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Omicron: Time for a restaurant re-boot?
The arrival of the Omicron variant of Covid-19 has hailed a return to stark newspaper headlines and further lows for an already battered hospitality industry trying to recover from previous lockdowns.
As consumer confidence dips once again and dining out becomes a feared rather than favoured activity, restaurateurs are set to lose money from cancelled bookings and a lack of seated trade.
If that assessment of the current state of play sounds depressing, the figures appear to make grim reading: the UK Labour party has warned that tens of thousands of hospitality businesses face closure in the coming months and trade body UK Hospitality suggests a 25% trade drop on normal levels.
If we are to take these scenarios as read, hospitality businesses which continue to practice the status quo and rely on what conventional trade they can muster are likely to face very serious financial challenges. Those with deep reserves may well be in a position to ride out the storm and await better times, but for many restaurants, bars, cafes and pubs already on a knife-edge the future could indeed look bleak.
We don't subscribe to that view.
Restaurateurs have always been innovative, resilient people and the demand among consumers for great food and drink will remain – but hospitality businesses do need to adopt new thinking in order to capitalise on the new norms. By driving forward changes in the way customers interact with their favourite restaurants and using technology to pivot towards innovative operating methods, restaurants actually face a future which both gives customers what they want and secures the business, its brand, staff and income.
Take away & delivery
Restaurants facing a drop in in-house dining must try to recoup revenue bu other means, while using their existing infrastructure such as staff, know-how and physical assets. For some hospitality businesses whose product offer is as much about internal surroundings as it is about the food, the ideas of offering some kind of take-away service might seem inconceivable. The very term “take-away” brings to mind images of grubby fast food outlets serving post-pub food to drunken revellers – quite the opposite of fine dining.
But with an open mind, restaurateurs are now able to continue serving their fantastic food to discerning customers, at the same price, by promoting the concept of dining at home. By taking the concept of high street take-away and re-branding it as a high-end concept encapsulating the original brand values of the business, an alternative sales channel is created which might just be a lifeline.
Think about it: customers choose a fine dining restaurant because of all the little touches and niceties; the air of quality from kitchen to table; the professionalism of the staff and the after-service. There is no reason why the basic high street take-away model cannot be re-purposed and heavily refined at-home, delivered fine dining: professional communications, great ordering technology, familiar uniformed staff delivering the dishes, better food containers, perhaps restaurant-standard cutlery provided together with table decorations, flowers and of course those little touches we mentioned, like a note on high quality paper from the owner or chef.
With delivery and takeaway sales for November up 97% on pre-covid levels, according to CGA & Slerp Hospitality at Home Tracker, this model will form a crucial battleground for getting great food into hungry diners seeking continued restaurant-standard experiences.
Pre-payments and deposits
The emergence of the Omicron variant has once again resulted in a slew of restaurants reporting huge numbers of cancellations due to fear on behalf of customers. In the media, chefs and restaurant owners – including some high profile celebrities – are describing the impact on their business of mass cancellations, which not only includes an obvious downturn in revenue but in some cases staff redundancies or closure of the business completely. Tom Kerridge reports 654 would-be diners at his restaurant cancelled their bookings in just six days, which is an enormous hit for any restaurant to take.
We don't think it needs to be this way.
Restaurants are in many ways a victim of their own goodwill and the last bastions of the “no deposit” mentality. No other sector has taken so much on trust and, until now, doing so has worked: we have developed a culture where customers do not expect to leave a deposit for their booking, or indeed pay up-front in full. Doing so is almost unheard of. Contrast this will other parts of the travel and tourism experience, from car hire to spa days, from cruises to flights, and we see a compelling case for fundamental change in line with the times.
A wholesale shift towards a deposit/pre-pay culture within the restaurant sector won't come without its challenges from customers, but in truth and as with other changes (such as smoking bans and the wearing of face coverings) these changes can, will and should become the norm.
Customers will get used to paying deposits or pre-paying as just a recognisable part of the buying process, but with one caveat: restaurateurs should not be afraid to implement the measures and must push them through universally if the public are to eventually accept them.
Putting this into context, a restaurant with an average cover price of £35 will lose £22, 225 if it has the same amount of cancellations in six days as Mr Kerridge. By requiring pre-payment or at the very least a reasonable deposit all or some of this revenue is saved.
There's much use of the phrase “new normal” right now, and deposits and pre-payments should become the latest examples. Restaurants need to hold their nerve and customers get used to that (in reality, most customers will have an ethical sense of social, civic and business responsibility and their consciences will tell them “it's only fair”).
Offering a dining at home service and taking deposits and pre-payments need not be viewed as emergency measures during these troubled times, rather, they represent the natural direction of evolution for food & beverage establishments. At-home dining is attracting another wave of interest long term, which offers restaurants the opportunity to maintain and extend their brand, diversify and retain staff and customers.
A shift in both restaurateurs' and customers' acceptance of deposits and pre-payments is a win-win for both, because the business maintains the revenue needed to continue to do what it is known for, and customers gain the confidence that their booking is secured in a safe and well managed way.
None of the current challenges faced by the hospitality sector are easy to resolve. The steely determination of restaurant owners to survive and thrive will stand them in very good stead, as will their continued adoption of new operating models. Customers, too, will continue to be loyal to their favourite brands, provided adequate mechanisms are in place to do so.
Favouritetable, the UK's best value full-function restaurant management system, includes Dine@Home, a module to support restaurants wishing to extend their floorage to the customers' own homes. The system also includes a host of cutting-edge tools to support restaurant operations, such as online booking with the option to request (and process) deposits and pre-payments.
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For a demonstration, click the link above, call us today on 033 0124 4785 or email us at info@favouritetable.com and see why favouritetable is the best value full-feature restaurant management system on the market.