Chapter 29 — Quiz

Twenty-four self-check questions. Answer from memory first; the key is collapsed at the bottom.

Multiple choice

1. The chapter's central argument for events is that: - (a) they carry higher margin than à la carte service - (b) they let you sell the hours the dining room cannot - (c) they reduce food cost - (d) they replace marketing spend

2. The three genuine advantages of an event are: - (a) higher prices, lower labor, less waste - (b) known covers, a known menu, and money collected in advance - (c) no displacement, no rentals, no coordination - (d) guaranteed profit, guaranteed counts, guaranteed reviews

3. Displacement means: - (a) moving tables to accommodate a party - (b) the contribution forgone from covers the event occupies - (c) rescheduling a booking - (d) staff reassigned from the dining room

4. Bellwether's flagship Thursday event grosses \$3,000 and contributes: - (a) \$713 - (b) \$1,419 - (c) \$1,800 - (d) \$2,236

5. The thin Tuesday event grosses \$2,400 and contributes: - (a) \$400 - (b) \$713 - (c) \$1,118 - (d) \$1,419

6. Displacement is larger on Tuesday than on Thursday because: - (a) Tuesday guests spend less - (b) the banquette run removes half the dining-room seats on a night with only 62 covers - (c) labor costs more on Tuesday - (d) the kitchen is slower early in the week

7. A mandatory service charge, under the framework described, is generally: - (a) a tip belonging to employees - (b) the employer's money in the first instance, and wages when distributed - (c) exempt from payroll taxes - (d) eligible for a tip credit

8. Distributing a service charge as wages affects overtime because it: - (a) reduces hours worked - (b) raises the regular rate in the week it is earned - (c) converts hourly staff to exempt - (d) has no effect

9. Bellwether's 22% service charge on the \$3,000 event produces \$660, against direct event labor of: - (a) \$320 - (b) \$470 - (c) \$692 - (d) \$980

10. A guaranteed count is: - (a) the number of seats in the room - (b) the number the client is billed for regardless of attendance - (c) an estimate revised on the night - (d) the maximum the kitchen will produce

11. Bellwether sets for more than the guarantee because: - (a) it increases the bill - (b) the worst event failure is a guest with no chair - (c) the health code requires it - (d) rentals are priced in blocks

12. The three-payment structure collects, by the day of a \$3,000 event: - (a) \$600 - (b) \$1,200 - (c) \$1,800 - (d) the full amount

13. The chapter insists the balance be charged the night of the event because: - (a) clients prefer it - (b) invoiced event revenue ages, and the food cost is already spent - (c) it avoids sales tax - (d) card rates are lower at night

14. At 40 guests, plated beats buffet at Bellwether by roughly: - (a) \$60 - (b) \$222 - (c) \$400 - (d) buffet wins

15. The buffet crossover comes at counts above roughly: - (a) 40 guests - (b) 60 guests - (c) 80 guests - (d) 120 guests

16. Coordination time is charged at 3.5 salaried hours per event regardless of size, which is the strongest argument in the chapter for: - (a) buffets - (b) a minimum - (c) off-site catering - (d) longer contracts

17. The plan's 14 events at \$3,000 contribute: - (a) \$16,800 (40%) - (b) \$14,218 (33.9%) - (c) \$12,000 (28.6%) - (d) \$21,000 (50%)

18. The chapter's recommendation on off-site catering for a restaurant this size in year one is: - (a) build it as a second revenue line - (b) do not chase it; take what walks in, priced at a premium - (c) decline all of it - (d) subcontract it

Short answer

19. State the displacement formula the chapter uses, with Bellwether's figures.

20. Why does the chapter say a minimum is "a floor, not a target"? Use the Tuesday event to explain.

21. Give the four-tier cancellation schedule from §29.5 and the clause that converts cancellations into reschedules.

22. Name three things you must do if you distribute a mandatory service charge, and one thing you must not do.

23. List the five most common off-site failures in order of frequency, and name the two documents that prevent nearly all of them.

