HUNGRY FOR IMPROVEMENT IN YOUR FOODSERVICE BUSINESS?

Learn how c-store foodservice is adapting to our changing culture

2700 Old Rosebud Drive, Suite 240, Lexington, KY 40509 • impact21.com • (859) 219-30402700 Old Rosebud Drive, Suite 240 • Lexington, KY 40509www.impact21.com • (859) 219-3040

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Today’s consumer is more knowledgeable about food than ever before. This knowledge can

come from exposure to foods from around the world, the countless cooking shows, or the gamut of unique food concepts dotting the

landscape with distinct flavor profiles.

Each of these impact the consumer’s knowledge. There is also a much deeper understanding and awareness of ingredients and nutritional values. Millennials drive a good part of this trend with their desire for products they perceive as healthier. Non-GMO, grass-fed, free-range and gluten-free are all current buzz words. Simply put, there is a more educated, sophisticated consumer and new norms.

There is also a dramatic change in eating patterns. People are eating smaller meals, more frequently and looking to do so as part of a busy lifestyle. The typical millennial, for example, may eat four to five meals per day and at non-traditional times. Breakfast all day has significant momentum and eggs are now considered an option throughout the day.

Advanced technology has also changed the foodservice landscape. It now drives the manufacturing process as well as foodservice management. There have been significant advances in manufacturing processes that allow for delivery of high quality prepared foods including sauces, proteins, entrees and sides. This greatly expands the options for retailers as to their offerings without overburdening the labor component or requiring a highly skilled culinarian.

On the foodservice management front, technological advances allow for a more sophisticated kitchen management solution and full integration into retail automation. Today’s technology has streamlined numerous processes within foodservice, including building recipes, forecasting demand, setting production requirements, cost analysis, inventory control, food safety and profit management. Subsequently, the ability to drive and gain insights into the results helps increase overall success of foodservice operations.

IMPACT 21 ON

FOODSERVICE

Q: The foodservice landscape is changing rapidly. How, and in what ways?

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C-Store foodservice has reached 22% of in-store sales. What’s the reason for this? How do consumer lifestyles play a part? Is this related to economics? Is it generational?

The changes in foodservice landscape has created new opportunities for c-stores. This is true because of changing lifestyles, and demand for high quality, diverse foods in a ready-to-eat form. Teens, millennials, service workers and

soccer moms have now joined the traditional c-store customer in accepting c-stores as a viable foodservice

option.Our growing economy is also a catalyst for demand due to emerging markets, new construction and a demand for more service workers. Other channels have to face the facts. Millennials see our channel differently than the “oil and gas” of the past.

We are “fast and fresh” and more often than other channels, offer mobile apps and loyalty programs to meet their fast-paced lifestyles.

Many c-stores have capitalized on these opportunities by presenting more robust, diverse, and comprehensive foodservice

offerings. Being able to readily deliver these products more consistently, with higher quality and without overburdening

the labor budget has resulted in increases in the c-store’s ability to effectively compete in the foodservice arena.

Successful stores have been able to effectively offer and communicate a high-quality foodservice offer with a great value proposition.

Q:

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What types of c-stores need foodservice assessments? Is this based on chain size, or can any size chain benefit?

Assessments are beneficial to any size chain as a fresh, objective look can often identify opportunities for improvement. There are often significant gaps between foodservice expectations and what is achieved. It is easy to

become “foodservice blind” with the many competing priorities and demands within each store.

A trained expert can take an objective, focused look at foodservice operations and identify opportunities to more effectively manage food safety, improve quality, reduce costs and drive profitability. The goal of the assessment is to not only identify the opportunities but to provide a roadmap to prioritize and address these opportunities.

What need do c-store leaders express as a reason for wanting a foodservice assessment?

C-store leaders want an objective, unbiased look at their operation with an identification of gaps and a

plan to address them. There is a desire for peace of mind around food safety and knowing there are not any glaring issues. They want to see what is missing

to better engage customers and beat the competition.

Defining what success means should be part of a good assessment. It may be simply more profit, or a desire to elevate the offering or a comprehensive foodservice strategy.

Q:

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What roles are most interested in foodservice assessments?

Foodservice assessments include components that touch every area of the organization.

To excel in foodservice requires a comprehensive

foodservice strategy.

That strategy includes:• product and menu development• concept and program design • distribution and supply chain • merchandising and marketing • management and execution standards • training and food safety • reporting and accountability

An effective foodservice assessment identifies the key opportunities for each area of the organization and how each role contrib-

utes to the overall success of the foodservice program. This can elevate the entire organization beyond foodservice as the roles

are refined, reporting processes are set, gaps are closed and a focused streamlined organization emerges. The C-suite

cares about foodservice being a competitive ad-vantage and how it drives bottom line results.

