Propel Morning Briefing Mast HeadAccess Banner  
Propel Morning Briefing Mast Head Propel's LinkedIn LinkPaul's Twitter Link Paul's X Link

Krombacher Headline Banner
Morning Briefing for pub, restaurant and food wervice operators

Fri 11th Jan 2019 - Friday Opinion
Subjects: A world of difference, time for lunch and delivery is here to stay
Authors: James Hacon, Glynn Davis and Ann Elliott

A world of difference by James Hacon

The world is an ever-closer place, that’s for sure. I have many personal stories that act as testament, including bumping into not one, but two British hospitality leaders in New Zealand at Christmas.

Last year was a busy one for me, moving full time into Think Hospitality and travelling to 21 countries, mostly for work but quite a few for pleasure too. Much of this travel is for client projects but the biggest chunk is presenting at and emceeing hospitality conferences. On counting, I worked out I had spoken to more than 7,000 hospitality leaders and professionals.

All that travel and listening to so many inspirational speakers opens your eyes to the innovation that exists in our sector. You recognise global trends and understand the opportunities in each country. It constantly reasserts what a great sector we work in.

So many principles of running a hospitality business are the same no matter where you go in the world, not least the challenge of getting the right team. In every country I visited last year leaders told me there was considerable pressure on the staff pipeline and they wished hospitality was more highly regarded as a career – and that’s without the direct impact of Brexit. Clearly the business models change, but not as much as you might expect. For the most part the secular trends are global, while cyclical trends are much more localised.

One thing we Brits can be proud of is the transformation of London’s food scene during the past two decades and the respect our capital has as a hospitality centre around the world. Apart from our American friends, it’s clear most other nations look to London for inspiration and as a benchmark, this is particularly prevalent across the rest of EMEA. 

During the Christmas break I took the opportunity to reflect on learnings and take-aways from individual countries and thought you might find it useful for your own travel plans this year. 

Beijing, China
In terms of using consumer technology in hospitality, China is only trumped by Japan. Forget your Visa and Mastercard when visiting China, neither work for the most part. Increasingly in Beijing people don’t pay with cash either, many outlets have stopped taking it. What becomes a nightmare for Western tourists is a super simple payment solution for residents. The two mammoth payment solutions of WeChat and AliPay work with QR code-type technology. Operators can use the solution to offer pre-ordering and pay-at-table technology. We see so many cool uses of such technology including scannable walls of dishes you can quickly select and which are then delivered directly to you, not a specific residential or work address. If you think the UK is bad for people looking down at their phones, wait until you hit the streets of China. People are glued to their screens so much coffee shops have virtual reality headsets for use while waiting. This use of technology quickly drains device batteries and in almost all coffee shops you can pick up a charging device that can be used on the go and dropped back at any point in the network. It works just like a Boris Bike, you’re only charged for the time you use it.

Dubai, UAE
If you want to see creativity uninhibited by cost, visit Dubai. It has some unbelievably iconic designs and loads of inspiration. You have the ideal recipe here –filthy rich wannabe restaurateurs splashing the cash on ridiculous fit-outs who aren’t too worried about returns, international brands wanting to make it big and gargantuan malls trying to stay ahead of the next city-sized competitor in development. Dubai is definitely eye opening and inspirational. For the most part the city has been driven by real estate opportunities for so long you get a mishmash of schemes across the city that open with a bang and then join the tens of others in a normal routine. That means you’ve got to make your money back quickly, if that’s your aim. Many of the established companies have finally got into a rhythm of creating concepts rather than just franchising but international brands are still prolific here, mostly from the US – although quite a few from the UK too. Dubai is still a favourite first stop for most British brands looking to franchise as it can be lucrative with territory fees. There is an expected bubble building around EXPO 2020, which is expected to pop shortly after, although it is undoubtedly the leading international destination in the Middle East and well worth a visit if you’ve not been before. 

Riyadh, Saudi Arabia
In contrast to Dubai, a city that has built itself as an international destination, Riyadh has long been off the international community’s radar. It has, however, always had a culture of hospitality closely linked to the Arabic culture and dining out. In the past few years, increasing numbers of international brands have appeared there, which isn’t surprising when you consider it’s the biggest market in the GCC. With the crown prince looking to open up the country an increasing number of brands are looking at opportunities and, with partitions coming down in many hospitality businesses, Saudi Arabia is becoming more palatable for many. That said, a number of brands still reject the market on a matter of principle, with recent events clearly not helping. Neighbouring Bahrain was a real revelation. It might be a small market but has some of the best home-grown concepts coming out of the Middle East. 

Dublin, Ireland
With Brexit looming and a casual dining squeeze in the UK, our closest neighbour has been getting a lot of attention. Walk through the streets of Dublin today and compared with even a year ago the number of British hospitality brands is on the up. There is still a traditional pub-going culture, with far fewer takeovers by gentrified drinking establishments. For the most part the market is still independent with a few larger players, mostly wet-led. It’s still one hell of a night out but with lots of creativity and innovation and, dare I say, many concepts clearly “borrowed” from some well-known London brands. 

