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Chatter Central Tasting the expenses of food and beverage


This month's review of online chatter returns attention to a discussion taking place in a favorite group on LinkedIn. No, it is not McGladrey Club World, although that is certainly a favorite. This discussion is taking place in the group Club Advisory Council Internationale, hosted by Search America. The discussion that sparked a look online is one that has been addressed in many presentations offered by McGladrey professionals and also highlighted in an article authored by McGladrey professionals, Tammy Tassitano and Stephen Robinson, titled, Why are we losing money in food and beverage?, published by Club Management magazine.

Returning to the current discussion taking place online, it was spurred with the question: "Breakfast, potentially the most profitable meal of the day, is so seldom served in private clubs. Why?"

The first response to the question certainly endorsed adding a breakfast offering.

Successful clubs are always looking for ways to increase service and value; [sic] this should be one of the easiest ways. With a thought out and careful plan this amenity can be added with little or no added expense. I think this is another one of those mis-guided ideas that success means having a grip on operating costs.

Other traditional concerns are raised by the same commentator.

Nobody will use it; we don't need the added labor. Etc. Etc. Etc. [sic]

However, the contributor issues a challenge to operators.

Imagine the club that raised dinner prices [by] a dollar and gave away a simple breakfast, that would be a fresh approach to a different experience.

Another commentator shared some specific stories of how breakfast, "the most important meal of the day" contributed to the overall club experience.

I was involved with a City Club that introduced a FREE continental breakfast or a $1.75 breakfast buffet. An ala cart menu was also available. Being in the dues business it was interesting to note that in the first nine months attrition had decreased 12%. 30% of New Members commented (at New Member orientation) that their first introduction to the club was at a breakfast meeting. Not to mention a 109% increase in breakfast business meetings. It also turns out that the new monthly breakfast guest speakers program is viewed as a tremendous value to the Membership simply because it's the only time of the day they can attend. Yes, breakfast can be a most profitable meal if you approach it as not simply breakfast.

From a governance perspective, another interesting point was made by a contributor.

Clubs that have traditionally held their board meetings before, during or after dinner, with the attendant issues of booze and frequent staff interruptions, have found breakfast board meetings to be more efficient. Directors usually need to leave the club to start their day, either at the office or the first tee. Breakfast is also a lower cost comp for directors accustomed to free meals at meetings.

With continued focus on running private clubs as the businesses they are, while attempting to understand what practices can be adopted from other businesses, it was interesting to read the following comment.

As a developer we have traditionally offered a free continental breakfast, having already opened the door we added a simple a la carte menu–this has driven meetings, revenues, foot traffic, body heat, brought more people to the club earlier and more often—win-win.

Another commentator also points to a breakfast offering as being the wedge product to drive broader usage.

This is really an excellent opportunity for the clubs growth of member usage. If the price points can be put aside to see the bigger picture of member retention and the possibility of future banquet revenue it could be very successful in an area that most clubs let slip away. Clubs that have a dining room open for breakfast but with poor attendance can certainly benefit by utilizing the labor dollars already present and give the staff a better sense of pride in their work that tends to fade when hours go by without a member. It also gives managers an opportunity to get more face time with members that may not use the dining room as frequently. Anytime we have an opportunity to provide our members with further service without major impact to the P&L it should at the very least be given a chance. I plan to start a Saturday breakfast buffet in May so we may capture members with early tee and court times and hopefully capture more of our resident families.

Ultimately, the breakfast question is answered like so many others in the club business.

Try something completely different to entice traffic...pay what [it's] worth to you...we need to use imagination and intelligence in creating value and service to the club.

While management can never allow the constraints and operating parameters in private clubs to be factors that hide poor management practices, boards of directors and members need to understand all of the economic realities of operating the food and beverage operation at their clubs. Several stories have been shared recently by clubs attempting to outsource the operation to local restaurateurs with little success. Once restaurant owners understand the constraints they would have to operate within at a private club, they often walk away from the opportunity. The restaurant business is difficult enough, without facing the additional challenges that are the reality.