GF Strategies founder and president, Greg Flakus.
In 1992, Greg Flakus and his firm accepted a project to manage the food and beverage (F&B) services at the Oregon State Fair, Salem. The project led to the beginning of what would lead to working with 53 fairs in 20 states from San Diego, Calif. to Essex Junction, Vt. After 25 years, Flakus is moving his company from the fair space to the festival and venue space. Venues Today caught up with the F&B strategist to learn lessons gleaned from his time as a fair-food guru, and his thoughts on the state-of-play in the new areas he’s looking to conquer.
Why did you start GF Stategies?
Flakus: I was asked by Don Hillman, Oregon State Fair CEO, to take on a nine-month project to look at the F&B program. I planned on returning to do my work in public relations after that. I went down and took a look and decided they need to do a few things better, including how they tracked their sales, and I put together some systems, and some forms, and made it tighter and more professional. As soon as that ended, the Deschutes County Fair, Redmond, Ore., asked me to do the same thing and a business was born.
Fifty-three fairs later, what are your takeaways?
When I started this company, most fairs were using staff members to run their F&B programs. They farmed out carnivals, parking and entertainment buying but not F&B. We were the first company to provide this service as an actual business and put in systems. So my first thought is, ‘don’t run your own F&B unless you know what you’re doing,’ and my second thought is, ‘don’t run it without a foolproof accounting system.’
Are fairs economy-proof?
Surprisingly, fairs do better in bad economies because people put off the big theme park trips and stay home and go to the fair.
Gate fee or free entrance?
Fairs are starting to look at the free-entry model and doing well with it. More people come and customers spend more inside at concessions. Fairs keep 100 percent of the gate fee and have to share with concessionaires if they don’t have one. It’s a trade-off.
Flat-fee or percentage model?
If your fair is still on a flat-fee you need to move to the percentage model. The large fairs in California started the trend, and Don Hillman and I picked up the ball and ran with it. After showing it to several fairs in the Pacific Northwest, I introduced it to the Houston Livestock Show and then to every fair I consulted for. Most fairs are now at 18-20 percent of the gross. In California they are at 28 percent.
Other best practices?
Better signage, less stands but better quality, encourage existing stands to come up with new menu items, have a minimum price for items so that stands aren’t competing against each other and starting price wars. This comes into play with nonprofits that can sell things cheaper because they usually have no labor or travelling costs.
Why are you leaving the fair space?
Most of my contracts are for three years. During that time, we find a lot of the shrinkage, train the staff, and we get them to a level they can go on. Most of the fairs are now doing it with our system using their own staff, or are happy staying with a flat fee. I decided the ability to get into more fairs wasn’t going to happen and I’ve had a good run with it. I’m focusing now on festivals, arenas and stadiums.
How is working with festivals, arenas and stadiums different from working with fairs?
The biggest difference on the stadium and arena side is that they have events year-round, almost every weekend. They have the opportunity to realize F&B revenue 52 weeks a year. On the other hand, festivals are even shorter than fairs, usually two-five days, and they need to jam in as much F&B sales as they can in their short window. If you don’t get your money in that time period, you don’t get your money.
What are the key trends you've seen in festivals, stadiums and arenas?
VIP continues to grow at music festivals. Fans are willing to pay increasingly higher festival charges for enhanced VIP experiences. Coachella, BottleRock and KABOO all crossed the $2,000-per-ticket line for VIP experiences and sold out.
Food offerings are now not just prepared in advance. More chefs are seen on-site preparing the offerings fresh and right in front of the festival attendee. Per person plate charges are now in the $12 to $15 range; two years ago this figure was below $10. Beverage offerings are now more upscale, featuring local bars with their signature drinks.
Experience within the experience is big now, including pop-up surprises and music groups coming together for surprise jam sessions. This is all giving the attendees a special experience. Some events have seen declines in ticket sales as they move from two days to three or four as they expand from three weekends to four and are finding that sales are just spread out over the timeframe. You need solid data before shaking your dates up like this.
Social media continues to be bigger all the time. Events enabling meet-ups via social media sites are very trendy. Sponsor measurement is still a big challenge. How to value the cost of being at events is still evolving.
What is your take on cashless?
Cashless is changing everything and revolutionizing F&B. Festivals are already doing it, venues are slowly getting onboard and fairs will go to that model soon. It also makes the back-of-house work easier because they don’t have to get reporting from each vendor; it’s all on the cashless database.
Final thoughts?
In the end, it’s all about relationships. I’ve had so many people introduce me to other people and talk about my services and it’s really gratifying. Keep your eyes open, and if an opportunity presents itself, go with it.