restarting your restaurant after covid-19...extensive restaurant and hotel operations experience •...

www.scorevermont.org

Restarting Your Restaurant After COVID-19MAY 19, 2020

JOHN PARMELEE


Agenda & RulesAGENDA• Rules for the webinar

• Introduction to the SCORE Organization

• Speaker Introduction

• Part 1: Preparation for Re-Opening

• Part 2: Know Your Numbers - Seating & Revenue

• Part 3: Forecasting & Breakeven Analysis

• Q&A

• Closing comments & survey

RULES FOR THE WEBINAR• All registrants are muted by default

• Question? Tap the Q&A button

• Chat will not be monitored

• If you use your mic, you are consenting to the recording and our non-profit use of it.

• This is not a confidential webinar or meeting.


SCORE• SCORE is an all-volunteer organization – we’re here to help small businesses, start up, grow up and succeed.

• Nationally, SCORE has over 10,000 volunteers!

• SCORE has more than 250 chapters across the country to serve local business communities.

• We provide confidential mentoring at no cost to you.

• SCORE offers 4 different types of mentoring: face-to-face (suspended for now), phone, email and video.

• SCORE has helped more than 11 million current and aspiring entrepreneurs through mentoring, workshops and educational services.


SCORE Vermont• Service area: ◦ Most of Vermont, in addition to Clinton, Essex & Franklin counties of NY Bennington county Albany chapter

Windham county Merrimack Valley SCORE (NH) chapter

Areas of Windsor and Orange counties Upper Valley SCORE (NH) chapter

• Main chapter location: Burlington, VT◦ Additional Branches: Montpelier, VT

Plattsburgh, NY

• Number of volunteers on our roster: 45


SCORE ServicesAlmost all services are at no cost

Mentoring

Confidential

No cost

Ongoing

Webinars & On Demand

Courses

Startup Roadmap

Simple Steps to Starting Your

Business

Simple Steps to Growing Your

Business

Online Resources

E-Guides

Templates

Checklists

Blogs

Videos

Infographics

Local Education

Events

Educational Series

Roundtables

Webinars

Workshops*


How Do I Sign Up for A Mentor?• Visit www.scorevermont.org or www.scorecfe.org

• Click Find a Mentor

• Check your email .. The next steps will come via email


Today’s SpeakersJohn Parmelee• SCORE Subject Matter Expert

• Professional career background blend of collegiate teaching at SUNY Plattsburgh and extensive restaurant and hotel operations experience

• Specializes in the restaurant and hospitality industry in the North Country and Vermont


Part 1: Regulatory Resources• Vermont OSHA – excellent document for education about the virus itself and workplace

protocol◦ VOSHA online/printable training: https://labor.vermont.gov/VOSHA

• State guidelines

• Local health department – maintain open lines of communication

• Monitor Chamber of Commerce and Government updates regularly

• Social Media and compliance transparency


Creating the Compliant Workplace Culture• Ownership / Management should have a

compliance focused management◦ Prioritize clear priority for compliance◦ Communicate sanitation and safety protocols for

employees◦ Proactive communication for customers

• Internal◦ Staff training and compliance◦ Follow federal, state and local requirements

• External◦ Guest safety procedures and compliance while

simultaneously maximizing income per square foot of your establishment.

◦ The new seating plan

Customer

EmployeesOwner/Manager


Regulatory Practices • Appoint a COVID contact person in your business - 24/7 may require more than one person

in some instances?

• This person must be fully trained in all required practices and able to answer any relevant questions about the virus

• Employees may be required to answer certain health related questions prior to beginning their shift – temperature check?


