Restaurant Business #4 2015

Page 1

AUGUST 2015

!

!

"

#

$ %


Shop for your catering supplies in-store or online at Makro 1 WORKWEAR SHOP HERE

1

2

ELECTRICAL EQUIPMENT SHOP HERE 3

GLASSWARE SHOP HERE

4

COOKWARE SHOP HERE

2 3

4

VIEW FULL CATERING CATALOGUE

makro.co.za


& )

'( ' ** +* ,

S

S

could have overlooked that if the&

the big picture in terms of restaurant

had been able to suppl& the ice-cold

and foodservice, like share prices and

drink I as craving to get me through

economic

the last leg of a bus& da&! Instead I

oes! "ut some#mes it$s

the small stu% that gets m& a'en#on! As the& sa&, God is in the details, and for restaurant operators improving

got a arm drink and, of course, takea a&s generall& don$t stock ice! Another common experience

the bottom line often does mean focus-

hen e have eaten out over the

ing on small details that make a big dif-

&ears ith our small daughter is to

ference to the customer$s experience!

have her served a tall glass of boiling

One of m& bugbears hen I eat out is being served beverages at the

hot, hot chocolate—even hen e have asked for it to be just arm! M&

rong temperature! What could be

gratitude goes out to those special

orse (beverage- ise) than arm

ait staff ho use their common

Coke or cold coffee? Wine and bubbl&

sense and tell the barista to make hot

are just undrinkable if the&$re not cold

drinks for children arm, not hot!

enough! Teapots must be heated ith boiling ater before the tea is made! I stopped at a QSR in a shopping

So, long stor& short: train &our baristas, bartenders and aiters to kno that cold beverages should

mall the other da& for one of those

al a&s be COLD, hot beverages

hurried, on-the-go lunches that QSRs

should al a&s be HOT, and serving

rel& on for their bread-and-bu'er!

boiling hot drinks to toddlers is prob-

The food as disappoin#ng, but I

abl& not a good idea!


PUBLISHER AND EDITOR Hila r& Wa rd

Restaurants in the ne s!

082 330 1981 hila r&@rbmag!co!za

Doppio :ero$s ;aul Chris#e tells us hat the future ADVERTISING SALES Hila r& Wa rd

holds for the brand!

082 330 1981 hila r&@rbmag!co!za

SA$s restaurant groups are bringing ne brands to Ni ck Ferris

market in a <urr& of ac#vit&!

0717858732

!" # # CONTACT ;O "ox 1346 Cres ta 2118

$

%

The number-crunchers at Insight Surve& reveal hat is driving the gro th of the fast food market!

Joha nnesburg +27 011 782 8636 088 011 782 8636 !rbmag!co!za

James Diack of Coobs fame talks about his ne eater&, The National, and farm-to-table provenance!

@res taurantbusinessmag @resbizmag

Restaurant BusinessTM ma gazi ne is published b& Ci ma rron Media I Ma rke#ng Co! Reg! 2011/101976/07 - Cop&ri ght reserved

ON THE COVER: The Doppio Zero group of restaurants has built on the success of one store, to expand this popular brand. See Page 6.


'(

'

( '(

(

()' * +

'

( '(

+ +

Radisson Blue Gautrain hotel has

spring with a new Lunch Box experi-

been revamped to incorporate an el-

ence invi#ng guests to dine al fresco

egant lounge and bar that flows onto

on the lawn while enjoying a gour-

the terrace and pool deck. The im-

met picnic. At R300 the Lunch Box is

proved layout accommodates more

perfect for two adults and features

visitors and creates con#nuous flow

delights such as roast beef chicken

with the restaurant bar and pool

liver parfait

deck all now centrally-located on the

pies; as well as roosterkoek with ar#-

third floor. The interior design is vi-

san cheese watermelon green fig

brant with a contemporary African

and koeksuster preserve; salad and

feel modern furnishing s and stylish

chocolate marquise pots. Special

comfortable sea#ng.

lunchboxes are available for children.

mini Overberg lamb


;QRS /TUVWXVY SZZ[W \Y WXUQV]TX V^ XTY Y_Y Q^` `Y^VYW XTY UR\ZRU -Q`\VXXY`S_ WXQUXY` a_ RYWXQRUQ^X BRWV^YWW. XTQX DQ\ZRW BUQ^`W VW SZZ[V^] XZ QbcRVUY XTY DZddVZ ZYUZ ]UZRd. “TTY_ TQeY^$X QddUZQbTY` RW ” TY WQ_W fVXT Q^ Y^V]\QXVb W\VSY. DZ ^ZX dSQ_ dZ[YU fVXT XTVW \Q^.

