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Morning Briefing Strap Line
Fri 7th Sep 2018 - Friday Opinion
Subjects: Calorie counts on menus won’t tackle the obesity crisis, staying relevant and the big alcohol conspiracy theory
Authors: Peter Borg-Neal, Glynn Davis and Paul Chase

Calorie counts on menus won’t tackle the obesity crisis by Peter Borg-Neal

I have devoted most of my adult working life to the pub and wider hospitality industry, and I have been relatively successful, now employing more than 1,000 great people and serving more than 200,000 guests a month. Apart from sleepless nights, a huge amount of pressure, and (very occasional) moments of self-doubt, the commercial battle has historically been pretty even, until these past few years.

Over that period, the government has introduced a taxation and rates system that is weighted heavily in favour of supermarkets and is forcing the closure of many small pubs and decreasing investment in high streets. The hospitality industry has ever-increasing burdens of employee-related paperwork, much of it centred on the ludicrous apprentice scheme. The government so badly manages beer pricing and taxation, that the breweries make more money from a beer duty rise than without, and then, to cap it all, we have the Department of Health (DoH).

Under the leadership of the arriviste Matt Hancock, the DoH has no concept of the law of unintended consequences, and its proposed regulation appears to have been conceived by badly-educated, good-intentioned puritan zealots. In a letter accompanying the department’s consultation document, he said: “Childhood obesity is one of the biggest health problems this country faces, with almost a quarter of children overweight or obese before they start school, rising to more than a third by the time they leave. This burden is being felt hardest in the most deprived areas, with children growing up in low-income households more likely to be overweight or obese than more affluent children. This represents a huge cost to the well-being of the individual, the NHS and the wider economy.”

Quite how knowing the calorie count on Raymond Blanc’s or Gordon Ramsay’s Plat du Jour will help low-income households get their little ones’ weight down is beyond me. Their restaurants, which are conspicuously absent from “the most deprived” areas, are doubtless part of the problem – but only in the most insane one-size-fits-all solution dreamed up by people who dislike joie-de-vivre or worse, never eat out.

So Mr Hancock can I just give you a few pointers your little elves have probably failed to mention – because the law of unintended consequences never impacts on those who take no ultimate responsibility. But it does on my 1,000-plus staff and to my tens of thousands of customers because increased prices, badly run governments and poor strategic thinking will all impact on them.

1. In 2009 the Food Standards Agency (UK) launched a calorie labelling initiative as a first step towards providing more consistent nutrition information to consumers in a way that would help them to make healthier choices when eating outside of the home. A six-month pilot scheme was launched in Northern Ireland (1 May to 31 October 2012), and there were only eight local food businesses (including contract caterers, restaurants, cafes and sandwich bars) and three local health trusts, all of whom displayed calorie information on menus for the first time, under the brand name “Caloriewise”. The eight small and medium-sized enterprises then had to have the help of The University of Ulster and the College of Agriculture, Food and Rural Enterprise to provide technical support for calculating the calories for them. There is no mention of the taxpayer burden on this giant, international experiment, but they worked out – that it was (a) difficult to do and (b) suffered from a little of uncertainty because not all menus and recipes were standardised across the scheme. Copies of the report, including a fascinating insight into the weight loss factor of a hamburger with and without onions, can be found here

2. On 3 March 2016, business secretary Sajid Javid promised to cut a further £10bn of red tape saying: “This government is delivering on its commitment to … build a more productive Britain. … Whenever we need to introduce new rules, we will consider their impact and make savings elsewhere.”

3. There has been very limited research done on the impact of calorie labelling across such a diverse variety of hospitality types and styles. These may include the perceptions of increased costs, a lack of technical knowledge, problems associated with keeping calorie counts consistent, alienating customers and ultimately creating a deterrent to menu innovation.

4. Restaurants such as mine will simply be unable to generate correct, speedy and verifiable information for all our daily specials that rely heavily on locally sourced produce – where consistency in cuts, fat content, water content, curing, ageing and a host of other variables will simply mean we are no longer able to support our local economies. This is not the same for larger pub chains, who have the same menu across their estate, and where a frozen Brazilian cross-bred steak can be pre-cut to exact size.

