Turning Unrecoverable Overhead into Extra Virgin Profit

What’s the fastest way to educate customers about olive oil? Serve it in restaurants. What’s the fastest way to get chefs to use the good stuff? Make it profitable.

Changing a common practice isn’t easy. It’s an uphill battle in a foodservice industry beleaguered with increasing food costs , lower ticket totals and fewer customers, but the smartest chefs have always looked beyond the obvious and found innovation. So, it should come as no surprise that an ingredient often served up in a little dish on the side to stave off hunger while customers’ orders queue up just might be the answer.

In the U.S market, the idea of profiting from “table staging” has never been popular with customers. But not so in other countries. No one balks at a nominal charge for bottled water served in every ristorante in Italy. Selling a sampling of olive oil as a starter course in New Zealand has been around for years. Expect bread on the table in Australia and you can expect to pay for it too. It might seem counterintuitive in a down-economy to start charging for something that has been given away for free, but evidence proves otherwise.

One such example is Paolo Pasquali’s OliveToLive program. In conjunction with the international group, Association 3E, Pasquali developed an olive oil serving and sampling system for restaurants. The program is designed to guard and guarantee the quality of the oil until it reaches the ultimate consumer at a restaurant table. He has convinced the best in the business, like the Culinary Institute of America’s Greystone campus restaurant and the Michelin-starred, Monastrell, in Alicante Spain, to install his “oleoteca” and serve up olive oil as a tasting course. So far, it’s a success at holding its own profit margin.

Not surprisingly, there is another benefit to featuring high quality olive oil in restaurants. It helps educate consumers about what olive oil should taste like. Pasquali believes that the restaurant business holds the key to the education process and that chefs are the ultimate ambassadors of promoting the good taste and quality of extra virgin olive oil. This makes all the more sense when the best chefs reach stratospheric celebrity status in the media.

Customers put their favorite chefs on a pedestal. They trust them. So much so that research from UC Davis proved that many consumers think rancid, stale oil is what the good stuff should taste like. Want to guess where they learned this? From the tables of many better restaurants that view olive oil as unrecoverable overhead.

So, it appears that there are two simple options for olive oil in the restaurant world. The narrow-minded chef’s solution: keep the cost as low as possible by buying bulk oil that does not do their culinary efforts or their customers any justice. The profitable chef’s solution: make tasting olive oil a special part of the dining experience and offer the very best artisanal examples – at a reasonable, recoverable price.


One Response

  1. January 9, 2012 at 8:06 AM

    […] Turning Unrecoverable Overhead into Extra Virgin Profit, the power of promotion was demonstrated by presenting olive oil as a treasured tasting course […]

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