James Stewart, director of nutrition services for Sodexo at the University of Minnesota Medical Center’s Fairview Riverside Campus in Minneapolis, scoured his operation to gain the biggest cost savings with the least effect on customers. To do so, Stewart says menu engineering was the saving grace to finding small ways to cut costs.
With an estimated 6% increase in costs for the year, James Stewart set out on a mission to cut costs at the 484-bed University of Minnesota Medical Center’s Fairview Riverside Campus in Minneapolis. For this director of nutrition services at this Sodexo account, menu engineering became the method to find little ways to cut costs nearly $106,000 for the year. The trick, Stewart says, was making sure those changes are as invisible as possible to the customer.
“Our prices have gone up about 6%. We increased prices in the cafeteria 3.2% in January. So, obviously, we’re taking a loss. That’s why we are trying to do these little things first and exhaust all the menu-engineering techniques to keep the cost from hitting the customer. People are trying to make ends meet for themselves with rising food and gas prices. We can’t charge $10 to $15 for lunch because, ultimately, we’ll lose customers.
We started looking at the things we serve and what the individual ingredients are that make up those items. When the cost of the individual ingredients go up at a higher rate than we can absorb, we look to see if there is an alternative that we can substitute and still have a high quality product. But it also needs to be invisible to the customer.
One thing we did was replace an Oriental chicken salad with a grilled chicken Caesar salad. The move saved us almost $10,000—mandarin oranges used in the salad just became too expensive and we switched our brand of chicken tenders. We also replaced our chicken curry on rice, which was on our patient menu, because the cost of coconut milk is so high. We replaced it with chicken à la king with a puff pastry and saved more than $3,000.
One thing we started at the end of July was taking off the placemats we currently use on our patient trays. If you pull those, it saves around $30,000. That’s real money. Some patients may like a placemat, but for the most part, people aren’t going to pay that much attention. Obviously, if you have your food on a clean tray and it’s good and hot, that’s what’s important. Sometimes you have to make those calls and say, ‘If I were a customer, I don’t think I would care that much about a placemat.’
Sometimes it’s just the little things that can make a difference. For example, we are switching from a burgundy trimmed paper napkin to a grey trimmed napkin. That will save us nearly $5,800. We also got rid of the garnishes on our lunch and breakfast trays. We saved more than $3,000 a year by not putting an orange slice on the breakfast trays; $3,000 was saved by removing cherry tomato garnishes from lunch trays. With 400 trays a meal, 1,200 a day, 365 days a year, you can just add them up and it’s like ‘wow, that’s a lot of tomatoes.’ But then, who would see that? If you go out to eat you might see a sprig of parsley on your plate and you might feel that garnishes like that are required to be there. But if you are getting the food that you ordered and there isn’t an orange on the plate, who’s really going to care?
Our customers are pretty understanding. We no longer put out lemons for water in the café. Some ask why. We say they are up 12% and we can’t afford them. Plus, we don’t charge for water. And people are OK with that. They are happy with the food quality and most of the customers that we have say they don’t know how we are able to survive.
Not everything has worked out for us. We switched from black foam plates to a white foam plate in the cafeteria. The change would have saved us about $13,000 a year. The problem was that the white plates were too flimsy. It works really well on paper but when you put heavier items on them, they didn’t hold up. We try everything to cut costs. With the plates, we found it was more of a hazard than a good cost saver because we didn’t want someone to get burned from a plate breaking.”