Chapter 7 The Restaurant Business

Introduction to Hospitality, Fourth EditionJohn Walker

©2006 Pearson Education, Inc.Pearson Prentice HallUpper Saddle River, NJ 07458

Chapter 7The Restaurant Business

After Reading and Studying This Chapter, You Should Be Able to:

Describe the different characteristics of chain and independent restaurants

Identify some of the top chain and independent restaurants

List the classifications of restaurants

Differentiate the characteristics of chain and independent restaurants

Restaurants Vital part of everyday life Patronized several times a

week for social purposes as well as to eat and drink

Offer society a place to relax and “restore”

Offer an opportunity to enjoy the company of friends, family, colleagues and associates

More About Restaurants 50% of the food dollar

is spent away from home

Multi-billion dollar business

Employs 11.7 million people

French Cuisine and Its Foundation

The French are credited with culinary art, largely due to two main events

French Revolution Thomas Jefferson

French cuisine and its foundations

Mother sauces Nouvelle cuisine (lighter cuisine)

American Adaptation Infusion

Blending of flavors and techniques of two cuisines

Culinary Greats Auguste Escoffier

Patron Saint of Cooking Julia Child Emeril “BAM” Lagasse Bobby Flay Charlie Trotter Alice Waters Paul Prudhomme Nobu Matsuhisa Gordon Ramsey Wolfgang Puck

Chefs of Today Need to Possess:

Cooking skills Employability traits People skills

Jeffrey VigillaExecutive Chef

Hilton Hawaiian VillageWaikiki

Approximate Market Share of Restaurant Segments

Full-Service Luxury Restaurants National Restaurant Association Good selection of menu items made on premises Haute cuisine Fine Dining Hall of Fame

Le Bec Fin Spago

There are few national chains Morton’s Ruth Chris’s Roy Flemings

Reasons for the Small Number of Luxury Restaurants

Labor intensive and require a higher level of skilled labor

Small percentage can afford high prices

Overhead costs may not be reasonable

Economies of scale are not as easily reaped

Consistency and quality are not easy to maintain

Limited market appeal

Other Restaurant Classifications Theme restaurants Celebrity-owned

Owned by celebrities such as Michael Jordan, Dan Marino, Steven Segal, Gloria Estefan, Junior Seau, Denzel Washington

Seau’s San Diego All Star Café House of Blues

Michael Jordan’s

Casual Dining and Dinner House Restaurants

Mid-scale casual restaurants

Family restaurants Ethnic restaurants Specialty restaurants

Specialty Restaurants Quick Service

Theme related $111 billion annual sales Better known as fast food Limited menus Guest helps defray labor costs

Quick ServiceHamburger

McDonald’s and Ray Kroc Added breakfast Expanding overseas Co-develop sites with gasoline companies $33 billion worldwide sales Drive thru

Quick Service Pizza Local and regional chains all with

delivery service $20 billion market Four major chains

Pizza Hut Domino’s Papa Johns Little Caesars

Quick Service Chicken

KFC is market leader Home delivery “3 in 1”

restaurants Other chains

Church’s Chicken Popeye’s

Other Types of Restaurants Steakhouses

New growth area Outback Steakhouse

Seafood restaurants Pancake restaurants Sandwich restaurants Family restaurants

Ethnic Restaurants Independently owned and

operated Mexican restaurants are

largest growth segment Different types are

developing Thai Indian

Trends Demographics Branding Alternative outlets Globalization Continued diversification More twin and multiple

locations More points of service More hyper-theme

restaurants Chains vs. Independents

Hawaii All Star Chefs Roy Yamaguchi Sam Choy Chef Mavro Alan Wong Russell Siu Peter Merriman