Yield Management

The food and beverage industry may start to employ yield management to increase revenues just as the hospitality and airline industries did. Yield management is a variable pricing strategy. By selling the same product for a different price to different customers or at different times, the restaurateur is able to generate the maximum revenue from a fixed inventory. For example, a restaurant may reduce prices for customers who choose to eat outside the traditional meal times, attracting consumers to spend during these non-peak periods. The revolution in sales that occurred in the airline and hospitality industries once they adopted yield management categories may well be replicated in the food and beverage industry in 2019. Dynamic pricing models allow restaurants to make money where they might previously have lost out – instead of turning away customers at peak times due to lack of space, they can make profit by redirecting such consumers to cheaper purchases during off-peak hours. Yield management intersects with other trends of 2019 such as social media and the use of AI – these technologies allow restaurants to specifically tailor their goods and services to consumers’ individual needs. Machine learning and AI allow more personalised sales to take place. Yield management, moreover, helps restaurants to economise, directing costs dynamically to where they will be needed based on variable consumption.