giftonyenkwere2001
CASE STUDY: Castelli’s Restaurant at 255 Four Generations of…
CASE STUDY: Castelli’s Restaurant at 255
Four Generations of Castelli’s
Castelli’s Restaurant at 255 is a casual, family-owned restaurant serving traditional Italian-American comfort food made from secret recipes that have been handed down from generation to generation of the Castelli family. The restaurant is located in Alton, Illinois, a small farming community that sits just outside of St. Louis, Missouri. In approximately 75 years of existence, spanning four generations of rich family history, Castelli’s has remained relevant by sticking to the basics with its menu items and ingredients, maintaining a family tradition of striving to provide excellent quality and service, and offering fair prices. However, like many long-running restaurants, Castelli’s has had to overcome its share of difficulties throughout the years.
In the mid-2000s, Castelli’s began experiencing financial difficulties, which continued to escalate when the economy began struggling. The fourth generation of the Castelli family, great-grandchildren Matt and Tracy, dropped what they were doing and moved back to Illinois to reassume control of their family’s business and eventually purchase the building back from the bank.
Back to the Basics
After they assumed ownership of the restaurant, Matt and Tracy did not change a lot about the restaurant concept. They kept the original recipes and ingredients that have been in the family for generations. The reason was that their biggest customer base consists of the Alton, Illinois, locals. Many of these people are long-time patrons from an older generation, who are familiar with the concept and menu items and love it for what it is.
At Castelli’s, the mentality has always been to give the customers whatever they want. This was initiated from the beginning by the original owners, Alfonso and Theresa. Because of this mentality, Castelli’s offers a large and impressive menu with over 75 items to choose from. It also offers carry-out party packs and carry-out combo meals to feed larger groups in need of a little comfort food. Castelli’s is open on weekdays from 11 A.M. to 9 P.M., and on weekends from Friday 11 A.M. to 10 P.M. The restaurant is busiest on weekends and holidays, at times serving up to 800 guests on a Saturday night.
Success Moving Forward
Matt and Tracy’s philosophy for success revolves around the idea that they need to be in the restaurant constantly, watching over their business. They believe it is important to establish relationships with customers to ensure they have a good time at the restaurant. And in return, Castelli’s has done well for itself under new ownership. With that being said, Matt and Tracy are still faced with many challenges every day. It is a challenge to maintain consistency in both the front of house and back of house operations by getting everyone to work as a team and produce a smooth and steady flow of service every shift.
A few years ago Castelli’s annual revenue was approaching $2 million. The restaurant saw a gradual increase in annual revenue and business demand, which reached $2.5 million at the end of 2012. With that in mind, their food and beverage cost was 38 percent in 2012 and their labor cost was 25 percent. Matt and Tracy’s goal was to increase revenue by 5-10 percent, lower their food and beverage cost to 30-35 percent and lower their labor cost to 22 percent in 2013. Ultimately, their long-term goal is to increase annual revenue to $3 million and eventually expand the business to a second location.
Questions
Chapter 1 discusses different challenges of restaurant operation. What are some of the challenges the Castelli family has faced operating the restaurant over the years?
Does the current concept have lasting longevity?
Should the owners alter the concept in any way?
3. What are some things the owners could do to increase their annual revenue? a) How can they lower food and beverage cost?
b) How can they lower labor cost?
4. What are some things the owners could do to generate more business demand with younger generations between the ages of 25 and 45?
a) What can you do to give people a reason to travel to Alton, Illinois, and visit the restaurant
CASE STUDY: EVOS
Origins
EVOS was started in Tampa, Florida, in 1994 by Alkis Crassas, Michael Jeffers, and Dino Lambridis, three friends from different backgrounds who enjoyed eating the classic all-American meal of burgers, fries, and shakes but were tired of feeling guilty after consuming food that was unhealthy and contained so many calories. After determining that a niche for healthy fast-food was nowhere to be found in the market, they decided to start a new restaurant concept based on that notion. The end result was EVOS, a fast-casual restaurant offering the typical fast-food items that people love to eat but re-creating them with better ingredients and healthier preparation techniques. Originally, the restaurant was more similar to an independent café, but over the years, EVOS has evolved into a well-developed concept franchised at multiple locations throughout the southeast. Currently, there are six EVOS locationsincluding four in South Florida, one in Atlanta, Georgia, one in Chapel Hill, North Carolinaand several in development.
