The crisis in the restaurant business has not yet fully manifested itself. The owners of democratic restaurants and fast food outlets have noted an increase in the flow of visitors. But what does the future hold for them? How will the situation develop in the restaurant business? And is it possible to prepare in advance for the worst?
Having reached Russia, the global financial crisis hit many sectors of the economy significantly. Many companies expect massive layoffs of employees, banks stop providing new loans and raise rates or demand early repayment of previously issued loans, production is reduced, and much more.
The crisis has not spared the food industry either. Already, the emerging trends are noticeable, which, if not given proper attention, can lead to disastrous consequences both for individual enterprises and for the entire industry as a whole. The scale of the crisis and its consequences for the restaurant business are not yet fully understood. The first wave has passed through the market, which has already inflicted losses, and how many more waves will follow it - we have to find out in the near future.
First of all, expensive restaurants with a high average check, designed for a wealthy public, suffered. In many of them the attendance has noticeably decreased. Among the first to stop going to expensive restaurants were middle-class people, employees of investment companies, managers of companies with foreign capital, employees of the banking sector, for whom prices in these establishments were at the upper limit of acceptable values, and who suffered the most from the crisis. And with each round of the crisis, there is an increasing outflow of visitors, for whom prices are the determining factor in choosing a restaurant. In parallel with the attendance, the average check is also falling.
People with high incomes, for the most part, have not changed their preferences and continue to visit their familiar and favorite restaurants, but at the same time, many of them have begun to be more cautious about prices. If earlier this person at dinner easily took a couple of bottles of wine from a renowned producer costing from a thousand euros, now he will prefer something less well-known, without overpaying for the brand. Most companies have cut their hospitality costs. And if earlier, during negotiations in restaurants, top managers did not pay attention to the final bill and simply paid by card, now such situations do not happen. The restaurants that have just opened in this segment are experiencing huge difficulties in promotion.
Medium and democratic restaurants suffered much less from the first wave of the crisis. Now the number of visitors to restaurants in this price segment remains at the level of the same period last year. This is partly due to the outflow of some of the audience of expensive restaurants to establishments of this price category. But if the crisis develops further, restaurants of this class may also feel a decrease in the number of visitors. This is due to the fact that most of the cuts that the market still awaits (many companies in various sectors of the economy have announced their intention to cut their staff by 5-20 percent) will affect this very category of people, for which mid-range restaurants are designed.
The crisis affected the fast food segment least of all. This segment is often the most resilient to various shocks. In Moscow, over the past few years, the beginnings of a culture of eating outside the home have begun to form. And fast food, as the most inexpensive manifestation of this trend, does not lack visitors. Many people simply cannot imagine visiting a shopping or entertainment center without visiting a food court. And street outlets of various fast food chains have become so everyday and habitual for a snack on the run that, due to their cheapness and established audience, they are unlikely to feel the pressure of the crisis. And with a competent financial policy, we can even talk about an increase in profits.
Very hard times await large chain restaurants. The inaccessibility of borrowed funds, at the expense of which the development of many network projects was carried out, has already led to significant slowdowns in growth rates. Terms of delivery of many objects at different stages of construction. delayed or even frozen due to funding difficulties. And this is only the first stage.
In the future, the need to return previously borrowed funds may lead to bankruptcies of those companies that, in conditions of economic prosperity, by all means and by any means sought to increase capitalization and gain market share. And in pursuit of these indicators, companies, confident in a prosperous and rosy situation in the economy, admitted critical indicators of the debt / EBITDA ratio. In any case, large restaurant holdings are awaiting staff cleaning. This will primarily affect the back office staff. Significant reductions will take place in marketing and development departments.
Another problem that will affect all segments of the restaurant business is the rise in prices for food products. Some supplier companies, trying to overcome the liquidity problem, are forced to raise the selling prices for products. This will lead to an increase in the cost of the final product in catering establishments. And in times of crisis, it is quite problematic to solve this problem by raising prices in a restaurant. Also, due to the lack of sufficient funds from suppliers who actively used credit funds to purchase products, it may be difficult to maintain the assortment. Because of this, some imported goods may disappear from the market.