24. An event puts forty people in the dining room, none of whom paid. Explain, using Chapter 23's arithmetic, why that matters commercially — and why the chapter says not to bank it.

Answer key — attempt all twenty-four first **1.** (b) — Chapter 24 showed Tuesday and Wednesday are *demand*-constrained, not capacity-constrained. Events sell hours the dining room cannot. **2.** (b) — known covers, known menu, prepaid. Note these are *certainty* advantages, not margin advantages. **3.** (b) — the contribution forgone from covers the event occupies. **4.** (b) — \$1,419, or 47.3% of the gross. **5.** (b) — \$713, or 29.7%. **6.** (b) — the banquette run removes 32 of 56 dining seats on a 62-cover night, so you displace roughly half the room. On Thursday (92 covers) you displace about a fifth. **7.** (b) — the employer's money in the first instance; wages when distributed. Not a tip, so no tip credit. **8.** (b) — it raises the regular rate for that week, which raises the overtime premium for anyone over forty hours. **9.** (c) — \$692. The service charge very nearly funds the event's labor, which is its function; it is not margin. **10.** (b) — billed regardless of attendance, due at a stated hour, and it cannot be reduced afterward. **11.** (b) — two extra covers is cheap insurance against the worst event failure. You do not bill the overset. **12.** (c) — \$1,800 of a \$3,000 food-and-beverage sale is in the bank before the event happens. No à la carte cover does that. **13.** (b) — invoiced event revenue ages past sixty days, and the food cost was spent weeks earlier. Chapter 33 shows what receivables do to a thin cash reserve. **14.** (b) — about \$222: fifteen points of extra food on \$2,080 (\$312) against five saved labour hours at \$18 (\$90). **15.** (c) — north of about 80 guests, which is a count Bellwether's room cannot hold. **For a 68-seat restaurant, plated is almost always right.** **16.** (b) — a minimum. The same 3.5 hours falls on a \$2,400 sale and a \$9,000 one. **17.** (b) — \$14,218, or 33.9%. A model assuming the restaurant's blended 40% would book \$16,800; **the \$2,582 difference is displacement.** **18.** (b) — take the one that walks in from a good regular, price it at a premium, treat it as a relationship investment. The \$42,000 does not depend on it. **19.** Displacement = covers occupied × average check × contribution ratio. Thursday: 20 × \$46 × 40% = **\$368**. Tuesday: 30 × \$46 × 40% = **\$552**. **20.** Because a minimum is the number below which you decline, not the number you aim for. The Tuesday event *meets* its \$2,400 minimum and still returns only \$713 — 29.7% — because coordination is fixed and displacement is worst on the quiet night. The plan's average has to run near \$2,800–3,000. **21.** More than 90 days: the 25% booking deposit only. 30–90 days: 50% of the minimum. 8–29 days: 75%. Seven days or fewer: 100%. **The clause:** a date change is not a cancellation if the new date is within ninety days and is not a Friday or Saturday in November or December. **22.** Any three of: say in words on the contract and final bill that it is mandatory and distributed as wages; run it through payroll; recompute overtime in the week earned; decide in advance whether a voluntary gratuity may be added on top; check jurisdictional disclosure rules. **Must not:** take a tip credit against it. **23.** (1) Something was left at the restaurant. (2) The power was not what was promised. (3) The room was not ready on arrival. (4) Nowhere to put dirty plates. (5) Holding time ran long because the client's programme ran long. **The two documents: a site visit and a signed load-out list.** **24.** Chapter 23 puts guest lifetime value at \$220.80 and Bellwether's plan needs 9,035 guests at four visits a year. An event is the most efficient acquisition event available — forty people in a good mood who owe you nothing. Converting two per event across fourteen events is roughly \$6,182 of lifetime contribution. **It should not be banked** because it is unmeasurable in advance, depends entirely on execution, and a plan that counts speculative lifetime value has stopped being a plan.