Creating a Profitable F&B Strategy

By Brian Bullock Chief Operating Officer, Restaurants, Legacy Ventures | August 28, 2016

In today’s environment, hotel owners and operators must find or create a food and beverage ( F&B ) concept that is accessible, inviting and relevant to the market. It’s important to create an atmosphere that entices hotel guests out of their rooms and into the greater scene, as having an alluring, busy restaurant enhances the hotel guest experience. However, to create a sustainable and profitable F&B offering, the hotel must attract local customers as well. To achieve this, the menu must be crafted around an unfulfilled need in the market and deliver on the service promise of the hotel brand.

Hotel restaurants often struggle with profitability, especially in boutique and mid-sized properties. If a concept portrays to the guest that it’s just another hotel restaurant, it will fail. Additionally, if a restaurant is too trendy and there is no substance, local guests won’t return once the initial “buzz” wears off.

Take, for example, the restaurant at the Glenn Hotel, located in downtown Atlanta. Before our company, Legacy Ventures, took over Glenn’s Kitchen in 2011, several operators failed because they couldn’t consistently deliver quality food and service at the restaurant while also meeting the hotel’s needs. Operators served up trendy concepts that fizzled, and when restaurants began to lose their buzz, operators struggled and compromised their standards even more — and revenues continued on a downward spiral.

Today, Glenn’s Kitchen is a destination in its own right and financially successful, with nearly $3 million in revenue last year and more than $500, 000 in profit. In fact, if Glenn’s Kitchen were a stand-alone restaurant, it would be profitable — a clear exception in the hotel industry.

The Three-Step Process to Choosing an F&B Concept

To create or select the right F&B concept, we take a three-step approach. Our forte is creating site-specific food, beverage and banquet programs, recognizing that exceptional guest experiences and profitability are the key objectives for today’s hotel owners. We have developed and managed 12 award-winning facilities and annually host more than 5, 000 banquet events.

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Coming up in January 2018...

Mobile Technology: Relentless Innovation

Technology has become a crucial component in attracting and retaining hotel guests, and the need to enhance a guest’s technology experience is driving a relentless pace of innovation. To meet and exceed guest expectations, 54% of hotels will spend more on technology in 2018, and mobile solutions in particular will top the list of capital investments. Many hotels are integrating mobile booking, mobile keys, mobile payments and mobile check-in into their operations. Other hotels are emphasizing the in-room experience, boosting bandwidth and upgrading flat screen TVs to more easily interface with guest mobile devices. And though not yet mainstream, there are many exciting technology developments on the near horizon. The Internet of Things (loT) is taking form in some places, and can be found in guest room control systems, voice activation systems, and in wearable sensors that can be used for access and payment options. Virtual reality headsets are available at some hotels so guests can enjoy virtual trips to exotic locations or if off-property, preview conference facilities and guest rooms. How long will it be before a hotel employs a fleet of robots for room service, or utilizes a hologram as a concierge, or installs gesture-controlled walls that feature interactive digital displays? Some hotels are already using augmented reality for translation services, or interactive wall maps, or even virtual décor. This pace of innovation is challenging property owners and brands to stay on top of the latest technology trends while still addressing current projects. The January Hotel Business Review will explore what some hotels are doing to maximize their opportunities in the mobile technology space.