Non-biodegradable plastic: It’s everywhere and it’s a big problem. From plastic straws to other dining disposables, the restaurant industry is abuzz these days with what to do with these less-than-environmentally friendly necessities. That holds doubly true for the packaging-heavy restaurant sector where no trip through the drive-thru is complete without a few plastic straws and the sheer cost of hauling all that plasticized refuse away can be stunning, but not in a good way.
In recent months, under the European Union’s 25-year Environmental Plan, the nations of that part of the world have made it clear that Europe is out to strictly limit the amount of plastic waste in the world’s oceans. In the U.S., major cities like Seattle and San Francisco, are phasing out plastic materials altogether.
For instance, just this past June in Malibu, California, a ban on single-use plastic straws, utensils and stirrers went into effect, forcing restaurant owners to use items made of paper, wood, bamboo or even pasta. Seattle was the first major U.S. city to ban plastic straws, and now requires restaurants to pay a $250 fine if they offer plastic utensils, plastic straws and plastic cocktail picks.
Since this is yet another hurdle that restaurant operators must try to clear, we’ve put together some tips designed to help brands adjust operations for this new non-plastic reality.
Seek brand-aligned alternatives
It pays now to get some idea of how your restaurant will deal with a world without plastic straws. Brand leadership could opt to transition to the more cost-effective paper straw solution, but be sure to consider how this will affect your customer experience.
Paper tends to weaken after long periods of being immersed in liquid, so paper stirrers may not work well either, leading your customer to blame your brand for their poor experience. On the other hand, a higher quality wood or bamboo stirrer may be a better substitution and likely just as effective for the customer as plastic stirrers.
Brands should work with their suppliers for the best possible options that align with their budget and customer expectations, then proceed to negotiate supplier contracts that save cash through bulk purchasing. Likewise, this re-evaluation of your inventory related to plastic utensils offers an opportunity to enhance both current and new relationships with suppliers and customers by focusing on the subtleties of your restaurant.
Leverage early adoption to create buzz
In addition to more local governments requiring changes, some large U.S. companies are opting to “join the cause” or simply get ahead of the curve on this issue. By 2020, Starbucks expects to have all of its stores using straw-less cups for iced drinks by incorporating a lid that will act more like an adult “sippy cup.”
Companies like the renowned coffee house brand show that there is an opportunity to be had in getting out in front of this change. By being an early adopter of the plastic-free restaurant idea, brands have something new and engaging to talk with customers about, while simultaneously affirming their beliefs in a “less plastic world.”
That’s an opportunity that can increase your brand awareness and, as a result, improve your brand equity or even guest counts. So remember, that if you opt to act on this subject area early, it’s important to talk about the good your business is doing and capitalize on the new buzz around your brand.
Smart strategic pricing
The menu board should never be the first place to look to cover a cost increase, even if it’s the result of a new environmental policy. However, if changing your menu pricing is the only option you have to maintain profitability when ordering new biodegradable straws, cups or stirrers, consider the best pricing strategies.
For example, if a cup of coffee now has a higher cost due to the use of plastic alternatives, then consider increasing the price on the smaller sizes to encourage trade-ups, rather than increasing the prices on all sizes equally. This strategy may give you the opportunity for higher average checks and ideally, higher margins.
Also, look at other areas of the menu for possible opportunities for price increases that could cover the increased cost of new biodegradable products. It’s important to target those items that would have the least impact on guest counts.
When making pricing decisions, it may be helpful for operators to get some expert input from professionals that understand your customers’ behavior. Through your transactional data, you can gain valuable insights about your customers’ purchase behaviors that can go a long way in guiding your business decisions around the use of plastic alternatives. The last thing you want to do with your efforts to make this a more environmentally friendly business and world is turn off the very customers that originally gave you cause to use plastic disposables in the first place.
Jeremy Bess is a senior consultant for Revenue Management Solutions, which provides a data-based approach to menu pricing and business strategy for many leading global restaurant brands and upcoming concepts. Bess and his team assist clients across North America in optimizing their gross profit.
Article originally published on September 21, 2018 by Fast Casual Magazine