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Morning Briefing Strap Line
Fri 15th Jul 2016 - Friday Opinion
Subjects: Food markets, balancing the picture and flaming June
Authors: Glynn Davis, Paul Chase and Ann Elliott

The dynamic world of food markets by Glynn Davis

There’s definitely something going on in the world of food markets, which is seeing a shift in the model away from selling the raw materials for preparation at home to the purchase of ready-to-eat meals for consumption within the markets.

From the groundbreaking activities of Jonathan Downey and his London Union (parent of Street Feast) business to the soon-to-open food-focused Boxpark in Croydon there is a growing trend for this new type of eating out venture.

Recent visits to Lisbon and Florence have highlighted how similar such food markets have recently been created elsewhere in Europe and are doing fantastically well.

Such markets are arguably extensions of what Eataly has been doing with its business – with a number of defined eating areas located within a single site (albeit serving just Italian cuisine). This is itself an extrapolation of the famous food markets such as Barcelona’s La Boqueria, Madrid’s Mercado de San Miguel and the newer but equally impressive Les Halles de Lyon Paul Bocuse market in Lyon with each having a number of dining-in bars and restaurant areas.

What separates the new breed from the food markets of old is their total dedication to eating in and the idea of having a wide variety of cuisines available that customers can select from and then dine communally in central seated areas.

Not only do these markets satisfy a desire for a more casual dining experience but the food on offer is typically provided by small independent operators whose previous experience of cooking food at any sort of scale has been limited to stalls at farmers’ markets.

They often specialise in a specific dish or a limited number of options that are new to their markets, which taps into the appetite among consumers for discovery – both of new producers and cuisines. Effectively the independent producers at these markets are operating like a pop-up with the added advantage that the tenure can be rolled on if they are particularly successful.

These markets are acting as a test bed – akin to an incubator in the world of technology businesses – that enables newcomers to find their feet and work out the logistics of delivering in serious volumes within an environment that has a nurturing undercurrent.

Such has been the early success of the Street Feast markets that include Dinerama, and Hawker House, that Downey is working on multiple new locations – from Manchester to London’s Smithfield market and even possibly across the Atlantic in Miami.

It is a similar story of expansion for the owners of the food market in Lisbon, which some people might be surprised to hear, is run by UK-based Time Out. Since taking over the site it has resurrected the Mercado da Ribeira Lisboa to a now thriving business that attracts up to 60,000 people per week to its variety of small food producers. Having recently raised £90 million it is now looking to operate similar food markets in major cities including London, New York, Miami, Berlin and Porto.

With Downey and Time Out among those looking to create many more food markets it looks like the traditional restaurant model of outlets on high streets and shopping malls could be disrupted? Or maybe not! In the same way the street food and pop-up restaurant operators have looked to progress onto running standalone outlets the same will likely be the case with the more successful concepts within the food markets.

Although Downey is certainly interested in helping his most popular tenants operate across his various food markets (and in some cases London Union is taking a 25% stake in their businesses to help fund their growth) there is still a desire for running standalone sites.

One of his biggest hits has been Breddos Tacos, which looks set to open as a conventional unit in south London under the name Pocho – helped by the backing of London Union. This all goes to suggest that the rise of the food market is both a very welcome and exciting addition to the eating out scene that not only provides a new way to dine but it is also a fertile breeding ground for new talent.

Whether these dynamic newcomers choose to stay within the confines of the food market or extend their reach into standalone units it all adds up to more exciting times for hungry people on the hunt for something interesting for dinner. 
Glynn Davis is a leading commentator on retail trends

Balancing the picture by Paul Chase

It’s that time of year again when the latest statistics on alcohol and health are published and the usual attempts are made, by the usual suspects, to misinterpret them to keep the moral panic on alcohol going. The figure that made the newspaper headlines were of the “More than a million alcohol-related hospital admissions in 2015” variety. This particular statistic – it is 1.09 million to be precise – is actually the number of hospital admissions in England where the patient being admitted had a medical condition that was or might be related to alcohol, regardless of whether the diagnosis that led to admission was alcohol-related or not.

This 1.1 million figure (which, with little variation is quoted every year) is the most hotly contested alcohol statistic ever produced! It is actually a measure of the prevalence of alcohol-related medical conditions of all people admitted to hospital in a given year, regardless of whether the reason they were admitted in the first place was alcohol-related. The purpose of collecting alcohol disease statistics on all in-patients was to give the NHS a means of planning resources; to understand what alcohol-related illnesses might be coming down the pipeline, it was never intended to be represented as being a “count” of the number of hospital admissions related to alcohol, and to quote it as such, as much of the media and politicians consistently do, is a gross misrepresentation.

