Restaurant And Hospitality News – August 31, 2015
By Christine Kern, contributing writer
In news this week, the NLRB hands McDonald’s some disappointing news; Travelers prefer free WiFi over Free Breakfast, Wingstop’s sales are being boosted by online ordering, and tiered bandwidth can help monetize WiFi.
McDonald’s Loses Appeal In “Joint Employer” Labeling Case
The National Labor Relations Board (NLRB) has denied an appeal by McDonald’s Corp. to delay or stop an effort to label it a “joint employer” of its franchisees’ workers, which opens the path for a final ruling that could have a dramatic impact on the relationship between franchisors and franchisees, the Nation’s Restaurant News reported. The decision was 3-2 to deny the request. In the ruling, Mark Gaston Pearce, Chairman of the Board, and Board members Kent Hirozawa and Lauren McFerran wrote: “We find that the allegations in the complaint are sufficient to put McDonald’s on notice that the General Counsel is alleging joint employer status based on McDonald’s control over the labor relations policies of its franchisees.” The move could mean big changes for the franchise world. Gregory Hanscom, an attorney with Fisher & Phillips in Philadelphia, told the NRN, ““Everyone is waiting for the other shoe to drop: The finding that McDonald’s corporate is a joint employer with its franchisees. In the franchise industry, that would be a very large, seismic change.”
Survey Finds Travelers Opt For Free WiFi Over Free Breakfast
A recent survey by Agoda.com has found that travelers named free WiFi as the most desired amenity, beating out free breakfast for the top spot. After free WiFi, other top amenities included free breakfast, a larger bed, and a larger bathroom. The survey was conducted in July 2015 and asked more than 5,000 Adoga.com customers which amenities they prefer in a hotel room. Travelers prefer Wi-Fi over breakfast, but barely, with WiFi receiving 55 percent of the vote compared to breakfast’s 45 percent. "We know both are important to our customers," says John Brown, Agoda.com's Chief Operating Officer. "Most hoteliers understand that, too, and the majority of the properties on Agoda.com offer room rates inclusive of Wi-Fi, breakfast or both," he said. Travelers do have a clear preference when it comes to spacious beds, though. When asked whether they'd prefer a bigger bed or a bigger bathroom, 75% picked a bigger bed.
Online Orders Help Boost Same-Store Sales In Q2 For Wingstop
Wingstop Inc. reported same-store sales rose by 9 percent in Q2, fueled in part by growing online orders, according to the company earnings call. Online orders at the 785-unit chain increased to 13 percent of sales. CEO Carlie Morrison said, “It’s definitely something we believe has long-term, strategic benefits for the brand.” And since half of their customers are millennials, the growth in online orders makes sense. Morrison said on the call that same-store sales have been driven by growing brand awareness, the chain’s effective use of social media and strong performance by new stores. He also said the company limits changes to its menu to keep operations simple. Domestic same-store sales, Morrison said, have risen 36.2 percent over the past three years, and the number of restaurants in the system has increased 50 percent since 2011.
Implementing Tiered Bandwidth To Monetize Wi-Fi
This article from eHotelier examines how hotels can balance guest expectations with the costs of providing Wi-Fi services. In survey after survey and study after study, guests identify free Wi-Fi as the most wanted and needed amenity. And according to a recent study, 72% of the guests surveyed declared that not having free Wi-Fi is a deal breaker when choosing a hotel. The challenge remains how to balance these expectations with the expense of providing quality wireless connectivity. One solution is to implement a tiered bandwidth service. As the article states, “In our recent study, 53% of the guests surveyed said they would be willing to pay an additional nominal fee for the increased speed and bandwidth. The sweet spot for hoteliers was $4.99. By implementing a tiered offering, guests who do not require increased bandwidth and are perfectly happy with the free Wi-Fi that the hotel offers are not penalized by having to pay for it. Those guests who require greater bandwidth for streaming content or transferring larger files would simply pay an upcharge. This is not unlike consumer offerings from cable companies that upcharge you if you want faster access.” For hoteliers, a robust state-of-the-art WiFi system will be a major differentiator in distinguishing their establishment from the competition. As the article concludes, “With the proliferation of internet-enabled devices rapidly increasing each year, tiered bandwidth makes the most sense for both monetizing the network as well as keeping guests happy.”