KPI’s should be monitored on weekly or monthly basis. That empowers executives to make right deci-sions about the foodservice program. When foodser-vice becomes a key component of the business, food safety becomes a concern.

Operations is concerned with planogram compliance, out of stocks, shrink, actual versus theoretical cost, and profit against budget. Other components of the

balanced scorecard will include customer analytics, training and safety compliance, and standards

adherence.

Q:

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No two projects are alike. What’s an average timeframe to complete a foodservice assessment for a 100-store chain?

Foodservice assessments can be completed in one to two months. This depends on the number of locations in the

chain and the complexity of the foodservice program.

Assessments have three phases:1. Pre-visit: This is a key piece of the discovery process. It includes a review of company financials, the menu, operations manuals, branding, program documentation, standards, training, metrics, and sometimes initial interviews.

2. Full Assessment: This is completed onsite and involves a deep review of each major component of the program.

3. Analysis: Consultants analyze the findings and then develop the roadmap. The roadmap will outline the steps

needed to execute their foodservice program at a higher level of food safety, sales and gross profit.

IMPACT 21 ON

THE IMPACT 21 PROCESS

Q:

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How disruptive are the foodservice assessments to daily operations? Will a client need to overstaff during training?

In most engagements, clients to not need to add staff for a foodservice assessment. We are sensitive to the time constraints that team members face. We do interview key personnel in the corporate office as well as certain members

of the operations team.

Store level assessments require some interaction with staff. We avoid interfering with their duties as we want to observe the team in action. These assessments are scheduled and we may want a few minutes of time with the key leader.

Is Impact 21 familiar with the health codes in our state or county? How can we be sure we will be compliant?

All food codes are based on USDA and FDA guidelines which our team follows. There may be

specific interpretations within a local jurisdiction. We do work with the operations team to understand any local guidelines as part of the discovery process. It

is sometimes the case that these regulations deviate within the chain. When necessary, we do reach out to

local regulatory bodies for their interpretation.

Q:

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Describe some of the details around the following items, and some specifics the assessment addresses.

In all the following areas we are looking for gaps in methodology, inconsistencies in procedures, pro-cesses and execution, lack of documentation and verification, and opportunities for improvement including training.

Here are a few examples:• In-store menus: Do the menus accurately reflect the offerings? Are they updated and how are preferences captured?

• Operating systems and processes: Are the systems comprehensive and do the stores follow them completely and consistently? Is the verification process in place and followed?

• Store workflows: Do the workflows accurately document the “what, when, why and how” along with an effective verification process?

• Food and employee safety practices and procedures: Are there issues that put the company at risk? Are any of the identified issues

systemic, training-related, or location specific? Is the compliance and verification in place?

• Customer moments of truth: How are the stores performing in the key areas of customer interaction?

• Reporting and accountability: Are the results and verifications accurately captured? What opportunities exist to streamline these?

Q:

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What are 3 major areas of foodservice that C-Stores sometimes overlook, or even get wrong?

1. The vital understanding that maximizing suc-cess in foodservice requires a comprehensive strategy and a commitment to becoming a food-service organization.

2. Foodservice is not always fully integrated into store operations and is treated as a separate entity. Therefore,

there are operational disconnects where safety and operating standards are not understood and lose their urgency.

3. The absolute critical need for item level inventory within foodservice as a management tool. This is not just for accounting purposes. It is essential to making the categories more productive and improving margins.

What answer do you have for a chain that feels its challenges are different from other chains, and therefore can’t implement our assessment?

Our approach is unique for every retailer and is designed to address their specific challenges.

What we do is look at fundamentals, industry best practices, the challenges the chain is experiencing and the desired results of the company. We then conduct

the assessment to identify gaps, opportunities, and root causes. The results are used to create a roadmap

specific to the company.

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How can a client be sure the recommended roadmap will not interfere with existing store operations?

Programs and initiatives often compete with one another for resources and prioritization. We can hold a competing priorities workshop after roadmap delivery.

This provides an opportunity to fully identify all significant initiatives within the company and set

prioritization.

How does the Company learn about customer perceptions? Surveys? Interviews?

Surveys and interviews are types of research that serve a useful role. Buying patterns also provide insight as do moment of truth evaluations. In these evaluations, customer interactions (moments of truth) are assessed to understand how the operations are executing and

delivering during these critical moments.

These tools help paint the picture of perceptions consumers may have and identify opportunities for improvement. From there a root cause analysis can be conducted to identify what gaps exists and what solutions can be developed to address the identified opportunities.

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