5. Much as overtly political, hard-line vegans cannot argue for the sustainability of UK farming as it conflicts with their ideology, so the proponents of calorie labelling cannot say there will be no impact on sustainable, innovative food production, rural communities and local food heroes – simply because there is no research that it would or wouldn’t. However on the subject of research and calorie labelling impacts on food choices…

6. According to a study published in the Cochrane Review in February 2018, putting calorie information on restaurant menus was found to reduce how much diners eat by just 12%. The systematic review carried out by Oxbridge researchers combined results from a variety of studies evaluating the effect of nutritional labels on purchasing and consumption habits. After close analysis, they found calorie labelling probably reduced the calorie consumption by 12%, but added that further studies would be needed to establish how effective this reduction is.

7. Meanwhile, a survey in 2011 by The Mystery Dining Company found 44% of 300 respondents said knowing the calorie count would encourage them to choose dishes with fewer calories per course, while 27% would choose the main meal they wanted but forgo a starter or dessert to reduce overall calorie intake. However, when asked to imagine themselves in a situation where the menu item they most wanted was 2,000 kcals when most of the menu items held lower values, more than half of the respondents said they would still order their first choice. A November 2015 survey on almost 8,000 diners in New York, (which introduced calorie labelling in 2008), has also confirmed “…no statistically significant changes over time in levels of calories or other nutrients purchased or in the frequency of visits to fast-food restaurants.” More can be found here

We all know Mr Hancock what the real problems are and I’m afraid it isn’t eating one of my delicious salads or vegan daily specials or even a fresh grilled fish that I refuse to cut up to make it exactly fit some town-hall jobsworth’s idea of what a fish portion should be.

It’s in your colleagues’ educational curriculum, which is destroying children’s mental and physical fitness. It’s in the relentless abdication of parental responsibility driven by too many jobs; too little money; too little home economics education, and too much government interference. It’s in the ready availability of pre-prepared low-cost cook-at-home supermarket foods that carry no VAT burden, no rates burden, and none of the other penalties that innovators such as myself have to carry.
Peter Borg-Neal is chief executive of Oakman Inns 
 

Staying relevant by Glynn Davis

Edelweiss, Old Vienna, Chimney’s, The Forge, Indus, Side Saddle, and Pancake Parlour will mean nothing to most people but these are all Yorkshire-based restaurants that hold great memories for me from my childhood.

One more dining venue can be added to this list that most people will undoubtedly know about – The BHS cafe. However, there is one thing that sadly unites all these places and it is none of them exist today. They have befallen that typical fate of restaurants – just like the people that frequent them they are not immortal.
 
This is already well known by everybody in the hospitality industry but what is noticeable today is the acceleration in their rates of mortality. The appetite among consumers for constantly new experiences is putting great pressure on foodservice operators of all descriptions. It is highly unlikely a restaurant could be created today that would live a very long and full commercial life without ongoing change to both its fabric and the food and beverage offering.
 
Roger Wade, founder of Boxpark, has suggested the maximum lifespan for any food and beverage format is maybe 20 years and beyond that it will become irrelevant – unless it has evolved dramatically over this period. Two decades might be a tad too hopeful I reckon and the chief driver of this is the behaviour of younger generations.
 
They now have some disposable income in their pockets and they intend to use it, but not at the same venues each night. Jonathan Downey, co-founder of London Union, recently stated these younger people are not becoming regulars like their parents once did. They might only visit a venue a small number of times per year and so to counter this Downey’s food halls morph into different propositions on a regular basis.
 
Each of his sites has a constantly evolving range of foods on offer. This can involve changing traders as well as encouraging the existing providers to evolve and diversify their offer with new dishes. Seasonal changes are also initiated whereby outdoor seating, barbecues and trampolines in the summer are replaced by fires in the winter and drinks that are relevant to the time of year.
 
The retail industry is encountering just the same pressures, which is why the department stores such as Selfridges and John Lewis are constantly bringing in pop-ups that bring some theatre into their properties and help them deliver a much richer overall experience.
 
By failing to evolve their offers, and not keeping their customer bases sufficiently interested, many restaurant chains will find themselves in a spiral of decline. Among them is Jamie’s Italian, which has at least recognised its errors and is proactively looking to address the situation. Having closed a third of its stores, founder Jamie Oliver has acknowledged the challenge of operating in a market where the demands of the customer base are in a constant state of flux.
 
The question he is toying with is how to inject more life within the walls of his restaurants. This could involve the ongoing curation of the space, whereby it acts more like a venue for various events of which food and drink are merely part of the overall mix. He is hoping this would potentially double his customers’ frequency of visits from twice to four times per year. This does not sound a lot but would be transformational for the business.
 