New York City, US
I’ve previously written about New York in Propel following our study tour there but it would be rather remiss not to mention the second-best dining destination in the world (he says as a proud Brit with hopes no American friends pick him up on the claim). When it comes to the contemporary and fine dining end of the market, NYC clearly nails it. That said, the bar scene didn’t feel like much to write home about and in terms of mid-market dining the UK is a clear international leader. When it comes to fast causal to-go it does feel like they are a little more ahead of the curve, with many more brands in this space in terms of differentiation of offer, although food quality leaves a lot to be desired. Salad is most definitely a bigger thing, perhaps with New Yorkers being a little more health conscious. In terms of soft drinks there is a crazy breadth on offer, with much more category differentiation. Lunch subscription was my biggest takeaway, which has hit the UK in a small way but still has a long way to go.

Auckland, New Zealand
Australasia clearly leads the world when it comes to coffee. Having lived in Australia and New Zealand for five years, I’ve struggled drinking coffee elsewhere. If I’d visited Melbourne it may well have pipped this spot but Auckland also has an incredible casual scene. They do casual far more organically than us. By nature the Kiwis are that little more laid back and with that comes a beautiful cafe culture that feels unique. It’s a long way for a visit but if you’re in the coffee or cafe business, this part of the world should be a regular pilgrimage.

Copenhagen, Denmark
Outside the UK, Denmark is the country I spent most time in last year and it’s definitely up there as one of the best food destinations in Europe. As in London, this wasn’t always the case in Copenhagen. It’s risen from virtually nothing during the past decade or so and is a real inspiration for foodies. As a nation the Danes have defined their own food identity and placed it within the national psyche. As well as the renowned superstar fine dining players, Copenhagen has a proliferation of creative premium casual dining brands and the meat-packing district is full of independents with an edge. Traditionally the city’s hospitality companies have been multi-concept, perhaps driven by only having one significant market in which to grow. However, an increasing number of branded outlets are popping up and trying to keep an edge as they grow – perhaps much more strongly as this market likes the sense of individuality. Watch this space for these brands appearing across Europe, with many looking to London after Germany and other Scandinavian cities.

Tallinn, Estonia
Perhaps a city to save for the future regarding hospitality inspiration but certainly one to add to this year’s weekend away list. Tallinn has really been influenced by the Nordic food revolution and is on track to drive an equivalent in the Baltics. There are a number of great operators doing interesting things but you need to seek them out. If you’re lucky you’ll find some cool speakeasy bars, beautiful waterside restaurants and great street food markets.

Across the world the most prevalent theme that stands out is one of hospitality as the heartbeat of nations. 

For consumers we provide places where people meet, where food brings people together, where memories are made, where locals can meet with internationals, where people lose reality for a period of time, where children discover a love of food and where love is born on first dates.

To our teams it provides a sense of family and belonging, helps teach people the skills of life, develops empathy, enhances communication skills, and gives those who may not have had an opportunity a chance to travel. Our sector really is like no other. 
James Hacon is managing director of Think Hospitality, which advises multi-site brands on growth and brand and development strategy as well as investing in early-stage concepts with a bright future

Time for lunch by Glynn Davis

Fast food has always seemed a bit of an oxymoron to me – if food has to be linked to velocity I’d go with slow rather than fast. But since we live in an always-on world with round-the-clock connectivity, food has sadly been sucked into the vortex of our on-the-go lifestyles.

This has been a driver behind the unbelievably fast growth in food delivery services. Why walk down the road and wait for your meal to be cooked and trek back with it when you can order it via an app and do something else while the meal is cooked and biked to your house?

Nothing could have been farther from my mind when I enjoyed my annual pre-Christmas lunch with my mother, who travels down from Yorkshire for these particular meals and to see her grandchildren – not necessarily in that order. It is something we have been doing for years and this time we booked lunch at Bibendum in London’s swanky Knightsbridge, where celebrated chef Claude Bosi cooks great food in his super-swish kitchen.

The reason for booking Bibendum was certainly down to the great food but equally down to the fact we wished to take as long as we wanted over the meal. Our idea was always to arrive at 1pm and not contemplate leaving until at least 3.30pm. Such establishments don’t typically participate in the game of allocating diners specific time windows in which they have to stuff themselves with food and then vacate the premises.

With some of the more successful independent restaurants today operating out of modest-sized premises, the need to turn covers and drive volumes is a financial necessity. I fully understand but still find it a bit of a shame. I’ve read some great reviews of the tiny 15-cover Evelyns Table in the basement of the beautifully refurbished Blue Posts pub in London’s Chinatown and, on wandering into the venue recently to enquire about meal timings, they told me dinners comprised three sittings of precisely one hour and 45 minutes. I didn’t feel the need to ask about the lunchtime arrangements.