Training• Documented training for all employees from management to line employees - classroom vs.

possible virtual training

• Logging compliance procedures – similar to temperature logs


Required Practices• Employers should have a plan to protect from spread of COVID-19 by employees and

customers

• Modifying the workplace (shields/barriers, moving workstations)

• Social distancing seating plans

• Cleanliness and sanitation documented sanitation schedule for all contact services

• Personal Protective Equipment (PPE): Comfort Factor

• No communal table top items or menus:◦ Condiment caddies◦ Paper/chalk boards◦ Electronic signs


Prepare Your Restaurant Seating Plan• Have a designated controlled entry plan◦ Reservation process◦ Waitlist procedures

• Compliant waiting areas and seating practices

• Compliant dining room, lounge and bar seating chart 25% or 50% occupancy? ◦ 6 feet between tables◦ No tables larger than 6 patrons

• Proper and professional signage (bilingual) for welcoming guests◦ Curbside Pickup◦ Dining Room and Bar Areas◦ User friendly


Part 2: The Revenue RecipeNew # of Seats

x Turnover

x Days (hours) of Operation

x $ Average Check per Customer

= $ Sales Revenue

• This is the process for forecasting revenue

• Goal is to determine your theoretical & realistic sales level


Pre Opening: Number of Seats Available• Determine your new realistic capacity at full volume vs. previously

• Maximize available seating

• Options to consider:◦ Outdoor seating◦ Is your town seeking to divert traffic for heavy restaurant traffic?


Seat TurnoverThe ultimate goal is to determine the average number of guests served, per meal period, per day

• Break down the anticipated number of customers served by days of the week and by meal period (if applicable)

• Demand is the major unknown

◦ Pent up demand

◦ Market specific

◦ Future of large parties and functions

◦ Who will show up

• Determine a realistic target turnover time (minutes) for your tables/seats during peak demand by meal period if applicable

◦ Casual Dining (60-75 min) vs. Fine Dining (90-120 min)


Seat Turnover• Staff training in all areas is critical for expediting turnover

• Factor in increased curbside sales revenue

• Reservation protocols


Days (Hours of Operation)

• Essentially, how many days in the projected period you plan to be open for?

• Do you contract or expand operating hours?

• Are you open 6 days instead of 7 -or- 5 days instead of 6?


Menu Engineering The Menu Is the Tool To Profitability

Menu Engineering and Sales Mix

• Connecting the customer to your bottom line

• What would you like customers to order from your menu?

• High gross profit

-or-

• Quick Turn

• High gross profit sales mix and its impact on the bottom line: “sell the lobsters”


Menu EngineeringAverage Check

Isolate from historical data and operational experience the following:

1. Lead Sellers / Signature Items

2. Menu Item Positioning / Graphics / Placement

3. High Gross Profit Items

4. Shorter Cook Times (fewer steps to produce) Estimate optimal ticket times

5. Abbreviated menus with more specials


Menu Engineering ConsiderationsAverage Check

1. Consider supply chain both from an availability and price stability perspective. Communicate with suppliers.

2. Compliance Cost Factor: Adding PPE costs to each menu item .50 to $1.00 Masks, thermometers, gloves and other safety equipment

3. Consider to go friendly items: Consider creating a separate to go menu and integration of POS on ordering platforms

4. Take advantage of disposable menu flexibility – specials etc.

5. Be entrepreneurial Think outside the box to create new revenue sources

◦ Sauces

◦ Apparel

◦ Menu packages


Menu EngineeringAverage Check• Pricing◦ Consider displaced revenue, packaging and compliance costs and be price competitive

• Study your competitive set Direct Competitors (3-5) pricing closely ◦ Starters◦ Entrees◦ Non alcohol beverages◦ Alcoholic beverages◦ Desserts

• Determine a new average check per customer per meal period ◦ Including or not including alcoholic and non alcoholic beverages◦ Use historical data


Beverage Sales• Table service historically a percent of food sales ratio◦ Example 75% food sales to 25% beverage sales

• General bar sales◦ Realistic percentage of historical sales 50-75%?


