Food and Beverage Operations Management

A case study of La Maison Poisson

CONTENTS
INTRODUCTION ........................................................................................................................................ 1 SECTION 1 ................................................................................................................................................ 1 Financial analysis ...................................................................................................................................... 1 SECTION 2 ................................................................................................................................................ 1 Evaluation of performance of the Restaurant............................................................................................ 1 Alternative Menu based on current trends and fashion ............................................................................. 2 SECTION 3 ................................................................................................................................................ 2 Pricing strategy ......................................................................................................................................... 2 SECTION 4 ................................................................................................................................................ 3 Most important problem of the restaurant................................................................................................. 3 SECTION 5 ................................................................................................................................................ 3 SECTION 6 ................................................................................................................................................ 4 Action plan ................................................................................................................................................ 4 SECTION 7 ................................................................................................................................................ 5 Importance of sustainability and waste management................................................................................ 5 Sustainability policy of the restaurant ....................................................................................................... 5 SECTION 8 ................................................................................................................................................ 6 SECTION 9 ................................................................................................................................................ 6 Long term strategy for the Restaurant....................................................................................................... 6 CONCLUSION ............................................................................................................................................. 7 REFERENCES ............................................................................................................................................. 8 APPENDIX 1 ........................................................................................................................................... 10

INTRODUCTION
Speaking in volume about the Hospitality industry, pivotal role is being played by the Food and Beverage division. Without this section, no restaurant and hotel can successfully run their business (Andrews, 2007). In the absence of Food and Beverage section, any type of hotels and restaurant cannot be convinced. Here, in this research report a complete analysis about the F&B operations and its management is being done. For this purpose, La Maison Poisson, Dover is taken as a case Hotel. This Hotel is situated in Kent. The owner of the restaurant is Jim Haddock. When taking a glimpse of La Maison Poisson restaurant it was revealed that they have 61 seat licensed sea-food restaurants. They also have cosy and gorgeous bars all over the world (Importance of F & B Department in a hotel, 2010). Wide range of services is being provided by the hotel. Further they are also being known for their best table services and easy to control standards.

SECTION 1
Financial analysis After evaluating the financial analysis of La Maison Poisson restaurant it was revealed that the total revenue of the concern is increasing from 2009 to 2011 but at a very steady pace. Further the net operating profit of the hotel is increasing in 2009 and 2011; however it decreases in the year 2011. Hence, from the above financial analysis it can be observed that the food and drink sales have increased over the past two years which also led to an increase in the total revenue of the company (Arduser, 2003). However, the drink sales remained stagnant from 2009 to 2010 before showing a stark increase in 2011. Company had a control over its overheads and operating expenses and didnt allow it to escalate much (Harris and Hazzard, 1992). Nonetheless, the net operating profit has fallen down to 43,540 in 2011 from 61,520 in 2010 (Refer Appendix 1).

SECTION 2
Evaluation of performance of the Restaurant Jim Haddock, being a 61 year old man, consistently engaged in managing and organizing all the relevant activities of the restaurant. In the year 1992, Jim started his own restaurant after a year of struggle. Modest return was significantly earned by the hotel. There were many reasons attached in the success of the restaurant. Some of them may relates with proper maintenance of
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eatery, consistent improvement in the Food and Beverage production and presentation, high standards for every activities and good level of table services being offered by the Restaurant. The performance of the hotel can be evaluated on the basis of various factors like, easy to control standards for the employees, static menu and beverage list of the restaurant and familiarity of the staff with the working environment. According to Jim, all these factors are the main factors behind the continued growth and success of the restaurant. Alternative Menu based on current trends and fashion The current menu of La Maison Poisson is not well planned and developed. In the present scenario each and every individual desire certain things to be offered by their choice of restaurant (Andrews, 2007). The menu should be eye catching, easy to use, designed nicely and properly and finally it should be responsive according to the current awareness. Jim or the manager should work upon on developing a separate menu for the drinks like Non-alcoholic, alcoholic, wine etc. they can also include cock tails, wines, beers, spirits, liqueurs, cider, Perry, aperitifs, still wines, sparking wines, alcohol-free, fortified wines, aromatized wines and champagnes (Hard, n.d). In the food menu, they must include starters, something raw like taste. All theses alternation will going to fascinate most of the youngsters, thereby increasing the profitability of the business concern.

