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2013

Your Voice for the Hospitality Industry. A Publication of the Kansas Restaurant and Hospitality Association

Table of Contents A letter from the CEO.............1&10 A letter from our Chair.....................3 HeinSight............................................4 ProStart..............................................7 Calendar of Events...........................8 2013 Industry Growth...................10 Welcome New Members...............11

FIRST QUARTER

PUBLICATION INFORMATION Submissions

You are invited to share your expertise and perspective. To submit articles or other editorial input, please contact Lisa Graham at lgraham@ krha.org or 316.267.8383.

Advertising

Get your products and services noticed by industry decision-makers through advertising. Kansas Restaurant and Hospitality Association News & Insights is distributed to all members four times a year, this maximizes your advertising exposure to the largest possible audience. For information on advertising opportunities, please contact Lisa Graham at lgraham@ krha.org or 316.267.8383.

Membership

For more information about your membership or to renew your membership contact our office at ksrest@krha.org or 316.267.8383 or log on to www.krha.org.

POS: Coming to a Smart Phone Near You Smartphone technology gives businesses and consumers payment flexibility. by qsrmagazine.com With smartphones getting smarter, smaller, and speedier all the time, concurrent advances in mobile point-of-sale technology are presenting restaurants with the opportunity to make their POS systems mobile. There are now numerous POS platforms that leverage the iPhone and other mobile devices, including Android-powered smartphones and tablet computers like the iPad, so that restaurants can process payments in the field with a credit-card reader. The readers either attach to mobile devices of the operator’s choice or accept payment through mobile applications like Google Wallet. These various platforms, experts say, liberate restaurants from the constraints and costs of traditional POS systems and open up game-changing new ways to capture information about customers that will help operators earn their loyalty. “This technology gives restaurants a degree of freedom,” says Mike English, a mobile payments expert at Heartland Payment Systems, which processes nearly one in seven transactions in the restaurant industry. “Traditional POS has been very regimented and costly, but mobile is very adaptable, not only in terms of payment but in terms of marketing tools from an ever-growing number of third parties.” While mobile POS is often touted as a boon to full-service restaurants—it can allow customers to pay at the table through a credit-card reader attached to a mounted iPad, for example, and waiters can log orders on a smartphone that zip back to the kitchen at 4G speed—the technology also has service-oriented benefits for quick serves, English says. “In [quick serves], we see mobile devices being used for line busting,” he says. “If it is lunch time and customers are waiting in a long line, they are a lot less likely to walk away if they see the restaurant open up another [payment option].” Beyond mobile POS’s value as a portable cash register is its potential as a conduit for invaluable consumer insight. Whereas restaurants are able to glean very little personalized information from credit-card transactions, they can learn a lot when customers use the mobile payment apps or opt in for an array of alerts and updates via their smartphones. “I would go as far as to say that merchants have almost zero knowledge of their customers from a credit card,” says Paul Cwalina, a senior vice president at First Data, which processes payments for millions of businesses and helps power Google Wallet, the Internet giant’s foray Your Voice for the Hospitality Industry.

Continued on 4...


KRHA Staff Adam Mills, President & CEO amills@krha.org Neeley Carlson Vice President, Education & Training ncarlson@krha.org Tina Cox Vice President, Risk Management tcox@krha.org Bob Chambers Member Services Representative bchambers@krha.org Karie Bell Account Manager kbell@krha.org Dave Belvin Loss Control Manager dbelvin@krha.org Rich Ewen Member Services Representative rewen@krha.org Lisa Graham Marketing & Communications Manager lgraham@krha.org Christine Hanaka Account Manager chanaka@krha.org Karen Hrdlicka Claims Specialist khrdlicka@krha.org Hannah Nighswonger Marketing Representative hnighswonger@krha.org Jeff Richards Member Services Representative jrichards@krha.org Anna Sadler Accounting Assistant asadler@krha.org Shannon Wilkinson Accounting Assistant swilkinson@krha.org Ron & Julie Hein Legislative Counsel rhein@heinlaw.com

