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Thursday, May 22, 2008

Managing The Check Average

Is this a great time to push your average check higher?

For over a decade, the economy has been buoyed by cheap money and big equity gains. Now the consumer sees tight money markets and capital losses. Company T&E reports are being scrutinized. Tourists are staying closer to home. Regulars are showing up less frequently. Dining rooms have lots of mid-week tables available.

When your place is packed this weekend, do you push the expensive entrees? High check averages may attract the same scrutiny as the $75 gas fill ups. This may be the time for a complimentary cup of coffee or even a slice of pie.

These decisions are rough on the food cost percentage. A complimentary menu item on your busiest night is risky. Will the customer return next week? If the strategic move gets a repeat visit, you win. If they go to your competitor or eat at home next week, you missed some marginal profit with no immediate gain.

Playing well on the margin is more art than science. It helps to measure results. If you want to encourage a repeat peak visit, a complimentary coffee and dessert could be offered to guests who reserve a table for the following week. Policy could be changed to make this semi-permanent. There would be very little wrong if the process repeated itself week after week during this economic downturn.

Would you sacrifice a coffee and dessert sale to get a table filled next week?

Typically, the after dinner drink and dessert course is very profitable. This action will have a significant impact on your check average. You can control the cost of this promotional gambit. Restrict the complimentary items to coffee, tea, and low cost dessert options. Loyal guests are the target in this exercise.

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