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Morning Briefing Strap Line
Fri 10th Feb 2023 - Friday Opinion
Subjects: Ordering ahead is the way ahead, building a better relationship between pub company and tied tenant, stepping outside the comfort zone to ask yourself some questions, employee engagement: the trickle-down effect 
Authors: Glynn Davis, Fiona Dickie, Ann Elliott, Jaime Fernández de la Puente Campano

Ordering ahead is the way ahead by Glynn Davis

During my time in north London, the two local McDonald’s nearest my current house have always been pretty busy restaurants. But since covid-19, one has become a high street feature for the legion of couriers blocking and flowing through its doors and servicing delivery orders, while the other is recognised for the snaking queue of cars that frequently trail out from its drive-thrus on to the public highway.
McDonald’s, along with other quick service restaurant (QSR) operators, is experiencing a post-covid world not necessarily worrying about how it is going to attract more cash-strapped diners. In contrast, it has more of a problem with working out how to handle the volume of customers hitting its stores and expecting to be served in a growing variety of ways – encompassing dine-in, take-out, home delivery, click and collect and drive-thru.
Alistair Macrow, chief executive of McDonald’s UK & Ireland, has suggested the combination of our ongoing insatiable appetite for competitively priced burgers and our multi-channel demands means that around half its sites may be trading at, or beyond their capacity, within a few years. This has not only led to the company targeting 50 new sites per year in the UK, but to McDonalds’s using technology more widely across its global base to boost the efficiency of its front-of-house procedures, in order to better handle customer throughput.
The rise of technology is most evident in the drive-thru channel, which has continued to be a very attractive touchpoint for post-covid diners. In the UK alone, sales through this format have increased by £500m over the past three years, according to NPD Group, as everybody from Costa and Burger King to Starbucks and Greggs looks to expand their outlets within the channel.
In the US, McDonald’s has been trialling order-ahead lanes that serve only those customers who have placed their orders online, which helps the company avoid customer indecision at speaker boxes when ordering, and the potential build-up of cars behind them. Leading this trend is Chipotle, with its Chipotlane drive-thrus handling digital pre-orders only, which have become a feature at the majority of its new restaurants. They have not only boosted throughput, but also generate average sales 15% higher than non-drive-thru locations. Others have followed this digital-only order-ahead route, with Sweetgreen and Chick-fil-A introducing “express” drive-thru lanes.
Chipotle took inspiration from Starbucks, which has long allowed its customers to order ahead online, and via its app, before picking up their coffees at their local outlet. Chipotle certainly saw value in not having a need for speaker boxes for customers to place orders, and has the ability to reassign employees previously taking the drive-thru orders, which has certainly helped during the ongoing chronic shortage of staff.
Other operators are continuing to use speaker boxes for drive-thrus but have chosen to drive efficiencies by aligning them with artificial intelligence-powered automation technology. McDonald’s is experimenting with a solution from IBM, while Panera Bread (sister company of Pret A Manger under the ownership of JAB) has introduced an automated solution into two outlets to improve speed of service as well as order accuracy. Rival solution ConverseNow is working with Domino’s and claims it enables restaurants to double their order volume at peak times.
Meanwhile, Del Taco and Checkers & Rally’s have been rolling out an artificial intelligence voicebot from Presto that includes an automated upsell function, which has helped drive average sales 6% higher when orders are taken through the software. Presto estimates that a mere 1,000 of the 200,000 drive-thrus within the US are automated, which undoubtedly represents a massive opportunity for QSR brands across the industry to boost customer throughput, improve order accuracy and drive upselling metrics.
The scenario is exactly the same in the UK, where drive-thrus are enjoying something of a moment in the sun but suffer from the same shortfalls as experienced in the US, with growing wait times and inaccurate orders. Along with the QSR brands and their popular drive-thrus, it is likely that many other parts of the hospitality industry will come to recognise the value of order ahead-type solutions. They will ultimately boost revenues, while also improving overall service levels for customers across the multiple channels through which foodservice companies must now operate.
Glynn Davis is a leading commentator on retail trends

Building a better relationship between pub company and tied tenant by Fiona Dickie

Theoretically, running a pub as a tied tenant is one of the more straightforward ways to do it. The agreement provides ample flexibility for the tenant to run pretty much whatever type of pub they’d like. But there’s the added comfort blanket of having a large organisation behind them, providing guidance and support to help them succeed, as well as direct access to a wide range of drinks. 

However, we know that, in practice, this isn’t necessarily the case. Over the years, pub companies were sometimes accused of taking their tenants for a ride through a combination of unfair practices, lack of transparency and a focus on short-termism at the expense of long-term sustainability. In recent years, and since the introduction of the Pubs Code, there is evidence that things are improving in terms of the pub company/tied-tenant relationship, which, given the hugely challenging economic climate, can only be a positive thing.