I might manage to make it along one day but all too often such restrictions reduce my appetite for visiting many well-regarded hot-shot places. Personally, I need to spend good time in good restaurants to do them full justice. Perhaps I’m unusual in enjoying meals that are all about taking your time and luxuriating in what has become an increasingly rare beast – the long lunch.

Shortly before my lunch at Bibendum I read an article in Noble Rot magazine by restaurant critic Marina O’Loughlin in which she extolled the virtues of old-school Soho restaurant L’Escargot. She applauded it for being one of the last bastions of the long lunch, writing: “London – the world, in fact – doesn’t have enough of this kind of forgiving joint, places to sink into, to abandon care and responsibility for anything other than the bill.” That certainly put me in the mood for Bibendum.

It’s a shame we have reached a point where such establishments have become the exception rather than the rule. In fact things are a lot worse than I thought if we are to believe recent comments by Anthony Pigliacampo, co-founder of US-based restaurant chain Modern Market. He believes fast casual is among the fastest-growing segments of foodservice because most people don’t have the luxury to sit down for more than 20 minutes to enjoy a meal. If 20 minutes is now deemed a luxury, I think there’s a problem somewhere and I want no part of it. Time for lunch.
Glynn Davis is a leading commentator on retail trends

Delivery is here to stay by Ann Elliott

The whole delivery model continues to fascinate me – how do operators handle it well, grow incremental sales and make money from it? If they choose not to participate are they leaving the door open for competitors, including Deliveroo’s own dark kitchen operations? If they drive delivery occasions do they lose dine-in visits?

Operators are increasingly using their kitchens to serve their own brands front of house and an invented “delivery only” brand from back of house. A chef can make a burger under his or her own company’s brand name and serve it to their sit-down customers and then make exactly the same burger under another brand name to send out on a delivery bike. I know this isn’t new news but it’s fascinating how it works all the same.

This is a ghost product and ghost products are often outselling the food they match. A delivery-only burger for an invented delivery brand can sell more than a branded burger even though they are exactly the same product, made in the same kitchen, with the same ingredients and same spec by the same people. What price brand then?

If a delivery customer’s choice of where they order from is largely based on speed, how much does a brand count for? Is this the beginning of the end for bricks-and-mortar casual dining brands? What is a brand name actually worth? One can argue absolutely nothing if it can’t deliver what delivery customers want, need and expect from delivered food.

As delivery-only operators know, putting kitchens on the ground and increasing distribution points is key. Of course having good-quality, hot food delivered quickly is just the price of competing and a necessity. However once an operator has cracked that, the more kitchens they have the more profitable they can become. They can use Deliveroo’s own marketing systems to turn off promotions on a minute-by-minute basis so if they want more traffic, are happy to compromise on margins and have teams on the ground, they can really drive sales.

That makes me wonder whether it could be an option for those pub operators with large managed or even large tenanted estates. Could their kitchens be used as dark kitchens and distribution points? It would give tenants who already serve food an opportunity to drive incremental sales and, of course, they can also add drink to the mix. It might drive more traffic to the pub but that’s not the point – it’s about making their business more profitable per se. That’s increasingly difficult for many tenants in many areas.

Of course it’s not as simple as putting food up on a delivery site and hoping it all works – there are front of house and back of house logistics to consider, including balancing the needs of dine-in and dine-out customers. If operators can’t offer quality food, speed, punctuality and value for money they shouldn’t even try delivery. The hope would be, though, that they are already offering those elements to dine-in customers.
Delivery isn’t a phenomenon – as I think some people hope it is – it’s here to stay. When I hear of two teenagers ordering bacon sandwiches on a Sunday morning because they can’t be bothered to visit a garage to buy bread and bacon it’s obvious this has become a way of life for some.

I can’t get delivery in my village – perhaps that’s an opportunity for my local tenancy? – but I know of many people using it six or seven times a week in more urban locations. These customers are using delivery to create the experience they want in their own home. They aren’t reliant on going out and hoping an operator can create it for them – it’s bespoke to their own personal circumstances.

This is a dynamic, innovative and customer-driven market place and I see many parallels between delivery/dine in and retail/online. Operators can choose to participate or not but the risks are there if they don’t and, perhaps, if they do.
Ann Elliott is chief executive of Elliotts, the leading integrated marketing agency in the hospitality and leisure sector –

Return to Archive Click Here to Return to the Archive Listing
Punch Taverns Link
Return to Archive Click Here to Return to the Archive Listing
Propel Premium
Pepper Banner
Butcombe Banner
Contract Furniture Group Banner
UCC Coffee Banner
Heinz Banner
Alcumus Banner
St Austell Brewery Banner
Small Beer Banner
Kronenberg Banner
Cruzcampo Banner
Adnams Banner
Meaningful Vision Banner
Mccain Banner
Heineken SmartDispense Banner
Propel Banner
Christie & Co Banner
Sideways Banner
Kurve Banner
CACI Banner
Airship – Toggle Banner
Wireless Social Banner
Payments Managed Banner
Deliverect Banner
Zonal Banner
HGEM Banner
Zonal Banner
Access Banner
Propel Banner
Pepper Banner