Pandemic through Food Service Matters prism

Article posted by Coliseum, February 8^th, 2022

Image: Tottenham Hotspur

Mike Plutino is a man with a vision. He is the brain behind hospitality industry disruptor Food Service Matters and his mission is to introduce innovation, first class hospitality, products, and service standards that make the whole dining experience an epicurean’s delight and drive food and beverage revenue in an ever-evolving market.

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Armed with 25 years of experience in the industry, before FSM, he spent 13 years as a Senior Leader with Compass Group’s Levy Restaurants, where he managed marquee accounts across the National Football League (NFL), National Basketball Association (NBA), National Hockey League (NHL), Convention Centers, Speedways, and nearly all major industry events.

About FSM

Food Service Matters is an industry leading food and beverage advocates and advisors. They act as advocates for their clients, providing an objective perspective and independent evaluation of their food and beverage business while delivering a refreshingly unique food service consulting and fan experience solution.

Mike Plutino was well aware of the fact that food and beverage have become crucial to the overall experience for fans of all ages and it is the “No 2 fan experience influencer”. This led him to set up the firm Food Service Matters in the year 2013 and today it is creating a new dynamic in hospitality management consulting primarily for venues within the sports and entertainment industry.

Mike Plutino, CEO and Founder, Food Service Matters, US, give the lowdown in an exclusive to ‘Coliseum’ on how the company has carved a niche for itself over the years. He also makes pertinent observations as to how COVID-19 has accelerated the whole venue redesign process and expedited the cashless and contactless factors – something which provides ‘food’ for thought.

FSM in a nutshell:

Advisors & Advocates
Food and Beverage Programing

As Mike Plutino puts in, “We have become the market leaders in food and beverage hospitality consulting here in North America and we have spent our lives in food and beverage and hospitality and sports. We have 70 million dollar businesses that are food and beverage-driven while at the same time food and beverage has become the No 2 fan experience influencer.”

He said that despite some great food and beverage providers, there is a lot to learn about the important part of this business.

Plutino is a straight-shooter and his transparent manner of doing business has been “well-received”.

Challenges

Revenue Optimization – Excellent food and beverage services in arenas does help in attracting fans but at the same time it is important to ensure that the revenue wheels are well-oiled; and
Request for Proposals – The request for proposals for the selection process – finding the right partner and landing the right financial deal;

Past, Present, Future

The four buckets:

2019 B.C

Plutino pointed out that though the outbreak of COVID-19 globally in March 2020 pulled back the world by several years but it also accelerated few things – “Once stadia reopened amid the pandemic, we had progressive clients, progressive venues that went cashless sooner than everyone else and experimented with different levels of pricing. Of course, they were just a handful of venues. As much as we knew cashless was a home run two or three years ago. It was going to take us 10-15 years to probably get there. But, COVID expedited that process.”

COVID fast forward

He further pointed out that though the pandemic was indeed nerve-racking for businesses but in a way it proved to be a blessing in disguise – “The pandemic expedited things like venues going cashless. Almost 80-90 percent has gone cashless and the ability to rethink everything in business has been remarkable. Venue operators had to do a rethink on big-sized venues and arenas became more futuristic with the ‘no-touch’ and ‘contactless’ factor coming into play. The pandemic surely accelerated all of this.”

Staffing challenges

As fans return to venues, revenue is at 30 to 40 percent but along with it comes severe staffing challenges; and
Supply chain issues and serpentine queues in venues due to high demand and skeleton staff.

Robust business

Plutino stated, “There are four core pieces that we have to solve today in order to help deliver us a business as twice as strong as pre-COVID days.”

The Core 4

Design
Technology
Menu
People

He continued, “How do we influence the buildings that are being renovated or designed for tomorrow? What is the role of technology? We have a lot of work to do on reshaping employee experience at a venue to change the dynamic and certainly how does that affect the venue.”