Recipe for Success
At EVOS, menu items are “air-baked” instead of deep-fried with oil, which significantly cuts down on excess fat. EVOS supports sustainable farming whenever possible, and many of its fresh products and ingredients are sourced from local family farms. The best-selling item on the menu is the Original Steakburger, made with naturally raised grass fed beef, which is both hormone and antibiotic free. Other favorites include “airbaked” chicken strips made with hormone-free white meat chicken, fresh salads made with locally grown organic field greens, homemade milkshakes made with organic milk and sugar, and real fruit shakes made with natural fruit juices. Because the food is fresh, high in quality, and unique, EVOS runs on a significantly higher food cost than many of their fast-food competitors, as approximately 31 percent.
The owners’ philosophy for success is built from a three-piece recipe. First and foremost, food is the star in a restaurant business, and you have to get that right before moving forward. Once you have the right food, you need to hire and retain the right people. At EVOS, the philosophy from day one has been a coaching mentality instead of a managing mentality. This means that managers should focus on coaching and developing their employees in an environment that cultivates participation and gives employees empowerment to make important decisions. Finally, it is important to build restaurants that are comfortable and inviting while maintaining the focus on eco-friendly initiatives.
Environment
EVOS is a company dedicated to eco-friendly and sustainable business practices. The name EVOS means “fast food evolved,” which epitomizes both their revolutionary outlook on fast-food taken to new heights and their environmentally conscious mentality. EVOS has made numerous commitments to the implementation of clean renewable energy by purchasing commercial restaurant equipment from Energy Star, using compact fluorescent lighting, which consumes less energy, and using energy-conserving light switches in the bathrooms, which turn off automatically when they are not being used. Furthermore, the owners use a variety of sustainable materials when building EVOS establishments, such as eco-friendly paints and adhesives, recycled wood supplies, and eco-friendly flooring panes. The paper products used in the restaurant are printed on recycled paper with soy- and vegetable-based inks, and the plastic cups and bags are biodegradable. According to the owners, the use of recycled paper and biodegradable products can amount to more than 5 percent of a restaurant’s operational costs.
Challenges and Goals
The owners of EVOS have faced many challenges from the beginning, including start-up and operational issues. Healthy fast-food did not exist when the original restaurant was conceptualized, and everything was new territory for the owners. Creating a menu was difficult because there were not many places you could use as a reference. In the beginning, they offered items such as tomato basil soup, traditional turkey and cheese sandwich, or tabouleh and hummus, all of which were made fresh from scratch. In addition, only one of the three owners had previous restaurant experience before starting EVOS. When the restaurant opened, business took off from the beginning, which required all three owners to perform the daily operations, while learning the ins and outs of running a restaurant business on-the-go.
EVOS has many goals moving forward as a company. The most general goal is bringing healthy fast food to America in as many communities as possible. One of the most important goals that EVOS owners have established is maintaining the culture they have created within the organization. This involves running a company that the owners are proud of and would want to work for if they were outsiders looking in, as well as a company they and their employees continuously want to work for as insiders looking out. The owners believe that this is extremely important to their success because the food and the look of the restaurant is something that can be copied, and probably has been to a certain extent, but the culture and the people are harder to copy, which has made EVOS unique in the long-term.
Questions
What type of restaurant would you classify EVOS as (quick-service, fast/quick-casual, casual, theme)? Why?
What other restaurant concepts is EVOS most similar to?
Who are EVOS’s competitors, and what are some ways that they differentiate themselves from their competitors?
What are the advantages and disadvantages of placing such a heavy focus on eco-friendly and sustainable business practices?