Such moves by Oliver – and the pain his chain is going through – are symptomatic of a complete change in the dynamic of the restaurant industry. Chris Miller, founder of White Rabbit Fund, has gone as far as calling time on the mass roll-out of identical outlets as he reckons the days of the 30-store cookie-cutter chains are over. Brands will have to be much more tailored to their locations and customer bases in his opinion.
 
It’s clear the once solid and largely understandable platform on which the restaurant and foodservice industry has been based has fundamentally changed. It is wreaking havoc on the incumbents and if the views of some of the more forward-thinking voices in the industry are to be believed then there is a lot more upheaval to come before any sort of equilibrium returns. If it ever returns to the same degree!
Glynn Davis is a leading commentator on retail trends
 

The big alcohol conspiracy theory by Paul Chase

If I could affect one reform to our education system, it would be economics should become a mandatory subject in the National Curriculum. Two reasons – economics is by its very nature a libertarian subject, and, secondly, it would save me lots of time untangling misunderstandings that would never occur in the first place if people who ought to know better had replaced their ignorance of economics with some basic knowledge of it.
 
A recent study from the University of Sheffield alcohol research team and the Institute of Alcohol Studies is a case in point. This study purported to show the alcohol industry was economically dependent on heavy, harmful, dependent drinking. The study claims the heaviest drinking 4% of the population is responsible for 30% of all consumption and 23% of all industry revenue. The numbers break down as follows – those drinking above guideline levels are estimated to account for 68% of total alcohol sales revenue in 2013/14; 81% of off‐trade revenue and 60% of on‐trade revenue. This represents 77% of beer, 70% of cider, 66% of wine and 50% of spirits sales value.
 
If all consumers reduced their consumption to within guideline levels – 14 units a week – alcohol sales revenue would plummet from £35bn a year (2014 figures) to £22bn – a decline of 38%. To mitigate this loss, the authors say the alcohol industry would need to raise prices substantially, for example by £2.64 for a pint of on-trade beer or £12.25 for a 70cl bottle of off-trade spirits.
 
The sub-text of this is the industry’s claim to be in favour of moderate consumption is insincere because it’s so highly dependent on excessive consumption. The purpose of this study is to demonstrate if consumers drank “moderately”, defined as no more than 14 units a week, they would be faced with unrealistically high prices if the industry was to maintain its profits at the current level. So, the researchers calculate how much the industry would lose from people drinking less and then work out how much prices would need to rise for profits not to fall.
 
Here’s where their basic ignorance of economics kicks-in. They don’t look at profits or even at turnover. Instead they assume consumer spending equals industry income and then slice off 38% because this is what they estimate sales would fall by if everyone suddenly drank no more than 14 units a week. The howler that’s being committed here is £35bn is not the industry’s money. More than £10bn of it goes to the Treasury in alcohol duty and other taxes, and billions more go to off-sales retailers and to pubs, clubs and restaurants. And what is left, about £10bn, is not all profit. Most industries make a net margin of between 7% and 10% and so the loss to the alcohol industry’s profits would be only a fraction of what these researchers claim. And this is before we calculate the cost savings to the alcohol industry that would result from producing less product.
 
So does the alcohol industry stand to lose if heavy drinkers all became moderate drinkers? Insofar as heavy drinking is associated with early death, and moderate drinking with extended longevity, the answer is no. If people drinking 50 units or more a week (harmful drinkers) all became light drinkers consuming 14 units a week they would all live longer. The alcohol industry would get the same revenue from them but over a longer period. Since it is unlikely this state of affairs would happen overnight – that any move towards drinking less, but drinking higher quality products would be an evolution – it’s clear the alcohol industry has no conceivable economic interest in the premature death of its customers.
 
There is therefore no conflict of interest between the industry’s support for moderate consumption and industry profits. Indeed, brand owners do not want their brand values undermined by irresponsible use of their products.
 
A total of 21% of UK adults are teetotal while a further 58% drink at or below the low risk guideline of 14 units a week. That’s 79% of people who are at no risk, or next to no risk, from alcohol. The remaining 21% drink at or below 14 units, but only 4% above 50 units a week. The alcohol industry cannot possibly determine the distribution of its products between different consumer demographics – that is a consequence of millions of buying decisions made by consumers on a daily basis. What is equally clear is the industry has nothing to fear from its customers drinking moderately and living longer. Only temperance lobby researchers without even a basic understanding of economics seek to define the alcohol industry as a conspiracy against the public interest.
Paul Chase is director of CPL Training and a leading commentator on alcohol and health policy

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