,

-

. (/ 0 -

.

12

Doppio Zero has carved out an envia-

nesburg to offer all-day dining with

ble niche in the “table service even-

an outdoor area and freshly-baked

ing dining ” segment. Actually make

breads and instantly became a hit

that “table service all-day dining ”—

with the trendy set but soon a'ract-

one of the things Doppio Zero does

ed families and business people too.

best is keeping the buzz at its restau-

In 009 /hristie and Milovanovic

rants going from the first breakfast

also launched ;iza P Vino a pizza and

croissant of the day un#l late

wine concept that has taken off well

/hris#e and business partner

a_ TVSQU_ fQU`

was one of the only places in Johan-

with seven stores and plans for more.

Miki Milovanovic opened the first

Neil Griffiths manages the ;iza P Vino

stand-alone store in Greenside in

opera#on while Ivan ,alsh is opera-

00 as a cafP bakery. At the #me it

#ons director for the Doppio brand.


DO;;IO ZERO HAS /ARVED OUT AN ENVIABLE NI/HE IN THE TABLE-SERVI/E ALL-DAY DINING MARKET REINVENTING THE /LASSI/ RESTAURANT EX;ERIEN/E IN AN ERA OD DAST DOOD DINING


-

Between both brands the group

/hristo Nor#er is bringing new focus

now boasts 19 stores including a Dop-

to the group$s kitchens—introducing

pio Zero restaurant in Alexandria

systems that improve produc#vity

Egypt. /ape Town opened in 008 and

and workflow. Nor#er has extensive

a store in KZN is in the pipeline.

33

4 ' 0

5 6

/

experience working in restaurants

/hris#e is frank that growing

overseas including stints with both

the group through franchising has

Gordon Ramsay and Jamie Oliver. To-

been a challenging learning curve.

gether he and /hris#e revamp the

Their business model has evolved to

menu twice a year to keep it season-

include a mix of company stores

ally fresh and relevant. The menu

franchise stores and joint ventures.

has evolved from its Mediterranean

“Our stores are big restaurants

roots to include a wider range of

with 00 to 300 covers and complex

menu items closely allied to popular

to run. An investor with no experi-

food trends. “I swore we$d never

ence wouldn$t cope so we try not

have dishes like curry on the menu ”

take on franchisees with no previous

says /hris#e. “Now we do

experience in the restaurant industry.”

and they are very popular.” The menu is structured

around

hearty

healthy seasonal fare with an eye

on

trends

like

Ban#ng.

Neil Griffiths, who is operations director of the Doppio Zero group’s Piza é Vino brand


(

,

* A new Doppio Zero costs

, *

'

, '' /hris#e says G;s and margins

around R6-million to develop with

are on track for the new stores at

;iza P Vino stores at around R3.5-

about F0m and 1 m respec#vely but

million and investors must put up

that food cost at F0m is a challenge

half the cash. Dranchisees who want

they are tackling head on looking at

to own mul#ple stores need to have

suppliers and adding value to the

the skills to lead teams so unlike

menu rather than cost.

with QSR franchises this is not an easy solu#on to growth. “The market went through a dip

“,e used to pay R 5/kg for calamari for example now it$s R60/kg so with our next menu we are look-

a few years ago but we are experi-

ing at value that works for customers

encing good growth now. ,e are

– instead of serving a F00g steak

aware of not ea#ng into our exis#ng

trim it down but make it sexy with

market share though so we are care-

other flavours and greens and

ful how and where we grow.”

sides…”

Best pizzas in the business: Doppio Zero dishes up traditional thin-crust, wood-fired pizzas


'(

7( 13

3 1 /

3

under the aegis of operations director Ivan ,alsh is a priority for Doppio Zero and the group is looking at off-site training with kitchens where staff can get hands-on experience. “Training is a big thing for us. If we train guys and they leave c’est la vie. You$ve got to be about more than your product; it$s also about your spirit. ,e feel we are better at food than most but improving service levels is an opportunity.”


