Self-fulfilling prophecy

[jimp]

Hello to all.

My wife, Lynda, owns Meals Made Easy in Fort Collins, Colorado.

I own a software company called What's Cooking Software that is used by a few meal preps and other "non-meal prep" restaurants.

I was made aware of this blog site by other friends in the industry.   I have read some of the posts and understand the frustration that is out there.

Clearly, these are tough times but there also seems to be a bit of  "self-fullfilling" thinking that everything is going in the tank.   It certainly will (for you) if you believe it.

Right now, broader economic conditions are dominating.   I talk to many restaurant owners outside of meal prep and conditions are not good because the consumer (which drives 2/3 of our economy) has turned off the spigot.   The question is:  how long will this last because the consumer has been known to turn it back on quickly.   You also have an election year...

The hot concept of "meal assembly" may be over, but innovations for the next market phase are well under way.   The trick is to be capitalized enough or "fending off your debtors" long enough to make it there when the pendulum swings.   And, it will swing.   

I am the type of person that will share anything with anybody.  In my opinion, there is no need to hide identities, etc. because if you really want to succeed, you have to put yourself in "harms way."    Harnessing the fear is the key.

I live with a "meal prepper" so I get some pretty good inside scoops on a daily basis about what is working and what is not.   Nothing is easy in this market.   You have to grind it out, pure and simple and get out there to reach new markets.   Be innovative and listen to the customer--even when they are not spending.

I sincerely hope that this subject (thread) will be useful to those that want to go to the next level in this very young industry.   

Please, ask me any question.   Any question.    If your question is focused on improving your business then I am game to answer them--because we need successful businesses to lead us out of this "doom and gloom."   

Of course, I own What's Cooking Software so you may feel there is a "hidden agenda".   But, software is just a tool to support the means of a business purpose.   Successful business models create software and not the other way around.    I got started when Lynda needed a report to tell her how much food she needed to order based on the online orders.   There was a real need and I filled it--because the alternative was the "hellish" spreadsheet dance.    At that time, stores like Let's Dish in Baltimore were already cranking out some pretty big numbers, just doing assembly.

In my opinion, this blog site will only "do good" if it helps people improve their business models.

Good luck to all.

Jim

[indiechef]

Glad to have you here Jim.  I agree about the self fulfilling prophecy for some people/businesses.  However,some people here (especially zees) have had immense forces beyond their control that ended their businesses.

I am always happy to see people here that are eager to share their experiences and advice to improve their businesses.

Jim, did you all have a forum/blog for owners or something a long time ago? 3 yrs or so?

[Tuckerbox]

Not to be a wet blanket, but Jim you are saying the same old thing that has been said a hundred times before for at least the last year or so. We’ve all heard the “Think positive!”, “Be innovative”, “Get out there and know your customer”, “Reach new markets” chants before. That really doesn’t solve anything.

Telling someone who has no health insurance to go see a doctor doesn’t do them much good.

You say the pendulum will swing; meaning what? Meal assembly will come back in vogue and customers will come back? A percentage of customers will come back but they will need Service X in order to stay a customer? The price needs to drop below Point Y?

You are saying people need to be capitalized enough to make it through the economic downturn and the traditional summer slump. Most people don’t have that kind of capital anymore, they’ve pretty much used it up just to get to this point in the year. And considering the summer and holiday season of last year was Spartan at beast when do you expect things to pick up? Meal assembly kitchens didn’t really play any significant role in people’s dinner preparation for Thanksgiving and Christmas, so how can they inject themselves into the picture this year?

I would like to hear some specific examples of how the business model can be improved, what actions owners can take tomorrow, or next week or next month to improve their situations. Considering the dozens, perhaps even hundreds of ideas that have been shared by owners so far which haven’t gained much, if any, traction I would like to hear your thoughts.

In my opinion this site and others like it have done plenty of “good” to help owners by offering a place to discuss ideas and to bring to light many topics they should be aware of.

