Sometimes Less is More

I am a big fan of Culver’s Restaurants.  They are famous for their terrific frozen custard and great “butterburgers” with almost 400 locations throughout 17 states.  The stores are bright and clean, and they have figured out how to attract and train friendly and competent staff.   If you haven’t been to one, you need to go.

I do, however, have an observation about Culver’s…. the menu is too big.  They’re famous for their frozen custard and burgers, but they also offer several chicken sandwiches; pork and beef choices; fish plates; fried chicken; lots of soups and salads; side dishes - even hot dogs!  It often takes a long time to order because the menu board is daunting for people in line.  Food is cooked to order and delivery can be slow in busy periods.  It has to be harder to train the kitchen staff than at most fast food restaurants, and it must be a nightmare to order food supplies.  Are these extra choices on top of the main things that bring people in, worth the extra expense and headaches?

I think the larger lesson is this: entrepreneurs never want to miss a sale, and it’s hard to say no to a perceived customer need.  Product and service additions seem like a way to grow the business and it’s easy to assume that the incremental costs are minimal.  On top of this, many businesses are in “survival mode” right now, and experts are telling them “..don’t stand still“  and  “..find other outlets“.

Unfortunately, these moves are often more complicated and costly than planned, and they can lead to unintended consequences - i.e. the longer wait times in the Culver’s example.  New ventures can easily become a distraction.  Often, using precious cash to add products or services that have iffy returns will make things worse in a hurry. Finally, the brand can suffer if customers no longer understand the company’s core offering.  These issues may not be applicable to Culver’s, but they happen a lot.  

Our advice is not to stand still…. but before deciding on a product or service addition, ask a few questions:

• Have we really done everything we can to grow our core business before adding more products or services?
• Do we have an accurate incremental cost analysis and reasonable sales forecast? 
• Are we considering all the possible impacts to the business beyond incremental costs?
• Will these additions improve - or confuse our branding?

The answers will often lead to refocusing efforts on the core products and services, and a conclusion that in many cases – less is actually more.