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In 2013 Let KRHA Make You More Efficient & Find You Savings! by Adam Mills, KRHA President and CEO 2012 ended marking what can only be considered a successful year for the Kansas Restaurant & Hospitality Association. I hope that as each of you read this article you are able to say it was a successful year for your business as well. As Geoffrey Chaucer stated, “Time and tide wait for no man.” So what challenges do we have to look forward to in 2013? Affordable Health Care Act, uncertainty in the economy, the rising cost to deliver food from farm to the table, a consumer base that is starved for time and looking for great food and low prices, and so many options to market your business via social media that it’s hard to keep it all straight. One thing is certain, efficiency and looking for every opportunity to lower your cost of doing business has never been more important to business owners than it is right now. We all know that in every challenge lies an opportunity to make things better than they were before. For many challenges your business will face, KRHA and the NRA can offer guidance and a solution! Business Challenge: What are my requirements under the new Health Care Reform Law? KRHA Solution: First of all visit healthcare.restaurant.org to find out just about anything and everything you need to know about how this law affects your business. Second, look for announcements regarding webinars being offered to members beginning Jan. 17th. We will be your expert on Health Care Reform! Business Challenge: My Insurance costs are rising and I’m unsure that what I’m purchasing is necessary, overall I don’t really understand my insurance coverage. KRHA Solution: Contact our in house insurance agency, Hospitality Insurance Services, and we will give you a thorough evaluation of your current insurance program. With our non-profit, member owned Self Insurance Fund for Work Comp there is no better place to purchase work comp insurance. For property, casualty, health, and specialty insurance programs specifically designed for restaurants, hotels, and other hospitality based businesses, we represent insurance carriers who are committed to your business needs. Business Challenge: The percentage of people paying with a credit card versus cash is growing to almost 70%. How do I get a handle on the amount of fee’s I’m paying? KRHA Solution: First off, the National Restaurant Association has been very active in lobbying the Federal Government for rate reform on small tickets and had some success on this issue. We understand the challenge you face with the loss of margin in menu pricing and are working diligently to provide a meaningful solution. Second, KRHA partners with Heartland Payment Systems to provide members with unparalleled service and excellent pricing. Business Challenge: How do I market my business in today’s world of Social Media and the various coupon sites? Continued on 10...


Your Voice for the Hospitality Industry. Kansas Restaurant and Hospitality News & Insights is a quarterly publication for members and industry partners. If you have questions about your membership or would like additional information about benefits, please contact KRHA at : 316.267.8383 or 800.369.6787

A letter From Our Chair by John Arnold, KRHA Chair & Proprietor Redrock Canyon Grill

On behalf of the Kansas Restaurant and Hospitality Association, I would like to congratulate all the members on a tremendous 2012. 2012 ended with dramatic talks of cliffs; both fiscal and even dairy. Despite the threats of milk elevating to seven (plus) dollars a gallon, Kansans are still going out! They are still participating in experiences in both restaurants and lodging. Records are being broken all over the state in regards to the amount of dollars the collective “WE” are bringing in. Part of the KRHA mission statement is to “…promote quality food and services” and that’s my main area of focus as we enter the new year. Due to media shows such as “Restaurant Impossible,” “Hotel Hell,” “Restaurant Stakeout,” and “Kitchen Nightmares,” superb service standards have become the expectation. Our consumers are driven to find the highest quality product with service standards similar to an entertaining show that meets every need. The bar has been raised on how guests should be cared for.

The Many Benefits of Membership The Kansas Restaurant & Hospitality Association is dedicated to helping members operate with greater ease, efficiency and savings. Member participants save on their bottom line each year by taking full advantage of KRHA’s many member benefits.

Contact us for more information at 800.369.6787 KRHA Self Insurance Fund • Workers’ Compensation

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This exciting trend of increased spendage for valued experiences has driven many high school students to choose our industry as their career path, not just a “job”. The estimated 138,100 employees in Kansas by 2022 is an attainable goal. CEO of Amazon.com, Jeff Bezos explains it as I see it. He stated, “We see our customers as invited guests to a party, and we are the hosts. It’s our job every day to make every important aspect of the customer experience a little bit better.” Let’s push through the dairy cliff, beef volatility, and heightened guest expectations by elevating our clients’ experience in our establishments. We can do this through commitment to exceed. All the best in 2013 and always!

