Niche Markets in the Food Service Industry

You could pretty much sum up the restaurant scene in America in one sentence: Hamburgers are dead; and beef itself is losing some appeal. The kind of restaurant that is making a name for itself these days is the one that gets a cult following rather than marketing to a general broad appeal. Consider this as an open letter to the food service managers of America. For pity’s sake, do something different!

We might as well face it: only the young care about general appeal any more. A ten year old kid is the most conservative diner you could imagine. Take them to any restaurant offering a menu of wonders and delights, and they’ll head straight for the hot dog. No chili, no cheese, just ketchup, thank you. Pizza parlors are about as exciting as their culinary explorations get, but they’d better offer plain pepperoni or there’s going to be trouble.

But the grown-ups think in terms mostly of ethnic categories. And speaking of ethnicity, Mexican, Italian, and Chinese are fine… but isn’t it time that we acknowledged that there’s more than three countries that make food? Treat yourself to a Mediterranean restaurant some time and you’ll get a feel for what you’ve been missing. Falafel, hummus, baba ganoush, fresh wet green tea leaves, sweetening with honey instead of sugar, and ways to cook lamb you’ve never thought of. Pita bread baked fresh on the premises, so it shows up at your table in a puffed-up balloon and slowly deflates to the flat pancake shape.

America, the melting pot of international culture, and yet unless you’re in one of the five biggest cities you’re out of luck finding international foods outside of pizzas, and tacos. the bowl of chop suey if you’re lucky. South American cuisine that is farther south than Mexico is unheard of. An Argentinian or Brazilian restaurant perhaps? And when’s the last time you found a Russian deli outside of New York? America has made two gains in Russian cuisine – Pirozhki and Baklava, and Baklava is more Baltic than Russian. I bet if you’re a typical American, you’ve never seen Shashlyk. It’s a Russian-style shish-kebab usually made with marinated lamb and some favorably sweet grilled onions. How hard is that to make? To take another example, France gets praised for it’s wonderful cultural food, but by reputation only. Let’s see a few more French restaurants and perhaps we’ll get a chance to see what all the fuss is about.

America has a hard time dealing with it’s own native cultural diversity, it seems. You get cheese curds in Minnesota, Iowa, Wisconsin, and in the rest of the States cheese is yellow and in the form of flat slices. Cajun cuisine got rave reviews on all of the cooking shows on Food network, but the craze seems to have come and gone without more than a few Cajun-themed restaurants popping up. Nobody east of Utah seems to have heard of a Denver omelet, nobody west of New England seems able to understand how to cook a lobster. I guess Indian cuisine within driving distance is a faint hope when you can’t even get all of America into one food court.

And as if the lack of international diversity and interstate diversity weren’t enough, it seems that even the methods of preparing food are stuck in a rut. Why must all chicken be breaded and deep-fat fried? Travel the planet if you have to, but find a place serving broasted chicken and grab a plate of that. There, now, wasn’t it nice to have chicken that isn’t drowning in grease for a change?

Consider the other food varieties largely missing from the American plate. Did you know pasta can be made from something besides wheat, bread can actually be something besides bleached and white, pickles aren’t always sliced and sour, and they’ve invented varieties of pepper which can be served whole besides the Jalepeno? That kielbasa sausage tastes just as good on a bun as a hot dog? That sweeteners can be based on something besides corn? That you can put condiments on a sandwich that aren’t yellow and red? That tortillas can be made from something besides bleached wheat flour? Listen, if only I never have to look at another “French fry” as long as I live, it will be too soon; enough with the damn deep-fried potatoes already!

American cuisine draws a heavy dose of criticism abroad, and for good reason. We simply do not offer substantial variety. The usually noble American ethic of being practical and down-to-Earth takes on an edge when you ask for something besides fried cow. What, are you some kind of elitist? Fried potatoes not good enough for you, you want fried mushrooms or zucchini instead, eh? Yeah, you must be an Imperialist to be making demands like that! No, actually, we’re not Imperialist, we just saw that food pyramid that the USDA put out and thought that it might make a good idea to support it.

Of course, the food industry feels a huge economic impact. Cost measures are everywhere; it’s difficult to get Americans to try something new, tough to find a supplier that offers a diverse stock who is also economical, and especially hard to hire trained staff that knows how to make dishes not usually found in the average homogenized restaurant. But with a small amount of effort, this can all be overcome. And the reward potential is outstanding. The restaurant business being competitive as it is, the one best way to draw a customer base is to offer something unique that you can’t get anywhere else.

Because you don’t want to be just another grill. You want to be that fantastic place that people drive miles out of the way to get to and tell all their friends about. You want to be the kind of place that serves the food people get an irresistible craving for. Irresistible cravings, after all, aren’t just a matter of taste – nutritionists have indicated that they’re your bodies way of telling you that you need certain nutrients that only the craved-for food can provide. But most of all, you want to be recognized as the food service manager with an edge, somebody who thinks out of the box and makes their business crazy successful by being better than all the others.