Through my work as Pubs Code adjudicator (PCA), it’s my responsibility to ensure that tied tenants are aware of the code, and that pub companies comply with it. The code exists to restore balance in the relationship between tied pub tenants and pub companies so that they work better together, and so that those tenants’ businesses can thrive. We work collaboratively with pub companies, where appropriate, to respond to issues raised by tied tenants and others to bring about beneficial change in the sector, while giving information to tied tenants to help them better understand their rights under the code. 

Measuring sentiment across the sector   
A key pillar of our work is the annual tied tenants survey, and fieldwork on this year’s survey is already well underway, with results to be published in the spring. For 2023, we are aiming to attract responses from more than 1,200 tenants – up from 614 in 2022 – making this our biggest and most impactful survey to date.

In essence, the survey looks to get an idea of the quality of the relationship between tenants and their pub company; gauge awareness of Pubs Code rights and understand where tenants get their information and support; draw on the experience of individual tenants’ contact with the PCA and PCA’s communications, including the website; and understand the experience of new tenants, including the value of the information they’ve received. 

It’s our responsibility in this research to highlight where pub companies are doing well, but also to call out pub companies that are failing to deliver for their tied tenants. We're not trying to scold them, but to ensure they can identify ways in which they can improve how they support their tenants in future, which ultimately will benefit the long-term viability of their business. 

Last year’s findings provided an important benchmark as to how tied tenants view their pub company. Overall, 62% of tenants said they were satisfied with their relationship with their pub company, and 22% said they were dissatisfied. Admiral came out on top of the satisfaction rankings (80%), with Punch Pubs finishing bottom (47% of tenants satisfied and 29% dissatisfied). A total of 83% of new tenants found the information they received from their pub company useful before their tenancy started, while the tenant/business development manager (BDM) relationship was generally positive, with 76% of tenants saying their BDM is fair with them in their discussions.

Building a strong relationship 
In terms of the pub company/tenant relationship, it’s vitally important that pub companies provide all the necessary information from the outset, building solid foundations in order to help the tenant create a sustainable business plan. Only then can the tenant have a realistic grasp of their obligations and expectations, ensuring they can get off to a flying start. 

Once these foundations have been laid, it’s important that there is active communication (and listening from the pub company) as this presents far greater value than working in isolation, in an echo chamber with limited resources. Ongoing dialogue benefits both parties, increasing efficiency, building trust and raising standards across the board. This is in the interests of tied tenants, playing a part in helping them tackle the ongoing challenges and empowering them to prosper. 

It is through these clear parameters that all parties can create a relationship that doesn’t just make life easier, but also increases the chances for business success and building a pub that is the pride of place in any community. 
Fiona Dickie is the Pubs Code adjudicator 

Stepping outside the comfort zone to ask yourself some questions by Ann Elliott

Two weeks ago today, at about 4.30pm our time, I found myself about to embark on two hours of yoga, and the start of a yoga retreat, while looking out over Polem beach, Goa, towards the Arabian Sea. After 13-plus hours of flying and ten hours hanging around at Mumbai airport, a few downward dogs were just what I needed to stretch my rather stretch-resistant body.

I don’t do yoga though. 

Correction – I had “done” yoga for a week in 2015 and that was about it. Nor had I “done” any degree of meditation, mindfulness or introspective consideration since then. So, I was in for a bit of a shock, both physically and mentally, over the days ahead. Luckily, having completed three out of four weeks of Dry January, the lack of alcohol over the week was the least of my issues.

I have to say that I am no great fan of January. Christmas has been and gone, it’s a dark month, it’s cold, promises of a wonderful year ahead have yet to emerge, the news is gloomy and trade is uncertain. It’s good then to have a break in the sunshine. Using that break though to practice yoga with 18 strangers is quite a different matter. It’s a bit intimidating, slightly outside my comfort zone, and vaguely nerve-racking. I don’t normally associate any of these emotions with a week’s holiday in the sunshine.

It was though one of the best breaks from work that I could have had. I can easily imagine taking this time (or even just a few days if it was available) with a team to understand each other and to appreciate how best to work together. I learnt a lot about myself and took away some useful tools on how to learn about others. Usually my learnings on holiday are pretty sparse. On this holiday, the learnings were meaningful and personal ­– lessons for life rather than just an evening out.

To be clear, my take outs from the week are my own and wouldn't hold up to scrutiny versus official yoga teachings for a minute. I don't think that's the point though.

