Article
Cutting condiment costs
Eliminating self-service, buying bulk among ways operators can save.
March 10, 2008
That sneaky ketchup packet seems to be everywhere — in the bottom of your work drawer, a side compartment of your purse or in the glove compartment of your car.
This is what happens when QSR customers open their bags of food to find 12 packets of ketchup. They'll use what they need and toss the rest into the trash or in a drawer to be forgotten.
It may not seem like a big deal to the consumer, but to quick-service operators every unused packet that goes to waste is a blow to their bottom line. And in increasingly difficult financial times, they can't afford to let a penny's worth of product slide through their fingers.
Managing condiment costs is a daily concern for Schlotzsky's Deli. Darrell Kolinek, vice president of franchise operations for Schlotzsky's, said many fast-food restaurants dole out more packets than the customer uses, offering a handful when one or two would suffice.
"We have to train our associates that it's not required," he said. "Hand them two, and if they want more, they will ask."
One effective way to cut condiment costs is by eliminating self-service stations.
McDonald's, for example, has shifted from giving consumers packets of sugar and cream to having employees put it in, said Darren Tristano, executive vice president of Technomic Inc. Operationally and profitably focused chains give customers only what they ask for and, in some cases, ask how many.
"If you ask for ketchup it's not, ‘Here's a handful.' It's, ‘How many packets would you like?' he said. "At the end of the day, they don't want a garbage can that's half full with unused napkins, ketchup packs and stirrers."
Tristano said a recent dining experience at Ruby Tuesday's pointed to another way operators are seeking to reduce condiment waste. Instead of having bottles of ketchup at each table, servers brought out small, ceramic cups filled with ketchup.
Bulk is the preferred delivery system for condiments, said Brian Darr, managing director of Datassential Research in Chicago. A case of individual packets of ketchup is more expensive for operators to buy than a 3-gallon drum.
"If the packets are out there, people will just grab a handful and throw them in their bag. You have absolutely no control," he said. "Whereas, if you have a bulk dispenser out front, and can only put it in a little plastic cup, you're going to take what you need because you can't carry that stuff anywhere."
The bulk containers also allow restaurants to refill and reuse the ketchup bottles at each table instead of having to repurchase new cases of bottles every week.
| ||||||||||||||||||
"We've learned that the more abundant the display of product out on our condiment counter, the more they help themselves to eat," Kolinek said. "We no longer have an overflowing display. We also now put salt and pepper shakers on the tables, which has allowed us to take the packets off of the condiment counter and use bulk."
The concept of limiting waste by controlling the delivery system is being applied to paper products as well as condiments.
"We've seen new types of napkin dispensers, which are the feed dispensers," Darr said. "You can only pull out one napkin at a time. They found that people won't stand there and pull at it a gazillion times. They'll pull it two or three times versus those ones where you can reach in and grab a whole bunch of napkins and just dump them in their bags."
The push to cut condiments costs has been spurred by rising operational costs throughout the restaurant industry.
"We have seen unbelievable increases in food costs from our manufacturers and vendors, so our industry is chasing pennies," Kolinek said.
The ethanol demand has sent the price of corn to an all-time high, affecting the price of beef and all corn products. Wheat also is in tighter supply, as more farmers opt to grow the more valuable corn and soybean crops.
"The end result is we see a lot of operators looking everything over, item by item, and trying to figure out ways to deal with this, because price increases have hit every item," Darr said. "It's not just chicken and beef or buns and rolls, it's every little thing. Everyone is trying to be more careful and cautious, and they feel the best way to do it is limit the delivery of condiments."