Heartland Payment Systems • Credit Card Processing

ServSafe

• Food Handling and

Alcohol Server Training

National Restaurant Association • Dual membership with NRA included with KRHA retail membership

John Arnold Chairman Proprietor Redrock Canyon Grill

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• Discounted Music Liscensing

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Enjoy some of the KRHA Allied Member’s Goods and Services

Kansas 2013 Legislature: A New Look

by Ron Hein, KRHA Legislative Counsel with Hein Law Firm, Chartered Airgas-Bulk Beverage CO2 316.258.2993 airgas.com Essential Elements 816.471.4040 Farmer Brothers Family of Coffees Cain’s & Superior 316.262.5443 Flowers Baking Co. of Denton 316.263.2211 flowersfoods.com Kansas Beef Council 785.273.5225 kansasbeef.org Knipe’s Liquor 620.663.3164 Liberty Fruit Company 913.281.5200 libertyfruit.org M & J Seasonal Concepts 913.642.4999 seasonalconceptsonline.com Marco Polo Intense Carpet & Tile Cleaning 316.250.4153 marcopolollc.com MSI Services Inc. 316.262.0556 MSI-services.net Qpon Dog Text Message Marketing Specialists 608.228.1940 Standard Beverage Corp. 316.838.7707 standardbeverage.com Tate Dairy Queen Brazier 620.227.2912 US Foods 800.877.4660 usfoodservice.com

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During the 2012 Legislative Session, the House and Senate battled over numerous issues stemming from the philosophical divide between the two chambers. The House and the Governor were far more conservative than the moderate majority combination between the Moderate Republicans and the Democrats who basically controlled the leadership and the votes in the Senate. The result of the philosophical divide included, among other actions, the inability to find a suitable compromise on the issue of legislative reapportionment. As a result, a panel of three federal district court judges decided the apportioment of the legislature. The reapportionment ordered by the court was more concerned with the deviation from standard population for each district than it was about the existence or nonexistence of incumbents in any given district. As a result, approximately fifty districts did not have any incumbent running in them, and approximately fifty districts pitted multiple incumbents against each other. With the drastic changes in the actual districts, the primary election saw a major challenge to Moderate Republicans by Conservative Republicans, especially in the State Senate races. Following that, there were additional changes to the makeup of the legislature resulting from the General Elections. Ironically, despite all the changes resulting from reapportionment and two contentious elections, the number of Representatives and Senators in the two chambers of the Legislature remained exactly the same: Senate - 32 Republicans/8 Democrats; House - 92 Republicans/33 Democrats. Since the Governor was not up for re-election until 2014, obviously Governor Brownback retained his office. However, a philosophical shift occurred when numerous Conservative Republicans defeated Moderate Republicans in the Senate. As a result of the 2012 Elections, the Conservative Republicans hold 27 of the 40 seats in the Senate, the Moderate Republicans hold 5, and the Democrats hold 8. The ramifications of that philosophical shift will mean the passage of additional pro-business legislation which had previously passed the House and been supported by the Governor, but which had been held up in the Senate. In addition, issues ranging from tax policy to education finance to pension reform to transportation funding may be impacted by the new conservative tilt of the Legislature and the Governor. The KRHA is interested in several issues which were held up by the Senate in previous years, and which the KRHA believes the new conservative Senate will be willing to support. It will be interesting to see how the new conservative Legislature totally impacts KRHA issues during the next few years. Only time will truly tell how this fundamental shift in philosophy will play out for the state and for the restaurant, lodging, and hospitality industries in particular.


Your Voice for the Hospitality Industry. Continued from 1..

into mobile payment. “They can see that a 16-digit number that ends in 1234 comes in twice a week or twice a month. Beyond that, they can’t do anything with it … because the bank keeps all of our information confidential. So it doesn’t really give merchants good data.” Mobile, on the other hand, allows operators to parse customer behavior. “The mobile POS … allows us to capture valuable data that gives us a better idea of our customers’ spending and buying habits,” says Charles Smith, owner of Chuck’s Wagon BBQ. The restaurant and catering operation based in Bowie, Maryland, uses a mobile POS platform called Sage Payment Solutions for processing credit cards in the field and for tracking sales in general. “For example, we know that if offered the opportunity to use a card versus cash, the card user is likely to spend more.” These kind of granular insights are hard to cull from analyzing credit-card transactions alone, Cwalina says. “The big thing is that people don’t share cell-phone numbers” as they do credit-card numbers, he says. “My wife has a different [phone] number than I do, and she is obviously a different person