Their biggest challenge, he says,

ing and house blends by Tribeca, the

however is finding the right people to

group is teaming up with local coffee

own and manage new franchise

roasters to introduce limited edi on

stores. “The restaurant business is not

ar san blends. The /rst coffee cam-

family friendly and recruiting intelli-

paign launched in July in partnership

gently is everything.”

with Urban Grind to introduce a

Doppio started out as a café

Guatemala &urundi coffee blend that

bakery and its in-store bakery re-

is Rainforest 3lliance cer /ed. The

mains a big part of the brand and

launch included a pop-up coffee e!-

iden ty and customer e!perience,

perience where commuters were

contribu ng "#$ to "%$ of turnover.

served free coffee from a retro trail-

&ut it simply isn't prac cal for all

er and invited to take part in their It

the stores to bake their own bread—

All Started With Coffee story on so-

for one thing the electricity cost is

cial media.

enormous. So three of the bigger

The Greenside store was a des-

stores have their own bakeries, while

na on restaurant for many custom-

the group's central bakery supplies

ers in the early years, who came

other stores with fresh bread daily.

from far and wide to enjoy the e!pe-

The group recently invested R".2m

rience. With "" stores it is now an

in generators to combat load-shedding

integral part of the Jozi lifestyle, and

and Christie says stores are now

further e!pansion is on the cards. So,

“pumping” when the lights go out.

where to ne!t for Doppio Zero?

“Coffee is our ne!t big push.” In addi on to its standard coffee offer-

“We're just trying to be the best at managing comple!ity,” says Chris e.


*

,

+*

*

* (* 1 * , (

* , ,

& 0

* * ,

4 (

,*

,

2 *

,* ,

*0

+* *

*

*3 (

4 (

( ' (0 '

, ( '(

*5 '(

industry has tradi#onally been built RAN PARA E

BURGER KING

on locally-developed brands. Up to 85m of restaurant franchise brands

A E H L IN

DOMINO$S

have up un#l now been home-grown

STARBU/KS

concepts. But that dynamic is changing as

PUR

RP RA I N RO/OMAMA$S

a “perfect storm” of condi#ons increasingly bring s iconic imported

F URNE,

KRIS;Y KREME BROOKLYN BROS MOYO

* Note that this list does not specify details of ownership which may include own brands master license holder agreements and various shareholdings.

brands—so far most from the U.S.— to the South African market. On the one hand our own fast food industry is experiencing rapid growth as well as demand from customers for global brands that make South Africans feel cosmopolitan and part of the global scene.


&'

'(

'( )


BATTLE OD THE BRANDS

The much-hyped entry of Burger King in

01

But the sleeper surprise of the

flubbed somewhat

year has been the sudden flurry of

when Grand ;arade Investments an-

ac#vity from Dournews who seemed

nounced last year that it was scaling

content for years to limit their plan

back dras#cally on the ini#al project-

to take over the world to rolling out

ed roll-out of 100 stores—and the

News /afPs. In the past year the

group is apparently having some diffi-

group has acquired Moyo restau-

culty bringing margins in line.

rants—a rescue opera#on they say is

But that doesn$t seem to have

paying

off already—as well as

affected the appe#te of other fran-

launching the sexy upscale Brooklyn

chise groups for bringing in U.S.

Brothers diner… and of course a

brands.

large helping of Krispy Kreme .

During August

Dournews an-

Damous Brands has been un-

nounced a JV to bring Krispy Kreme

characteris#cally

unacquisi#ve

in

doughnuts to SA shores while Taste

this phase—having snapped up most

Holdings announced that it had

of everything in the local market

snapped up the master license for

both at the back end and front

Starbucks. This less than a year aqer

end—including ,akaberry

its Domino$s ;izza coup sparked a

Basket Tasha$s and Vovo Telo in re-

“pizza war”—with a testy Kevin

cent years.

Bread

Hedderwick of Damous Brands fame

But Damous Brands despite re-

who came out swinging in defence of

portedly sirng on a pile of cash—

his Debonair$s ;izza brand.

and s#ll as hungry as ever for acqui-

RO/OMAMA$S HAS RE/OGNISED AND EX;LOITED A REVOLUTION IN THE BURGER /ATEGORY— /ONSUMERS DON$T ,ANT DAST DOOD BURGERS THEY ,ANT GOURMET DAST-/ASUAL BURGERS.


P./ /S: 0fro1 top, le23: 4risp5 4re1e is set to launch in South Africa in Nove1ber; Carlo Gonzaga of aste .oldings is bringing in Starbucks; a 4risp5 4re1e advert fro1 the U.S.; GPI is having a tough 81e establishing Burger 4ing as a pro9table en8t5.


BATTLE OD THE BRANDS

THE MU/H-HY;ED ENTRY OD BURGER KING HAS DLUBBED SOME,HAT. G;I S/ALED BA/K DRASTI/ALLY ON ITS INITIAL TARGET OD 100 STORES TO GET ITS MARGINS RIGHT. si#ons—has curiously steered clear

in all of this will be Spur /orpora#on

of bringing interna#onal brands into

and its recent acquisi#on of 51m of

its stable preferring apparently to

Brian Altriche$s RocoMama$s fast cas-

snap up home-grown concepts just

ual burger chain—a home-grown

at the point where they have cap-

burger concept that has neatly cap-

tured the imagina#on of the public

tured the very desirable Millennial

and need to grow.

market—young

Is this a market they don$t want to play in? If not why not?

hip and

urban

across middle to upper income groups and all races.

