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Utilizing Manufacturer Rebates for Added Profitability AND Sales Increases!
Now more than ever, operators should be looking at unique ways to add profit to the bottom line.
If you are in the foodservice business, I am sure you have seen every one of these offers come across your desk from various manufacturers. The operator coupon concept is nothing new by any means and has always been an avenue to showcase new or featured products. It's an advertising piece, and a very effective one, but do you know what the actual redemption rates are? Depending on whom you ask, a typical operator coupon redemption rate may fall in between 3 and 4%. And make no mistake; the manufacturers are well aware of it.
I am not advocating a "redemption revolution" (we love our suppliers too much!), but profit conscience operators need to take a long hard look at the potential financial return.
Redeeming these coupons is tedious and if you only purchased enough to earn back $20, I wouldn't even bother. But let's look at another scenario:
Let's say that ABC Onion Ring company is offering a $5.00 per case coupon on their newest product.(with a $500 maximum for the next 3 months) Your onion ring sales are in the tank and frankly, the onion rings you are buying aren't really that good in the first place and you only buy them because of the cheap price.
To maximize the $500, you only need to sell 1.2 cases per day! To get those sales started quickly, get with your Golbon distributor Sales rep. and request samples for you and your staff to try. If the product looks like it will fit your menu (and upgrade to a better onion ring!), see if the broker will get you some free cases for "Sampling Night" Use the free cases and cook up a small plate of onion rings for every table that sits down for a meal. Have a wait staff contest to see who can sell the most orders that night; many times the broker can authorize the reward through the manufacturer, so you still haven't forked over a dime!
Customers like free stuff, and I'd be willing to bet that over half of your customers would purchase an order of onion rings! (Remember, these are awesome onion rings!)
Sell them for the same price that you sold your not-so-good onion rings. You won't be out anything because of the free cases you received. Announce it as an intro special. I wouldn't be afraid to do this for a few days to make sure you are getting maximum exposure to your customers.
Once you have made the commitment to change onion rings, raise the price a bit to get to the profit level you need, but don't stop there! Run a few specials that feature a side of onion rings, or give your customers a choice to get onion rings instead of fires at no extra charge! Run a few more wait staff contests and get your onion ring sales sizzlin right along!
In the long run you will have a better product, with a better profit model, and another $500 in the bank!
Coupons and rebates are not always about how much you can get back in the mail, but a way for operators to upgrade their products and their menus. In today's challenging economic times, this is not only just a good idea, but a business building method.
