2. 2 Understanding Foodservice Operations

3. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Objective Recognize various foodservice segments.

4. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Foodservice Segments Commercial foodservice- businesses with a primary goal of preparing and selling food for money continued

5. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Foodservice Segments Noncommercial foodservice-operations that provide foodservice as a secondary activity; also called institutional foodservice

6. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Commercial Foodservice Includes –full-service restaurants –quick-service restaurants –hotels –clubs –catering  What are some examples of commercial foodservice in your area?

7. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Restaurants Full-service restaurants: span a range of styles from fine dining to casual Quick-service restaurants: customers typically place orders at counter; offer speed, convenience, and reasonable prices; often called fast-food restaurants; some of the most lucrative operations in the industry

8. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Hotels Hotel dining options range from vending machines to numerous on-site restaurants of varying styles and cuisines continued

9. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Hotels Hotel restaurants provide service to registered guests as well as the community Many hotels operate room service and banquet facilities

10. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Clubs Many private clubs provide their members with clubhouses with restaurant and banquet facilities Members expect fine cuisine and excellent service Members of city clubs use the club’s dining rooms for business and entertaining purposes

11. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Catering Catered events are often held in a hall or banquet facility Off-premise catering involves catering locations that do not normally serve food

12. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Noncommercial Foodservice Includes corporations schools colleges and universities hospitals and nursing homes military continued

13. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Noncommercial Foodservice (continued) travel parks and recreation stadiums and sports arenas convention centers prisons and correctional facilities

14. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Objective Compare and contrast the different forms of business ownership.

15. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Legal Forms of Business Ownership Free enterprise recognizes and promotes a person’s right to own a business The three main legal categories of ownership are –sole proprietorship –partnership –corporation

16. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Sole Proprietorship The owner of a sole proprietorship is personally responsible for all debts of the business Sole proprietors have final authority on all decisions

17. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Partnership A partnership agreement spells out the responsibilities of each partner and how profits and losses will be divided Each owner is personally responsible for all the debts of the business in a partnership Legally, the partnership is ended when one or more partners dies or leaves the business

18. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Corporation Ownership of a corporation is divided among investors in parts called shares The corporation has most of the rights and responsibilities of a real person, including responsibility for its debts In general, corporations pay more taxes than other forms of ownership

19. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Objective Summarize government’s involvement in regulating foodservice operations.

20. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Foodservice Laws and Regulations Laws and regulations governing how a foodservice business operates may be enforced by one of three levels of government—federal, state, or local Businesses must abide by the law or regulation which is most strict

21. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Objective Explain the different ways foodservice businesses are organized.

22. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Organization of Foodservice Businesses Foodservice businesses can be organized as –independent restaurants –chains –franchises

23. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Independent Restaurants An independent restaurant is a restaurant that is not a part of a group Each is a unique operation with different ownership  What are some advantages and disadvantages for independent restaurants?

24. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Chains Chain restaurants are often referred to as “multi-unit foodservice operations” A chain uses the same menu, décor, and management practices in each location  What are some advantages and disadvantages for chain restaurants?

25. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Franchises The owner of a franchise restaurant pays for the right to operate a franchise and is called a franchisee The franchisee –pays a fee for the right to use the brand name, concept, logo, and advertising –is required to use the franchise company’s products and operate by its standards

26. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Objective Summarize the risks and rewards of entrepreneurship.

27. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Entrepreneurship Many entrepreneurs are attracted to foodservice businesses continued

28. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Entrepreneurship Successful chef-entrepreneurs must have –great culinary skills –business management expertise –the ability to see the larger business environment and new opportunities

29. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Risks and Rewards Risks of entrepreneurship –Repayment of debts if the business fails –Restaurants have high failure rates Rewards of entrepreneurship –Being your own boss –Financial gain –Personal and professional pride

30. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Compare the two foodservice segments Review –Commercial foodservice is businesses with a primary goal of preparing and selling food for money. –Noncommercial foodservice includes operations that provide foodservice as a secondary activity; also called institutional foodservice. continued

31. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Give examples of both commercial and noncommercial foodservice Review –Commercial: full-service restaurants, quick- service restaurants, hotels, clubs, catering –Noncommercial: corporations, schools, colleges and universities, hospitals and nursing homes, military continued

32. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Describe the difference between full- service and quick-service restaurants Review –Full-service: servers take the customer’s order and bring the meal to their table; can be casual or fine-dining –Quick-service: customers typically place orders at a counter; offer speed, convenience, and reasonable prices continued

33. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Describe three forms of business ownership Review –Sole proprietorship: one owner; responsible for all debts of the business; makes all decisions –Partnership: ownership shared by two or more people; each owner is responsible for all debts of the business; share business responsibilities –Corporation: a separate entity with legal rights; ownership is divided among investors; the corporation is responsible for its debts continued

34. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. What level of government enforces laws and regulations governing foodservice businesses? Review –Federal, state, or local government may enforce laws and regulations governing foodservice businesses continued

35. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Explain how independent restaurants, chains, and franchises differ Review –An independent restaurant is not part of a group; a chain is a group of restaurants owned by the same company; franchise restaurants are independently owned restaurants that are part of a larger restaurant chain continued

36. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. What attracts entrepreneurs to foodservice businesses? Review –Most restaurants are small, independent operations; small businesses have lower start-up costs; small businesses are easier to manage continued

37. Permission granted to reproduce for educational use only.© Goodheart-Willcox Co., Inc. Describe the risks and rewards of entrepreneurship Review –Risks: having to repay debts if the business fails; restaurants have high failure rates –Rewards: being your own boss; financial gain; personal and professional pride