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with different spending habits, and so [businesses] can talk to her one way and to me another way.” Smartphones open up very exciting opportunities when it comes to business-consumer communication, the experts say. As mobile POS technology evolves, an operator will be able to send coupons to opted-in customers’ phones based on their shopping habits or geographic location. They will also be able to offer sophisticated, mobile-based loyalty programs that will leverage social media and ditch paper punch cards. “We’re thinking about how businesses currently interact with the consumer and figuring out how we can better connect them,” says Travis Kellerman, a manager at POSLavu, which makes point-of-sale software for the iPhone and iPad. Of course, communication is a two-way street, and that means restaurants need to be very careful not to bombard their customers with messages. Otherwise, they could experience a backlash in the form of miffed tweets and Facebook postings. “The old days of businesses dictating to consumers are over,” Cwalina says. “There is a danger of too many texts, too many coupons. The mobile device is great, but I think there is definitely a danger of people getting too much on their phone.” At the moment, though, the potential of mobile POS far outweighs the peril. The technology is in its infancy, and new developments are on the horizon. These include near-field communication, which allows smartphones to share data with other devices that are in close physical proximity, and EMV cards, which have microchips that allow them to interface with mobile phones. Restaurants may not have a choice but to adapt and adopt, Cwalina says. “I think it’s going to become a way of life,” he says about mobile payment. “Credit cards are going to be used more rarely, and mobile is going to happen a lot faster than plastic. This is not a fad. “In baseball analogy,” he adds, “mobile technology is in the first inning.”

Member KRHA www.vrbbplains.com

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Your Voice for the Hospitality Industry.7

Feeding Dreams. Building Futures. by Neeley Carlson, Vice President Education & Training ProStart is a nationwide, two-year program for high school students that develops tomorrow’s restaurant and hospitality industry leaders. From management skills to culinary techniques, ProStart’s industrydriven curriculum provides real-world educational opportunities and builds practical skills and a foundation that will last a lifetime. In Kansas there are 25 high schools utilizing the program, exposing 1,500 students to the hospitality industry. To connect the industry to the classroom, KRHA Educational Foundation hosted two boot camps to provide industry mentoring opportunities. This also provided students the opportunity to start developing their management concepts and menu for the Kansas ProStart Invitational. The ProStart Invitational is a venue for students to showcase their talent while networking with industry. They also learn about college opportunities while competing for scholarships that are awarded to the top 3 teams. At the state competition teams compete in three events during the competition requiring intensive culinary and hospitality management skills. Teams that place first at their state competition advance to the National ProStart Invitational in two categories – culinary and management. The culinary competition highlights the creative abilities of each team through the preparation of a three-course meal in 60 minutes using only two butane burners. Management teams develop a proposal for an original restaurant concept and apply critical thinking skills to challenges restaurant managers face in day-to-day operations. Students in the edible centerpiece competition demonstrated their creative ability through the preparation of an edible centerpiece consisting of fruits and vegetables. The performance of teams in all events is observed and rated by expert judges from industry and academia. By bringing together the industry and the classroom, ProStart gives students a platform to discover new interests and talents that can open doors to fulfilling careers. We depend on industry support to help build the leaders of tomorrow. You can help us inspire tomorrow’s managers, chefs, operators, suppliers and foodservice educators by getting involved. To find out how you can get involved contact the KRHA office.

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Calendar of Events

Visit krha.org and click on the Calendar/Events tab for a full listing of our annual events.

January 16 & 17

KRHA Legislative Affairs Conference Taste of Kansas Luncheon 11:30 am-1:30 pm Annual Member Meeting 1:45 pm Ramada Inn, Topeka

February 26 & 27

Kansas ProStart Student Invitational DoubleTree by Hilton, Wichita March 21 KRHA Insurance Board of Directors 9am-12pm Marriot, Wichita KRHA Association Board of Directors 1pm-3pm Marriott, Wichita

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Your Voice for the Hospitality Industry.