Calculating Estimated RevenueCalculation:

New # of Seats

x Turnover

x Days (hours) of Operation

x $ Average Check per Customer

= $ Sales Revenue

Example: 100 seats x 1.25 Turnover x 313 days x $13.00 Avg. Check = $510,000

• Select a useful time period to calculate sales 3, 6, and 12 months

• Don’t forget to incorporate beverage and curbside and other sales

• Best Case / Worst Case scenarios based on turnover


Part 3: Breakeven Sales AnalysisThe ultimate goal is to determine what is the estimated breakeven sales level

Step One:

Isolate fixed expenses, overhead, insurance, utilities, taxes, fixed wages etc.◦ Example: $150,000◦ Prorate as necessary $12,500 monthly

• Reminder: Possible impact of PPP on forgivable payroll (immediate vs. long term affect)


Breakeven Sales AnalysisStep Two:

Determine the Contribution Margin (cm):

• Variable cost percentage as they relate to sales

• (45% (CGS) + 20% labor + 5% misc. operating costs = 70%)

• Then, subtract this total from 1 to determine the (cm)

• Example: 1-.70 = 30% cm (20-60) normal range

• Breakeven sales level = $150,000 (FC) / .3 (cm) = ~$500,000

• Compare to estimate using revenue recipe on previous slide of $510,000

• $500,000 / 313 days of operation ~ $1,600 per day


Breakeven Sales AnalysisHow many guests do we intend to serve?

• 100 seats x 1.25 (seat turnover) x 313 (days of operation) =

39,000 anticipated customers = 125 per day average

What is the required average check?

• $500,000 / 39,000 = ~$13.00 average guest expenditure◦ Does your menu support this average check?

Use this average as a base price point for pricing appetizers and entrees


Other Formula Applications1. POS OOP (online ordering program) installation cost $1,300

$1,300 / .30 (cm) = $4,500 in sales to cover cost

2. Profit Desired or Added Fixed Costs$150,000 (FC) + $50,000 (Profit Desired) / .30 cm = $670,000 sales$670,000 / 37,500 covers = ~$17.75$670,000 / $13.00 = 52,500 covers


Conclusions• Be prepared to be compliant by being resourceful and focused

• Forecast your financial future

• Work together and help each other meet this challenge


Q&AEarlier in the presentation, you had mentioned that there should be a member of the staff that is trained in following COVID guidelines, will this be mandated or is this a suggestion?• Mandated per Governor Scott’s orders.◦ 1. Health and Safety Requirements. All employees, including those already working (except healthcare workers, first responders, and others already trained in infection control,

personal protection/universal precautions), must complete, and employers must document, a mandatory training on health and safety requirements as provided by VOSHA, or another training program that meets or exceeds the VOSHA-provided standard.

◦ 2. Training Requirements. All employers shall provide training and a written copy of standard operating procedures to be developed by the Vermont Occupational Safety and Health Agency (VOSHA), in consultation with VDH, on, at a minimum: The signs and symptoms of COVID-19 and an explanation of how the disease is spread; Information on appropriate social distancing and personal hygiene practices, including those set forth in this Addendum 11 to the Executive

Order and applicable ACCD Guidance; and The types, proper use, limitations, location, handling, decontamination, removal, and disposal of any PPE being used.

◦ Employers may adopt another training program that meets or exceeds the VOSHA provided standard, or additional policies and procedures that are applicable to the employment environment and employees’ duties, which shall not be less restrictive than those developed by VOSHA. All businesses and non-profit and government entities in operation must complete and document mandatory health and safety training by May 4, 2020.

https://governor.vermont.gov/sites/scott/files/documents/ADDENDUM 11 TO EXECUTIVE ORDER 01-20.pdf


Q&ADo you have any informed guesses about legal capacities, i.e. when it'll be legal to accept 25%, 50%, 100%?