SECTION 3
Pricing strategy Only by presenting and designing the menu attractively does not boosts up the sales of the firm. Thus, it becomes pre-requisite on the part of the hotel owners to adopt right pricing policy for the product and services being offered by them (Oxenfeldt, 1982). The pricing policy and strategy for the new menu on the basis of different approaches is discusses below: Cost based pricing The selling price of the menu will be identified by adding some percentage of cost price to the cost of drink, say; Gross profit is equals to Sales minus the cost of sales (Cost-Plus Pricing, n.d). Competitor bases pricing Here in this method the pricing of the products and services is being determined by the prices being offered by the competitors of the company. Further, the selling price of the new menu will be fixed by considering market orientation. By

considering the ability and likeliness of competitors as well as what they are charging for the same type of operations is also evaluated for estimating the prices (Oxenfeldt, 1982). Psychological pricing This type of pricing approach is based on the assumption that there are certain prices, which have a psychological impact (What Is Psychological Pricing, n.d). There is also a notion that customers will respond easily with these types of prices and are more likely to purchase the same. Al these types of prices possess a digit of nine. The prices are tagged so on the belief that people will more assures that they are saving money on their purchase (Oxenfeldt, 1982).

SECTION 4
Most important problem of the restaurant In spite of having good and consistent standard, reasonable price of the food and conveniently located at the city town, the restaurant is coming across with numerous problems and obstacles. As Jim was asked to take rest, he appointed a full time manager, who takes into consideration all the operations and management of the restaurant (Importance of F & B Department in a hotel, 2010). The manager of the hotel was of the view that no sufficient scope was given for the purpose of developing and expanding the business. Further, Jim was also not spending huge amount on refurbishment of premises as well as in maintenance and hygiene. However, the important problems coming across with the restaurant are as follows: High attrition rate in the restaurant Failure in forecasting demand Problem with stale and boring menu No maintenance in regards with the health and hygiene

SECTION 5
In the above section it has been identified that the problem of high attrition rate was being the most important and crucial problem troubling the growth and success of the hotel. For the purpose of getting more insight into this situation, a detail analysis in regards with the number of employees leaving as well as being employed in the firm is required to be done. Here in this case study, no relevant information in relation with this problem is given (Managing food and beverage operations, n.d). As no proper scope was provided to the manager in order to expand and develop the business by Jim, absenteeism and turnover of the workers has increased
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substantially. The reasons and factors responsible for high employee turnover in the restaurant is significant to identify with a view to combat this situation (Managing food and beverage operations, n.d). The further required information can be obtained by surveying the employees who left the organization as well as aspirants who are on the way of leaving the hotel. This will help in determining as what factors are responsible behind this problem.

SECTION 6
Action plan

ACTION PLAN
Date 1/01/2012 Goal To identify and combat the problem of high attrition rate in La Maison Poisson Restaurant (Sample action plan, n.d)

Action steps

Timings

Surveying and interviewing employees

who left the

In next 30 days

organization as well as those who are willing to leave the hotel

Assessing their Reponses

In next 10 days

Taking corrective actions on the basis of their responses. Some of the steps might be: Improving the working environment Proper Reward and Recognition Appropriate performance appraisal system In next 45 days