Welcome New KRHA Staff! Rich Ewen, Insurance Agent Avid golfer and family man Rich Ewen joined the KRHA in November 2012. Prior to joining the KRHA team, Rich worked in the insurance business for 25 years, primarily in employee benefits. Rich graduated from Emporia State University with a degree in Political Science.

Our Sincere “Thanks” to the KRHA Annual Corporate Sponsors

Would you like to sponsor us? Contact Adam Mills at amills@krha.org to learn about the many benefits that come with being a corporate sponsor!

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Anna Sadler, Accounting Assistant Former bank employee and elementary school administrative assistant Anna Sadler has been married to Lance Sadler for 13 years, and together they have two children. Thirteen-year old Lane and nine-year old Ava are active in sports; therefore, the family of four enjoys spending their summers on the ball field! Anna enjoys working out; in fact, Anna is currently a group fitness instructor at the YMCA and McConnell Air Force Base. Anna holds a bachelor’s degree from Friends University in Organizational Management and Leadership.

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Continued from 2... KRHA Solution: We partner with Fishbowl Marketing and have a special program for members of our Association. This program is not only affordable but it is created by people who truly understand how best to navigate the social media and electronic age. Call us today and we’ll get a representative from Fishbowl in touch with you at a reduced price for KRHA members! The NRA also offers member only webinars to guide our industry on the best practices. Business Challenge: I’m flooded with email and communications about so many things that it’s hard to know what is important and what is not important. I can’t read everything that comes to me but I’m also worried about missing things that I shouldn’t. How do I stay on top of things in the little bit of time I have available? KRHA Solution: Put the KRHA Website in your favorites list on your web browser and create an email folder for all of the KRHA emails that are sent out. We send out a bi-weekly newsletter, a quarterly magazine via email, and a weekly legislative report while we are in legislative session beginning Jan. 14th 2013 and ending in May when the session wraps. In addition we will send informational notices out as necessary when urgent information becomes available. As always, feel free to call our offices anytime you need information or updates on important issues. Belonging to KRHA means access to critical information and important services you need to run your business! Let us help you make 2013 GREAT!

Adam R. Mills President & CEO

Restaurant Industry to Grow in 2013 Despite Sustained Challenges by the National Restaurant Association While the operating environment will remain challenging, America’s 980,000 restaurants are expected to post record sales in 2013, according to the National Restaurant Association’s (NRA) 2013 Restaurant Industry Forecast. Industry sales are expected to exceed $660 billion – a 3.8 percent increase over 2012. Restaurants will employ 13.1 million individuals in 2013 as the nation’s second-largest private-sector employer, representing 10 percent of the total U.S. workforce. Looking ahead, the NRA expects restaurants to add 1.3 million new positions in the next decade, pushing industry employment to 14.4 million by 2023. Because of the strong growth in restaurant employment, labor challenges will start to reemerge. Recruitment and retention, which was a top challenge pre-recession, will make its way back onto restaurant operators’ radar as the U.S. labor pool is starting to become shallower; restaurant operators in all segments expect recruitment and retention to be more challenging in 2013 than in 2012. The top challenges cited by restaurateurs vary by industry segment, and include food costs, the economy and health care reform. After increasing steadily in the last three years, wholesale food costs will continue on an upward trajectory through 2013, putting significant pressure on restaurants’ bottom lines as about one-third of sales in a restaurant goes to food and beverage purchases.

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The sluggish economic and employment recovery impacts consumers’ cash-on-hand situation, which in turn impacts restaurants as there is a strong correlation between consumers’ disposable income and restaurant sales. Preparing for the implementation of health care reform will put additional cost pressure on some restaurant operators in the near future. One-third of a typical restaurant’s sales go toward labor costs, so significant increases in those costs will result in additional cost management measures. When it comes to consumers trends, interest in technology will continue unabated. Restaurant operators recognize that technology can enhance customer service and appeal to consumers, but they are not fully meeting consumer demand in this area yet. On menus, local sourcing and nutrition remain the hottest trends. More than seven out of 10 consumers say they are more likely to visit a restaurant that offers locally produced menu items, and more than seven out of 10 consumers say they are trying to eat healthier at restaurants now than they did two years ago. The NRA’s 2013 Restaurant Industry Forecast details economic, workforce, operational and consumer trends that affect the industry, and how operators can leverage those trends to build business and guest satisfaction. A free resource to state restaurant association members, the report also provides national, regional and state sales and employment data. Get your free PDF of the 2013 Restaurant Industry Forecast at Restaurant.org/Forecast. You’ll need your member number to download the report.


