Imagine walking but all you can do is look at your toes – it’s only a matter of time until you bump into something and have to look up. Well, look up because as the top executive of a restaurant concept, it is time to think about the future of the restaurant. How far out are you willing to let yourself think?
We realize that in family dining and all full service restaurant models, there is little real growth with existing assets and all your peers are focused on fixing a broken model. It’s broken and while we can’t throw it out, the assets have value, there is only so much time until not only does fast casual steal more demand, but food that is delivered to the home and fresher food displaces what we know as the global chain restaurant concept.
We are not trying to sensationalize disruption, industry change or the like. However, staring at one’s toes and focusing solely on short term gains are not the answer. They are necessary but are not sufficient for maximizing shareholder value.
What is the solution? We recommend utilizing a Lean Startup approach to experimenting and optimizing the business model. From a core trend perspective, focus on two patterns, convergence of needs in convenience and better/fresh food. Realize that the Internet and business innovation in related channels and industries have created significant Channel Blur that cannot be ignored. Merely dabbling in delivery services isn’t nearly enough of a fix even today. Your industry boundaries are no longer defined by core competencies such as partnership/ franchise management, consistency, great service, cost/scale management, etc. Look at the future convergence in food consumption, driven by consumers’ unconditional need for fresh/healthy food when and where they want it. This means that grocers, packaged foods companies, restaurant office and home delivery and local chefs/caterers/commissaries all are your new competitors…or partners.
It is clear that the future restaurant brand and concept owner will look much different – as the leader you need to paint a vision to increase the value of your large enterprise now!
As the top officer we invite you to consider our approach which requires outside influence where we can deliver a strategic study, market tests, etc. so you can go to your board to demonstrate how you will lead the brand to capture more than your existing share of this new game. Keys to start are:
- Holistically redefine the future business model – Define the “what’s” as to what you are going to do to optimize the core restaurant concepts for the future
- Optimize the guest experience – segment guests and hone your concept against the most valuable segments, recommend improvements across the concept and physical elements, product innovation, and end-to-end service experience
- Cannibalize yourself with experimenting on next-generation new concepts – not just the lagging ones like “express” concepts at airports, universities, etc. For family dining it’s reinventing the concept as a fast casual (similarly, it is not a winning concept to just pare down a menu!)
- Focus on a strategy and model for global expansion – focus, invest and define a strategy on the key elements for market entry – global region by global region. This requires a strategic plan with significant market experience which we have. We estimate 90% of the restaurant chains are way under invested in this land grab and that once you miss it, you miss it
- Test brand licensing, partnership – to build awareness, brand ubiquity, and a multi-channel brand in grocery foods and home delivery, but take a long view of this and find right fit partners.
If you have done all those things, you are done – until then we can be reached here.