Business People Club

Don't Eliminate the Middle Man Add One!

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by Titank
Don't Eliminate the Middle Man Add One!

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commented by Hawkward
Today, there are situations when we actually add a “middle person” instead of eliminating one for increased service efficiency. If it’s cost-effective and demand is high, then proper market positioning will make it a worthwhile endeavor. For example, my sister just informed me of a food delivery service in New Mexico that will let you choose one out of many different food outlets (all types of ethnic/fast food)- and then guarantees delivery within a specific time period. This not only gives the customer assurance of reliability, but more choices for dining take –out style.

 In other areas of industry, the same idea holds true. There are electrical suppliers that no longer manufacture the product of electricity, but now are involved only in the delivery process of electricity to the customers. Because of market fluctuations, the new delivery supplier will utilize many other different energy suppliers to get the product of electricity to the customer efficiently and at the best market price.  Again, adding the middle man seems to benefit all around.

 In relating this theory to restaurants, it is the food runner that has become popular, especially in the larger dining establishments that rarely existed years ago. Food runners are employees who only work the rush hours of the dining room- only running food back and forth from the kitchen to the tables with light dining room table interaction (condiments, fresh pepper etc.). It is a 2-4 hr. shift, depending on how long the dining rush lasts.

 Before large restaurants existed, the waiter would complete the process of order taking and delivering of the food. Today, the food runner can be implemented (additional middle man) relieving the waiter of this time consuming and sometimes painstaking process. The waiter must share a percentage of his tip with the runner, but in return his job is eased because the food is delivered for him- allowing extra time to work more tables and up sell to customers thereby increasing sales. Though, it does remain the waiter’s responsibility to check the table for additional diner needs-- either while the food is being placed by the runner or shortly thereafter. The tip-out to the runner is usually 10-15% depending on the service system, but well worth it if waiter sales can increase by 20-30 %.    

The main point is the food runner addition improves delivery service efficiency while being cost-effective (if the sales increase outweighs the payroll increase). Properly integrating employees into the dining room with exact middle man connections always makes for smooth service flow. It’s not a matter of just blindly throwing extra employees at a service problem, but organizing the best system possible with the minimal amount of labor.  

Adding the middle man can sometimes streamline operations in such way that it becomes irresistible and impossible to ignore. Always, the demand arises when delivery routes of a service system become overloaded.

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