[onthego]

Gosh, I feel bad for ya JimP .
I have a question for you, how is business going for your wife at her MA up, down, flat?
What up-tick in her business have you seen with using your new version of your software and innovations?

The hot concept of "meal assembly" may be over, but innovations for the next market phase are well under way.   The trick is to be capitalized enough or "fending off your debtors" long enough to make it there when the pendulum swings.   And, it will swing.   

I am the type of person that will share anything with anybody.  In my opinion, there is no need to hide identities, etc. because if you really want to succeed, you have to put yourself in "harms way."    Harnessing the fear is the key.

I live with a "meal prepper" so I get some pretty good inside scoops on a daily basis about what is working and what is not.   Nothing is easy in this market.   You have to grind it out, pure and simple and get out there to reach new markets.   Be innovative and listen to the customer--even when they are not spending.

What new innovations have worked for your wife's business.
What makes you believe the pendulum will swing back?
What are her customers telling her that she needs to do?
Thanks for sharing!

[Tuckerbox]

Is this the part where I feign surprise that Jim never came back to discuss this topic or answer any of the questions he was so eager to have people ask?

Pretty typical I’d say.

[indie2]

No surprise Jim hasn't popped back in.  While I was a member of the independent owners assoc. I don't think he or his wife ever posted on the owner forums--Unless, of course, it was about software/websites and he could promote one of his products.

Why would bother to share "best practices" or contribute to solving a problem, when he got a cut of the manuals Bert was selling?  Conflict of interest, apparently.

[Tuckerbox]

It may be wrong to pick on someone when they’re down, but Jim took the Stephanie Allen approach in you need to work your business and that if you just think happy thoughts then good things will come to you and your business will succeed. He also stated (right in the title) that we’re all living the self-fulfilling prophecy of being negative and down on the industry and that’s why our stores failed.

Here Jim, have a seat at the table of reality.

So Jim, since you seem to have your finger on the pulse of the industry, how do you explain this one?

“Meals made easy, the store connected to What’s Cooking Software and EMP announced they are closing after five years because they can’t cover operating costs. A couple months they announced they were switching from in store sessions to preordered to go only using their new software.”

I checked the Meal Made Easy site and you can’t place an order or view the menu. So either something is terribly broken with the site which prevents customers from placing an order (definitely not a good think from a software vendor perspective) or they’re packing it in.

So what happened? Could it be the rest of us were right in our opinions and assessment of the industry? Were we right in thinking the model was horribly flawed and that there was very little to save it? Were we wrong in thinking that everything is going in the tank? You may have had the inside scoop but it seems you ended up right in the same place as the rest of us. How could that possibly be?

What happened to the pendulum swing you were so sure was going to come around? How come you didn’t connect with your customers like you told the rest of us to do? Did you harness the fear? Why weren’t you able to go to the next level in this very young industry?

I feel bad for you Jim, I really do. Closing a store isn’t a pleasant experience. Maybe you got lucky and won’t be in debt for years to come like so many of us. But as I have said before, you can’t make a profit on wishful thinking.

[ontherebound]

Tuckerbox the Times Union in Albany New York just ran this story-Notice the quotes I have highlighted belwo.
Self-fulfilling Prophecy indeed.
Rarely has a new retail business idea been embraced by entrepreneurs so quickly, only to fail so spectacularly, as did the "meal assembly" concept.
http://timesunion.com byline Alan Wechsler

Unfortunately, the idea just didn't catch on -- not here, and not in many other places in the country.
"For some reason, the whole concept is just not doing very well," said Dave Bellso, whose wife owns the Make & Take Gourmet chain, based in Syracuse. The two-year-old company had a store at The Crossing shopping center in Clifton Park, but closed it after a year for lack of business.
"When the industry first started, the research from the early stores showed it was a destination," he said. "As the industry grew, that changed."