Design

Before the pandemic hit, studies were conducted on how long lines at venues can move twice as fast because long lines resulted in an attrition rate of up to 45 percent. Nothing concrete was coming out of it but as soon as coronavirus bared its fangs, it was almost a ‘Eureka!’ kind of situation because queues got shortened with COVID-19 protocols getting promulgated in stadia and with that came social distancing, payments in cashless mode and everything contactless with in-seat delivery of food and beverages.

The head honcho maintained, “The crowd flow getting streamlined doubles the velocity of transactions. The venues that were 95 percent belly-up three years ago are now 95 percent market-driven.”

Staff shortage

Though the world is limping back to normalcy despite COVID-19 variant Omicron continuing to claw globally and venues are reopening, severe staff shortage persists. Stadiums rapidly opening to full capacity without enough hourly/low-level management staff to give the service fans expect.

Challenges

Pre-COVID there was a staffing shortage and in a post-COVID planet it has got magnified.

Solutions

Operating model of venues will have to change and venues will have to be more flexible;
Venues need to be deliberately designed to require less food and beverage staff; and
Grab and go markets and the use of technology hold the keys.

Warned Plutino, “We have to redesign venues to ensure that they can operate with 400 food and beverage staff. Otherwise, we are going to wake up after four years and will still be dealing with the staffing shortage that we are dealing with today.”

Self-service kiosks

Self-service kiosks create a significant increase in average order size compared with traditional counter interactions.

He said, “The notion of the more components we could take out of the concession stands markets and cut down on seconds make the difference the more we could have the fans do it themselves. It cuts down on labor costs and gets the consumer used to this whole self-service concept.”

Technology

Cashless + Contactless

Right behind design, technology is a hot-button topic while cashless is talked about probably almost every day. A lot of futuristic venues are coming up boasting tech bells and whistles.

Cashless is speeding up services and the efficiency level has also gone up.

Just walk out

The push-in technology, the self check-out markets – the model now, as Plutino pointed out, is cost-prohibitive for a segment of the population but with time everybody will adopt this technology due to the efficiency factor.

Point of Sale

Plutino informed, “We have a very different perspective on Point of Sale within the industry. One is that we don’t believe that it is the food and beverage providers No 1 selection. We believe that a Point of Sale system can be a tremendous amount of data collecting and feedback collecting on the client side. For years, our industry has needed that piece of hardware to be the inventory control master and we haven’t looked at it as something that has to process transactions very quickly – easy for the employee to use and do that for their guest. So we are seeing a shift from inventory control and ensuring that the No 1 purpose behind Point of Sales system is to quickly process a transaction.”

Mobile ordering

The mobile ordering piece has not fit in very well as Plutino pointed out, “This is something that we are looking at closely and I think we have some more to do as an industry of figuring out what this sweet spot is and how it would value to the fan experience. We don’t think we are there as yet.”

Core Menu

Less items on a menu is driving higher levels of revenue and improving the speed of service whether it is 15-20 percent; and
Average increase in order size

Variable pricing

Variable pricing to play a key role.

Ready to Drink Alcohol + Seltzers

Plutino observed, “A no-brainer for most – what are the hottest products of the day that every venue has to have and one example is the explosion of ready to drink alcohol beverages and certainly the seltzer category being the leader by far – a product that was probably optional to have on your menu a year or two ago and now is an essential piece just like the beer.”

Tax Exclusive Pricing

The cashless piece has solved four-five different problems all at once like the tax exclusive pricing.

People

Concluded Plutino, “We have not done well on the people’s side – one is leveraging the team and the assets of the venue, the brand, the name. It is a special thing for an employee to be at Fenway Park in Boston (US) and I don’t think we have taken advantage of that, I don’t we have packaged it and employees would prefer to work at McDonald’s down the street for the same hourly rate and we will have to turn on and use the assets we have – know how to savor our employees. We will have to rethink that whole proposition and take on this issue.”

Closing note

Plutino wants to drive home the fact that COVID-19 has indeed changed the way venues operate – evolution of the hospitality industry, technology solutions to encourage frictionless environments, smart ways to streamline menus, local market integration benefits, labor solutions, venues jumping on the cashless bandwagon and no-touch aspect and staffing shortage forcing a rethink on how venues are designed.

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