Quality in the Service Industry Is Job One – Your Service Must Be Quality

I have long been conflicted about what exactly quality means. Is quality in the eye of the beholder? Is quality impossible to achieve if you manufacture or sell cheap/inexpensive products or services? Is China or Mexico or Taiwan or Russia universally synonymous with poor quality? What does it mean to say, “You get what you pay for”? Is there a market segment where poor quality works? Is a quality product or service more expensive? Is a JD Powers ranking becoming another certification for quality?

Quality is becoming a almost a common theme. It has even become self proclaimed and anointed. Go to most any website or peruse literature and you will note most copy proclaims something to do with quality. Most people are in awe when they see a company producing product under an ISO Certification, but do they know what ISO Certification really means to them? In addition to ISO you find quality certifications for most industries/economic sectors. There is Six Sigma, CRM, TQM, Deming and even variations within these programs.

Frankly, it all boils down to a simple fact: Did the customer get what was expected for the time or money expended; was the client satisfied with the exchange-their time and money for the service or product? Further, satisfaction can also be achieved through quality programs, it’s called Customer Service.

Over the years I have been party to major ISO certification efforts and attended Deming Seminars on achieving quality. In the 1980’s the Navy got involved in quality improvement. The theory was, everybody outside of your department that came to you looking for help had to be looked upon as your ‘customer’. Further, periodically your customers were ask to rate your delivery of services. But, the simple fact remains: Did you give the client/customer at least what was expected relative to value in a product or service? Quality issues are still talked about today, just not as much in your face. Look at the slogans-Job 1, quality goes in before the name goes on, 98.6% customer satisfaction rating. Then look at the success of iPhone built in China. I would compare that quality with any product in the rest of the world relative to quality.

Before we move on let me ask another question, “does the purchase of product or services from the internet limit the consumer’s ability to buy and receive quality?” Let me illustrate with a recent experience. I recently bought a car charger for my cell phone from an on-line seller. The picture of the product looked great, seller advertised it as being quality and all the customer ratings were great. Guess what? It was an absolute disaster relative to the product experience. The quality was poor and it did not work. Sure, I could get a refund but the hassle of filling out forms, time zone issues, no phone contact, etc.; that total experience was just not good!

The father of quality innovation is Dr. Edwards Deming. Dr. Deming is known for his work in Japan following WW II. He was known to General MacArthur and was brought to Japan to help revive Japanese industry. Japan did in fact turn out some very quality war products with exceptional engineering such as the Japanese Zero aircraft. But after WW II the future was in consumer products. Therein was the problem for the Japanese…cheap and volume was their mantra.

He was a statistician by training and that experience was the foundation upon which all industrial quality programs were based. I submit that the philosophy of production quality also applies to the service sector. Dr. Deming’s task was to set a course for Japanese industry to move from cheap and shoddy, to innovative and quality products. It took time before quality was recognized in the Japanese automobile, aviation and consumer electronics. Are names like Toshiba, Sony, Mitsubishi, Honda, Nissan, and Lexus, just to name a few, familiar to you as quality today? I can remember when Datsun (today’s Nissan) was laughed at as a rust bucket automobile.

My point is: Quality matters to the majority, but there is still room for the cheap products. I read a report several years ago that stated that buying cheap products and replacing them with new cheap products was a cycle that was extremely expensive. But obviously, sometimes quality is out of the reach of some people or for even a specific application. For example, I do not need to buy Snap-On tools. A socket set I buy at Wal-Mart is perfect for my applications at about 1/10th the costs.

But let’s ask a simple question: Is quality that much more expensive to produce and deliver? I submit the short answer is- No! This short answer is based on some assumptions in the areas of: volume, product life cycles, designed use, government regulations, automation, and distribution. Even Six Sigma has proven quality improvements in the service sector can save costs. Simply retaining clients because of good service is 5 times cheaper than replacing dissatisfied clients.

I am in the service sector and I want to illustrate why potential clients should look for vendors and service providers that deliver quality. I believe we will discover that it benefits everyone.

If you are committed to having and maintaining a reputation for quality of service, you should strive to work with clients who want, understand and appreciate quality. Conversely, if you are a client demanding quality look to providers that have processes in place that will deliver on your quality goals. It is a fact that in a ‘high touch’ industry the quality of service is expensive to deliver. Therefore, knowing what the client expects will dictate the level of quality all parties agree upon.

My definition of Quality, in the service arena, is delivering services that satisfy the client’s expectations. Part of the satisfaction equation is managing expectations and that means not over committing and/or under delivering. Do not compromise an ability to deliver quality bu lowering the price for the sake of getting a client.

