Hansen’s Hideaway Restaurant

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increased labor efficiency and maximize profitability.

Tactical Issues / Short Term :

Since Hansen’s Restaurant had a limited menu, menu flexibility and daily special treat offerings to customers were issues to be looked into to minimize food waste. Hansen’s had years of historical data on breakfast and lunch service, however, Kathryn was uncertain about forecasting meat requirements for the dinner service. She knew for a fact that she need as much flexibility as possible in terms of menu items, portion sizes and quantities, especially at first offering. She was also unsure on the implications and impact of offering dinner and how would this affect their current breakfast and lunch services. Would dinner cannibalize the lunch service or attract in new customer with different eating and spending habits ? Whichever meat specification(s) she chose, she also needed a flexible meat supplier who delivered, had no minimum purchase requirement and was willing to work with her until she has a better handle on demand for her dinner service.

Strategic Issue / Long term :

Is it better to make (fabricate) or buy beef portions ? this would be the underlying deciding factor for Kathryn to come up with a decision. She would need to identify all the relevant cost elements. The Make options included fabricating from (a) whole carcasses, (b) sides of beef), (c) fore-and hindquarters, (d) primal cuts, (e) subprimal cuts or (f) steak-ready cuts.

Kathryn has decided that, if she fabricated meat in-house, she would need to purchase a vacuum-packer that cost between $ 1,500 to $ 2,000 to prolong the shelf life of meat when frozen and reduced product loss from meat storage options. This also ascertains lower risk of leakage. This will need to be factored and included into the Total Cost of Ownership (TCO). Although this was not a significant deciding cost factor, processing a whole carcass had the greatest impact on her back-of-the-house (kitchen) remodel. It will entail installation of walk-in cooler large enough to accommodate a meat hook with a beef carcass, a firm cutting table made of non-corrosive material, wrapping table, band saw, hack saws, grinder,slicer, wrapping materials, vacuum packing equipment, knives, sharpening steel and stone, knife sterilizer, safety aprons, gloves and other sanitizing supplies. The walk-in cooler could cost $ 10,000 upwards. Electricity and labor costs would tremendously increase. Let alone, the rough estimate for outfitting a butchering station ranged from $20,000 to $ 25,000. Kathryn was also unsure of the extent or cost of kitchen remodelling that would be required. Besides, the fact that fabricating a carcass required the highest level of butchering skill in order to maximize yield and produce quality portions, Kathryn was not an expert yet. Her labor cost would decrease over time as she develops her fabrication skills and gain complete knowledge of the bone structure and natural seams and understand more about yield possibilities of the entire carcass.

There are other issues when butchering in-house, such as beef quality and food safety. Using the right cut, the right portion and grade of beef largley determined quality. Preparing it correctly helped ensure tasty dishes at sensible cost and any wrong cut would drove avoidable costs. If Kathryn would not be able to quick freeze beef like a manufacturer, there was issue on the meat’s discernable deteriotation in taste, juicess and tenderness. However, Kathryn knew that she could buy fresh beef with the intention of using it immediately and still have a back up plan of freezing it. Meat was also highly perishable and highly susceptible to deadly pathogens that forms on meat external surface easily because of high-water content. Other risks include making in-house ground beef from trimmings during the grinding process which would increase chance and possibility of customer illness brought by multipliying pathogens. This can severely destroy the reputation of the restaurant and may invite possible lawsuits in the process. As such, safe handling and storage were critical. There was also higher risk of cross-contamination if fish, chicken, pork or beef were prepared in the same area or used with the same knives. Another issue is to continously dispose of blood, sinew and inedible material. Cooler temperature had to be kept always at/or below 4°C. Storing meat in the same cooler with dairy and produce or storing near the door, was also a contributing risk factor as continually opening the door might raise the temperature above 4°C. Kathryn knew for a fact, she cannot skimp on cooler space. The amount of cleaning and sanitizing or reducing microorganisms to a very low level on food contact surfaces would increase depending on the amount of in-house fabrication as well. There were also risks to both under-over sized portions. So, well calibrated scales were required.

Kathryn being a part owner, menu planner and head chef is already a busy person running the restaurant operations. She may not readily developed the required butchering skills and competency which would mean she would require to hire an experienced and skilled butcher to assist her.

On the other hand, buying portions from fabricators directly would give Kathryn the flexibility to order beef portion sizes and specific cuts associated with uncertain customer demand on a just-in-time basis. Vacuum sealing increased food safety and shelf life. The need of expensive cutting equipment and fabrication labor are eliminated. The risk of contamination is reduced. However, Kathryn will need to pay for convenience and flexibility. She will need to carefully consider from the three types of meat suppliers, such as the general good service purveyors, meat purveyors and local cattle farmers that will provide her the greatest advantages and flexibility room in order to ensure the success of the business.

ENVIRONMENTAL ANALYSIS

1) Meat Fabrication Process

Meat was purchased in many forms and processing stages. The whole carcass was cut into halves (sides), which were cut in half into fore-and hindquarters. Quarters were then separated into primal cuts which were cut into subprimals, steak-ready cuts and ready-to-cook portion cuts.

Exhibit 1 : Cut of Beef

2. Meat Suppliers

Kathryn was considering three types of meat suppliers :

a) General food service purveyors

Strengths : delivery surcharges and at times, fuel surcharges were included.

Weakness