Your Voice for the Hospitality Industry.

Welcome New Members! Knackies 111 S Maple McPherson 620.504.6030

The Dore, LLC 114 N Washington Ave Wellington 620.326.7611

Coco Bolo’s 1227 Bluemont Manhattan 785.537.4700

Wichita Inn & Suites 5211 E Kellogg Wichita 316.685.2233

Freddy’s Frozen Custard 11775 S Black Bob Rd Olathe 316.558.5388

Hungry Cats Inc 520 McCall Rd Manhattan 785.537.8822

Image One 12274 Mahoning Ave #11 North Jackson, OH 331.538.9900

Northrock Suites 7856 E 36th St N Wichita 316.634.2303

McDonald’s 24 E Pancake Ave Liberal 620.624.8741

Quizno’s 900 Hays Dr Manhattan 785.539.9500

Jack in the Box 9330 Balboa Ave San Diego, CA 858.571.4091

Wichita Inn North 3741 N Rock Rd Wichita 316.636.2220

McDonald’s 1800 N Kansas Liberal 620.626.7556

Quizno’s 2815 Anderson Ave Manhattan 785.776.6300

Wesley Inn 3343 E Central Wichita 316.858.3343

Wichita Hopps LLC Dba River City Brewing Co 150 N Mosley Wichita 316.263.2739

Quizno’s 1000 E Crawford Salina 785.306.0600

Abersonek LLC Dba Pita Pit 3242 N Rock Rd Wichita 316.201.4748

Empire Catering 523 E Douglas Wichita 316.992.1000 Mad Jo, LLC Dba Douglas Street Eats 1713 W Douglas Wichita 316.303.9808 Ambassador Hotel Collection, LLC 104 S Broadway St Wichita 316.239.7100 Law Kingdon Architecture 345 Riverview #200 Wichita 316.268.0230

Quizno’s 701 Kenwood Dr Salina Freddy’s Frozen Custard 2030 W 23rd Lawrence 785.865.0123 Freddy’s Frozen Custard 223 McCall Rd Manhattan 785.210.1123 Cox Brothers BBQ 3930 Rainbow Blvd Kansas City 785.539.0770 Cox Brothers BBQ 812 E Chesnut Junction City 785.579.6606

Neill Enterprises LLC Dba College Hill Dairy Queen 5335 E Central 316.290.9098 Open Table, Inc 643 E 70th Terr Kansas City 913.449.9991 Grant Thorton LLP 8300 Thorn Dr, Ste 300 Wichita 316.265.3231

Wichita Inn West 6335 W Kellogg Wichita 316.943.2373 Parkwood Inn 505 S 17th Manhattan 785.320.5440 Manibhadra Inc Dba Days Inn of Emporia 3032 W US Hwy Emporia 620.342.1782

Wichita Hotels 4011 N Tara Cr Wichita 316.371.8667 Wichita Inn- Super 8 8220 E Kellogg Wichita 316.371.8667

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PRSRT STD U.S. POSTAGE PAID Wichita, KS Permit #662

3500 North Rock Rd. Building 1300 Wichita, KS 67226

Your Voice for the Hospitality Industry.

PUT THE HIGHEST STANDARD IN TRAINING AND CERTIFICATION TO WORK FOR YOUR BUSINESS AND YOUR CUSTOMERS.

Employee Training Dates Kansas City January 29 May 14 July 9 September 24 November 19

Marion April 25 December 12 Manhattan January 22 June 4 September 10

Manager Training Dates Lenexa February 19 April 23 June 18 August 13 October 22 December 10

Manhattan February 8 June 6 Wichita February 5

Go to www.krha.org to check for additional training dates and locations.

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