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Our Industry’s Image

I’ve been blessed with a long career in the hospitality industry, during which I’ve met some of the most engaging, caring, and creative people among my fellow restaurateurs and chefs.  We’ve laughed, cried, broken bread together, shared our business secrets, spoken of our successes and our failures, complained about our competitors, our landlords, and our governments, and taken pride in those we have had the privilege to mentor. Do you know what I’ve never heard any of them say, even in private after many fine wines and whiskeys? “I really don’t want to provide healthcare for my team members because I want to buy a new boat.” Or, “Quality of life is important only for me and my family. My employees can fend for themselves.”
The newest addition to my résumé is as a member of the Restaurant Brain Trust, a group sponsored by the financial services firm BDO. It includes a realtor, a contract CFO, a restaurant investor, a BDO marketing professional, and myself. The Trust comes together to create events designed to share beneficial information about the hottest topics affecting the hospitality industry in the DC region. In this role, my fellow Brain Trust members and I speak frequently on all the issues that can adversely affect our business. They are many, and many are frightening.
But here’s what is fascinating to me. When we speak to operators and managers about all these subjects, their comments and questions universally emphasize the positive angles on all these areas. They don’t ask “How do I avoid providing healthcare?” Instead, they’re asking, “How do I provide good healthcare coverage while running a healthy business?” Or, “How can I build an environmentally friendly restaurant while remaining within my development budget?” And most importantly, restaurateurs are asking, “How do I provide my team the ability to earn a good living while running a financially successful restaurant and without raising prices?”
Restaurateurs are providers by nature.That’s how many of us ended up in this business. We love the act of giving and making people happy. We like being generous. There is a little bit of Santa Claus in us. So when we are portrayed as the “Industry of No,” against a raise in minimum wage, or healthcare legislation, or family and sick leave, we get frustrated and defensive because it simply isn’t true. In fact, we’d love to be able to do all of the above and more. What is true is that owners understand that we are responsible for the income and livelihood of our team members, and a restaurant that goes out of business employs no one.
All this became crystal clear to me many years ago, back in the days when my friend Rob Wilder (co-founder of ThinkFood Group) and I were just starting our respective companies. I don’t recall where we were — whether I was drinking at his bar at the original Jaleo or he was drinking at mine at Sam & Harry’s. I do recall that he turned to me and said, “You know what keeps me up at night? It’s that I have 300 employees who are counting on me to ensure the financial health of the restaurants so that they can pay their mortgage, car payments, rent, and feed their families. I take that responsibility very seriously.” Rob, if it makes you feel any better all these years later, I didn’t sleep that night either.
Restaurants are a fine balancing act between desirability and costs. To restaurant patrons, it is a clear equation. Sure, we all want to eat at Pineapple and Pearls every night, but very few of us can afford that, so we balance that sort of occasional splurge with cooking at home, carry-out meals, and more moderately priced restaurants.
The balancing act for a restaurateur is less obvious. Restaurants desire to provide their teams every benefit and a superior quality of life. Yet, somewhere in there, fiscal responsibility acts as a governor of the “Santa Claus” tendencies. If restaurants have to charge $30 for a cheeseburger and $12 for a beer in order to provide benefits on a Fortune 500 scale, how many cheeseburgers and beers will they actually sell? And if the restaurants aren’t selling food and beverages because they are perceived as too expensive, how long will these businesses be able to meet payroll and pay benefits?
The image of restaurants as the “the Industry of No” is not deserved.  It’s really more like the “Industry of Wishing We Could do More.”

About the Author

MICHAEL STERNBERG is an award-winning expert in a wide array of foodservice venues, including restaurants, hotels, stadiums, arenas, and airports, with operations ranging from full-service to grab & go. He is CEO of Sternberg Hospitality, a full-service restaurant and hospitality consultancy, and a principal in Mokja Ventures, an investment fund for creative, scalable restaurant concepts. He can be reached at: michael@sternberghospitality.com or 703-298-2706.

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