Optimizing Hotel F&B Returns

In the 1990s, hotel restaurant dining had a bad reputation. During this era, most hotel food and beverage programs were designed strictly to be enjoyed by in-house guests during their stays, and they did not welcome local foodies. And, because hotel restaurants were not pulling in outside revenue or retaining customers, food and beverage programs suffered severely. These financially unstable hotel restaurants were economically problematic in that they made it impossible for fully functioning food and beverage operations to have sufficient margins.

The new generation is bouncing back from this phenomenon, as hotels strive to establish locally known and embraced dining options within their walls. Larry Spelts, vice president of business development at Mt. Pleasant, S.C.-based management company Charlestowne Hotels, says, “The ideal and super-successful hotel restaurant has strong local support, but that has to be created. Obviously, first you have to have a good product, a good concept, and you have to execute it well, but you also have to build that relationship and build that exposure in the local community.”

Achieving this goal is a feat that has eluded many hotels in recent years. In Spelts’ experience, the way locals are most effectively drawn to hotel restaurants is through soft openings. Instead of immediately opening to the public, Spelts suggests having invitation-only benefits for local charities when the restaurant is ready to open. Choosing charities that have a strong and supportive local demographic in the community, he explains, will have the restaurant packed for several nights in a row. If this is executed properly, Spelts maintains, it can create momentum to roll into opening to the public.


Yet keeping locals interested in the restaurant after having a strong opening has proven to be almost as difficult as getting them there in the first place. Susan Terry, vice president of culinary and food and beverage operations at Milwaukee-based Marcus Hotels & Resorts, believes that the key to maintaining the success of a hotel restaurant is to focus on what makes all customers happy. Terry says, “It’s really easy to run a business that has strong repeat customers. It’s very difficult to find new customers all the time.” Concepts that serve a large local demographic, she says, will keep customer retention rates high.

But even as they’re catering to a local clientele, hotels must also take care not to lose sight of guests needs, which also may vary considerably depending on whether the guest is traveling for business or leisure. The best way to keep guests’ attention—and keep them spending money in the hotel—is offering a number of different dining options at varying price points. Terry says, “When you have a number of options, it allows the guest to move around the hotel without getting bored. There’s no feeling of repetition because they’ve got options to choose from. Even better if there are options based on what their specific price point might be.”

Exciting and varying concepts are very key to making customers want to return to a hotel restaurant; guests won’t eat there if they don’t feel comfortable with the concept, Terry says. “If you want to keep your customers inside your hotel, having variable options for them is hugely beneficial. It also allows you to have restaurants that are not trying to be everything to everybody. They can be based on specific customer concepts and be true to those concepts without necessarily having to worry about alienating a different customer.”

Watching trends keeps restaurants in business; if restaurants aren’t current, new customers won’t return. Hotel restaurants must commit to trends they see sticking, and be wary of ones that are only around for a couple of months. “Trends are important to watch and understand, and if you’re savvy, you know how to act,” Terry says.

While all of these different variables reel customers in and hook them to the restaurant, ultimately what keeps guests returning is a good customer experience. Enthusiastic, well-trained staff members and delicious menu items will keep both customers and employees happy. As Spelts says, “Nothing is more important to creating consistent quality in any food and beverage business like volume, because if you don’t have a busy restaurant, it makes it very, very, very difficult to keep everyone sharp and focused. It also makes it difficult to keep a good house staff.”

Terry and Spelts agree that the first step to having a hotel run smoothly is to have a strong operations team that knows what the expectations are concerning the facility, the customer experience, and the quality of products. Not only does this reflect on the employees, but it also shows customers a strongly defined operating standard that the hotel and restaurant share. Hiring the right people with the right jobs and keeping those employees committed and focused on different individual outlets of the business will make a hotel restaurant run smoothly. Terry says, “Food and beverage may not always be the whole conversation, but often it’s an important piece of the entire conversation of the dynamic or the importance of the overall hotel experience. With these steps, maybe customers will remember that they don’t have to be an in-house guest to enjoy a great meal at a hotel restaurant.”

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Robin McLaughlin is associate editor of LODGING.