Looking back and looking at the year ahead

MCA talks to leading operators across the sector about the big lessons of 2017, what’s keeping them up at night and their predictions for 2018. Featuring contributions from: Oakman Inns, The New World Trading Company, The Deltic Group and many more.

Rupert Clevely, co-founder of Hippo Inns:

What would you say is the key lesson from 2017?

Not to be swayed by the need for quick wins through discounting. I believe customer loyalty is more important than ever, so a focus on standards (through service, staff knowledge and quality of offer), rather than offers, will inevitably make the customer experience better than ever.

Where will growth come from in 2018?

Growth will come from being the best, by ensuring our offer is always considered to be great value – this is relevant across all brands, no matter what level they are.

What’s keeping you up at night about the coming year?

Staying true to my ideals and not being diverted into short-term tactics, such as special offers or pricing, to compete against the casual dining sector, which always seems to produce extraordinary discounts – hold firm!

Which brand/company is your one to watch for the next year?

I’d love to say Hippo Inns as I truly believe we will do great things in 2018 – the building blocks are in place. Regarding other pub groups, I’d say Fullers and Young’s are two to watch, and in the casual dining sector, I see Pizza Pilgrims having a very exciting year ahead.

 

Peter Borg-Neal, founder and chief executive, Oakman Inns:

Key lesson of 2017

The economy is going nowhere, the government is obsessed with Brexit and our sector is suffering from over-supply. This sector is no place for the weak or the uncertain.

Growth in 2018 with come from…

Winning market share.

What’s keeping you up at night?

Mainly the things I can’t control, such as taxation and inflation.

One to watch

I think the guys at Bistro Pierre have built a really solid business. Their concept isn’t particularly innovative but it does deliver quality and value. As a business they are focussed on sensible property deals and consistent operational delivery ­– a strategy that will stand them in good stead going forward. I expect them to grow strongly but steadily.

 

Peter Marks, chief executive, The Deltic Group:

Key lesson of 2017

Keep pressing government on the delicate ecosystem of the ‘going out’ economy – we seem to be making inroads at last. The ‘going out’ economy needs understanding about its viability; it cannot put its prices up easily, yet is under constant cost pressures often as a direct result of government policy. A company needs to be in good health to create free cashflow to make returns to shareholders and reinvest in their estate. Overtaxing just kills investment.

Growth in 2018 will come from…

For Deltic growth will come from continuing our refurbishment programme, developing new marketing and sales initiatives and the use of technology to better target messages to the individual and save costs. We will continue to look at acquisitions as well.

What’s keeping you up at night?

The business. We need to seek change in licensing. If an incident happens, and we run a good ship, then defaulting to a closure, even for a short period of time, is poor legislation. In the days of social media, a closure can become a lightening rod for users to suggest that such and such a venue should not reopen. This could affect any of us. New measures need to be considered.

One to watch

New World Trading Company

 

Charlie Young, co-founder of Vinoteca:

Key lesson of 2017

It’s always about the basics: invest time and money in staff welfare and training; improve service levels and food quality; work hard at sourcing the best products at the right prices; don’t be greedy – these things pay off, even in the hardest of times.

Growth in 2018 will come from…

Standing out from the crowd through achieving the above, and from not standing still.

What’s keeping you up at night?

The thought of a botched Brexit.

One to watch

Blacklock

 

Chris Hill, chief executive, The New World Trading Company:

Key lesson of 2017

There have been lots of lessons to be learned from the fortunes of others in 2017. The big lesson we have learned is that customers are growing more and more fickle, and to succeed we must deliver an ever-increasing amount of products/stories/opportunities/relationships.

Growth in 2018 will come from…

I wouldn’t expect the overall industry to grow but for those businesses looking to gain market share in a stagnant sector, customer experience, live music and social media collateral will be the winning hands. All built on a solid base of engaged, happy teams.

What’s keeping you up at night?

If the wider industry discounts too deeply for too long at the start of 2018 (which I’m fully expecting they will), it will fundamentally change the value relationship consumers have with eating/drinking out. This would present a huge long-term issue for brands who don’t build discount models but build on service-driven experiences.

One to watch

The Florist – although I would say that.

