Preface

Food sales in the restaurant industry reached over 17 billion dollars in 1958. This represents a sales increase of more than 40 per cent since 1950. Despite this growing trend for eating out and a steadily expand­ing sales volume, the mortality rate in the food service industry is ex­tremely high. One investigation after another has shown that from one-fourth to one-third of the restaurants that begin their existence in any one year were out of business by the end of that year.

What are the causes for failure? This question was asked of many highly successful food service organizations and operators in the coun­try. Invariably they replied that a restaurant operator will fail unless he has a thorough knowledge of food. He should be able to design a profitable menu pattern, to purchase, receive, store, prepare, and serve each menu item in such a manner that he maximizes his profits and the satisfaction of his guests. He must understand and be able to control himself and his relationship with employees, customers, dealers and the community. He must have a knowledge of management, admin­istration, organization, supervision, controls, accounting procedures, pricing, promotion, contracts and insurance protection. He should be aware of changing regulations concerning possible union tactics, food, health, wages, taxation, shifts in consumption income levels, popula­tion and costs, relocation of business areas and changes in competition.

Consequently, the significant causes for failure are:

1. Inadequate knowledge of food.
2. No understanding of people.
3. Inexperience and no knowledge of business.
4. Little awareness of a constantly changing environment.

Conversely, to succeed in this field the food service operator must be able systematically to control, forecast and budget food, labor, bever­age, rent depreciation, and other operating costs, to promote his sales, to maintain good human and public relations, and to keep one step ahead of his changing environment.

Preliminary investigation showed that there is no single restaurant business or type of unit that is representative of the entire industry. Each food service operation has different problems requiring manage­ment decisions that occasionally vary constantly and provide different expectations of profit.

Because of this diversification there is no single idea or formula that can guarantee the highest profit for all operations. However, since food service units have the same basic problems of housing their physical equipment, purchasing, storing, preparing and merchandising their food, selecting, training and motivating a productive labor force, many of their basic problems have common principles from which correct solutions can be evolved.

The authors gratefully acknowledge their debt to the Can Manufac­turers Institute and to Mr. Harold H. Jaeger who initiated the research study that pinpointed and evaluated many of the factors influencing the profitable management decisions described in this book; to Mr. Charles Staples, Institutions Magazine, Mr. Jack Ghene, Volume Feed­ing Management, and Mr. Cal Morken, Diner Drive In, for their per­mission to include in this book several of our articles first developed in their fine periodicals.

Thanks also to Food Service Magazine, Gas Magazine, Inc., and to several restaurant operators and equipment manufacturers who sup­plied us with numerous photos for use in this book.

No text is the work of the authors alone. This book represents the distillation of experience and knowledge of many owners and managers successfully running all types of operations: from drive-ins and diners to service restaurants, cafeterias and inplant feeding units, with sales volumes ranging from $80,000 annually to $1,700,000 a unit, located throughout the nation from Maine to Florida and across to Washington and California. To these restaurateurs and to the restaurant industry as a whole this book is respectfully dedicated.

Peter Dukas
Donald E. Lundberg

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