Why Are Restaurant Operators Such a Hard Sell?

Ask any vendor who sells into the foodservice industry and they will tell you, operators are just “hard to reach”. Ask any technology purveyor the same question and they say “tough, tough sell, slow adopters and hard to sell-they want everything for free.” Ask almost any service provider, and really, it’s the same answer. Ask a venture capitalist about financing a company that plans to sell products or services to restaurant operators and they’ll tell you the same thing in a slightly different way – “been there, done that, no thanks, way, way too hard.” So, why is that?

The reputation this industry has for being “stuck in the mud” when it comes to innovation has to stop. It’s not a badge of honor to be the last or nearly the last industry to embrace new ideas, fresh concepts and the dreaded - technology. It’s really unfortunate. And, it’s affecting how we, as an industry, grow into our future. With new stuff being invented daily that millions of consumers are embracing, what gives?

I met with what I consider to be a typical entrepreneurial restaurant operator yesterday. All I was doing was ordering take-out at a sushi restaurant, an empty sushi restaurant mind you. So, while I was waiting I took the opportunity to ask a simple, somewhat harmless question; “So, how’s business?” “Okay,” was the answer. Then, I asked “tell me what you are doing with social media?” We discussed the usual suspects - Facebook and Twitter and then the conversation fell flat when I asked how that was working for him – “I Don’t know.” So, being an entrepreneur who runs a company dedicated to providing social media marketing solutions to restaurant operators, I told him about FohBoh. I presented FohBuzz and FohMedia to him and explained how powerful these two social media products and services could be for restaurant operators . While “Paul” loved the idea, and believed in the strategic value of implementing a social media strategy for his restaurant, he asked “is it free?” “If it’s not free my boss will never go for it”.

Fair enough. Free is good and powerful and affordable too. Wired Magazine just published an article called “Money wants to be free.” Chris Anderson, Wired’s publisher and editor, as well as the author of The Long Tail, as well as a recently published book entitled Free, agrees. But, I wonder. Is free good enough for restaurant operators? Is it really price that distinguishes operators as “hard sells?” Or, is it just the hassle? Or, is it because it’s a commodity more valuable than money – time? Or, are we just stuck in the old ways of operating a restaurant because that’s all we know and change sucks?

So, while I love technology and value the days-per-week it saves me, I have to ask this question: If there was a way to increase customer engagement and retention at your restaurant in a way that could be measured, in real time, would it have to be free for you try it?

Tags: Restaurant vendors, SaaS, Selling to restaurants, restaurant, restaurant purchasing, technology"

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Comment by Michael L. Atkinson on March 21, 2010 at 3:04pm: Jonathan, great comment. SaaS providers do generally offer a free trial, which serves to lower the barrier, or should. You are also correct, CaC is high; always has been for this industry, which is the point of this blog post. I am hoping conversations like these will lead to more trial and attentive restaurateurs. Vendors and operators need a to be more open to establishing relationships where both benefit from the success of the other.

Jonathan, when operators and vendors can look at the the buy/sale process as a partnership we will begin to make progress.

Comment by Jonathan Morse on March 18, 2010 at 5:58am: -Michael,

I would add also add that most SaaS products come with a FREE 14-30 day trial were the Operator can recognize the ROI before even spending a nickel. There is a software revolution happening right now above and beyond social media and restaurants are too stubborn to take advantage of it.

One final point I have is that Customer Acquisition Cost (CaC) for restaurants is enormously high compared to other industries. Because of the high CaC most technology companies will not innovate or develop any products that are geared towards restaurants. The losers in this scenario are restaurants. So, next time you make a commitment to a meeting/demo please show up, turn the phone off (or have someone else answer the phone), assign a Manager to take the delivery and pay attention because there is usually gold to be found.

Comment by Michael L. Atkinson on March 16, 2010 at 3:25pm: The reality is there are two sides to this argument but there should be just one. Any vendor presenting a technology opportunity to an operator must be able to answer this simple question - "why should I buy it and why should I buy it from you?"

Steve makes a good point that domain expertise is important. Equally important is product knowledge and a sensitivity to the operators' business needs. Vendors and operators should be on the same team and share in the rewards of a successful business partnership. Optimizing a partnership means an to the question I asked above with a benefit to both parties.

Enterprise software sales is about ROI. Why wouldn't it? But, many of the new SaaS (Software as a Service) products are outrageously inexpensive and easy to use so ROI very low. Most don't even require a contract and in many cases, the set up fee, if any, can be negotiated, depending on how much labor is involved. Vendors who don't require a contract are sharing in the risk of product acceptance.

My point here is that technology is leveling the playing field in an industry that really should be embracing all these amazing new technologies, social media and others. Hardware is so last century. It's all about the cloud and in most cases, cloud solutions are cheap, scalable and most importantly, can be easily canceled. You have very little to lose and everything to gain.

