DELCO FOODS
NOVEMBER 2021 VOL. 26, NO. 11
KEEP YOUR CUSTOMERS COMING BACK By Peter Thor, BFC
RAISING PRICES; DO’S AND DON’TS By Peter Thor, BFC Everybody predicted a slow recovery to the economy- true! But once some states opened, political pressure resulted in all states opening within weeks. Pent-up demand, fueled by months of inactivity and government subsidies, resulted in unprecedented consumer demand for restaurant meals. The supply chain of growers, processors, and logistics had been largely constrained for 18 months during the pandemic and is still struggling to return to pre-pandemic production levels. Worldwide shortages also created export demand which lifted prices for most protein and dairy items. Facing higher ingredient costs across the board, restauranteurs are also confronting worker shortages and significantly higher labor costs. The combined result is a crisis not seen in a generation. To work the problem, what actions should a local restaurateur take? What are competitors doing? Can the business survive if costs continue to rise and revenue doesn’t? These questions and more face nearly all operators today. As has been well documented, more than 100,000 restaurants have already permanently closed. Recently, cost basis for key ingredients have increased substantially, getting press calling attention to inflation. In our industry, it is well documented, basics increased year-over-year. Beef + 120% Pork + 16% Poultry + 55% Soy Oil + 110% Pizza Boxes + 35% The key question is whether ingredient costs will stay high, or not, as we enter winter months and vaccination rates increase. Our expectation is “yes” for several reasons. Supply chain issues are not going away as safety and distancing requirements in production facilities are unlikely to change and may become more stringent. Grain and feed costs and labor shortages will limit supply of all proteins, and strong international demand have led to higher domestic prices. (continued on page 2) A PROUD DISTRIBUTOR OF BELLISSIMO
While good food is still the best advertisement, no restaurant operator can afford to ignore the business side of the industry, and this includes creating an effective marketing strategy. Critical for success for independent pizzerias are loyal (repeat) local customers. Your menu is one of the best marketing tools you have, and it costs almost nothing. Refresh it regularly and pay attention to changing costs and new items, adding limited offers, and remove slow and unprofitable items. It’s always good to create some excitement; and one good way is with a contest. Running a contest is great for business in a number of ways. It (continued on page 3)
MARKET UPDATE Dairy
PRICE
LAST MONTH
DIFF
Cheese Blocks
$1.807
$1.797
$0.010
The cheese block market was the highest since January and the barrel maket was the costliest since May. In the last five years, spot butter prices averaged 3.6 percent lower in October.
Beef
PRICE
LAST MONTH
DIFF
50% Trimmings
$1.034
$1.230
($0.196)
Packers put together a relatively robust performance, moving 657,000 head through plants. While we’re looking for continued downside ahead, the better news might be that the 50s broke back below the $1.00 mark.
Poultry
PRICE
LAST MONTH
DIFF
Wings (Jumbo)
$3.092
$3.126
($0.035)
The chicken market is weakening, with the weekly Southern States Parts report revealing a $2.65 whole wing price with the Northeast market holding below the $3.00 area. We continue to look for lower prices ahead. As of 10/15/21
1
RAISING PRICES DO’S AND DON’TS (cont. from page 1)
Travel restrictions have both limited Americans traveling abroad and tourist visiting the United States. Many consumers are hitting the road for domestic travel, boosting restaurant and lodging demand. Restaurant employment has risen each month this year yet remains 20% lower than a year ago. As diners return, many restaurants are facing a dual hurdle of rising costs and worker shortage. Contributing reasons for the shortage include fears of working in closed areas during Covid, competition for workers in better paying industries, and often cited increased and extended government unemployment benefits. Mike’s Hot Honey started out of a pizzeria in Brooklyn 11 years ago, creating a whole new category of pizza topping that has been called a ‘game changer’ by pizza fans and spawned best-selling menu items for pizzerias nationwide.
If one concludes that inflationary costs are here to stay as will be higher labor costs, what actions can a restaurateur take to survive? The conclusion must be to take possible cost saving opportunities and to raise prices in one form or another to offset cost increases. The labor shortage is also real and likely to continue into 2022 which may force other adjustments. Cost and labor-saving options may include reducing operating hours or closing during one or two “slower” days of the week. Other ideas include embracing labor-saving options in preparation like pre-shredded cheese, pre-cooked wings, and simplifying the menu to exclude the lowest margin items. Re-examine portion size in all menu items where ingredient costs have significantly increased. Similarly, employing online ordering, improved POS systems, and streamlined processes can reduce labor hours, stress, and employee turnover.
Request a sample to see what all the buzz is about: mikeshothoney.com/sample wholesale@mikeshothoney.com (212) 655-0574
EXPERTLY
Crafted. EXACTLY WHAT You NEED.
