With The Creation Of The Restaurants Business Group, Dubai Chamber Steps Up Its Support Of The City's Restaurateurs
The Restaurants Business Group has been built to serve restauranteurs' common interests through cooperation with relevant authorities, at a time when this sector needs to tackle an endless list of COVID-19-induced sector challenges.
Following months of efforts that included everything from bringing fine dining to customer’s homes to launching affordable spinoffs of high-end brands, Dubai’s restaurants now have access to a new undertaking that will seek to help them tackle the impact of the COVID-19 crisis and secure their futures. The Dubai Chamber of Commerce and Industry has announced the establishment of the Restaurants Business Group, a new non-profit under its umbrella that will support the city’s restaurant sector by unifying the voices of member companies.
In line with other swift reactions of the UAE government to help business navigate the COVID-19 crisis, this new initiative by Dubai Chamber comes at the right time- as restaurants re-open under new guidelines, the Restaurants Business Group will play an essential role in addressing common issues and helping industry players adjust to the new normal. Mubarak Bin Fahad, owner of The Tashas Group, was appointed as Chairman of the Group, while founding Executive Committee members quickly outlined the group’s objectives and plans for 2020. In a statement to the media, H.E. Hamad Buamim, President and CEO of Dubai Chamber, stressed the crucial role that business groups and councils play in driving sustainable growth and enhancing economic competitiveness, adding that Dubai Chamber has been working closely with the Restaurant Business Group and other sector-focused business groups to promote constructive dialogue and foster public-private sector cooperation.
H.E. Hamad Buamim, President and CEO, Dubai Chamber Of Commerce And Industry. Source: Dubai Chamber Of Commerce And Industry
The Restaurants Business Group has been built to serve restauranteurs’ common interests through cooperation with relevant authorities, at a time when this sector needs to tackle an endless list of COVID-19-induced sector challenges. “The industry has taken a major blow [due to the COVID-19 crisis],” confirms Walid Fakih, General Manager of Emirates Fast Food Company, the operator for McDonald’s in the UAE, and one of the board members of the Group. “Those restaurants that were already primarily generating revenue via delivery may not have been impacted much, or in some cases, have been experiencing higher volumes. However, I would say that most restaurants experienced a significant drop in business, and any shifts towards delivery could not have compensated. Those who survived up to now have to recoup the losses of the past few months, and have to plan and prepare for another round of restrictions.”
Indeed, a platform for restauranteurs to address common challenges seems needed now more than ever. Kunal Lahori, CEO of Pret To Go, who is also one of the board members of the Group, gave us an overview of the COVID-19 impact on the sector, starting with the reaction of landlords. “Some landlords have been positive in the sense of initiating a relief ranging from one to three months of rent waiver, but they don’t realize that the support that we need should not be for a short term, but for a longer term, as the losses faced by the restaurant owners in the lockdown period far surpass the relief offered,” says Lahori. “For the relief to be effective at all, a longer term model needs to be adapted by the landlords, which is a turnover rental for the next 12 months, then analyzing the sales, and discussing the future.”
Walid Fakih, General Manager, Emirates Fast Food Company. Source: Emirates Fast Food Company
Lahori adds that the COVID-19 crisis has created a new normal whose effects will last for 12 to 24 months, if not even more. “We have been with those landlords for many years and have never really asked for such a relief, and we have been paying our base rents, turnover rents, service charges, marketing fees, and all other fees without blinking,” Lahori says. “But the support that we now need has to be for a longer period in order to give the restaurants sustainability.” He explains that restaurant owners have been forced to face the realities that, due to running their businesses with high discount schemes and exorbitant commissions to delivery platforms, they ended up not having a healthy runway for their businesses anymore which threatens their existence. “On the other hand, those restauranteurs that had looked after their customers directly have had the opportunity to surge during the crisis as they were able to engage one-on-one with them,” he adds. “Investment in marketing and direct sales channels is very important.”
When it comes to customers, Lahori continues, they might have benefitted from the price wars between competitors, and they have also enjoyed a lot more availability of their favorite brands online- but they have also had to endure shorter menus and lesser product and service availability during the lockdown. “However, the likes of Zuma, Avli by Tashas, La Petie Maison are now delivering to customers doorsteps, which, for the customer, is a great addition to their usual casual restaurant list,” Lahori says. “Dubai has really advanced in this criis, and this is why we have great faith in the leadership. One such example is the legal home delivery of alcohol- this is a game changer, and shows the progressive thought process of the Dubai leadership and their executive team.”
Looking toward the future, Lahori supports the Chamber’s decision to make the Dubai Restaurant Group the voice of reason for the city’s F&B sector, especially due to the need for a new reform and policy post COVID-19, he says. He believes that the government hearing the concerns of the business operators, while introducing relief efforts alongside new laws and regulations, will have a crucial positive effect on the sector. “As with most situations in life, you have to 'hope for the best, and prepare for the worst,’ and since the COVID-19 crisis is no different, we will deploy measures to be able to ensure sustainability of the business,” Lahori says. “It will be the survival of the fittest during these enduring times, of course, and only those brands that have a differentiated USP will have a fighting chance.”
Kunal Lahori, CEO, Pret To Go. Source: Pret To Go
And Lahori believes that his particular brand belongs to that select group. “We at Pret To Go are committed to our brand standards and quality, and we will not compromise on these,” he explains. “We serve organic coffee and healthy food options to our guests, and I do believe customers will stand behind such brands, especially at times when every one is concerned about their health. They will naturally gravitate towards healthy food. With that being said, we are much wiser today and have implemented a suite of online marketing efforts and direct e-commerce sales platforms to enable our customers to order direct, and also benefit from our loyalty program. I also believe the UAE government and leadership have combatted the situation very well, so we can be assured that we will bounce back, and it will only be a matter of time.”
Fakih echoes this sentiment, and particularly praises Dubai Chamber for creating a formal channel of communication between the restaurant industry and the authorities in Dubai. “Being in the presence of others from the same industry, and being able to listen and share thoughts and concerns in itself provides immense value,” he says. “In addition, having the capacity to engage with Dubai Chamber in a structured framework has the potential to benefit all our colleagues who may share the same or similar opportunities. At the end, all our work needs to add value to the Dubai economy as well as the industry.” Going forward, Fakih advises his peers to adopt a people-first, business-second approach. “We all need to maintain a healthy balance sheet as best as we can, in anticipation of a return to closures and restrictions, while always focusing on the safety and wellbeing of staff and customers,” he says. “Maintain your highest standards at all times without taking shortcuts. Also, I would advise all to engage with landlords and suppliers for any kind of assistance, keeping in mind the long-term benefit for all stakeholders. It is better for all of us to hurt a little, than a few of us to hurt a lot.”
Meanwhile, Lahori’s advice for restauranteurs is to maintain a strong focus on details, which includes things like perfecting their customer experience and retention strategies, and keeping a close eye on the delivery experiences they are offering their customers. “I think that most of the businesses need to be more proactive with their online sales and direct channels and marketing efforts, instead of focusing on discounting strategies that have worked in the past, but now need to reinvent themselves,” he adds. “I would request the sector to deploy measures which will ensure sustainability of the business. Finally, I would recommend driving cost efficiencies and leanness in the business to get past the difficult times, as the frills can always be added later, but the foundation must be a lean and stable structure.”
Tamara Pupic is the Managing Editor of Entrepreneur Middle East.