• Best source is in the Mon / Wed / Fri Governor’s Press Conference ~11:00a (WCAX). ◦ A week ago, they hinted it was likely going to be like retail, open up slowly at 25% capacity. ◦ Monday this week, they hinted that they are likely going to do like NH and allow restaurants to serve

outside, but didn’t specify density. ◦ They also hinted that this Friday’s conference might be an announcement on restaurants.

• Summaries are always given on ACCD website, as well as their daily newsletters.

https://accd.vermont.gov/covid-19


Q&AWhat was the name of the cost analysis model you used?

• Cost Volume Profit Analysis. This model can be used for hospitality applications as well as numerous other types of businesses. It can be referenced by several different names.

When calculating REVPASH should that be based on the total number of seats or the social distanced seating plan?

• For the near future, use the social distance seating plan.◦ REVPASH applies to revenue per available seat hour. ◦ It is a fairly new metric being used in the industry for turnover purposes one step above the seats x

turnover equation used in the presentation. ◦ To minimize confusion, this was omitted from the webinar.


Q&AAny suggestions besides empathy on getting employees to comply with PPE and distancing requirements?

• The Why’s:◦ Health◦ The business could face legal action◦ It can be considered gross misconduct and dismissal may be allowed

• Options:◦ Let them choose their own PPE (who doesn’t love a Batman face mask?!)

Be flexible whenever possible

◦ Communicate with them in a friendly manner. Don’t order them around with a heavy hand. Address it by acknowledging that you recognize this is a cause of irritation.

Ask them for ideas on how resolve their issue, while maintaining that for the immediate future, state regs will require PPE.

Since this is state-wide, quitting an getting working at another establishment, is a moot point.


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Values, Beliefs and How We Act.

Our clients’ success is our success.

Our Mission:Foster vibrant small business communities through mentoring and education.

Owning Our

Future: One

SCOREOur Vision:Every person has the support necessary to thrive as a small business owner. VALUES

BASED

CLIENTFOCUSED

ACCESSIBLE

RELEVANT

BEST-IN-CLASS

GROWTHORIENTED

COSTEFFECTIVE

2025

Strategic Objective Indicator

SO1 Create More Client Success Impact – Client Outcomes

SO2 Expand SCORE Capacity Volunteer Engagement

SO3 Increase Sustainable Revenue Total Revenue Raised

How do we get there? See reverse!

C L I E N T S M AT T E R :

Lifelong LearningMattersWe believe that small business owners who are lifetime learners adapt to change more readily and are more successful.

Volunteers as lifelong learners remain relevant, achieve personal satisfaction and growth.

Small Business Matters

Small business is

the engine of our

national economy

through business

formation, job

creation and

wealth building.

Small businesses

and their support are

critical to vibrant

communities in

our society.

DiversityMatters

We believe in the importance, value and power of diversity – diversity of people and diversity of thought.

The diversity of race, gender,

ethnicity, geography, and experience is important and valuable

in SCORE.We strive to achieve

diversity of our volunteer corps, staff,

board and clients.

Giving Back Matters

We give volunteers, stakeholders and

sponsors the ability to give back to

communities through their support of

SCORE.

Successful small business owners understand the importance of

giving back to their communities.

RelationshipsMatter

In relationships, we act with integrity, respect, honesty, purpose, and

professionalism. We listen with an open mind, encourage and openly communicate

with all people seeking help from SCORE.Personal, long-term relationships are a

driver of small business success.

Community alliances are critical to the

success of SCORE.

VolunteersMatter

SCORE is volunteer business people

helping small business people solve business

problems.

Volunteers give freely of their time, energy

and knowledge to help others.

SCORE volunteers donate over 1 million hours of their time

each year to support their communities.

ExperienceMatters

A client’s experience matters – the truest

measure of our mission and our service – we ensure that our clients have a positive experience.

A volunteer’s experience matters – their relevant knowledge, wisdom and experience serve our

clients through mentorship and education.

A volunteer’s experience with SCORE matters – we ensure that volunteers find value and satisfaction while

engaged with SCORE.

