The Roasting Bean had 34 seats at small tables and 15 bar stools at the counter which was adjacent to the picture windows that looked out onto the street scene below. It was a perfect setting for a coffee house. The building had been a successful bank branch, but when the bank moved, the part of the building which housed the bank remained vacant for two years. John spent nearly $40,000 in renovations to get ready for opening. He had the counters reconditioned, flooring redone, windows trimmed, cabinets and display cases installed, plumbing and electrical systems installed, and a hood system for venting the stand-alone coffee roaster retrofitted into the existing space. The Roasting Bean opened to rave reviews, and John never looked back.
 

The brunch menu was served from 9 A.M. to 1 P.M. on Sundays. It consisted of assorted omelets, pancakes and French toast, and side items such as bacon and sausage, homemade breads toasted to perfection as well as 

As John stepped in to assist his baristas serve the steady stream of customers, he considered expanding his restaurant, eliminating the trouble -some brunch service altogether, or perhaps designating a brunch only seating area in the coffee house so he could manage the flow of business more efficiently.

Brunch Menu for Roasting Bean Coffee House	Price	Volume
Three egg omelets with variety of vegetable
and cheese fillings	$5.75	12
Bacon or sausage	$1.45	10
Fruit plate	$3.25	8
Home baked breads (not made on premises)	$1.25	12
Pancakes with maple syrup	$3.75	10
French toast	$3.75	8
Assorted baked goods (not all made on premises)	$1.65	25
Coffee drinks	$1-3.25	22
Teas	$1.75	4
Juices	$2.25	14

1. Was John experiencing lost revenue from people staying too long?
2. How could John encourage people to leave after completing their meal?
3. Is profitability the only measure of success in the coffee house business?
4. Can you think of any ways to increase the check average and other revenue?

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the baked goods he sold every day. All ingredients were fresh. His cus- tomer base grew to capacity for Sunday brunch in a matter of months. They flocked to hear the music, sip coffee, and chat with friends and loved ones over a long brunch. After comp leting their meals, most patrons lin- gered over another cup of coffee to extend their experience in the warm and creative setting. The kitchen wasn't set up for volume. It was used primarily for baking small batches of muffins or cookies that complemented the coffee sales. Sandwiches were prepared from cold cuts and many of the more complex baked goods were purchased from a bakery in a nearby town. The kitchen consisted of a large dish washing area with a three-basin sink, a small gas. stove, and the prep area. A reach-in refrigerator was a hand y place to keep the sandwich ingredients. John didn't know if his cook could even put out more than the 40 to 60 brunches he sold each Sunday. John's cost of labor for brunch is marginal, as he needs a dishwasher on duty no matter what. His additional cost includes a cook to prepare the brunch and one more counter person to provide service for the additional customers. He pays the cook 512 per hour for a six-hour shift for a total direct cost of $60 and he pays the counter server $8 an hour for a six-hour shift and a total of $48. With an additional 30 percent for payroll taxes, benefits, and overhead costs, the total additional labor for brunch comes to about $143. An additional cost for the musicians was $225 for the four-hour brunch music. By the time churches let out around 11 A.M., no sea ts were available and the Roasting Bean had to turn people away. The church crowd, although perhaps a bit more conservative than the typical customer, wandered away to the old standby restaurants down the street. There were a variety of altern a tives so they weren't disappointed. John wondered how he could make room for these folks whom he'd tried to cultivate as customers dur- ing the week because they worked in town and would possibly join the group that orders coffee drinks to go. He wondered whether lost business on Sundays meant lost business during the week because these people hadn't experienced the quality of his coffee nor the good service his people provided. The church-goers didn't even have a chance to become loyal cus- tomers. There were others too who \.\.'eren t up early enough to enjoy the Sunday brunch at the Roasting Bean. They would wander in at a leisurely pace around 11:30 looking for a good coffee drink. and a baked good. By this time of day, dishes were piled into bus trays and it was obvious that brunch was over with. The register attendants didn t even ask whether the new patrons were interested m seeing a brunch menu. The kitchen was too busy washing dishes. the baked goods he sold every day. All ingredients were fresh. His cus- tomer base grew to capacity for Sunday brunch in a matter of months. They flocked to hear the music, sip coffee, and chat with friends and loved ones over a long brunch. After comp leting their meals, most patrons lin- gered over another cup of coffee to extend their experience in the warm and creative setting. The kitchen wasn't set up for volume. It was used primarily for baking small batches of muffins or cookies that complemented the coffee sales. Sandwiches were prepared from cold cuts and many of the more complex baked goods were purchased from a bakery in a nearby town. The kitchen consisted of a large dish washing area with a three-basin sink, a small gas. stove, and the prep area. A reach-in refrigerator was a hand y place to keep the sandwich ingredients. John didn't know if his cook could even put out more than the 40 to 60 brunches he sold each Sunday. John's cost of labor for brunch is marginal, as he needs a dishwasher on duty no matter what. His additional cost includes a cook to prepare the brunch and one more counter person to provide service for the additional customers. He pays the cook 512 per hour for a six-hour shift for a total direct cost of $60 and he pays the counter server $8 an hour for a six-hour shift and a total of $48. With an additional 30 percent for payroll taxes, benefits, and overhead costs, the total additional labor for brunch comes to about $143. An additional cost for the musicians was $225 for the four-hour brunch music. By the time churches let out around 11 A.M., no sea ts were available and the Roasting Bean had to turn people away. The church crowd, although perhaps a bit more conservative than the typical customer, wandered away to the old standby restaurants down the street. There were a variety of altern a tives so they weren't disappointed. John wondered how he could make room for these folks whom he'd tried to cultivate as customers dur- ing the week because they worked in town and would possibly join the group that orders coffee drinks to go. He wondered whether lost business on Sundays meant lost business during the week because these people hadn't experienced the quality of his coffee nor the good service his people provided. The church-goers didn't even have a chance to become loyal cus- tomers. There were others too who \.\.'eren t up early enough to enjoy the Sunday brunch at the Roasting Bean. They would wander in at a leisurely pace around 11:30 looking for a good coffee drink. and a baked good. By this time of day, dishes were piled into bus trays and it was obvious that brunch was over with. The register attendants didn t even ask whether the new patrons were interested m seeing a brunch menu. The kitchen was too busy washing dishes.

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Was John experiencing lost revenue from people staying too long No John was not experiencing lost revenue from people staying too long John was not experiencing lost revenue from people staying too lo... View the full answer