Those in the business muse as to why the idea failed in so many places. Some wonder if the corporate franchise fees were too high. Or perhaps the high cost of buying and preparing food day after day made it too expensive. Maybe customers cut back due to the economy. Or maybe the concept was just not attractive enough.
"Not enough people know about it," said Teresa Shurtz, vice president of operations at Super Suppers, based in Fort Worth, Texas. Now in 42 states, the chain began about five years ago and has about 150 stores.
It was once considered one of the nation's fastest-growing franchises. Growth has slowed since then, and now Super Suppers is pushing new ideas such as curbside service and off-site delivery.
Others continue to be mystified by all the failed stores.

[independent owner]

I know many will disagree but I think one of the main reasons MAKs have failed is low quality food.  Many recipes are awesome when prepared fresh and less than desirable when put through the freezer process.   Cooking is often regarded as an art.  Preparing frozen meals is a science -- quite different.

The 6-8% franchise fee is a true killer as well (let's not even talk about paying higher prices for ingredients so the zor can get their year-end kickback).  I don't think there's a franchise out there that actually earns the right to collect that fee based on performance - though most will still be very happy to sell a franchise to anyone uninformed enough to purchase their 'proven system'.

But the fact is that independents have failed as spectacularly as the franchises, so the franchise fee isn't the only thing killing the business.

[workforfood]

independent owner's comment about food quality got me thinking.....
 
I'm sure I'm just stating the obvious, but I also think one of the biggest hurdles is the changing menu. Everyone's tastes are SO different, there is no way a customer can come to a store, make 6+ meals, and love every one of them every month. We do get a lot of compliments on our food, but the ones I'm most worried about are the ones you never hear from again. Did they hate it? Did they make it wrong? You try to promote "meal customization" but the advertising budget is only so big. You can't promote everything.

Also along those lines is the issue of favorite meals. People typically go to a restaurant for the 1 or 2 things they really love. If they are coming to you for something specific and it just so happens they missed the recent month you had it, they may walk out disappointed.... and empty-handed. I've tried the, "If you like that one, you'll love this one, too," but it doesn't always work. And, I just don't have the space, man-power, or sanity to stock 150 items all the time in 3 different portion sizes.

But, it's just another hurdle in a very bumpy race.

[allthingsculinary]

Personally, in my store I used excellent ingredients, we made sure we didn't skimp. Because I'm culinary professional I understand the food science behind frozen recipes, the ones I developed for our network had that in mind. If you don't understand the principals behind the science of freezing food you need to get educated. That goes for franchisees or independents.
The standards for food quality I practiced were above what my franchisor set-I'm not ashamed at all as far as the quality of food that went out my doors to my customers, and that was NOT the reason why my business closed. My food costs were higher because of that philosophy -I wasn't willing to compromise my standards. Unfortunately for me that was a two-edged sword.
For some chains and other independents food quality may be an issue, not for me. I made sure that if I wouldn't serve it personally from my home kitchen to guests and family, then my customers didn't get it either.
Workforfood is correct though we MAK's can't be all things to all people, customization is time consuming and it raises your costs as a business owner.
Customers-The ones who were unimpressed will not be the vocal ones, most people will not say anything if they were dissatisfied-they just won't come back, that's the way I am, I figure I'm not the exception I'm pretty much the norm.
Changing the menu every month was always a sticking point for me, my network thought you had to have 12 new menus every month to give people variety-I don't believe that's true-again look at your habits-Workforfood again had it right. People are creatures of habit-they find something they like and they will go back specifically for that item. Too many choices for most customers is not a good thing. Restaurants MAY put a new item or two on their menu every quarter, but to completely change their menu every month just doesn't happen (unless you run a sheeshee place). People do eat the same things over and over again. I'm just nt convinced a complete menu change every month is the way to go.
That may be a reason customers menu shop when there is more than one MAK in their area-to find the food they like or a reasonable facsimile.
That's the reason I stocked certain best selling customer faves items in my G&G freezer all the time.
It's unrealistic to think you can afford to stock and keep an inventory for 30-40 menu items consistently.
I agree too with Independent Owner that people are still stupid enough to buy a "proven system" from anyone; simply because neither one exists, but most prospects are woefullly unaware of that.
It will indeed be a bumpy ride for those of you still open. I hope you all do well!

