FROM THE FIELD
January 2004
Fixing Food Portions and Making Money

As Robin wrote in his November column, this “fat” thing isn’t going to be easy. Americans are getting fatter while we talk about it. Downright corpulent. Mike Muenchow of Electrolux said in November at the Milan Show that obesity now is overtaking Europeans as well. We’re fat, fat, fat.

Back in our April issue, “Cheap Shots And Lawsuits” addressed the legal situation with a bloodshot eye on America’s tendency to blame someone else for everything, including obesity, as if someone were holding a loaded kielbasa to our heads. “As a society, we’ve tried legalism,” I noted. “A little goodwill, a little cooperation, a little moderation might be the answer.” Common sense, we used to say.

Fortunately, solutions to the fat thing do exist. Pizza Hut recently introduced low-fat ingredients in new pizzas, for example. TGI Friday’s has announced a low-carb menu, and so has Blimpie’s. In-N-Out Burger has a bunless burger wrapped in lettuce.

We spent decades touting "value" as if it were the same thing as "volume."

Another approach involves no new food chemistry at all: Just make it easier for patrons to select smaller portions. You don’t even have to get rid of the plus-size menu entries. Just add some alternatives, and promote them in a visible way that gives them equal stature.

Maybe you can give them jazzy names to create some interest. Most Americans have been taught that “small” or “half-size” are lesser substitutes for “full-size”—once kids are big enough to sit in an “adult” seat, they don’t want the “kiddie” one anymore. Same goes for entrées. But if you label them “smart sized” or “the fitness edition” or some such, then you’ve got something to work with. And so do your customers.

We’re not talking uncharted waters here. Many chains, including Applebee’s, have offered “half-portion” menu entries for years, and many others now are joining them.

The main trick will be to manage menu pricing. I can hear the bean counters screaming now, worried about jiggering pricing and concerned that a change in the food volume will upset the delicate economic balance. And there is some math to consider. As I noted in an April 2001 column, “We’re fast approaching the point at which we can move food from farm to consumer at 100% efficiency—meaning through the pipeline with no margin at all.” Ironically, that’s a double-edged sword. Any slowdown at all pushes the supply chain into the red. So, by golly, you have to heap that plate high to keep that “value” perception up and keep those “value” customers coming. Or so we told ourselves, because it was easier than pulling out the calculator. We spent decades touting “value” as if it were the same thing as “volume.”

But Americans are not physically active enough anymore to play Henry Ford’s volume-efficiency strategy for dinner. It’s time to change. If you get the balance of pricing and demand-projection correct, your dollar volumes shouldn’t go down, and your margins might actually go up. What’s the worst that can happen? Everyone buys the “smart size,” and with such high demand…you can raise the price.

Brian Ward
Chief Editor