Chapter 1 – The Food Service Industry
Eating is not optional
The History of Food Service –
-
First Restaurants were part of homes that sold rooms and
food to travellers
By the time of the Roman Empire, Inns were common.
The Roman Catholic Church – first “Hotel Chain”
Inns and Alehouses in England as early as 1400 AD
In the Americas – Cole’s Ordinary was among the first –
Boston 1634
Food and Beverage in the
Modern Era
The early 20th century saw the
construction of large modern hotels
1950’s – many felt the quality of food and
beverages had declined in hotels.
Today Food and Beverage is considered a
prime profit center for many hotels.
Freestanding Restaurants
Began in 1765 in Paris, France – the word
restaurant derives from this establishment.
In the U.S. the first restaurant is generally
accepted as Delmonico’s in New York City
(1827). The group closed in 1923.
“Harvey House” was the first chain of
commercial restaurants and hotels in the U.S.
Non Commercial Facilities

Business
 Mills
 Employee Benefit
 Office Coffee Services

Hospitals
 Therapeutic diets

Schools
 Food Service began in mid 1800’s
Evolution of Food Establishments









The automobile – drive in restaurants, drive
through, etc. (A&W, Howard Johnsons)
Quick Service and “Fast Food” (McDonalds,
Burger King)
“Fast” Casual Food
Food Trucks
Delivery (Pizza, restaurant menus)
Laundro Bars
Food Courts
Grocery take out / sit down (Whole Foods)
Home Meal replacements
Basic Segments

Commercial Food Service Operations –

Non Commercial Food Service
Operations
Commercial Food Service

Commercial Food Service Operations
attempt to maximize profits primarily
through the sales of Food and Beverage

Examples:
 Restaurants
 Hotel F&B outlets
 Other – catering, food truck, carts, etc.

Freestanding Eating and Drinking
Places –
 Can Be independent
 Corporate
 Chain and Franchise
Styles Include:
Fine Dining
Casual Dining
Family Service
Quick Service
Lodging Food Service Operations

Full Service
 A La Carte Dining – Gourmet to Family
 Catering
 Room Service
 Coffee shops
 Bars

Limited Service
 “Lobby Food Service”
 None
Other Commercial Facilities
Public Cafeterias
 Bars, Taverns, Lounges
 Ice Cream Stands
 Caterers
 Food carts and trucks

Non Commercial Operations
Operations offering Food and Beverage
as a component of –but not the primary
mission
 Usually focus on offering nutritious
meals and minimize expenses related to
Food and Beverage Operations

Non Commercial
Business Industry
 Healthcare
 Educational
 Leisure/recreation
 Transportation Organizations
 Private Clubs


Business / Industry
 Company canteens (Google), Vending

Healthcare
 Hospitals, Orphanages, Nursing Homes

Educational Institutions
 Schools, Universities, Senior meals

Private Clubs
 Country Clubs, Dining Clubs

Leisure and Recreational
 Arenas, Amusement Parks, Casinos, Bowling alleys

Transportation Companies
 Airlines, Trains, Ships

Others
 Prisons, Military, Religious, athletic facilities, Cruise Lines,
Organization of Commercial Operations

Commercial Food Services – 3 main
categories
 Independents
 Chain Restaurants
 Franchises

Independants
 Owned by an owner or group with no chain
affiliation
 May have multiple units

Chain Restaurants
 Multi Unit Organizations
 Often have the same menu, purchase
cooperatively
 Maybe owned by a Company, Franchise
company, private owners(s)

Advantages of Chain Restaurants
 Easier to acquire cash, credit and long term





leases
Scale affords the opportunity to make a
mistake
Ability to experiment (foods, décor, etc)
Personnel advantages
Can afford specialists (finance, risk
management
Better internal controls – can compare
results within units.

Disadvantages of Chains
 Difficult to keep up with changing markets
and economic conditions
 Bureaucracy creep slows and can hamper
efficiency
 Single bad event can damage the entire
chain
Franchises
 Special category of Chain Restaurants
 Franchisee pays a fee to for the right use
the Name, Design and Business Methods of
the Franchisor
 Franchisees are often local investors
 Maybe be required to pay royalty fees on a
percentage of revenue, advertising fees,
sign rentals, food products etc.
Advantages to Franchising
Start up assistance
 Company training programs
 National Advertising campaigns
 Name Recognition, Food Consistency
 Lower food cost with volume purchasing
 Tested operating procedures
 Employee recruiting

Disadvantages

Strict Contracts
 Menu set
 Décor set
 Specified production equipment
Contracts tend to favor Franchisor
 Little room to negotiate


Co Branding – 2 franchises share
facilities
Non Commercial Companies and Contract
Management Companies

As Pressures for cost containment mixed with lower
revenue, there is a need for non commercial operations to
operate more like their commercial counterparts

Advantages
 Large Companies have greater resources to solve problems
 Can save money through effective national negotiations
 Can often operate at lower costs
 Faculty administrators can delegate to food service
professionals

Disadvantages to Contract Management
Companies
 May assume too much control – effecting
public image
 Some people dislike the profit motivation in
non profit type operations
 Concerns of decreased food quality
 Organization may become too dependent on
the CMC.
The Future of Food Service







Home Meal Replacements
QSR – new foods and higher quality items
More entertainment in casual restaurants
More offering in non traditional stores (711)
Comfort foods, Fusion Cuisine, Healthy
choices
Green Restaurants
Improved Technologies
Vocabulary














A La Carte Menu
Chain Restaurant
Co-Branding
Comfort Foods
Commercial Food Service Operation
Franchise
Franchisee
Franchisor
Green Restaurant
Home Meal Replacement
Independent Operation
Lobby Food Service
Non commercial food service operation
Office coffee service