A Question for Michael Masterson
“We sell fresh seafood to 4- and 5-star chefs, primarily in central North America. We have seen a reduction of 20 to 30 percent in our sales over the past 16 months. Can you recommend anything to help us ‘ramp up’ sales without necessarily ramping up marketing expenses?”
T.L.
Apple Valley MN
Michael’s Answer: In situations like this, you have to see through to the source of the problem… and the source is not your customers, the chefs, who would like to be buying more. It’s their customers, who are spending less at restaurants nationwide.
To solve your problem, you have to figure out how you can help the chefs recapture their lost profits so they can be streamed back to you, the vendor.
I have several friends in the restaurant business, and I’ve been in it myself. One thing I’ve learned is that when times are tight people respond to discounts and special deals, even in fancy restaurants.
Many high-end restaurants are afraid to lower their prices because they fear it will lower their prestige. But there are several ways that they can do it without damaging their reputation.
They can, for example, offer “happy hour” specials. These are really early bird specials upgraded for the baby boomer market (your customers’ customers). What they do is serve the wine and even the booze at half-price from, say, 5:30 to 7:30. People come in for a drink and end up staying for dinner — and spending more than they’d planned. And since the margins on wine and booze can be huge, the restaurants make out just fine… even selling it half-price.
So that’s one idea you can give your customers. Another idea that comes to mind would be for them to feature a half-priced wine matched to one of the more expensive types of seafood you are selling. Or for them to create daily seafood specials using your more inexpensive fish — perhaps including a free dessert.
What I’m saying is that, as a businessperson, you have to recognize what you can change and what you can’t. You can’t change the economy. You can’t change the fact that people are eating out less frequently and even then spending more carefully.
But you can change the way your customers think about you. Rather than being just another vendor, become an ally in their fight by giving them good suggestions on how to succeed. They will appreciate it and will reward you with as much business as they can.
[Ed. Note: Each month in the Liberty Street League newsletter, Michael Masterson -- as well as Alexander Green; Dr. Marc Faber, Ph.D.; Dr. Gary North; Keith Cotterill; Doug Casey; Jim Rogers; and other wealth-building experts -- share tips and strategies with members. But they're not limited to small business advice. The Liberty Street League board will show you how to take advantage of opportunities in Internet marketing, stock investing, precious metals, real estate, commodities, and much more. And all of these opportunities require little money to start. To find out more about the Liberty Street League and its recommendations, go here.]
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