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CASE STUDY: Castelli's Restaurant at 255 (Walker. 2015. pg. 21) Four Generations of Castelll's Castelli's Restaurant at 255 is a casual. family-owned restaurant serving traditional Italian-American comfort food made from secret recipes that have been handed down from generation to generation of the Castelli family. The restaurant is located in Alton. Illinois, a small farming community that sits just out- side of St. Louis, Missouri. In approximately 75 years of existence. spanning four generations of rich family history, Castelli's has remained relevant by sticking to the basics with its menu items and ingredients, maintaining a family tradition of striving to provide excellent quality and service, and offering fair prices. However, like many long-running restaurants. Castelli's has had to overcome its share of difficulties throughout the years. In the mid-2000s. Castelli's began experiencing financial difficulties, which continued to escalate when the economy began struggling. The fourth generation of the Castelli family. great-grandchildren Matt and Tracy. dropped what they were doing and moved back to Illinois to reassume control of their family's business and eventually purchase the building back from the bank. Back to the Basics After they assumed ownership of the restaurant, Matt and Tracy did not change a lot about the restaurant concept. They kept the original recipes and ingredients that have been in the family for generations. The reason was that their biggest customer base consists of the Alton, Illinois, locals. Many of these people are long-time patrons from an older generation. who are familiar with the concept and menu items and love it for what it is. At Castelli's, the mentality has always been to give the customers whatever they want. This had been passed down from the beginning by the original owners, Alfonso and Theresa. Because of this mentality. Castelli's offers a large and impressive menu with over 75 items to choose from. It also offers carry- out party packs and carry-out combo meals to feed larger groups in need of a little comfort food. Castelli's is open on weekdays from 11 AM. to 9 RM. and on weekends from Friday 11 A.M. to 10 RM. The restaurant is busiest on weekends and holidays. at times serving up to 800 guests on a Saturday night. Success Moving Forward Matt and Tracy's philosophy for success revolves around the idea that they need to be in the restaurant constantly, watching over their business. They believe it is important to establish relationships with customers to ensure they have a good time at the restaurant. And in return. Castelli's has done well for itself under new ownership. With that being said. Matt and Tracy are still faced with many challenges every day. It is a challenge to maintain consistency in both the front of house and back of house operations by getting everyone to work as a team and produce a smooth and steady ow of service every shift. A few years ago Castelli's annual revenue was approaching $2 million. Recently. the restaurant has seen a gradual increase in annual revenue and business demand, which reached $2.5 million at the end of 2012. With that in mind. their food and beverage cost was 38 percent in 2012 and their labor cost was 25 percent. Matt and Tracy's goal is to increase revenue by 5 to 10 percent. lower their food and beverage cost to 30 to 35 percent and lower their labor cost to 22 percent in 2013. Ultimately. their long-term goal is to increase annual revenue to $3 million and eventually expand the business to a second location. 1. Chapter 1 discusses dih'erent challenges of restaurant operation. What are some of the challenges The Castelli family has faced operating the restaurant over the years? 2. Does the current concept have lasting longevity? Should the owners alter the concept in any way? 3. What are some things the owners could do to increase their annual revenue? a. How can they lower food and beverage cost? b. How can they lower labor cost? 4. What are some things the owners could do to generate more business demand with younger generations between the ages of 25 to 45