 Compensation and Benefits

Mini goals and milestones Identifying the employees leaving the organization

SECTION 7
Importance of sustainability and waste management Waste management is nothing but the practice of accumulating and disposing the waste produced by the activities of human (Waste Management, n.d). For instance, if a person purchases any product, after it use it disposes of its plastic packaging, that packaging becomes waste. The time, waste is introduced in the environment; it spreads many harmful diseases and effects, which cause dangers to the life of human. Therefore, it becomes very important to manage this waste (Sustainable Waste Management, 2007). On the other hand, the significance of sustainability is different to different people. It encompasses comprehending the interdependent relationships between the culture, environment and economics (Ofallon and Rutherford, 2010). In the present scenario management of waste is very important; as recently more concerned is being imposed on environmental friendliness and greenery. La Maison Poisson restaurant owner should take into consideration management of waste in the intellects so as to avid many problems coming out of way. They can deal with the waste in many ways like collecting the raw-material, proper disposal, recycling and processing. Sustainability policy of the restaurant Saving of water in all different activities of work Separation of organic and in-organic waste Using biodegradable cleaning products Offering high quality services to guests Saving energy in all walks of work (Sustainable Waste Management, 2007) Remain committed towards protection of environment and culture heritage

SECTION 8
Quality of the food is considered as the main forefront in food services. Due to rising problems of health and safety, people are becoming more health conscious. Thus, in order to succeed and achieve a competitive edge over the other firms in the market, hotel should focus on introducing healthier options to their potential guests. Presently, obesity is considerably the major issue of most of the people. Many hotels and restaurants are shifting towards offering low fat meals and healthy food options to their potential customers. Introducing nutritional information on the menu is very important for the restaurant. This can be articulated from the rising problem of obesity, dietary problems and health in almost all countries of the world (Green, Drake and Sweeney, 2009). The information of calories, nutrition, fat and other data is vital in many aspects. Thus, the below facts, it will be proved that nutrition information on menu will be considered necessary for the restaurant to introduce. Some of them explained beneath: To avoid food allergies Helps in making healthier choices on the part of the consumers Nutritional information on menu propels the restaurant to make healthier meals for the guests (Gaydos, n.d). It also helps in avoiding certain diseases

SECTION 9
Long term strategy for the Restaurant For long term viability of the restaurant in each and every aspect, it is highly recommended to Jim, the owner of the hotel to introduce employee engagement and enrichment program for the purpose of motivating and giving them scope so that they can develop the business more (Dittmer and Keefe, 2008). This strategy will also help them in curbing the situation of high attrition rate within the organization. Further, the manager of the restaurant should also keep a check on disposing waste, such that proper health and hygiene will be maintained. Waste management strategy like 3R i.e. Reducing, Reusing and Recycling should be used by the hotel. This will help them to have more customer base for the hotel, which in turn improves the financial viability of the concern (Green, Drake and Sweeney, 2009).

CONCLUSION
The present research report has investigated various reasons pertaining to the success and problems being faced by La Maison Poisson restaurant located in Kent. This research study has commendable given an account of and reasons as to how the availability of the business concern can be improved in long term as well as what strategies should be adopted by the hotel in order to curb the high attrition rate (Cousins, Foskett and Gillespie, 2002).