Comment by Jeffrey J Kingman on March 14, 2010 at 2:34pm: Another of the best food sales peeps I know, Jim "Nightmare" O'Dare, a DSM with PFG Northcenter, emails his district bright n early each morning. He includes the market reports that PFG gets from the buyers in the field, headlining critical shortages of products such as romaine. He also includes tips to drive sales.

To @Annette: I'm the same way. If I have a product question, I need it answered. I simply don't have time to waste sifting through a catalog or online. I want a knowledgeable person on the other end of the phone when I call. Suppliers that get my business are the ones that provide best customer service. Sometimes it's not always price.

Comment by Jeffrey J Kingman on March 14, 2010 at 2:29pm: @Steve,

Two of the best food purveyors I worked with did exactly that. Bill Bridgmon (a FohBoh member) and Roger LeClerc, both of whom worked for PFG Northcenter when I used them, spent time in my kitchens. Bill always said he wasn't a salesman, he was an ideator. There were numerous times over several years that he'd get us through a pinch. Roger and I had a system on Sundays; he'd come in an hour before the busy Sunday brunch buffet and help us run out the setup. After brunch was underway, he and I would go sit and plan the week's main supply purchase.

These guys are both pros, both in restos and in sales. They understood what would help me the most and did what they could to help me drive sales.

Comment by Steve Paterson on March 13, 2010 at 10:26pm: Here's an idea from left of left field (as is usual for me).

All sales people who sell things to the restaurant industry should work in a restaurant for a period of time. Preferably in a position where they can also observe directly, the chaos and high energy/time demands put on the decision makers in any given operation.

By process, you will naturally learn when is a good time to try and sell something and when is not.

If you feel comfortable enough, why not arrange to give the chef/manager/whatever some of your time helping out in the restaurant for free, in exchange for some of their time to present your sales pitch. It's a pretty creative approach, but I'm willing to bet you would be much more successful (and relevant) in your sales career.

Personally, I haven't really experienced many issues getting access to the decision makers, simply because I've walked a million miles in their shoes and I speak their language and know when they are approachable and when to stay away.

Comment by Annette Aaron on March 13, 2010 at 9:31pm: The food/vendor industry is behind the times. I'm not a restaurant - I own a catering company so I do need some of the same services. When I first opened my kitchen, I called many vendors. Some never showed up. Some vendors pointed me to their website that had all their products on line.

It was totally boring and labor intensive to go through. When I have a question about an order or a new product I cannot get through to the salesperson and get caught in voicemail hell.

Some vendors to their credit send out colorful, professional, nicely designed updates by eblasts. I open them all the time.

Comment by Jeffrey J Kingman on March 13, 2010 at 7:56am: Awesome topic - thanks Michael. There's a lot of great responses here too. I'd like to suggest two books that have bearing on this: "Getting to No" and "Getting to Yes". They were written by the guys who developed the framework for the South African Truth & Reconciliation Process. Google them and read - they're excellent.

I can speak to this from both sides of the coin. As an Exec Chef, I could spot a salesperson at a 1000 yards. My guard was instantly up - I just knew the salesperson was going to suck up my time; and time is my most valuable commodity. As a consultant to a food manufacturer (that had only dealt with the grocery industry), I had to teach the National Sales Director about this. He believed that he'd get an hour with each Chef or Operator. I ran him through several locations - back of house, including the Hilton Towers Chicago during NRA, to show him how little time restaurants have. In sales myself to the industry for my services and for my clients products, I know I have a two minute window to approach. I have two minutes to get across enough information that the operator will decide later, in the office, to check me out.

First though, comes that I need to know the target. So many salespersons would walk into my kitchen with "answers" that exhibited a complete lack of awareness of my menu or what I would be interested in. For example, I specialize in from scratch cooking. There have been hundreds of salespersons that would take up my time trying to sell me pre-prepared items or items not even close to the menu direction.

Know Your Target Well - research
Elevator Speech - two minutes; four bullets
Minimize the Lit Drop - One half-sheet flyer with bullets
Never During Meal Time - basic courtesy
Skip the Stuck In Muds - it's panning for gold or picking low-hanging fruit

Comment by Rod Guinn on March 11, 2010 at 4:39pm: Excellent post and comments -- and, as EricL and others note, the "reluctant response" doesn't just apply to technological offerings. I've done work with franchise systems which did an excellent job of educating franchisees on the positive (economic) benefits of menu, recipe, or design changes which the franchisor was introducing, and others which did not. The difference in speed of rollout, consistency of application, and resulting profitability were dramatic. The best way for anyone to sell a worthwhile product or service is for the buyer to need it, and that requires an investment (on the seller's part) in time and education, and an ability to see the adaptation process from the buyer's perspective.

Comment by Keith Bernhardt on March 11, 2010 at 2:45pm: I guess this would be along the same lines (as far as time is concerned) :
Went into McDonald's on the University of Missouri campus, years ago. the height of lunch hour and a journalism student was in there to do a story for
her class. She asked the manager "Are you busy ?"

The manager said : "Look Around>' Yes, they were packed.