POWERED BY

Funded [in part] through a Cooperative Agreement with the U.S. Small Business

Administration.

SO1: Create More Client Success

KPI – Client Outcomes (Business Starts, Jobs Created, Business Growth)

Strategy Actions

1 – Increase the number of clients seeking SCORE services (new client growth)

• Grow awareness of SCORE (mentions in media, social media interactions, traffic to website)• Increase number of client leads (mentoring requests, online workshop attendance)• Attract more diverse clients (% of women and minority clients)• Strengthen One SCORE branding (Form 16 brand compliance)

2– Leverage Client Service Quality (Client engagement, NPS, “did SCORE help?”)

• Improve Loyalty (Client Engagement, service drivers improvement)• Maintain transactional mentoring quality (Manage poor NPS performers, Improve CYNC)• Improve Quality of education services ( create, benchmark, and improve local and national workshop with

uniform NPS)

3 – Develop new services/products to meet client needs (New offers launched, “did SCORE help?”)

• Launch Voice of Customer panel• Recruit and promote “National” video mentors (video mentors, video MREs)• Develop client roadmaps

4 – Improve Client retention (long term clients, services per client)

• Return More Clients (long term clients, one and done mentoring clients)• Convert and Cross Sell (create and benchmark one and done rate across services, clients served by more

than one mentor)

SO2: Expand SCORE Capacity

KPI – Volunteer Capacity (number of active volunteers, volunteer engagement)

Strategy Actions

5 – Create Consistency and Improve Organizational Alignment (processes standardized, volunteer engagement)

• Playbook Development– Standard Processes/Procedures– Organizational structure

• Centralize Non-Client Serving Processes– Technology, CRM, Reporting (develop and launch new CRM)– Accounting, Banking (develop and launch centralized accounting and banking system)

• Eliminate silos and geography implications (Collaboration question in volunteer survey, organization model)

6 – Increase Number of Active Volunteers (number of active volunteers)

• Accept more volunteer applicants (volunteer acceptance rate)• Attract volunteers from new areas (applications from Strategic Partners)• Create network of national SMEs to ensure relevant experience and skills available to all clients (quantity of

national SMEs)

7 – Improve Volunteer Retention (volunteer turnover)

• Implement a Turnover Red Flag System (reduced volunteer turnover)• Build a Inclusive culture (volunteer diversity)

8 – Create Meaningful Local Community Engagement (field expansion, local partnerships)

• Strategic Location Expansion in field (new locations in high growth areas)• Advance the utilization of External Advisory Boards in more chapters (In Top 10 markets)

SO3: Increase Sustainable Revenue

KPI – Total Revenue Raised (Revenue Distribution)

Strategy Actions

9– Grow Government Relations Impact

• Small Business & Appropriations (achieve federal rev goal)• Other Federal Agencies (add support from one other agency)

10 – Increase Non-federal Revenues

• Corporations (Revenue raised)• Foundations (Revenue raised)• Individuals (Revenue raised)

11 – Support Field Resource Utilization

• Revenue Investment for Growth (Form 3 metrics)• Local Grants opportunity identification for chapters (Specific revenue line item growth in field)

(That’s an increase from 74% in 2017.)

Our Goal: 80% of clients say “SCORE helped me” by 2021 (An increase from 74% in 2017.)

SCORE helps a diverse range of American Small Businesses and Entrepreneurs.Of SCORE’S 2019 client base…

were women61%were minorities46%were veterans10%

2019SCORE is a uniquely American organization that synthesizes two historic national ideals: entrepreneurial spirit and volunteerism.Since 1964, SCORE has provided expert volunteer mentoring to more than 11 million entrepreneurs and small business owners. As the nation’s largest network of volunteer business mentors, SCORE is committed to helping any person succeed in their small business endeavor.

