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Orchan’s Christina How and Craig J Selby discuss the landscape for food and beverage operators and how they can stay current / relevant to their patrons.

1)      What are some of the challenges restaurant operators face in this competitive climate?

CJS: There are many challenges operators face.

At the coalface, finding suitable and appropriately-trainable staff is a major hurdle; sourcing reliable and consistent suppliers of quality ingredients at non-fluctuating prices. But deeper the issue is staying relevant. It is building a recognisable brand and keeping your customers loyal – getting your customers as unofficial brand ambassadors, and building the business from strength to strength. Restaurants come and go, and in an industry as fluid as this, its important to be able to react positively to trends.

2) We are seeing a “hipsterisation” of the food & beverage industry. Is this shaking things up, or is it simply a fad?

CJS: I personally believe this is a fad. I’m all for it though, as it is shaking things up. It is forcing more traditional restaurants to reevaluate themselves, and to up their game.

However hipsters are not new. Every generation has hipsters in some form or another, and the approach simply brings us back to square one. The advantage is that it opens doors for customers first – to see what is possible beyond existing confines, and this then translates into higher customer expectation – and ultimately better response from operators as they sharpen their game.

For a long time here, the industry has been quite staid, in the sense that innovation was not at the forefront – hipsterisation is one of the contributing factors to changing that experience.

CHYL: I agree with Craig that it is forcing more traditional restaurants to reevaluate themselves and up their game. But, I don't think it's a fad.

I believe there's always been that group of people who appreciated things that were unusual to what was traditionally offered in the F&B industry, but never got to access it until someone decided to ignore the "label" and went ahead to create such space for these people. At the very core, there are those who truly appreciate it. But, as with anything, it comes with those who just ‘jumped on the bandwagon’.

3) How do consumer habits and spending power affect the survivability of restaurants? What can outlet operators do to influence this?

CJS: Being value-to-the-table is always key. No matter what your price point is, your customers must get perceived value or higher. Anything less and you are selling yourself short.

Consumer spending habits directly affects survivability. If no one is spending, it of course affects business. Operators needs to look at ways to extend their offerings to customers – perhaps off-peak specials, changes in opening hours, promotional dining packages, etc.

CHYL: Just to add on, it's important to connect with your target market regularly; not to a point of annoyance, but enough for them to remember your establishment the next time they decide where to dine. People these days consume food with their eyes before it actually enters their mouths, and they're more often than not socially active. Connecting with them on that level gets one foot in the door. Then, the rest is up to you and your team to ensure their experience is worth every penny.

4) What are some of the elements that can make a food and beverage outlet standout for consumers and tenants?

Both: Design. Service. Cuisine. Publicity. Innovation. Guest chefs. Location. Tie-ins.

5) What are some of the strategic approaches existing operators can take in order to keep up with the game?

CHYL: Engage an external party to help re-evaluate your brand and what it offers. However, it's important to engage one who is going to listen to your brand story (or help you build one if you don't have one), take time to understand and actually help strengthen your brand inside and out. When we are so engrossed in our own brand, sometimes we forget how to step outside and see from a different point of view. Engaging external party helps with gaining new perspective within the F&B industry, but still have a say in the direction your establishment is going to take.

6) Looking into outlet concepts might be one of the ways restaurants can stand out. What are some concepts operators and owners can consider?

CJS: Let’s not look at what they can consider, but lets look at what they shouldn’t/ I recall both a hospital themed restaurant, a toilet themed restaurant, and then a cat café with only two cats. Whilst we want our concepts to stand out from the others, this standing out still needs sensibility constraints.
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The hospital themed restaurant (in Penang) failed. Why? It felt odd. Customers felt the concept was too clinical, and could not enjoy the theme of the atmosphere. For some, it crossed the line. For others, one does not have positive association between food and healthcare – hospital food is never deemed good. For me, they over invested in a large retail space, but lacked the marketing to promote it. Getting a small crowd into such a restaurant is a challenge – but whenyou have in excess of 100 seats to fill at any one time, the task is monumental.

The toilet themed restaurant is great. It gets publicity, and it draws the curious crowd. But that’s the issue – the curious crowd only want to try something once – they are unlikely to become your long term clients. Long term clients want a concept that they can fall in love with – an ambience, a feeling – not a curiousity which can be satisfied on one visit.

By rights the cat café concept should have worked. People love pets. Their food was great. Their location great. But, when you can seat 40 pax at a time, and you only have two cats – well, excuse me? Expectations were not met – customers expected to see many friendly cats walking around to interact with. But two – and not very friendly ones at that – meant customers didn’t get the interaction – only the visuality.

Any theme, be it simple (eg; Italian, Mediterranean) or complex (30’s style jazz bar) needs to endear customers, and it needs to be the real thing. If you cant transform your customer into the essence of your theme, you have failed. Let them forget where they are – they need to be embedded into your theme for the duration of their visit. That may be as simple as good food and service, or it might extend to the feeling of “I forgot I was in Malaysia for a while”.

7) What is more important – concept, menu, or staff / service?

CJS: All. They are intertwined, but fluctuate. It's important to balance all positively so customers enjoy the experience.

CHYL: Hahaha~ I cannot agree more. A positive balance between all aspects will earn you return customers. Here's the potential outcome if you were to compromise one of them. If you compromise concept, people are going to get confused as to what they're going for. When they plan their next meal, your establishment will not be at the top of their mind simply because they're unsure what you actually offer. If you've got a great concept but an irrelevant menu to match, it defeats the purpose of having a concept. If you've got an amazing concept and superb menu but terrible staff / service, they're going to walk out.

8) Are food delivery services necessarily a threat for brick-and-mortar outlets? How do these newly-emerging concepts fit into the industry?

CHYL: They are a convenience, not a threat. They don’t replace restaurants, or the experience that diners seek from a restaurant; they value-add to the industry in terms of convenience or ‘samplers’. Chains such as Little Fat Duck grew from food trucks – but you never see established restaurants substantially grow by adding a food truck. For several it is just a gimmick to reach more customers.
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9) What is the role of our more traditional or long-standing fast food outlets in the industry?

CJS: There will always be a place for fast food providers in the landscape. They suit a certain psychographic and demographic, and have over the years carved out a segment all for themselves. This segment is highly contested, and is quite challenging to break in to. For example, international chains trying to go against Starbucks face challenges; likewise to emerging local chains trying to go head-to-head with existing players such as OldTown White Coffee or PappaRich.

The role of these outlets is to provide an element of convenience for customers. It is also to provide staple, standardised food. Some may argue that a further role is to help youth transition into the workplace, by ensuring that low-skill jobs are available for youth to engage with and receive training, thus providing them a valuable experience.

For customers, it is simple comfortable convenience, hopefully with 24 hour access.

10) Does having a pretty view and/or an expensive address guarantee success?

CHYL: No. It is a draw-card factor that might motivate a customer to try an outlet, but it does not guarantee any form of success. Success is a combination of multiple factors, and the customer must tick-off the positive experience of each of these in order to want to return; therefore, the outlet needs to ensure it is constantly delivering at the appropriate pace and level.

CJS: Many great outlets are not in ideal locations, are stuck in hidden alleys or others (think Speakeasy’s) – they simply provide the whole package. Several outlets in prime KL real estate failed – not because of the location – but simply failing to stay relevant to customers.

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