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Upscale restaurants

The most traditional segment of the restaurant and foodservice industry is fine dining. Historically the idea of an upscale restaurant included certain key organizing principles: efficiency in the production of freshly prepared food and professionalism in service. Prices are typically the highest of any segment, because the food is almost exclusively ‘hand made,’ not unlike a Rolls Royce automobile or a man’s tailored suit. Fine dining is defined by having a well trained and professional staff of waiters, usually including a dining room managed by someone in the role of Maitre d’ Hotel.


By nature, restaurant operators are protective of their proprietary information. In other words, they are reluctant to share operating results with their neighbors for fear that it will give those neighbors a competitive advantage. For generations, this meant that every small or large restaurant had its own way of ‘keeping score’ financially. Unfortunately, this made it difficult for one restaurant to compare itself with others, or to compare standardized knowledge across segments, regions, or even on occasion within organizations themselves.

Revenue management in restaurants

Restaurant revenue management can be defined as selling the right seat to the right customer at the right price and for the right duration. The determination of ‘right’ entails achieving both the highest revenue possible for the restaurant and also delivering the greatest value to the customer. Without that balance, revenue management type practices will in the long term alienate those customers who feel that the restaurant has taken advantage of them. Revenue management, or yield management, is commonly practiced in the hotel and airline industries.

Restaurant systems

Restaurant systems describe the Information Communication Technology used for the effective running of the business, namely procurement, stock control, production and service, revenue control, and payroll systems. The procurement system includes the ordering and receipt of a food or beverage requisition, the selection of reputable suppliers, the creation of electronic invoices, and the acceptance of goods and the transfer of goods to stores. The stock control system facilitates storing and issuing of food or beverages, stocktaking and receiving food or beverages.

Restaurant life cycle

Foodservice operations, like other businesses, progress through several life cycle stages: introduction, growth, maturity, and decline. These stages correspond, as shown in Figure 1, to a revenue time function. Some restaurateurs enjoy a lengthy life cycle while others experience the four stages in less than a year. The terminality depends on understanding the differences among the different stages, progressing smoothly in the early stages while managing growth effectively, and executing successful strategies that are appropriate to the respective life cycle stage at the right time.

Quick service restaurants

What the restaurant industry calls a QSR the rest of the world refers to as fast food. In all fairness, the food itself is not fast; it is the service that adds the quickness, generally taking less than 5 min from the time an order is placed until it is presented to the diner.

Midscale restaurants

The first examples of ‘chain’ restaurant companies were those in the segment called midscale (see Chains). This market niche has also gone by the terms coffee shop, limited service, or family restaurants. The term ‘midscale’ refers to both pricing and service components. Pricing is midscale because menu items are generally priced above the QSR level but below the Casual Theme segment. Service falls between traditional full service and the low cost fast food/quick service offerings. Midscale/family coffee shops are typified by a strong identification with breakfast and lunch menu offerings (see Dayparts), often serving these items in a 24 hour/7 day a week operating environment. Menu selection can be quite broad, primarily to appeal to a general population of consumers ranging from young to old, traveler to local, business to leisure, and everything in between.

Limited menus

A limited menu is typically limited in one of two senses. It may be limited in the number of menu choices offered or in the number of ways a menu ingredient is prepared/served. In the first instance the term refers to the number of menu items a restaurant has for its guest to choose from. The most limited menus in terms of choices are thought by most to be offered at quick service restaurants. ‘Variety’ in this setting is provided by the numerous condiments and toppings that can be applied to each order.

Kitchen fire suppression system

A kitchen fire suppression system is a pre engineered system which is designed to protect the ventilation hood, duct, and food cooking equipment under the hood. Kitchen fire suppression systems are designed to prevent fires from spreading to the duct system and ultimately the rest of the building. A kitchen fire suppression system is incorporated into the hood design and designed to sense fires in the food service equipment under the hood.

Independent restaurants

If asked to name a ‘typical’ restaurant, many people would describe a local, independent, full service eatery from their own neighborhood. It would be owner operated and the owner would know many customers by name. The French use the terms ‘chef/patron’ and ‘restaurateur’ when referring to the proprietor of a restaurant: the proprietor is called the former if he or she operates from the kitchen and the latter if he or she operates mainly from the front of the house.