 

Marcos Fernandez Pardo, chief executive of Iberica, and managing director of InPaella:

Key lesson from 2017

Don’t do Brexit? I would say as times get harder the focus on the key stakeholder, the people who work in Iberica, is more pronounced. I strongly believe there is an unstoppable move from finance being the focus in the economy to the human resource. Do what you do well. Tough times take customers to refuge in those places they know provide the quality service they want constantly.

Growth in 2018 will come from…

I believe the Spanish sector is consolidating its footprint both in the capital and countrywide. There is a strong and healthy competition working hard to improve its product and service quality. The customer is learning more about our varied gastronomy and is more adventurous, opening interesting avenues.

What’s keeping you up at night?

The people that make Iberica and where will they come from. Increasing costs, tightening margins in a time when pockets are also tightened. How can we be better?

One to watch

Again I would focus in our sector. There are very exciting new openings in London, of which Nieves Barragán and Quique Dacosta jump to mind. This follows David Muńoz and Eneko that opened this year. Which alongside Arzak, Nacho Manzano and Marcos Moran add up to an impressive 17 Spanish Michelin stars present in London by next year, from 14 this year. I would watch this space in general as all are working hard in their brands, their products and service. They all have the experience and teams around them to be imaginative, creative and effective. It is a bit like Real Madrid, you know they have the maturity to hold the pressure of a final, which is what next year will feel like.

 

Simon Potts, managing director of the Alchemist

Key lesson from 2017

 2017 was a good year for the business. We had four new openings and have demonstrated the ability to translate our brand into completely different cities - as well as maintaining underlying growth in our mature estate. Perhaps not a lesson as such, but we are very aware that the market for new sites has shifted strongly in favour of ambitious operators, so we are expecting more interesting opportunities for the year ahead on the acquisition front and are careful of being very mindful in that regard.

Growth in 2018 wil come from….

At the back end of last year, we launched a co-ordinated breakfast campaign as we looked to evolve our all day offering; we revisited the morning menu, tweaked the early morning environmentals and sharpened the service focus; we believe this offers a great opportunity for growth in the coming year as the business continues to be a social hub throughout the day for our guests. We now put equal emphasis on our dining offering as we do our cocktails, and have been receiving excellent feedback from our customers from the launch of our new food menu at the end of last year.

 What’s keeping you up at night about the coming year?

We are ever mindful of the people challenge, we know already the pool of talent is shrinking in the sector and we are working on every angle to recruit, on-board and retain the best people in the business – the people proposition is inherent in The Alchemist, but we will be working harder than ever to meet the challenge this year. I am also conscious, certainly of the sheer weight of numbers, of people in the business. We employ over 700 people at The Alchemist and that is a lot of livelihoods to be responsible for. While it doesn’t keep me awake at night, it does keep you focussed.

One to watch

 I think there are lots of interesting concepts out there – the Bundobust guys are growing well. Swingers obviously have a great concept and clearly a big result getting the Oxford St location, so I’m looking forward to seeing how that translates. I also like what Blacklock have done so far with unique spaces.

 

Andrew Lennox, chief executive of Koh Thai Tapas:

Key lesson from 2017

Being able to tell the difference between the opportunistic ‘price riser’ and the real deal. So many people this year have tried to put prices up to go a step forward rather than just to stay still. There is a big difference and we have had to be very careful with our supply chain this year.

Growth in 2018 will come from…

Multiple acquisitions rather than single site units. It will also be interesting to see how the market looks in the age of no premiums and lower rental aspirations.

What’s keeping you up at night?

Nothing keeps me up at night, I run until I hit the pillow then I’m gone – but rising costs have to be continually watched.

One to watch

It will be interesting to see what Ceviche does this year – I ate there years ago and it was really good, and I wondered then when they would get out from the big smoke.

 

Eve Bugler, MD and co-founder of BabaBoom

Key lesson from 2017

That the industry is going through an incredible period of change. Being female-led, small and a kebab specialist is actually an advantage. Who’d have thought that 10 years ago?

Growth in 2018 will come from…

New openings & delivery

What’s keeping you up at night?

Asking: “Where’s the joy?” At its heart, that’s what BabaBoom is all about. If we focus on nailing that from a product, team and customer perspective, the results will follow.

One to watch

I’m excited about Padella’s new opening north of the river. Going off piste – if I could choose a place to watch it would be White City – I think it’s going to be a new hub for West London.