MERA panellists answer extra questions from Mingora Q&A
Delivery, consumer behaviour, and casual dining are all covered
Last week the Middle East Restaurant Association ran an online webinar around Mingora's latest industry survey and was overwhelmed with questions.
Because of this, some of the panellists have now kindly answered some of the questions they didn't get round to doing during the webinar.
What is the future of restaurants or causal dining is going to look like, in terms of layout and seatings post Covid-19?Mert Askin: Once governments start lifting restrictions, we can expect a “normalization period.” It is quite difficult how long this will take, yet it is safe to assume that we will go through a series of adjustments over a period of 6-12 months. We have already started seeing limitation on seating arrangements and layout. These are in line with the “social distancing” guidelines and will in time be relaxed. I personally do not expect to have permanent limitations on this topic.
Contactless payments are going to continue to be the norm. We will be more and more cashless. It is safe to assume that consumers might be more receptive to electronic menus and self-ordering now. Technology is ready to support his already and we need to continue assessing the consumer behaviour.
We might have some new accreditation requirements. These might involve new tools to monitor team member health and safety. Dubai is already using an app to facilitate certain food safety measures. I believe these will be extended.
Do you think the consumer behavior will change post Covid-19? More deliveries and less dine-in?
Tapan Vaidya: Will the consumer behaviour change fundamentally? Like everyone, I don’t have that crystal ball but I do know that mankind has developed their instincts over millions of years. And it takes thousands of years for these instincts to even vary. So, I would rule out any fundamental change. The business model was anyway shifting towards a Delivery Model for our business from the 80’s/90’s when families preferred to go to a pizza restaurant to have a fresh made pie. Convenience started to play an important role around the turn of the century and gathered momentum during the last decade. That momentum could get stronger now but I believe Malls and public places of gathering will also see their share of the limelight – however slow that process may be. Millennials were always going digital and now they have extra reason to go that route, Gen Z will fuel the pace even more!
Dining in, will always remain an experience, families will crave for every now and then. Perhaps compulsive dining may suffer in the short to medium term but not to the extent that folks will do away with a way of life that has evolved over last 6 to 7 decades. COVID-19 has proved to be more than a speed-breaker, but pace will pick up down the road.
What is an acceptable commission for the aggregator?
Tapan Vaidya: At the outset, my opinion is that there can’t be one standard answer for aggregator commission. Restaurants at Atlantis are delivering now – an aggregator will be happy to take 10% from a check average of AED750 for delivery! That same aggregator will not be happy with 20% from a QSR where the check average is AED75.
Leave aside fine dining concepts – from the rest of the field, today aggregators charge anything between 15% to 35%. In my opinion, if a constant variable charge is to be established, it should be 15%. That said, the best solution really lies in flat-rate lumpsum model, where aggregator should be paid based on the following KPIs:
• Fixed per delivery charge, say AED 15 for distances of 5 kms from the restaurant
• Fixed per delivery charge, say AED 19 for distances of between 5 and 10 kms from the restaurant
• Fixed per delivery charge, say AED 22 for distances greater than 10 kms from the restaurant
• This charge may drop by 5% if no. of orders exceeds, say 3,000 per month. And so on and forth.
Aggregator should manage all costs within this revenue model, balance is profit. For operators, the higher their check average, the lower the aggregator commission in term of %. Such arrangement may not be palatable to aggregators because suddenly now there is a ceiling to their earnings but if all operators unite then aggregators may be left with no alternative but to listen. They will still have profitable business – perhaps not as lucrative to attract funding as they do today!
The only other option is for aggregators to allow operators to publish marked-up prices on aggregator platform. That would be the only way aggregators can have his pound of flesh but operator does not give up his margins – but consumers who want to enjoy convenience provided by the aggregator, pay the price. Wonder how long the consumer will take to realize it is better to go direct to the operator – something the consumer has forgotten today!
During these unprecedented times, keeping consistent engagement with the public especially through social media. I'd like to know how the local and regional media can help to raise publicity for independant restaurants?
Simon Ritchie: As we have seen through the likes of Samantha Wood's #UAERestaurantsUnite hashtag earning over five million impressions in its first month, there is an overwhelming desire from the community to help local restaurants flourish. Caterer is happy to play its part in that and we always ask that restaurateurs get in touch with us to let us know what they are doing. If you have something unique or original that is working and you'd like to share it with the industry, my inbox is always open.
We also run a number of regular features and video series from which we are always looking for content - whether it's our How To cooking videos or our Coronavirus Diaries feature, there are plenty of way to share your story with our readers and the industry at large.
Of course, Caterer Middle East is a trade business publication, so I would always suggest if you are looking to drive footfall in-store that you contact the likes of our sister title Time Out. They are very open to hearing from restaurants about special offerings they have. If it would be of interest to your customers then it's likely to be interesting to their readers, so drop them an email.