Why do you think the EVOS concept has had such a modest growth over the last 18 years? What should their goal be for expansion over the next 5 or 10 years?
CASE STUDY: Wurstkuche
History and Concept
Wurstkuche is the purveyor of exotic grilled sausages in downtown Los Angeles and Venice Beach, California. The company was started in November 2008 by Joseph Pitruzzelli and Tyler Wilson, two cousins with big ambitions and no previous restaurant operational experience. Before the formation of Wurstkuche, Pitruzzelli worked at an industrial design firm in San Francisco that specialized in designing bars, restaurants, and night clubs. Meanwhile, Wilson was an undergraduate student at the University of Southern California studying business management. Although they had never worked in restaurants before, they felt that they had the right combination of knowledge and experience to be successful in the restaurant business.
Staff and Customers
At Wurstkuche, the philosophy for success is to strive for employee satisfaction, guest satisfaction, and an overall sense of community. Pitruzzelli and Wilson wanted to create an excellent dining experience, as well as a great place to work. They believe that managing customer’s expectations largely contributes to guest satisfaction. Heavy emphasis is placed on equality of service, which means that all customers are treated equal regardless of who they are. Wurstkuche invites a wide range of clientele that includes construction and railroad workers, business professionals, lawyers, young professionals, college students, and international communities. One of the goals set out for this restaurant venture was to encourage people of all walks of life to get to know one another, while enjoying a unique dining experience.
Pitruzzelli and Wilson believe that employee satisfaction is equally as important as guest satisfaction in Wurstkuche’s overall success. They strive to achieve a high level of employee satisfaction by maintaining fair and equitable business practices, while striving to create a work environment that is community driven, much like their clientele base. Because they believe that all of their employees are essential to the restaurant’s success, they want to ensure that their employees know that they are important, and then reward them for their hard work. Therefore, all tips from customers are pooled together and every employee gets a certain percentage, from the dishwasher to the bartender.
Challenges
There have been a variety of challenges over the first few years, working to sculpt Wurstkuche into the restaurant that it is today. Wurstkuche relies heavily on their staff to produce customer satisfaction. One of the biggest ongoing challenges is to instill a passion for being at work and to ensure that the staff continually delivers excellent customer service and enjoyable experiences time in and time out. Although turnover is high in the Los Angeles restaurant industry, Pitruzzelli and Wilson are strong believers of internal promotion. Most of their employees started from the bottom as food runners and worked their way up through the line of service. They are continuously faced with educating leaders and managers for the company by determining what drives people and then innovating different techniques to encourage their employees to take ownership of the company.
Strategy for Expansion
Wurstkuche’s demand saw rapid growth in the first two years, steady growth in the third year, and now business is starting to level off. Currently, Pitruzzelli and Wilson are considering developing a third location in Denver, and possibly more in the future. The strategy for expansion revolves around targeting Metropolitan areas with emerging culture that have urban energy to them. They have a five-year goal of expanding to 10-15 new locations. The new challenge is building more of the same concept and reproducing the philosophy, principles, energy, culture, and experience in each location. Pitruzzelli and Wilson want to create a timeless experience that continues to evolve with changes in the market and the economy over time.
Questions.
Which kind of restaurant is likely to have the greatest productivity per hour? Which will require the most advertising and promotion and the most dining room space per customer? Which has the greatest likelihood of the highest return on investment?
Roughly what percentage of meals eaten out are purely for pleasure?
Most college and university students majoring in hotel and restaurant management are not interested in fast-food restaurants. Why not? What distinct advantages do such restaurants have? What disadvantages?
What is the relationship between your logo and your restaurant concept?
Comment on the statement “Behind every restaurant there is a concept.”
List five factors that together help formulate a restaurant concept.
How are restaurant image and concept related?
