Shifting Markets
I spotted a couple of chalkboards on the pavement outside local restaurants over the weekend. The first one read:
"Cut price 3 Course Lunch
Only £4.50
Open 12 - 2.30"
Just along the street the second one proclaimed:
"Hungry? Thirsty, Fed up Shopping ?
You Have Walked Far Enough
Enjoy Freshly Cooked Salmon with an Ice Cold Beer
Open All Day"
The Agents FOR SALE sign was above the doorway of the first restaurant, a " no booking we are too busy" on the door of the second restaurant.
I think we all know by now that the coming summer - maybe even the coming year is going to be tough for hotels, restaurants and bars. Markets are shifting under all kinds of pressures. Camping and Self Catering is experiencing a boom. Customers are scouring the planet looking for attractive exchange rates for their holiday £ or $ and you can bet more than a few "Friends and Relatives" accommodation offers are getting called in - " you remember you said we could come and stay when we liked?"
Beware
The immediate reaction to fuel demand is to cut your price, but beware. If you cut into your cleverly calculated selling price just how far can you go before you start to not only reduce your profit margin for re-investment but also have to start making savings on staffing and before long your levels of service. Now some people will figure that they can still make the same margins and continue to employ the same number of colleagues by simply buying cheaper food to sell, scrimping on the house wine, changing the timer on the car park lights, god forbid even supplying cheaper toilet tissue. Dont.
Go on try selling instead - you know it's the right thing to do. Don't you ?