™
We understand you have personalized needs and are here to help you find or create just the right topping. We’ve spent decades perfecting the craft of our meat toppings. For us, it’s not just a job, it’s a passion. Let’s start with a sample at BurkeCorp.com
There has been much debate about when, how, and how much to raise prices. There is also debate about how to explain or communicate higher prices. A simple approach is to increase each menu item to reflect the higher costs of labor and ingredients. Others successfully argue that putting a Covid “surcharge” at bottom of each invoice is more honest, explanatory, and more easily adjusted than regular menu price changes. Consumers are not aware of the magnitude of cost increases to restaurants and labor shortages, and wages publicity have been dumbed down by the media. However, if one chooses to reflect higher costs, in menu prices or a surcharge, a simple but consistent message must convey that higher costs of ingredients, PPE, safety distancing, and limiting capacity have created an untenable financial crisis for many operators. We encourage immediate attention to ingredient cost and operating saving opportunities as well as raising prices to reflect likely higher cost future. Please reach out to your local Bellissimo distributor or Bellissimo Foods directly to connect to an expert who can help.
©2017 Burke Corporation. All rights reserved.
A PROUD DISTRIBUTOR OF BELLISSIMO
2
KEEPING YOUR CUSTOMERS COMING BACK (cont. from page 1)
Di Prim'Ordine Farina Flour
attracts attention, provides entertainment, encourages repeat business and allows you to collect customer information for future promotions, recipe specials, and e-commerce. Contests can be almost anything fun. Possibilities include trivia night, physical competitions, raffles, and giveaways. In order to run successful customer contests, consider these tips: •
Make sure your prizes are enticing, but do not compromise your bottom line. You want to make sure that customers perceive the prizes as valuable in order to entice them to participate. Good prizes include gift certificates, free drinks and free meals.
•
Give an advantage to repeat customers. Repeat business is exactly what you are trying to encourage, so providing regular customers more chances to win will help you achieve your goal.
•
Don’t forget to gather customer information! In order to get customers to enter and get their prizes, you should collect their email addresses and other contact information like birthdays. Keep the information in order to send strategic messages and let them know about more deals and promotions.
•
When implementing an email marketing campaign, there are a few things you should keep in mind: 1. More personalized emails always work better than mass messages. For example, keep a list of your customers’ birthdays and send out a personal message a few weeks ahead of time letting them know they can come in and get a deal on their special day. 2. When offering a discount, offer a good deal. Discounts are still the most popular restaurant promotion. Offering limited time deals can be pretty easy on your bottom line and also wet customers’ appetites for your delicious offerings. 3. You don’t want to email customers too much or too little. Customers genuinely want to know about good deals and will appreciate a notification of your promotions.
Di Prim 'Ordine Farina is a “00 Style” Pizzeria Premium Professional Flour, offering a high-quality, untreated patent bread flour milled from a select blend of domestic hard winter wheat. It's excellent for hand stretching and a hot, fast bake and packed in an operator-friendly 27.5 lb bag.
Some People Say We’re Obsessed With Flavor. We Say They’re Right.
With over 200 varieties of dressings, marinades and sauces — including more than 20 barbecue and wing sauces from Sweet Baby Ray’s, America’s number one selling barbecue sauce — we’re proud to offer an unbeatable breadth and depth of products for our partners to choose from and work with.
Any other questions? We’d love to hear from you. Visit us at kensfoodservice.com or sbrfoodservice.com or call us at 1-800-633-5800 A PROUD DISTRIBUTOR OF BELLISSIMO
According to a recent survey, 40 percent of consumers report that they “usually” use the internet to find a restaurant to go to. Add in the consumers that “sometimes” use the internet to find a restaurant and the number jumps to 70 percent. Your business might be about food, but your online presence cannot be ignored. Keep customers coming back by marketing not only your great food, but the excitement and fun of a local pizzeria. Try a contest and build your customer communication to be a powerful contribution to your bottom line.
3
Keep Your Customers Safe Ice Melt is a must-have during harsh winter months. Prevent areas from getting slick due to ice and snow. Melts ice and snow even at -15 degrees F. All that’s left is a safe, clean surface. Keep your customers safe. #309070
Ice Melt
1/50#
READY TO COOK BREADED CHICKEN TENDERS #1007606
2/5#
Moist & tender with a golden breading. Ask your Delco Sales Representative for more information or to place your order today.
Employee Spotlight Sometimes a person blends VR VHDPOHVVO\ DQG H൶FLHQWO\ into the mix that you forget they’ve only been part of the team for less than a year. This is the case with Erica Sibley who joined Delco’s Customer Service team in March and already feels like a seasoned member. It may be her past experience as an Operations Manager for an event space that made her transition so smooth or it could be her positive attitude. “Caring, compassionate, friendly and funny” are words AP Specialist, Melissa Pyles, use to describe Erica and other colleagues echo that sentiment. Customer Service Rep, Lucas Robins, notes, “It’s a shame we don’t do Zoom calls with customers because Erica is constantly answering calls smiling. She never shies away from trying to brighten someone’s day.” Along with her positive attitude, Erica has adapted well to the demands or her job. “My customers who place their orders with her have been very pleased with her product NQRZOHGJH DQG FRPPXQLFDWLRQ ZKHQ ¿[LQJ LVVXHV ´ explains Sales Representative, Austin Hendrickson. It should come as no surprise that Erica says the customers and her colleagues are the best part of her job. As far as the worst part, Erica says, “Supply chain issues – thanks COVID.” When not happily helping at work, Erica enjoys reading, going to concerts, trying different restaurants and drinking margaritas (which we endorse as a real hobby). She also loves to travel and says South America is the next dream trip. Erica hails from a family of four and has an older brother who lives locally. Her baby is Ringo – dubbed “the cutest pup in town”. “If interested, I’m happy to show you the 1000 photos I have of him on my phone,” Erica says. Erica’s positive attitude and willingness to jump right in have made her a valuable part of our Delco family. Erica’s Favorite Saying/Outlook: “There is ALWAYS room for dessert.”