Already now there are problems with procurement, which have to be urgently resolved. Many restaurants are forced to change suppliers without tenders in order not to be left without products necessary for their work. And this again, in turn, negatively affects the cost.
At the same time, the crisis also brings some advantages for the restaurant market. Due to the closure of weaker players in the food industry and the wave of cuts in other areas of the economy, personnel shortages will be solved, which has been one of the key problems of the restaurant business for several years. Limited vacancies in other areas of the business will force many job seekers to take a closer look at the restaurant business as a temporary bay in order to endure difficult times. In the future, some of them stay in this area for a long time. It will surely get better with foreign specialists who will be more willing to respond to proposals from Russia, since the crisis has affected other countries as well. Again, for fear of being unclaimed at home, many foreigners are afraid to leave our country.
As for consulting services for the restaurant business, there is already a sharp increase in demand. The need to optimize business processes in a crisis situation makes many restaurant owners turn to specialists for help. As a company specializing specifically in complex anti-crisis consulting, the number of inquiries has more than tripled over the past month. And this is only the beginning of the crisis.
In the future, with the emergence of new problems, we expect an even greater number of calls. Another trend is that if six months ago the number of requests for anti-crisis consulting was approximately equal to the number of requests for the so-called start-up, now the overwhelming majority of requests are anti-crisis consulting. Therefore, for consulting companies, the main specialization of which is strategy-up, a significant decrease in demand is possible. On the contrary, at the moment we can afford to be even more demanding of the customer.
What can you advise restaurateurs on the eve of difficult times. Now, since the crisis has not yet fully affected the restaurant business, there is time to take measures in order to endure difficult times with less losses. It is necessary to be more responsible and cautious when it comes to doing business. The general level of economic recession is not clear, and a lot depends on various factors that are difficult to predict.
It is difficult to give precise recommendations without knowing the detailed situation at the facility, because different enterprises may have different areas with a limp. Someone has problems with theft, someone suffers from a lack of clear positioning, and much more. And if earlier the restaurant could stay afloat with these problems, then in the conditions of the crisis the presence of unresolved problems will inevitably sink the whole business. And the sooner these problems are resolved, the greater the chances of a successful outcome of events.
It is necessary to revise budgets for the future period and, within reasonable limits, to reduce costs as much as possible.
Review the marketing policy, adjust development plans, adjust the staff, remove duplicate positions. In many companies, for example, there are several office managers, although one could easily cope with the volume of work. To make reductions in the departments that gained "excess weight" during the period of financial prosperity. Why in the marketing department there are 5 people, if the advertising budget for the future period is cut by three times. Or the development department, if the financial situation does not allow opening seven new outlets in the foreseeable future.
Adjust the menu to increase positions with the highest margin. It is necessary to withdraw dishes consisting of products that may disappear in the near future, so as not to urgently look for a replacement at any price.
Talk to suppliers. Find out the situation. Pay attention to the control of the cost of products and goods included not only in the so-called category "A", but also take a closer look at category "B" Pay attention to the choice of the bank through which settlements with suppliers go. In case of problems with the bank, account freezes are possible. And for a restaurant, even a few days of absence of calculations is fatal. Maybe it makes sense to open accounts in several banks?
We can already say that in the near future we are expecting a stagnation of the restaurant market. Weak players will be forced to leave. And the strong will focus on optimizing processes within the company and will not actively expand. Now, in anticipation of a new round of the crisis, it is necessary to tighten their belts tighter and clean up the tails that have been dragging on since the time of economic recovery. All resources must be mobilized to resist the crisis. I would like to hope that the world or at least the Russian economy will soon recover from the crisis, and now we have already reached the bottom, which will be followed by a rebound and a further rise. But one must hope and believe, and just in case it is better to group up in order to endure a possible blow, and if it does not follow, then it will be much more convenient to start from this position for the assault on new peaks.
