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Friday, February 24, 2006

Don't Destroy Your Stars

One of the absolute and totally rigid laws of effective food cost control almost never to be challenged: Do NOT alter your signature recipes with lower quality alternatives strictly to create a lower cost.

After years of new and improved commercials, corporate brand managers watched the results of the New Coke campaign. My friend (a huge Coke fan) wrote to Coca Cola. To Coke's credit, they brought back the old formula.

A great article "If A Little Cost Cutting Is Good, Then Can A Little More Be Bad??" was presented in the February 2004 Newsletter of the Operations Management Center. The article demonstrates the key difference between value enhancement and cost cutting as a strategy.

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