To ensure you are constantly improving on your quality commitment:

  • Always strive to improve processes and communication throughout.
  • Match the right vendors and employees with the delivery of service.
  • Partner with vendors who have the same quality motives.
  • Document informal agreements and discussions where practical.
  • Take actions to support quality, it speaks volumes.
  • Seek out clients who appreciate and demand quality because those are the relationships that build your reputation.
  • Pleasantly surprise clients in anticipating conflicts and quickly address issues.
  • Use checklists for a project; never rely on memory
  • Debrief with all vendors and the client. This will ensure that the client can air concerns and it gives you the chance to resolve problems. After all, satisfying the client is the goal.

In the service arena 96% of unhappy clients/customers do not complain to the provider of the service. But, they are 3 times more likely to give a poor recommendation versus those clients that did complain.

Whether it is a vendor or client, be inordinately fair and respectful throughout the process. I work with a vendor that refuses to address anyone by their first name or nickname. Familiarity deprecates the client’s perception of professionalism.

This sector is more ‘touchy feely’ and by definition is very labor/time intensive. It requires a high level of personal interactions. To be successful it must be based on personal reputation, trust/relationships, and an unspoken contract of-“I will trust you to do what you say you will.” There are many stories in business about people who did deals on handshakes alone. Today however, we need contracts to provide continuity as people move from job to job and position to position. Wouldn’t be nice for people to say about your service company; I got more than I expected and contracted to receive.

There are some similarities between the product (manufacturing/goods) sector and service sector. For example, there is a perceived value of quality relative to the specific price of goods or services, and both have an element of customer service value that adds to the quality experience. Availability is a critical element to the perception of quality in separating a premier provider versus also ran.

In essence, if you are a client look for providers who present well organized plans and suggestions, listen well to your stated and even unspoken requirements, offer ‘wow factor’ alternatives, have a reputation of excellent delivery and a group that you can easily relate with.

Understanding the Sales Relationship in the Service Industry

Our job as a salesperson is to find problems that a customer has that is both profitable for you and the customer. Solving this problem creates a win-win. Your job, as a salesperson, is to demonstrate clearly that the value of the solution by your product or service is worth more than the price that you are asking for. In other words, the benefits, results, and satisfaction that will come from purchasing that particular service will outweigh the price.

Almost every failure in selling is because you have been unable to demonstrate that what you are selling is worth more in benefits results and satisfaction than you are asking in money value. The reason for this could be as simple as the salesperson describing the features and technical details of the product or service, instead of showing how the customer will benefit from purchasing this particular service. This small difference can be huge in terms of winning business. The customer does not care about the features, they want to understand what it will do for them.

Another thing to think about is that the sale is not over once the client has decided to purchase the service. The conclusion of the sale is actually the beginning of the sale in the customers mind. When the customer buys from you, the customer goes from being independent to being dependent on you, your company and your services. The customer has handed over a check to your company on the promise that the services discussed will be completed and meet their expectations.

Building A Strong Relationship

No company can survive on one-off sales. And no company should take any sale for granted. The first sale will always cost the most up front. Continuing to offer solutions to that customer that solves more of their problems will allow them to keep coming back to you and your company. Asking for referrals will allow for easier selling as the prospects will be more interested in your product or service. There are always new problems that need solving. Being able to demonstrate how your company can provide those solutions is the key.

An Overview of the Daycare Service Industry

The daycare or ‘child care’ industry generally refers to the care of children by non-family members outside of the home. The industry is quite broad and includes small home-operated daycare centers right through to large pre-school centers that take on an educational role as well as caring for the physical needs of children.

Some daycare businesses focus on children of a certain age. Infant care centers look after babies and children younger than two and ‘before’ and ‘after’ school care centers cater mainly to older children up until their teenage years. The main sector of the market is children under six who have not started school yet.

Daycare is a multi-billion dollar industry in the US and it has shown phenomenal growth over the past three decades, spurred on by the fact that more women are choosing to work instead of remaining at home with their children. Higher divorce rates have also meant that women are sometimes unable to take care of their children at home and have no choice but to work to support themselves financially.

The industry shows no signs of slowing down and is set to continue to grow over the next decade. Daycare has proven itself to be surprisingly resilient to recessions in the past.

Many people are drawn into the industry as it offers good opportunities for smaller sized businesses and it generally has low barriers to entry in terms of costs as well as red tape. The top reason that attracts people into daycare though would be a love of children. Daycare professionals work with children for most of the day and have a great chance to contribute to their growth and development.

Training requirements are still quite minimal for daycare workers with most states only requiring a child care certificate that can be achieved with less than 100 hours of study. While many people think that working with children is a dream come true they often discover that it can be more stressful than they originally thought so staff turnover rates are generally higher than other industries.

Parents are becoming more selective about the kind of environment that they want to leave their children in. Most parents now understand that the first four or five years of a child’s life are so important in that they highly influence the way that a child will learn and interact with others and their environment as they get older. Daycare has become much more than babysitting as parents have realized that it is important that their children are in an environment that stimulates learning and mental and physical development. There is definitely a trend in the industry towards quality in this respect.

The future of the daycare industry looks bright and savvy entrepreneurs who are able to balance a love of children with some good business sense should be well rewarded for their efforts.