National Impact

29,681New Businesses Started

67,706Non-owner Jobs Created

97,387Total Jobs Created

$394 SCORE’s cost to help create one business

$120 SCORE’s cost to help create one job

$34.66 Amount SCORE clients return to the Federal Treasury for every federal dollar appropriated to SCORE

67% Percentage of SCORE clients that reported an increase in business revenue

39% Average business growth reported by SCORE clients

Over10,000Volunteers

serving clients in over 1,500 communities

Who We Are:

SCORE volunteers donated 4,919,089 hours of service in 2019

Research Methodology: The SCORE Foundation engaged Pricewaterhouse Coopers to conduct research into the economic impact that SCORE’s 10,000+ volunteers had on the US Economy in 2019. Pricewaterhouse Coopers conducted a census survey of all SCORE mentoring clients and 19,168 responded via telephone and web. Total client revenue, business creation, and job creation numbers were calculated via straight line extrapolation from the survey respondents to the total number of 2019 SCORE clients.

New Businesses Started

Non-Owner Jobs Created

Strengthening America’s Economy:SCORE earns the federal government money as a direct and effective catalyst for business and job creation.

Small businesses need money and mentoring to be successful. No organization is more effective at mentoring than SCORE.

Impact on the state:

Data provided by SBA

Small BusinessClients who Receive3+ hours of MentoringReport Higher Revenues and Increased Business Growth.

2019

SCORE is of notable value to entrepreneurs and small businesses:

Research Methodology: The SCORE Foundation engaged Pricewaterhouse Coopers to conduct research into the economic impact that SCORE’s 10,000+ volunteers had on the US Economy in 2019. Pricewaterhouse Coopers conducted a census survey of all SCORE mentoring clients and 19,168 responded via telephone and web. Total client revenue, business creation, and job creation numbers were calculated via straight line extrapolation from the survey respondents to the total number of 2019 SCORE clients.

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69% of all clients indicate that SCimportant to their business success

ORE is

FAQs About SCORE

• Since 1964, SCORE has provided expert mentoring to more than 9 million entrepreneurs and

small business owners.

• SCORE is an all-volunteer organization – we’re here to help small businesses, start up, grow up

and succeed.

• Nationally, SCORE has over 13,000 volunteers!

• SCORE has more than 350 chapters across the country to serve local business communities.

• We provide confidential mentoring at no cost to you.

• SCORE offers 4 different types of mentoring: face-to-face, phone, email and video chat.

Can I? Switch my mentoring methods?

Yes! You’re never locked into a specific mentoring method. If you prefer face-to-face during the summer –

great! Want to switch over to phone, video or email during the winter – great! Just keep an open line of

communication with your mentor about your needs.

Meet my mentor more than once?

Yes! You and your mentor will work out a schedule to meet on a frequency that works within both of your

schedules.

Bring my business partner to my mentoring?

Yes! We can always get a conference room (if we’re not meeting at our downtown location), get everyone on

a conference line, have a group video session (Skype, Zoom, etc.), or include everyone in email mentoring.

Have multiple mentors?

Yes! We realize that as your business develops and grows, you may need additional specialty mentors. Simply

ask your lead mentor to bring in a subject matter expert or another mentor.

Use SCORE for another side business that I want to start?

Yes! Just communicate with your mentor or contact the chapter.

Change mentors entirely?

Yes! Sometimes personalities just don’t mix. We get it. Contact the chapter to request a

different mentor.

Meet with my mentor in your new office?

Yes! We just moved to Downtown Burlington and we have 2 offices, plus a conference room.

Take a break?

Yes! We realize that there are times when you’re not available for mentoring (i.e. busy season,

life changes, etc.). When you’re ready to resume mentoring, simply contact your mentor, or the

chapter, to resume your mentoring schedule.


Survey Time!You will be prompted to fill out the survey at the end, along with a reminder in 48 hrs.

Thank You!

restarting your restaurant after covid-19...extensive restaurant and hotel operations experience •...

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