The truth about hospital admissions, where the primary or secondary diagnosis leading to admission is an alcohol-related condition, or has an alcohol-related external cause, is buried in the official HSCIC figures and is as follows:

* Narrow Measure: alcohol-related admissions where the primary diagnosis was for a condition wholly or partly attributable to alcohol. 
** Broad Measure: alcohol-related admissions where the primary or secondary diagnosis was wholly or partly attributable to alcohol. 

It’s important to recognise that the numbers in the table above represent the number of alcohol-related hospital admission episodes, not the number of people admitted to hospital because of alcohol. Which brings me to ‘frequent flyers’. We know from Parliamentary answers that 54% of those admitted had been admitted two or three times in the year; and that 26% had been admitted four or more times. So how many people generated these alcohol-related hospital admissions? Let’s take the 2014/15 figures as an illustration:

Using the ‘broad measure’ we can see that there were 319,090 alcohol-related admissions in England in 2014/15, where the primary or secondary diagnosis was for an illness wholly or partly attributable to alcohol, or where there was an alcohol-related ‘external cause’ – such as an injury received during a drunken fight. If 54% of these admissions were of people admitted two or three times, then that equates to 86,154 people. If 26% of them were of people admitted four or five times then that equates to 20,740 people. Which leaves 63,819 people who were admitted only once. Add the three numbers up and it turns out that these 319,090 hospital admission episodes were generated by 170,713 people.

There are 1,880 hospitals in England which have an A&E department and where people can be admitted for overnight stays. Clearly alcohol-related hospital admissions will not be distributed evenly between them, but if we divide 319,090 admissions by 1,880 hospitals that is an average of around 170 admissions per hospital, per year – just over three a week – and these admissions are generated by just 90 people per hospital, per year or 1.7 people per hospital, per week.

How often do we read or hear it said that the burden of alcohol-related admissions will “bankrupt the NHS”? And yet the NHS as a whole deals with over a million patients every 36 hours! It is utterly disingenuous for the media and politicians to spout scaremongering statistics that grossly exaggerate the impact of alcohol on the NHS. For the health lobby this kind of statistical shenanigans is so ingrained that I doubt they even know they are doing it anymore.
Paul Chase is a director of CPL Training and a leading commentator of on-trade health and alcohol policy

Flaming June by Ann Elliott

We have just had our best ever June as an agency in terms of sales and profit. In fact, we have just had our best month ever. I could put that down to all sorts of reasons but the truth of it is, I just don’t know why apart from the obvious – more happy clients spending more money with us. And I am not the only person feeling that way.

In the last week alone I have had lots of operators asking me how June was in the market place. Was it awful or was it okay? Generally, I have to say, June seems to have been brilliant with many operators in double digit like-for-like growth. “Thank goodness for that,” they say. “I thought it was just me. We had a great month but I just don’t know why.” Over a few glasses of wine, we have mulled over the reasons.

It’s not been about football. Many of those with growth, haven’t had TVs or shown the football at all. It’s not been the weather either – year-on-year, it’s been no better (and perhaps even worse) than last year. It doesn’t seem to be due to more effective marketing although a number have significantly up-weighted their digital activity this year. It’s not due to a poor performing competition. Indeed competition has become more intense, more specialist, more customer focussed and more, not less, worrying.

This June growth seems to be slightly more prevalent in the smaller niche operators, but a number of major chains have experienced it too. This is not a story about David beating Goliath. Small, medium and large operators have all talked to me about it. North and south. Pubs and restaurants.

Some think it’s down to Brexit. Uncertainty before the vote and even more uncertainty after it though, would surely normally dent customer confidence and reduce their visits to restaurants and pubs. Customers, of course, in times like this would be saving not spending money.

Customers though are not behaving like this. Covers are up. Spend is up. These growth operators wonder if it’s because more people are holidaying in the UK rather than abroad and if more Europeans are now coming over to the UK due to the relative value of the pound to the euro. This seems an incredibly quick reaction, though, to recent political events. These operators feel a surprising sense of optimism particularly in London. It feels counter-intuitive with all the recent political “goings on” but their optimism is real.

The other key reason for growth seems to be takeaway and delivery. One casual dining chain chief executive told me that they thought they could attribute at least 50% of their double digit like-for-like growth to the massive growth in their takeaway/delivered business. And it’s not all about Deliveroo (who seem to be annoying and irritating operators they work with in equal measure due to arrogance and complacency).

One major operator told me that they were using every single delivery route to market (they all cost the same anyway) that they could and that UberEats was outperforming Deliveroo by five to one. He couldn’t wait for Amazon to start their delivery service so he that he had multiple routes to market for his delivered product.

The great thing, too, was that this growth has not stopped at the end of June. It is happening in July. These last two weeks have also seen amazing sales growth despite Brexit, the weather, the football, Boris Johnson, the labour leadership challenge and the launch of Pokémon Go (or perhaps customers are looking for Pokéstops in restaurants and pubs).

Long may this growth continue – I love talking to happy operators.
Ann Elliott is chief executive of leading PR and marketing company Elliotts –

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