Mr. Holthouser

Food & Beverage

Important Things to Recognize for Establishing F&B Venues in Today’s Economy

By Jim Holthouser, Senior Vice President Brand Management, Embassy Suites Hotels

Co-authored by Beth Scott, VP Restaurant Concepts, Hilton Worldwide

Developing a concept for a new restaurant involves a certain amount of risk. Get it wrong, and you can end up with a lot of expensive square footage that will wreak havoc on a hotel’s overall profit level. Get it right, and you’ll trigger significant rewards, including a boost in profits and increased visibility for your property; in addition, your customers will enjoy an enhanced guest experience.

Market Intelligence a Must

Planning must be market-driven. Wise hotel developers will always invest in an in-depth study of the local market to determine which restaurants are attracting a steady clientele, and to identify the USPs of popular venues that contribute to a sustainable level of success. A few evenings of dining around locally will provide a bird’s-eye view of the restaurant scene, and also a snapshot of the clientele at each venue.

Of course, awareness of new and emerging trends in the food and beverage arena is also key to planning. Even if the plan is for a traditional restaurant serving classic French or mainstream international cuisine, a developer should be sure to explore the food and beverage landscape in depth in order to create a design, presentation and menus in sync with guests’ preferences today, and an ambiance that will encourage repeat visits. Right now, small plates are a great way to offer portion and price flexibility, and health and wellness-driven beverages continue to grow in appeal. Classic American dishes will always have a place on U.S. menus, and this season we’re seeing these classic dishes prepared with innovative modern twists that add to both flavor and presentation. A smart approach can help advance a restaurant to rank among diners’ personal favorites and to stay top of mind whenever dinner plans are under discussion.

Success Story

At Embassy Suites, we’re now seeing a larger investment by owners in two specific areas—meeting facilities and F&B. It’s important, therefore, that both areas turn a significant profit. F&B has great potential when catering revenues are added, but profit levels with restaurants tend to be lower. We know that our hotel owners don’t all have expertise in this area, so the challenge of planning and operating a dining venue takes on greater magnitude. Consequently, about half of the brand’s restaurants are outsourced to third-party management companies. In many markets, the most successful restaurant style for our owners has proven to be a steak house, with Ruth’s Chris Steak House and Omaha Steak House popular choices. Of course, we see diversity also. The new Embassy Suites San Antonio Riverwalk-Downtown, which opened in November 2010, features the very first John Besh restaurant at an Embassy Suites property. Called Lüke, this new brasserie-style restaurant presents a menu filled with robust local flavors and an upbeat setting that is at once casual and chic.

Overall, the F&B product across the Embassy Suites brand has proven to be extremely successful, with several key factors visibly contributing to this triumph. We have always encouraged owners to aim for a best-in-class operation, and to style their restaurants to take into account both the local market and the hotel guest demographic. To any new owner, I’d say take a look at your guests and be guided by their personal style. Do you see a lot of suits in the mix, or is their style more casual? Are they traditionalists or adventurers? Do they lunch alone and then meet friends/colleagues for dinner?

Value-Driven Operation + Smart Design

For our owners, the objective is to build a value-driven restaurant operation that may not necessarily have the cutting edge of a Gordon Ramsay hot spot, but still delivers excellent food with consistency. Our customers know they can always count on a superior standard in all elements of the guest experience at an Embassy Suites, and this high level of reliability not only encourages regular visits but also becomes a catalyst for word-of-mouth recommendations. Looking across the board, I believe we have possibly the most consistently executed brand in the U.S. market.

There’s a strong focus on smart design at our properties, with flexibility that will support the diverse needs and changing mood of diners throughout the day. With adaptable lighting and varied music selections, a dining venue can be seamlessly transformed between lunch and dinner to offer a businesslike setting at noon and a relaxing ambiance in the evening. From an owner’s viewpoint, flexibility in our design process addresses their respective needs and budgets. It’s an important building block in fostering excellent relationships, especially in today’s uncertain economy.

