5 Reasons Why Food Halls are the Perfect Entry Point for the Foodservice Operator

Look around and it’s possible you have seen a food hall pop up in any major city in the US. Why? Because they are epic that’s why?

Okay, maybe that is a little too general and biased but let’s take this to a practical approach and explore the 5 reasons why food halls are the perfect entry point for the foodservice professional.

#1: They meet guest demand for variety and lower price points and that is key

Guests want and desire change often. Food halls allow today’s consumer to meet a need that traditional restaurants don’t...cuisine variety.

A lot of restaurants can have a wide range of selections on their menu, however, they most likely are within a certain niche. Hard to find a menu that has crepes, ramen, sushi, and bbq on the same menu.

Food halls allow today’s consumers to find a little bit of everything. The smart food halls also offer smaller portions to encourage a more grazing style to eating. Variety is the spice of life they say and food halls allow people to explore other cuisines in a safe format.

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Shutterstock

#2: They offer lower startup costs than traditional brick and mortar restaurants

For restaurants just getting started the food hall allows you to get started without the major financial commitments that most traditional restaurant ventures require. No need to spend money on dining rooms and furniture as the food hall will take care of these areas.

You can get into a food hall concept for about a quarter of the costs that a 50-75 seat restaurant would be. That gives budding entrepreneurs a fighting chance in an ultra-competitive market like we are in now. There are some many costs that new restaurants do not anticipate that can really put a concept way behind the eight-ball before opening. Unexpected construction overruns with plumbing and electrical work, for example. HVAC installment that requires customized ductwork. Stainless steel tables. Refrigeration that can meet health department codes and more variables.

These areas of construction can quickly get out of budget really fast for new restaurants. In fact, the number one reason most new restaurants fail is undercapitalization. That usually occurs from construction costs eating up your startup budget.

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Shutterstock

#3: They allow you to refine your brand without too much risk

Food halls that are properly planned offer something that goes beyond the classic food court at a mall like we grew up with. These new food meeting spaces have become the rage in most markets since they offer food at an elevated level that goes beyond the standard pizza, Chinese food, or hot dogs offered at mall food courts. Instead, food halls offer upscale options like gourmet burgers, street tacos, poke, churros, lobster rolls, and many other ethnic specialties.

Forward thinking and entrepreneurial-minded food halls are also doing something that is exciting for new restaurant owners: they offer business coaching. Think of it as a business incubator!

Since food halls are successful when their tenants are successful, it makes sense to give people resources that perpetuate that success. Business development, branding consulting, restaurant systems, and marketing are just a few of the services that business coaching can provide.

#4: Existing restaurants can expand into new markets

“Food Halls allow an existing brand to really take their signature items to a new level. Luke’s Lobsters took the one item they are known for their Classic Lobster Roll and started rolling them out in food halls. That side business of doing what they do best brings in over $4M for the brand! says Kelley Jones of Kelley Jones Hospitality (Las Vegas.)

If you have a signature item, you should consider making a food hall concept focused on that! It can not only build brand depth, but it can also increase brand awareness. Remember that the goal is for market domination and recognition. Food halls offer a cheaper alternative to opening another full-service location.

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Shutterstock

#5: They allow you to have a better life

The food hall experience also can provide you with a lifestyle outside of the realm of having a full-service establishment. One thing many don’t consider is that with bigger restaurants come bigger headaches. All business problems are really people problems in disguise. So, the bigger your staff, the greater the possibility of more people problems popping up.

Also, as competition grows, having a small established food hall concept means you can staff it much easier! You will see that as labor becomes tighter and people demand higher wages, the food hall concept will be a great option for restaurateurs. Small is the new big! Plus, with the lower opening costs, it becomes a prime path to grow into a little restaurant empire.

Food halls are not slowing down anytime soon. The smart restauranteur will take advantage now before the rest of the market become wise and then jumps on the food hall bandwagon. It’s always better if you can be an early adopter to trends that have staying power.

Food halls are here. Are you going to jump in?

Want to learn more about food halls? Don’t miss this recent On Foodable Side Dish episode showcasing some of Miami’s best food halls.

Theory vs. Practice: The 5 Commandments of Food Safety

Theory vs. Practice: The 5 Commandments of Food Safety

By Jim Berman, Foodable Industry Expert

Food safety requires a number of investments that have no real return: Time for training. Money on tools and resources. All the color-coded, compliant toys that make the kitchen look like it is stocked with Lego parts. Putting “best practices” in place with those ignored, vinyl binders collecting dust on some gray file cabinet. And that doesn’t even get into the warfare-like stockpile of chemicals taking up good closet space.

It would be a full-time to job to keep everything straight. But, without some nets — hairnets? — in place, a typical Tuesday afternoon can be anything but. Food safety is hugely important. In the 2016 AlixPartners North American Restaurant and Foodservice Survey, food safety ranks second with consumers’ soft spots, just below prices and even above nutritious options.

Few thoughts stir a restaurant operator as much as a sleep-disrupting nightmares of fire, employee injuries, and the local news crew kicking in the front door over allegations of food safety violations. But reality is reality; Unless something goes wrong, food safety isn’t a focal point of daily operations because there are simply too many balls to juggle at one time. Boiled down, here are five commandments for keeping the paying public healthy to spend their money in your establishment.

Read More

Minimum Wage Hike Forces LA Restaurants to Change Operations

Restaurant Closed Sign

Los Angeles’ recent minimum wage increase went into effect as of 2015 and will continue to rise to $13.25 an hour up to 2017.  According to research by the Pew Research Center, nearly 44% of the minimum wage workers across the country are in the food preparation and service industries.  Yet while Los Angeles’ wage increase seems likely to benefit the multitudes of restaurant workers currently working for minimum wage, for restaurants the effects are not as beneficial.

For restaurants and other small businesses that are particularly sensitive to minimum wage hikes, these increases have forced businesses to reevaluate their operations.  While mass layoffs is not an option as service would be affected, restaurants have begun resorting to other measures to combat the effect of the minimum wage hikes such as shortening their opening hours, foregoing the staffing of hostesses in the mornings, and eliminating nonessential positions such as sous-chefs and assistant managers. 

For some restaurants, their choice of ingredients has also been affected by these hikes, with many now favoring lesser expensive cuts of steak and considering switching from fresh to frozen seafood.  And for an unfortunate few, the minimum wage hike has caused them to permanently close their doors.

With Los Angeles City Council members proposing further wage increases by 2019, these cost saving measures will likely only increase.  How will the continued minimum wage hikes affect other Los Angeles restaurants?  Read More