The Season of Giving The holidays are a time of giving gifts and sharing great food. Why not combine the two and order delicious, high end foods from Delco Foods to give as presents this holiday season? We have a variety of specialty items you can combine to create elegant gift baskets or order a single item and wrap in a beautiful paper. We also have wonderful items to enjoy during holiday meals with your family and friends. From non-food items to delicious catering options, we have you covered. Be sure to give Delco Foods enough notice to have your items in time. For a listing of great gift ideas, please visit us at www. delcofoods.com or contact Theresa Wells at twells@ delcofoods.com. We wish you a happy holiday season!
www.delcofoods.com
Comments, Questions & Suggestions What Do You Love? In February we feature Delco items that our employees love and can’t live without. Now it’s your turn… Send an email to Theresa Wells at twells@delcofoods.com and tell us what Delco products are top on your list. If we feature your comments in our February 2021 issue, we will credit your account $10. If you share a recipe we use, we will credit your account $25. So come on, tell us what you love! Deadline: December 15, 2021
Please contact us toll free at 800.536.1234, locally at 317.876.1951, or visit us online at delcofoods.com. We truly value your opinion. As always, our number one goal is to keep you ŚĂƉƉLJ͘ KƵƌ ŶĞǁƐůĞƩĞƌ ŝƐ ũƵƐƚ ŽŶĞ ǁĂLJ ǁĞ ƐŚĂƌĞ ŶĞǁ ŝŶĨŽƌŵĂƟŽŶ ĂďŽƵƚ ƚŚĞ ƉƌŽĚƵĐƚƐ ĂŶĚ ƐĞƌǀŝĐĞƐ ǁĞ ŽīĞƌ͕ ĂƐ ǁĞůů ĂƐ ŝŶĚƵƐƚƌLJ ŶĞǁƐ ǁĞ ƚŚŝŶŬ ŵĂLJ ďĞ ŝŶƚĞƌĞƐƟŶŐ ĂŶĚ ƵƐĞĨƵů͘ &Žƌ ƉĞƌƐŽŶĂů ƐĞƌǀŝĐĞ ĂŶĚ ƐƵƉƉŽƌƚ͕ ƉůĞĂƐĞ ĐŽŶƚĂĐƚ LJŽƵƌ ĞůĐŽ &ŽŽĚƐ ^ĂůĞƐ ZĞƉƌĞƐĞŶƚĂƟǀe. ϱϬϬϬ ŶƐŽŶ ůǀĚ͘ tŚŝƚĞƐƚŽǁŶ͕ /E ϰϲϬϳϱ ƚŽůů ĨƌĞĞ ϴϬϬ͘ϱϯϲ͘ϭϮϯϰ ͘ ƚĞů ϯϭϳ͘ϴϳϲ͘ϭϵϱϭ ͘ ĨĂdž ϯϭϳ͘ϴϳϬ͘ϳϴϬϯ
Remember you can visit us online at www.delcofoods.com, “Like Us” on Facebook and follow us on Twitter & Instagram
CH
NOVEMBER 2021 VOL. 26, NO. 11
Permit #810
Presorted Standard EC US Postage KI PAID PIZ NSI Oakland, CA ZA DE Permit 810 IND FOR US TH TR Y NE LA c/o BELLISSIMO FOODS EW TES 1600 Riviera Ave. Ste. #315 T S
INSIDE THIS ISSUE • Raising Prices; Do’s and Don’ts • Keep Your Customers Coming Back • Market Update
Walnut Creek, CA 94596 RETURN SERVICE
PH:317-876-1951 | FAX:317-870-7803 www.delcofoods.com
Delco Foods is a proud distributor of Bellissimo authentic Italian ingredients.
Visit Bellissimo.com for more information on Bellissimo authentic Italian items, specials & more!
NEW!
Talk to your distributor about CUSTOM BLENDING your ingredients, to achieve CONSISTENTLY superior, flavorful results each and every time.
1-800-ALLSPICE allseasonings.com A PROUD DISTRIBUTOR OF BELLISSIMO
CRISPY SEASONED LATTICE FRIES SATISFY CRAVINGS WITH A BOLD FLAVOR.
CONTACT YOUR DIVISIONAL SALES MANAGER FOR SAMPLES TODAY!
8