[lisa]

Actually, once you figure out your customers, it is not hard to keep a large inventory.  We have 40 entrees and about 10 sides that are part of what we call our "anytime menu."  These are the things we pretty much promise to have always--it took two years to figure out what these would be.  Then we have another 40 entrees and 10 sides that are seasonal, and room for about 10 that change whenever we feel like, or customers ask, sometimes hourly, daily, weekly...  Our compromise was that we only stock one size.  People don't care if they have to buy two or three, and we never tried to market to the small eaters, so our entrees generally serve 3-4 average eaters.  We have me and my husband, and two boys 10 and 11 and it is usually perfect for us, sometimes we have leftovers, but I always serve at least one vegetable and a salad (not that enyone but me ever eats them, but I try...), sometimes I add a side I would have had to pay for.  That said, in another year, we will need two of everything...  But really, once you figure out what your customers like, then the things that are easy to make with the ingredients you always have, or buy in small quantities anyway, you can keep a good CONSISTENT inventory of favorites ANS rotate in fresh recipes regularly, too. 

I have been talking to a woman who wants to open a kitchen and I still think this business can work, but I told her that if I could start over, I would do a couple things differently, first NOT buy into a franchise, second, have a full commercial kitchen with a full oven and range.  Then, you would be able to offer cooking classes and limited assembly, but you would focus on specific things, like at every session people would assemble three meals--Italian, Asian, olives, whatever, that way you are targetting that activity to the people who care and are willing to be a little inconvenienced (you don't need six or eight bars with every single ingredient labeled and in order...), but all the rest of your revenue would be preassembled, or catered because I think light catering totally fits in our concept.  That's just my opinion, but it really is possible to keep a good inventory and I think it is imperative, Lisa     

   

[Kaye]

I agree with ATC, our food was very good and I also wouldn't sell a product or even an ingredient that I wouldn't serve at my home.  To me, my store was an extension of my kitchen since my name and my face stood behind it all.  I don't think you have to have the catch of the day in order to be able to sell a good product.  Our food tasted good and held up to freezing very well.  I fell VERY confident that food quality was not an issue for me, and I think this is supported by the number of requests for various recipes that I got when my customers found out we were closing (which I did NOT provide, of course) 

Lisa, I'm curious about how many freezers/refrigerators you have in order to house 80 or so different meals plus sides?  I didn't have enough space to store that many different items in my place, and I know that I had a lot more retail freezer space than most of my competitors within a 15-20 mile radius.  But, I also had clear-front freezers and tried to keep everything displayed nicely with a list of what was inside.  Some of my competitors just stacked and stuffed stuff in their freezers and customers literally had to hunt for what they wanted.

Kaye

[dinnerzen]

Hey Kaye-
How's life post-MAK treating you?  Enjoying your summer?

[lisa]

Kaye, like everyone else, we have been forced to adopt a less than ideal model with less than perfect equipment.  We started with six doors of freezer space and just recently grew another three.  We do not have glass-door units, so they are not organized for a customer to navigate, but we prefer it that way.  We can keep them efficiently full and we like that our customers simply pick photo cards off boards and we do all the heavy lifting and finding.  But each door easily holds eight different pan entrees, and eight to ten different bag entrees, so 18 times 6 is 108 different items.  But, we keep varying numbers of each entree.  We only keep a couple orders of a few soups, fish, and vegetarian entrees as they are not in as much demand, but the people who like them do need to have them.  Then, some we make 20-30 at a time, but a lot of those never make it into the freezer since they get sold right away.  Unlike the assembly model where a lot of storage space was needed for portioned or panned inventory, we don't need that anymore.  Our 3-door freezer is only full right after the truck comes, then everything gets processed immediately into entrees.  So those three doors also hold prepared entrees when the other six are full.  It took two years to figure out how to make it work, but we pretty much have it down now.  If we had a website that worked for us, things would be peachy!  Lisa