REFERENCES
Books and Journals Andrews, 2007. Textbook Of Food & Beverage Management. Tata McGraw-Hill Education. Arduser, L., 2003. Restaurant Site Location: Finding, Negotiating & Securing the Best Food Service Site for Maximum Profit. Atlantic Publishing Company. Cousins, J. Foskett, D., and Gillespie, C., 2002. Food and Beverage Management. 2nd ed. Prentice Hall. Dittmer, P. R., and Keefe, J. D., 2008. Principles of Food, Beverage, and Labour Cost Controls. John Wiley & Sons. Green, E. F. Drake, G. G., and Sweeney, F. J., 2009. Profitable food and beverage management: planning. Hayden Book Co. Harris, P. J., and Hazzard, P. A., 1992. Managerial Accounting in the Hospitality Industry. 5th ed. Nelson Thornes. Ofallon, M. J., and Rutherford, D. G., 2010. Hotel Management and Operations. 5th ed. John Wiley & Sons. Oxenfeldt, A. R., 1982. Pricing Strategies. Amacom. Online References Cost-Plus Pricing. n.d. [Online]. Available through: <http://thesocialmarketplace.org/toolkit/price/cost-plus-pricing/>. [Accessed on th 9 December 2012]. Gaydos, L., n.d. Presenting important information to your customers. [pdf]. The University of Texas at Austin. Available through: website: <http://www.utexas.edu/student/housing/foodpro/pdfs/providingmenuinformation2012.p df>. [Accessed on 9thDecember 2012]. Hard, R., n.d. Building the Menu: Breakfast Options. [Online]. Available through: <http://eventplanning.about.com/od/catering/p/breakfastmenus.htm>. [Accessed on th 9 December 2012]. Importance of F & B Department in a hotel. 2010. [Online]. Available through: <http://redcarpetacademy.wordpress.com/2010/05/13/importance-of-f-b-department-in-ahotel/>. [Accessed on 9thDecember 2012]. Managing food and beverage operations. n.d. [Online]. Available through: <http://www.egyankosh.ac.in/bitstream/123456789/35740/1/UNIT-14.pdf>. [Accessed on 9thDecember 2012].

Sample action plan. n.d. [pdf]. ABclarke. Available through: website: <http://www.setting-andachieving-goals.com/support-files/sampleactionplan.pdf>. [Accessed on 9thDecember 2012]. Sustainable Waste Management. 2007. [pdf]. Audit Scotland. Available through: website: <http://www.auditscotland.gov.uk/docs/central/2007/nr_070920_waste_management.pdf>. [Accessed on 9thDecember 2012]. Waste Management. n.d. [pdf]. Available through: website: <http://www.environment.tn.nic.in/SoE/images/WasteManagement.pdf>. [Accessed on 9thDecember 2012]. Is Psychological Pricing. n.d. [Online]. Available through: <http://www.wisegeek.com/what-is-psychological-pricing.htm>. [Accessed on 9thDecember 2012].

What

APPENDIX 1
2009 328,000 94000 422,000 137,940 56,142 194,082 40.27% 37,858 57.95% 190,060 227,918 54.01% 123,600 37,042 6,800 167,442 60,476 14.33% 29.29% 27.72 9,196 4,680 2.456984 5143.726 14.0924 8.78% 1.61% 3.489362 7033.333 10.23335 18.17234 227,918 167,442 2010 342,400 94,600 437,000 140,800 57,480 198,280 39.24% 37,120 58.88% 201,600 238,720 54.63% 139,200 31,800 6,200 177,200 61,520 14.08% 31.85% 29.1 11,732 5,748 2.449548 5057.79 13.85696 7.28% 1.42% 3.61945 7283.333 12.50637 22.1778 238,720 177,200 2011 355,940 118,000 473,940 156,860 68,432 225,292 42.01% 49,568 55.93% 199,080 248,648 52.46% 158,800 41,608 4,700 205,108 43,540 9.19% 33.51% 30.56 15,686 8,554 2.292202 6081.211 16.66085 8.78% 0.99% 3.016441 7899 16.08527 26.45941 248,648 205,108

Food Sales Drink Sales total revenue Cost of Food Sales Cost of Drink Sales total cost of goods sold GP% drink gross profit from drink GP% food gross profit from food gross profit GP % total Payroll Overheads and Operating Expenses Maintenance total operating expenses net operating profit %operating profit Labor % Average spend per head food and beverage Average food stock Average drink stock ASPH food / ASPH drink Covers per annum Average covers per day Overheads and operating expenses % Maintenance % Food beverage ratio Seat turnover Food stock turnover Drink stock turnover contribution margin Fixed Cost

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Note: Calculations for total number of visitors = total cost of sales / average spend per head food and beverage

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