CASE STUDY: Salt “Gastropub”
Introduction
“Salt” is New Jersey’s first gastropub, which was opened by Bradley and Laurie Boyle in April of 2008. In case you’re not already familiar with the concept, a gastropub is simply a pub that serves better-than-average fare, which originated in England in the early 1990s. “Salt Gastropub” features upscale food served in a casual setting without the pretense of a fine-dining establishment. Its menu items are complemented by its vast assortment of quality beers, wines, and specialty cocktails, all of which are reasonably priced to encourage frequent patronage. The name “Salt” was chosen after much deliberation and debate, but the idea was simple; what better way to sum up a concept that is focused on great food than to name it after the key ingredient used in all food preparationssalt.
Background
In 2001, Bradley and Laurie opened their first restaurant, “Bula,” in Newton, New Jersey. They owned and operated Bula for eight years before they decided it was time for a larger restaurant operation with a different concept in mind. While driving through the Township of Byram, New Jersey, one day, they discovered a “roadhouse-style” building that was for sale in a rustic setting with highway frontage. Bradley and Laurie seriously considered purchasing the building for its ideal location, architectural potential, and with hopes that they could get if for a good deal, which they did. Bradley and Laurie spent six months trying to get the approval for an SBA loan. The timing was a key factor in getting their loan approval, as the economy began to struggle shortly after.
Customers and Employees
Before it was Salt, the previous business was a local dive bar known as 76ers Waterloo Inn that attracted a rough and often rowdy crowd. Bradley and Laurie wanted to cater to a completely different market from the previous concept, and they knew it would be a challenge to change the location’s reputation and give people a reason to come to the establishment. Furthermore, they wanted to be a pillar of the community, as the building is located in a family-oriented community. There is a huge emphasis placed on “the Salt family,” which encompasses the staff, customers, and the community. The employees have bought into this philosophy and embrace the culture.
The Menu
When creating the menu, they wanted it to be approachable, with familiar items and ingredients prepared in a unique way; all they while keeping the theme of traditional English pub fare in the background. For this reason, some of their most popular items include Fish ‘n’ Chips using beer-battered tilapia; Bangers and Mash using pork sausage in sweet apple gravy with creamy smashed potatoes; and garlic and rosemary marinated Hangar Steak. The key to the entire restaurant is the extensive beer selection, which consists of over 70 beers to choose from, most of which are either craft or imported. At Salt, they make an effort not to serve mainstream beer brands; however, there are a select few available for the everyday guy who yearns for the staple American brand.
Success and Challenges
Since opening in April of 2008, Salt’s business has grown every quarter. Overall, it has seen approximately 35 percent increase in business in the past four years. Bradley and Laurie attribute their success to “the perfect storm” of factors that worked out in their favor. They had the right concept for a struggling economy, combining a reasonable price point, good food, and a casual setting and live entertainment, all of which resulted in a desirable experience. Most important, they embedded themselves in the community, and the community embraced them in return by supporting their business. Finally, they maintained an active presence through advertising, social media, and participating in various events to give the restaurant recognition. In 2010, Bradley was featured as a contestant on Food Network’s hit television show Chopped, which gave the restaurant instant notoriety and significantly increased demand.
Bradley and Laurie have faced various challenges over the past four years at Salt. One of the biggest challenges has been handling the various customer concerns that arise. There is currently a notion in the hospitality industry that “the customer is always right.” This can be difficult because customers can be extremely demanding, and the fact is that they are not always right. The Boyles have stated, “We have had suggestions on colors we should paint the bathrooms, the type of music we should have, the beers we should serve, the uniforms we should use, the hours we should be open, to just about anything you can imagine. We love the suggestions, and get a kick out of a lot of them . . . but Salt was a well-thought-out concept that had been developed over years, and we are what we are and always stick to our guns.”52
QUESTIONS
How would you prioritize the considerations in menu planning for your restaurant?
There is a trade-off between a fully qualified chef and lower costs. How can a balance be achieved to leave a reasonable return for the owners?
To achieve maximum efficiency in your restaurant’s kitchen, who should be involved?
Discuss how the equipment and menu must harmonize to create a smooth operation.
How seriously should restaurant operators become involved with the nutritional content of foods the chefs serve?
