Capacity Management: An Introduction

TO THE MAX. AGAIN.

Alright, folks, it’s time. Time for capacity management, that is. Yesterday we sort of kicked things off by talking about some psychological benefits to having a full house (and you have no idea how close you were to getting a picture of Dave Coulier and John Stamos rocking mullets), even if you have to fake it. Today we’re going to jump off our segue and talk about capacity management proper.

What do I mean when I say capacity management? Well, it’s simple, really. Let’s take a look:

You’re running a business. That much is obvious. And in that business, you have one commodity that is limited: seating. Now this cuts both ways: your limited seating both drives demand (at least to a degree) and it also constrains the amount of business you’re able to do during peak times.

How does it drive demand? Well, it’s a psychological thing. Here are a few factors of limited supply driving demand:

• If you’re popular and its always tough to get a table, the makes you more desirable. People like awesome stuff, and feeling like the belong to an elite group.
• People want things that are more difficult to get. Look, for example, at the Nintendo Wii. For several years, Nintendo’s “inability” (and I put quotes around that because they have a long history of manufacturing shortages) to keep up with demand made owning a Wii more desirable.
• This desirability also puts you in the public conversation, which forms a loop of sorts. People talk about eating somewhere that is hard to get into, or talk about how it is hard to get into, which in turn makes people want to go there more.

Obviously you need to get your volume up there before you can see this kind of word-of-mouth feedback loop to start happening, but it’s something to think about.

And how about that volume? Or, more specifically, how about managing volume; any volume, of any size? All things being completely equal (meaning that at peak periods you have a wait for a table), your revenue potential is constrained by that one, solitary aspect of your operation: the amount of available seating for your patrons to use.

Over the next day or so, we’re going to be talking about how to best manage your capacity for optimal seating arrangements, table turns and overall revenue generation. We’ll be looking at several studies that tackle this from a couple of different areas: restaurant layout and table mix (being the number of different sized tables available to you). We talked a bit in the past about spatial considerations and how they subconsciously influence meal duration, and we’ll be bringing that back in as well.

Once we go over the physical aspect of capacity management (being your seating), we’ll take a quick look at refining ancillary internal processes to help speed things along and increase table turns.

In other words, buckle up: it’s about to get awesome.

In the meantime, reach out and tap the folks at Vanee Foods for more ideas on streamlining your operation. Get into it!