Labor Day Weekend
I want to use this as an example of one of the uses of managerial accounting. Accountants are in demand as advisors. This business model described below solves many of the problems of a traditional restaurant. Here in San Antonio the San Francisco Steakhouse has gone to a meeting only format. That like Miss Bobo's solves many of the traditional restaurant problems. We will discuss this in class this week.
Lunch at Miss Mary Bobo’s
Lynchburg, TN and Fredericksburg, TX are destination cities. They are the envy of every small town Chamber of Commerce in America. With less than ten thousand population, many tens of thousands of tourists flock to each city each year. Indeed the small towns of Central Texas are one of the top five tourist destinations in the State. Lynchburg is the home of iconic Jack Daniels Distillery.
Our front burner example is Miss Mary Bobo’s Boarding House in Lynchburg, TN. One can google the name to view a plethora of positive comments and images.
There really was a Miss Mary Bobo. The former Salmon Hotel became her Boarding House in 19089. She died in 1983 but remained involved in the Boarding House until her death at age 120 in 1983. The House itself is classic southern style, two storied with a front porch and central hallway.
Today the house is divided into ‘dining rooms’ with a round table and chairs featuring a large Lazy Susan in the center of the table. Each table seats nine to ten with the House accommodating 65 maximum for each meal.
Dining is by reservation only. Each meal has a hostess whose job is to describe the history of the Boarding House and, yes, turn the lazy Susan so each diner can partake of the various offerings. Each hostess answers questions, maintains decorum, and without anyone noticing, moves things along so that the room is cleared in time for the next group.
As a college accounting professor I started adding up the advantages of this venue as the ideal restaurant set-up. Here goes.
- All seating’s are by reservation. Since you know how many are coming you can plan on exactly how much food to prepare. No wasted food or leftovers cuts the costs.
- The number of dining experiences can be expanded or contracted depending on demand. If three tour buses want to stop, one can have three lunches at 11, 12 and 1 PM. Or one can cut back to a single setting if need be.
- Jack Daniels owns the Boarding House now and promotes the culinary arts program at the Community College, named for Jack’s nephew, Len Motlow, who took over from Jack. Those students are on scholarship and work as bus boys and such. So there is the opportunity to interface with a local college.
- The Boarding House only operates at lunch. So no need to be there early for breakfast or late in the evening. There are no alcoholic beverages eliminating another potential cost control headache.
- Miss Mary’s operates six days a week from Monday through Saturday. This coupled with the lunch only business plan makes it much easier to staff the Hostess and kitchen component.
- The cost of food is low, and preparation is straightforward. We won’t need Wolfgang Puck in the kitchen. So the food cost is low and preparation within the ability of anyone capable of donning a white apron and chef’s hat.
- The day I was there the entrees were fried chicken and meat loaf. The Hostess explained that every meal had the southern staples of fried okra ( a novelty to Yankees no doubt), baked apples, chow chow (tomatoes and onions), and a bowl of beans. Chess pie (again, keep it simple) was the desert and ea or water rounds out the beverage selection. And the best for last part is, the price is $20. Per person for what is essentially a low cost meal. No doubt there is some haggling with group prices for tours but then that assures a steady stream of customers. Accounting wise this means the contribution margin ratio is high, which is a good thing.
My point is that this business plan conquers many of the problems that plague the typical start-up restaurant. The menu is simple and once the right ambience is established, things, well, get cookin’.
Now I grant that last step is vital. But find the right older home, construct a story about town pioneers gathering in similar establishments in the 1920s, recruit a few friendly Hostesses, and you should be on your way.
Destination locations are built by visionary entrepreneurs. Here is the vision, any applicants?