Keeping it preserved: Safeguarding the food and drink industry against crisis

It’s now been almost two years since the beginning of the Covid-19 pandemic. And yet many businesses and industries are still in the early stages of their recovery. Businesses, especially smaller ones, have suffered significantly at the hands of COVID-19, and none more than those in the food and drink hospitality industries.

In the early stages of the pandemic, a study by Reply found that open rates for many in the food and drink industry, such as bars, cafes and restaurants decreased by eighty percent. While that trend is now changing as vaccines roll out and customers once again roll up, the damage suffered to some during this time was irreversible.

In a recent roundtable, hosted by the Great British Entrepreneur Awards and haysmacintyre, an experienced panel of food and drink business owners and experts came together to brainstorm what can be done in the future to prevent such significant damage from possible future crises. Though held before the surfacing of the Omicron variant, the roundtable discusses plenty of possible ways to keep a hospitality business strong through such an event.

Fortification with diversification

Businessman and investor Warren Buffet once said “diversification is protection against ignorance”. And this famous quote is certainly something the roundtable resonates with, especially through the pandemic.

Karim Ullah of Brohmon, begins: “We’ve been very focused on launching retail products [since the start of the pandemic].” He explains that if there is another lockdown, those products will carry the business through and, at minimum, keep it “ticking over” until hospitality can reopen

“It’s diversification,” Tabassum Awan of Pink Tea Cafe agrees, warning that “if you want to survive, you need to diversify your own portfolio”. 

“I would have never thought of starting online,” continues Tabassum, elaborating that while she initially never planned transitioning into an online sales based model, it was an essential pivot for her business to survive the pandemic.

“This whole situation has taught us you have to think outside of the box,” Chido Plunkett of DaChi’s Restaurant To You says. She explains that while the pandemic was devastating, entrepreneurs being pushed out of their comfort zones has made them “thrive in ways we could have never possibly thought of”.

While her business’ overheads are much lower due to the lack of a physical venue, Chido says that something like passive income can be essential for any business. Telling the roundtable how DaChi’s Restaurant To You adopted membership benefits into their business model, Chido says this allowed it to “serve many with less work”.

Do we have lift-off?

The roundtable took place before the emergence of Covid-19’s Omicron variant and subsequent uncertainty about future restrictions. The group discusses whether or not it is worth launching a physical venue in an age of declining High Street figures. No doubt, bars, cafes and restaurants all took a hefty hit and the increase in online commerce has become more than apparent. 

“I think right now is one of the best times to open a café and restaurant,” says Kirsty-Lee Griffiths of Macro Food. “People are striving for that experience.” 

There was a sense of enthusiasm for physical hospitality venues among the group, but they weren’t without warning. 

“It’s an amazing time to open a restaurant, but I would wait another three or four months,” says Andu Avasilinei of Uzumaki London He claims that there will soon be a large influx of available sites for venues.

“Now is definitely the best time to take over some shops,” agrees Teddy Lee of Maki & Ramen. Teddy references that lease premiums are significantly decreased and you could potentially save a larger sum of money purely by adopting a physical venue sooner rather than later.

“I don’t think somewhere like London is going anywhere in terms of opportunity,” says Lou Palmer-Masterton of Stem & Glory.  

“Our restaurant in London is doing very well, it’s been really busy and exceeding pre-lockdown,” she says. 

Despite this, Lou recognises the opportunities available elsewhere, saying “we are definitely going to be looking outside of London for our next site”.

Transcending tradition

With a new crisis comes a new perspective and in terms of property, some think it’s time for it to be out ‘with the old and in with the new’ in for lease models. With costs ever-increasing elsewhere, it’s not becoming viable for many businesses to even have physical locations not just from their inception, but over the course of their entire operating period.

“People can’t actually make a profit with the present model,” warns Karim. “It’s ridiculous. Costs are rising everyday, whether that’s starting costs, ingredients costs, fixed costs have to come down. It’s the only way the High Street is going to survive.” 

Karim makes the point that alongside the economic woes suffered by many, it’s simply not viable to have such high costs when it comes to property. 

“There’s a huge variety between landlords,” says Coralie Sleap, author and previous business owner, who describes “bullying” by a previous landlord, highlighting that while a lot of it comes down to resources, the relationship between your own landlord can have a huge impact on whether or not it can be viable for you to have a physical location as a business.

While it may not be a suitable option for many food and drink businesses, Chido finds significant advantage in operating from home without a permanent public base and the potential difficulties of a landlord.

“Fortunately for us, we are the landlord,” says Chido. Though not without its challenges, Chido acknowledges that her own business is very mobile and unique, operating from home and bringing the business to clients rather than having a set venue. Chido says: “At least if you have a shopfront, people know your face.

“While we’re very present on social media, it’s not the same as people walking into a café and seeing the owner. I have a friend who owns a café and the support from her community seemed a lot bigger because people knew, people knew her and about the café.”

Reflecting on the discussion, Isabelle Shepherd, senior manager at haysmacintyre said: “Covid-19 has had a huge impact on the hospitality sector.

Those operating restaurants and cafes have been through a very turbulent time since March 2020 and it is vital they protect themselves as far as possible from future crises.

Those attending the roundtable shared thoughts and innovative ideas on creating new revenue streams, the use of dark kitchens and relationships with landlords. It was great to host a group of entrepreneurial individuals who are growing their food and drink businesses in a challenging environment.”