Food and Beverage Management Chapter 1 – The Food Service Industry Food and Beverage Management

Eating is not optional The History of Food Service – First Restaurants were part of homes that sold rooms and food to travellers By the time of the Roman Empire, Inns were common. The Roman Catholic Church – first “Hotel Chain” Inns and Alehouses in England as early as 1400 AD In the Americas – Cole’s Ordinary was among the first – Boston 1634

Food and Beverage in the Modern Era The early 20th century saw the construction of large modern hotels 1950’s – many felt the quality of food and beverages had declined in hotels. Today Food and Beverage is considered a prime profit center for many hotels.

Freestanding Restaurants Began in 1765 in Paris, France – the word restaurant derives from this establishment. In the U.S. the first restaurant is generally accepted as Delmonico’s in New York City (1827). The group closed in 1923. “Harvey House” was the first chain of commercial restaurants and hotels in the U.S. Guilds of Innkeepers and Catering Operators. This was a soup vendor (the Original Soup Nazi!)– who sold his/her soup as “le Restaurant Divine” the “Divine Restorative” In 1878 Harvey started the first of his eating house-hotel establishments along the AT&SF tracks in Florence, Kansas.[1][2] The rapid growth of the Harvey House chain soon followed. Fred Harvey is credited with creating the firstrestaurant chain in the United States. Harvey and his company also became leaders in promoting tourism in the American Southwest in the late 19th century. The company and its employees, including the famous waitresses who came to be known as "Harvey Girls", successfully brought new higher standards of both civility and dining to a region widely regarded in the era as "the Wild West". The popularity of the Harvey Girls grew even stronger in 1946, when Judy Garland starred in the film version of Samuel Hopkins Adams’ novel The Harvey Girls.[3]

Non Commercial Facilities Business Mills Employee Benefit Office Coffee Services Hospitals Therapeutic diets Schools Food Service began in mid 1800’s

Evolution of Food Establishments The automobile – drive in restaurants, drive through, etc. (A&W, Howard Johnsons) Quick Service and “Fast Food” (McDonalds, Burger King) “Fast” Casual Food Food Trucks Delivery (Pizza, restaurant menus) Laundro Bars Food Courts Grocery take out / sit down (Whole Foods) Home Meal replacements

Basic Segments Commercial Food Service Operations – Non Commercial Food Service Operations

Commercial Food Service Commercial Food Service Operations attempt to maximize profits primarily through the sales of Food and Beverage Examples: Restaurants Hotel F&B outlets Other – catering, food truck, carts, etc.

Freestanding Eating and Drinking Places – Can Be independent Corporate Chain and Franchise Styles Include: Fine Dining Casual Dining Family Service Quick Service

Lodging Food Service Operations Full Service A La Carte Dining – Gourmet to Family Catering Room Service Coffee shops Bars Limited Service “Lobby Food Service” None

Other Commercial Facilities Public Cafeterias Bars, Taverns, Lounges Ice Cream Stands Caterers Food carts and trucks

Non Commercial Operations Operations offering Food and Beverage as a component of –but not the primary mission Usually focus on offering nutritious meals and minimize expenses related to Food and Beverage Operations

Non Commercial Business Industry Healthcare Educational Leisure/recreation Transportation Organizations Private Clubs

Leisure and Recreational Business / Industry Company canteens (Google), Vending Healthcare Hospitals, Orphanages, Nursing Homes Educational Institutions Schools, Universities, Senior meals Private Clubs Country Clubs, Dining Clubs Leisure and Recreational Arenas, Amusement Parks, Casinos, Bowling alleys Transportation Companies Airlines, Trains, Ships Others Prisons, Military, Religious, athletic facilities, Cruise Lines,

Organization of Commercial Operations Commercial Food Services – 3 main categories Independents Chain Restaurants Franchises

Independants Chain Restaurants Owned by an owner or group with no chain affiliation May have multiple units Chain Restaurants Multi Unit Organizations Often have the same menu, purchase cooperatively Maybe owned by a Company, Franchise company, private owners(s)

Advantages of Chain Restaurants Easier to acquire cash, credit and long term leases Scale affords the opportunity to make a mistake Ability to experiment (foods, décor, etc) Personnel advantages Can afford specialists (finance, risk management Better internal controls – can compare results within units.

Disadvantages of Chains Difficult to keep up with changing markets and economic conditions Bureaucracy creep slows and can hamper efficiency Single bad event can damage the entire chain

Franchises Special category of Chain Restaurants Franchisee pays a fee to for the right use the Name, Design and Business Methods of the Franchisor Franchisees are often local investors Maybe be required to pay royalty fees on a percentage of revenue, advertising fees, sign rentals, food products etc.

Advantages to Franchising Start up assistance Company training programs National Advertising campaigns Name Recognition, Food Consistency Lower food cost with volume purchasing Tested operating procedures Employee recruiting

Disadvantages Strict Contracts Contracts tend to favor Franchisor Menu set Décor set Specified production equipment Contracts tend to favor Franchisor Little room to negotiate Co Branding – 2 franchises share facilities

Non Commercial Companies and Contract Management Companies As Pressures for cost containment mixed with lower revenue, there is a need for non commercial operations to operate more like their commercial counterparts Advantages Large Companies have greater resources to solve problems Can save money through effective national negotiations Can often operate at lower costs Faculty administrators can delegate to food service professionals

Disadvantages to Contract Management Companies May assume too much control – effecting public image Some people dislike the profit motivation in non profit type operations Concerns of decreased food quality Organization may become too dependent on the CMC.

The Future of Food Service Home Meal Replacements QSR – new foods and higher quality items More entertainment in casual restaurants More offering in non traditional stores (7-11) Comfort foods, Fusion Cuisine, Healthy choices Green Restaurants Improved Technologies

Vocabulary A La Carte Menu Chain Restaurant Co-Branding Comfort Foods Commercial Food Service Operation Franchise Franchisee Franchisor Green Restaurant Home Meal Replacement Independent Operation Lobby Food Service Non commercial food service operation Office coffee service