The Daily Rail: Dropping beef prices means opportunity for restaurants

DID YOU KNOW… 45% of diners would like to choose their table from a digital schematic like they would choose an airline seat? That was one of the key takeaways from this year’s National Restaurant Association soiree in Chicago. Other hot topics include rising labor competition and costs, as well as whether predictive technology will change our industry.

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QUIZ: How about a nice cold beer quiz?


We work with numerous hospitality venues to help them make sports viewing more enjoyable for their patrons. It isn’t all about the audio, however. Here are some things we have learned in our travels.


Why it’s important to you: Beef prices are dropping fast and that means opportunity

It isn’t often that multiple business factors align so well in our industry, but that’s exactly what is happening with beef prices. If you haven’t already seen movement in your beef quotes, press your vendors because all trends are showing a significant drop in cost. 

Start with bumper grain crops for feed, add to it lowered transportation costs, then round out with the demand side (spring/summer grilling season) and you’ve got real opportunity to leverage beef for profit. Taco Bell is selling a $1 beef taco, Shake Shack is launching a limited time only bacon cheeseburger and, as we have reviewed recently, Applebee’s is upgrading from select to choice beef in their major rollout of wood-fired grills.

Whether you ride the tidal wave with the big guys or just watch your underlying cost of goods sold decline, it’s good news for the center of the plate. Why not take advantage and run a special to embrace the demand increase and give your guests what they want? 


Why it’s important: One mistake can cost a life

The owner of an Indian restaurant in the UK was found guilty for killing one of his customers. Mohammed Zaman was convicted of manslaughter and gross negligence and given six years in jail. The reason is pretty horrendous, too. In an attempt to save money, Zaman had switched out the almond powder in his chicken tikka masala for a cheaper ground nut mix that apparently contained peanuts. The unfortunate customer, Paul Wilson, specifically asked for the dish with “no nuts” because of his severe peanut allergy. The request was noted by staff, even written on the lid of Wilson’s takeout container. Yet the nut mix powder was still used. 

Zaman was cutting corners he was $400K in debt. Outside of using cheaper ingredients, he also hired untrained illegal workers. While looking to save money is perfectly fine, it shouldn’t come at the expense of a guest’s health. We’re sure we’re preaching to the choir here, but it’s absolutely vital that you take food allergies seriously and train your staff properly. One mistake can be fatal and lead to incarceration.


Why it’s important to you: Vietnam is a major producer of shrimp

When President Obama announced on Monday that he was lifting of the lethal arms embargo of Vietnam, it was the end of a long slow dance of normalization between our two countries. Some will discuss the decision as a way to keep China at bay by arming our friends. Other’s will exclaim it’s just another place to sell our main export, bullets and bombs.

For our industry, it means a more stable relationship with one of our main suppliers of farm-raised shrimp. A casual look at the shrimp prices shows, with a small exception in 2014-2015, shrimp prices have stayed flat over the past 10 years. In fact in April of 2006 the price for 26-30 shrimp was $10.47 and this past April it was $10.36. Those are nominal dollars, which doesn’t include inflation. That means that the cost of shrimp has dropped significantly. This is due in large part to having an open market that regulates pricing. Add to that price drops in other commodities like, say, beef for instance and it’s all good for your food cost for the near future.