At the start of the morning’s yoga session our teacher would pose two or three questions for us to consider during the day to then discuss and debate during our late afternoon/early evening practice. Some guests did the yoga but not the questioning, a few participated on some days but not others.

Inevitably, some questions were more relevant than others to each of us personally. There was no pressure. It was an amazingly kind and supportive environment in which to discuss some pretty fundamental questions that included:

* What used to be important to you but isn’t now?

* What are you wanting to change? How can you do this?

* Which relationships do you want to consciously keep or need to let go of?

* What would help you live a more joyful life?

* Do you say: “I would really like to do this but...” and why? What is holding you back?

* What are you not saying no to? (I loved this one)
* If you were really living your life to the full what would you be doing?

* How could you express your talents more fully?

* If you died tomorrow, what would you regret? (slightly too close for comfort)

The questions posed were often intriguing and a bit challenging and, while the answers were not necessarily life changing, they often provoked the need to change thinking and/or behaviour.

I also really liked some of the teacher's comments:

* Comparison is the thief of joy
* What we say matters

* Life is in the transition
* “Letting go” is the heart of yoga

* You don’t need to take big steps – they just need to be in the right direction

* You cannot be connected to others if you are not connected to yourself

Taking time out at the start of the year, not only to think but also to relax, was brilliant. I can't recommend it highly enough. We are all booking again for next year.
Ann Elliott (she/her) is a portfolio non-executive director and board advisor

Employee engagement: the trickle-down effect by Jaime Fernández de la Puente Campano

My curiosity for the topic of employee engagement began some years back when I was with a friend in a coffee shop in New York. The waitress had been amazing, and I really wanted to pass this on to the manager. 

When I approached him to share my experience, he thanked me and requested that I leave a review on Google My Business. But to be honest, the food actually wasn’t great. It would have been misleading to leave a great overall review, when it was the experience with the employee I was specifically happy with.

That was when it dawned on me: the absence of a channel or social network where customers could praise employees’ work, rather than a general star rating for the venue. And that was how Guudjob (now Engagement by MAPAL) was born in 2014.

At that time, we could assume this kind of channel didn’t exist because business owners probably didn’t think it was that important. Enabling guests to praise your employees is a nice thought, right? But what’s was in it for the business owners? Why would they make the effort to implement a system like this?

Fast-forward to today. Hospitality businesses are struggling to fill vacancies and candidates are scarce. Those jobseekers that are open to work in hospitality (that’s another topic) can cherry-pick which employer they’d like to work for. So, the tables have turned, and it’s the employers who are now being interviewed. It’s fairly simple: employees who feel good working in your organisation talk positively about your organisation and recommend it to others.

Culture can make or break your business
The competition to attract the best talent is fierce, and employer branding has never been a bigger priority. And it starts with culture, which I define as a vision, a mission and a unique way of doing in order to differentiate yourself.

Out of 5,000 employees who responded to a global Glassdoor survey, 56% said a strong company culture is more important than a higher salary. And when looking for a new job, 73% take the company’s values into consideration and wouldn’t apply unless they were aligned with their own.

But culture isn’t something decided in the boardroom, framed and put on the wall for everyone to admire. It must be aligned to your business objectives and strategy and be engrained in everyday behaviours in the organisation. Leaders must practice what they preach – to use the phrase, “do as I do and not as I say”.

Why is culture important?
Brands which have a clear and strong company culture that their employees identify with and transmit through their behaviours will see the benefits:
* Your employees become brand advocates. They spread a positive image about your business as a place to visit, and to work.
* Commitment is increased. When your teams are committed, they go the extra mile to please guests, solve problems faster and stay with your company longer.
* More cohesive teams. The positive effects of teamwork and team spirit are amplified when everyone lives and breathes the culture.
* Behaviours are aligned with values. When employees behave in accordance with your (and their) core values, the benefits are maintained in the longer term, helping you reinforce your business sustainability.
* Increased productivity. Satisfied employees are 12% more productive in contrast to dissatisfied ones, who are 10% less productive.

Managers are the vehicles of culture
All of this sounds great, but how do we get from defining culture to the ideal scenario, where employees live and breathe it every day? Well, there are many factors, and it doesn’t happen overnight. One thing is clear: leading by example is one of the main drivers of company culture. On the other hand, poor leaders can sabotage your efforts to build a positive culture. Good leaders must strive to empower their teams, but this can’t be directly instilled. 

Empowerment comes as a result of creating conditions like trust, respect and honesty, where employees feel important, listened to and valued. So, culture trickles down. It starts at the top, but certainly doesn’t end there. Leaders have a major role to play to ensure it becomes part of the brand’s DNA.
Jaime Fernández de la Puente Campano is the founder of employment experience platform, Engagement by MAPAL

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