Kitchen size and layout are naturally a major consideration for any restaurateur. Properties configured with our Design Option III prototype are built with a single kitchen, which is tasked with producing all meals throughout the day. Consequently, operating costs are manageable and a high level of efficiency can be maintained. The Flying Spoons restaurant concept introduced in January 2009 was created to deliver a good-quality dining experience, and at the same time ensure simplicity in the operation.

A Focus on Authenticity + Brand Features

The global presence of Hilton Worldwide presents a great advantage to all of our brands, providing a vast range of multi-cultural resources to inspire menus that guarantee an authentic dining experience. Across the brands, bar cocktails also draw inspiration this way, and drinks with an exotic aura—like Ginger Mojito, Key Lime Margarita, Bacio Bellini, Urban Negroni, and Sangria—are especially popular. While guests naturally appreciate a focus on freshness in all the ingredients, the presentation is equally important, adding a festive dynamic.

Embassy Suites keeps a finger continuously on the pulse of the marketplace, helping owners identify and fulfill a region’s need for a full-service hotel. Guests at all our properties enjoy the 24/7 convenience of in-suite facilities like mini-fridges, microwaves and coffee makers; and they are appreciative of Embassy Suites signature features, especially our complimentary cooked-to-order breakfast and our free evening Manager’s Reception.

The latter has become a highlight for many regular guests, inviting them to mingle socially over cocktails and light snacks in a fun, relaxing environment. An intrinsic feature of the brand, these nightly events provide an opportunity for management to offer a friendly thank-you to guests for their business and loyalty.To keep the receptions energized and fresh, the brand recently launched a resource guide that encourages F&B directors to be creative. Diversity in the tabletop displays helps revitalize the setting, and distinctive features at a growing number of Embassy Suites properties may include local beer served in freezer-chilled glasses, pita chips hot from the oven, or a special drink of the day that demonstrates stylish mixology flair. We’re seeing progressively more of our hotels offer freshly prepared snacks in sweet, salty and savory categories, charmingly served in unusual containers—Chinese rice cartons, for example, and paper bags that recall a fish-and-chips-style presentation. Bartenders are engaging and friendly, setting a tone that echoes the warm Embassy Suites welcome and puts guests immediately at ease.

The Way Forward

The bottom line? It’s all about knowing the market inside-out and identifying what your particular market wants today... and tomorrow. Once the restaurant style is determined, and a smart design achieved with a flexible approach, then I’d say the key ingredients for enduring success are authenticity, quality, and consistency. It’s a recipe that has certainly worked for Embassy Suites Hotels.

!Co-author Beth Scott is VP Restaurant Concepts for Hilton Worldwide. Ms. Scott oversees a global team that provides restaurant and bar solutions to properties among the diverse brands. With her team, Ms. Scott leads initiatives aimed at developing and realizing innovative and commercially successful concepts with unique identities that add value to the Hilton Hotels and Resorts, Doubletree, Embassy Suites Hotels, Conrad, and Waldorf Astoria brands globally. Ms. Scott's expertise extends to diverse areas of food and beverage, including global consultation, brand-enhancing initiatives, and building and running high-end restaurants and entertainment venues in premier locations.

As the global head of brand management for Embassy Suites Hotels since 2006, Jim Holthouser leads marketing, sales, revenue management, research and development and franchise owner relations efforts for the $1.8B annual revenues brand. Mr. Holthouser also serves as global head of full service brands (Hilton, Doubletree and Embassy Suites) for Hilton Worldwide. Under Mr. Holthouser’s leadership over the last three and a half years, the Embassy Suites brand has won numerous awards for product and service quality. Mr. Holthouser can be contacted at 703-883-1000 or Maggie.Giddens@hilton.com Extended Bio...

HotelExecutive.com retains the copyright to the articles published in the Hotel Business Review. Articles cannot be republished without prior written consent by HotelExecutive.com.