entrepreneur to commit to with an agency – it is real money for resources that can feel a bit…intangible. But as a rapidly growing brand, we knew it was critical to do this work upfront – especially as the Superior Switchel story was beginning to be told by people other than Melina, who does so with passion and expertise.

Expo West is a huge opportunity to gain exposure with retailers, investors and industry influencers. So, it was exciting to help Superior Switchel bring the refined brand work to life at this years’ event – and in a way that was repeatable for other important tradeshow opportunities throughout the year. The right event strategy is an important avenue for emerging brands. Being at the right place, at the right time, with the right product to build awareness can accelerate growth.

Superior Switchel at Expo West

For many entrepreneurs, social media is part of how their brand was built. Regardless of personal appetite for social media, it is often a necessary piece of the puzzle as the business grows, and approaching it through content strategy becomes more important in order to scale appropriately. With the goal of maintaining a high level of ongoing, quality engagement, we worked with Melina to develop a strategic framework for thinking about her channels and social presence strategically– and one that made planning out future content both simple and scalable. To supplement her current approach, we provided assets that could be dispersed in timely, relevant ways.

WHAT’S NEXT?

In reflecting on the last year of work, it is pretty cool to see how much one entrepreneur can inspire so many advocates around them. Through Melina’s personal story, passion and dedication to her business, our team was energized by our partnership. It was easy to want to do more and to go further, which is a testament to the brand she is building. It’s also a reminder that advocates can become resources – through a formal partnership or by leveraging this community of food experts in the local community.

 

Questions, comments or want to learn more? Let's connect! weshouldtalk@jtmega.com

Want to receive more Thought For Food Insights?
Subscribe Now »

Recent Posts