Restaurant ownership, like any other business venture, involves certain risk. A successful restaurant owner must possess a willingness to invest time, energy and money, risking many unknowns; an ability to entrust others with responsibility - adding more employees, giving managers more control - relinquishing the reins as necessary, thus risking one's personal reputation in the hands of others; the cognitional ability to discern when to stand up or stand down and risk the ambiguity of change including, but not limited to, being capable of feeling uncomfortable at times, appearing silly occasionally, being rejected, and/or disagreeing with those we love or respect (including family members).
As risk increases, with the restaurant marketplace more complex than ever (food safety concerns, marketing dominance by the Chains, and globalization - with little elbow room for Luddites or those technically challenged, et al.) and frivolous lawsuits against restaurants abound, ranging to the ridiculous - like "The Tres Chic Fatties vs. Food Porn Suits", as collectively labeled by an associate of mine recently (Translation: adults not taking responsibility for their own food addictions, with some blaming it on advertising), there are situations where it would behoove owners to take notice.
Consider the following:
An upscale restaurant - located in a major city on the West coast - began offering valet parking due to limited nearby restaurant parking. But when a customer claimed an expensive jacket had been stolen out of the back seat of his car, the owners had to reevaluate whether it was worth the risk of offering valet service.
A fast-casual restaurant owner felt fortunate being able to lease space on a busy thoroughfare near a major university. But the owner soon found himself being sued when one of his patrons collided with a group of students and fell on the sidewalk while trying to exit the restaurant's crowded front doorway during the busy lunch hour.
A quickservice restaurant was hit with a lawsuit after a patron got sick and went to a hospital emergency room after eating a fish sandwich which, allegedly, "had been sitting in the warmer tray too long because the customer was late picking it up." The real culprit was the restaurant's homemade tartar sauce, which was three days old and contaminated.
A private club, which served food and alcohol, was sued by one of its employees for sexual harassment, claiming the club-employer encouraged lascivious behavior by its members by requiring servers to wear provocative uniforms. The employee contended that the ownership group knew or should have known about the harassment and failed to take corrective action when club-employee abuses by its members occurred.
Risk Assessment
Operations' Checklists are invaluable tools commonly used by consultants to not only evaluate and improve business performance, but to identify potential risks to restaurant guests, employees, and owners - alike.
Ingress and egress, parking facilities, patron and server traffic patterns relative to facility floor plans, restaurant cleanliness, food and equipment handling, safety procedures, employment issues and general business practices are the typical subjects covered in such an assessment.
For example, a fast-casual restaurant in the suburbs of a major city had frequent problems with guests running into each other and furnishings, often distracted while conversing, as they were coming and going from the restaurant - having to ambulate through a blind L-shaped hallway - of which the owner was becoming increasingly concerned. Starting at the entrance of the restaurant, some of the employees assisted in an operational evaluation as to how to remedy this problem (and others) using a simple customized questionnaire/checklist:
Q: Is the restaurant receiving area and/or doorway free from obstruction, enab ling guests to enter and leave the restaurant without risk of injury?
A: No.
Q: Are both carpets fastened securely to the floor and all thresholds fixed level to the floor so that no one will trip and/or fall?
A: No. (Thresholds were raised.)
Q: Is there adequate lighting, with light bulbs replaced as necessary?
A: No. (Scant artificial lighting present near the blind corner. Natural lighting from large windows was evident during daylight hours, but the restaurant was open until 11 p.m.)
Q: Are there any "sharp edges" in furnishings or fixtures that may pose a risk if someone passes by, especially those near corners, turns, or doorways?
A: Yes. (A clumsy, decorative coat rack and brass easel were both situated too close to one of the doors and the hostess stand was obstructing part of the main dining room entrance.)
Q: Are the outside walkways or sidewalks free of water and mold which could cause slippery conditions?
A: No. (Evidence of mold on the sidewalk and a plug in a downspout posed risk.)
And so on.
While the hallway ended up being structurally modified, we didn't stop here.
Restaurant owners should consider ALL areas/aspects of the operation from a risk standpoint.
Risk Education
Restaurant X found itself in an employment controversy surrounding an arbitrary tipping-out policy, where a waitstaff mutiny seemed to be ensuing. The restaurant owner was also privately being threatened with a lawsuit by a disgruntled former employee about this same policy.
With information so readily available online (likely spawning an increasing number of employee-jurists), simply winging-it - with regard to employment and other business law matters today - is quite foolish.
According to the DOL:
Tip Pooling: The requirement that an employee must retain all tips does not preclude tip splitting or pooling arrangements among employees who customarily and regularly receive tips, such as waiters, waitresses, bellhops, counter personnel (who serve customers), busboys/girls and service bartenders. Tipped employees may not be required to share their tips with employees who have not customarily and regularly participated in tip pooling arrangements, such as dishwashers, cooks, chefs, and janitors. Only those tips that are in excess of tips used for the tip credit may be taken for a pool. Tipped employees cannot be required to contribute a greater percentage of their tips than is customary and reasonable.
[For further information, see dol.gov/esa. If you have any additional questions, contact a lawyer who specializes in employment law. ]
Confronting Risk
The Pastry Chef at an upscale restaurant went to the restroom four or five times a day, yet had flour on his hands when entering and leaving the restroom every single time, which the employees joked about "for years."
Further observations revealed that while the pastry chef appeared to be quite talented, he also had flour on his nose frequently, didn't clean his workspace except at the end of the day, and sometimes reused dirty utensils. Need we explore the potential risk here?
After a private showdown with the restaurant manager, this Pastry Chef immediately cleaned up his act.
"I didn't notice that I was doing this and no one ever told me," said the Chef, however inexcusable, with the point being that without proper supervision is it any wonder that such behavior goes on, "for years," no less?
Employees - including de facto management employees, such as was the case with this Chef - do, TOO, need to be reminded about personal hygiene and safe food handling processes.
Sharing Risk
As some risks are unavoidable no matter what a restaurant owner does, most owners have commercial insurance policies to protect against these basic risks. But insurance policies can also be written to protect against other risks - through the purchase of additional coverage - based on the specific needs of each restaurant.
For example, a restaurant located in a midrise building - only accessible by a long and steep flight of stairs - had to determine whether it was worth the additional coverage, costing many thousands of dollars in insurance premiums, as it had never once in over ten years had a claim related to these stairs and wasn't sure the money spent to protect the restaurant from a possible claim was worth it.
A good insurance provider did and can assist in making such difficult decisions.
Risk Prevention
I received an e-mail from a struggling restaurant owner who noted the following in his letter (which, by itself, is a mouthful on what kind of "help" is typically afforded to small businesses):
"Bankers love to lend, accountants do your taxes, and they leave me to figure out how to make a profit."
Part of figuring out how to make a profit is to reduce risk/s:
1. Be "there" (whether at the restaurant or not) and pay close attention to details;
2. Set goals - short-term and long-term - and actualize them, in accordance with the law/s, following realistic timetables;
3. Build good and honest business relationships with suppliers, expecting the same in return;
4. Boldly critique your restaurant from a risk prevention POV and make any necessary adjustments/improvements posthaste;
5. Do right by your employees, always; and, most importantly:
Meet your restaurant dining guests' wants and expectations every single day: Deliciously and safely.
Maren L. Hickton is the principal of Maren Incorporated, a Full-Service Hospitality Consulting and Marketing Firm based in Pittsburgh, PA. Maren can be reached by e-mail at Mareninc@aol.com.