The group$s results certainly keep

Burgers have always been a ro-

investors happy but Damous Brands

bust category and a favourite with

doesn$t seem to have the crea#ve

South African consumers but Ro-

juice to create its own brands or

coMama$s has recognised and ex-

the appe#te to bring in iconic inter-

ploited a trend in the category—

na#onal brands.

consumers don$t want fast food

The group has also focused on

burgers6 they want fast casual ar#-

its Rest of Africa -RoA. expansion

sanal burgers aka ‘smash$ burgers.

and markets such as India and Du-

There is certainly no shortage

bai—as have the other groups with

of burger restaurants sa#sfying this

Dournews for example announcing

demand—but only Rocomama$s has

five new RoA stores in 015/ 016.

really got the recipe right6 trendy

But we$re going to go out on a limb and predict that the real winner

urban and ar#sanal yet classic nostalgic casual and affordable.


BATTLE OD THE BRANDS

,hat really stands out though is that all these new entries have one thing in common. ,hether burgers

,HAT ALL THESE NE, ENTRIES HAVE IN

pizzas or doughnuts they are all going after the same slice of the market6 the middle and upper middle class who have the disposable income to spend on fast food. As a corollary our restaurant groups seem to be ignoring the burgeoning lower LSM market being served by shisa nyamas shebeens and supermarkets—in favour of

/OMMON IS THAT THEY ARE ALL GOING ADTER THE SAME SLI/E OD THE MARKET6 THE MIDDLE AND U;;ER MIDDLE /LASS ,HO HAVE THE DIS;OSABLE IN/OME TO

RoA and international expansion. So pass the popcorn6 the next few years of foodservice in South Africa is going to be interesting to watch!

S;END ON DAST DOOD.


,

(

.3 ('

1 )(

But given the aforemen#oned chal-

7- .

would think it would be a formidable foe to

lenges why is the industry experiencing

the local fast food industry. But what im-

such phenomenal growth? According to

pact if any is this dietary phenomenon

Insight Survey the mul#faceted answer

having on domes#c consump#on trends?

requires a nuanced understanding of the

According to Insight Survey's Dast Dood

industry environment and market dynam-

Industry Landscape Report 015—which

ics and encompasses an array of compe#-

provides a dynamic synthesis of primary and

#ve strategies underpinned by progressive

secondary research—the impact of Banting

business acumen and consumer-centricity.

has in fact been minimal to non-existent.

Dirstly there is aggressive penetra#on

The industry is under siege from far

by chained global players such as Burger

more ominous foes in the form of rising

King and Domino's into the local market as

commodity prices market saturation

part of their con#nental expansion plans.

hygiene scandals and load-shedding. Yet despite this fast food is growing

FA

REN

(B U H IN PA

4 ,EEK ): 2009-2014 80m

80 m 70 m 60 m

local consumers in-

50 m

creasing from 66m in

F0 m

Individuals who have

PUR HA IN

90 m

exponentially—with

009 to 80m in 01F.

F

7 1m

7 8m

7 Fm

78m

6 6m

30 m 0m 10 m

purchased fast food

0m

over a four-week peri-

009

010 2009

od has risen by close

2010

011 2011

01

013 2012

otal adults

31 F18 675

3 96 3 8

3F 037 887

3F 066 6 1

to 10 million within

Bought food

0 7 6 3F8

3 FF 703

5 58 1

6 F60 337

the last five years.

Source: AMPS. Graphics adapted fro1 Insight Surve5

01F

2013 36 FF8 883 8 57

9

2014 36 93 000 9 F58 000


This coupled with

NUMBER F FA

F

RE IN

U H AFRI A (APRIL 2015)

the rapid growth of KD/

resident global and local franchise stores is boos#ng market performance. There was a net

Steers

509

,im py

F97

Debonairs

in 01F with the top

/hicke n Licken

Ne' growth in franchise s tores in 01F

3 30

Nando's /hesa Nyama

13F

38

Dish & /hip /o.

growth of 13F stores

10 franchises having

771

300 51

R30 bn

F0

Turnover genera ted McDonald's

a national footprint

00 0

1 00

of 3 6F3 outlets -as of April 015..

00

3 00

F0 0

500

60 0

700

8 00

900

Source: Business ech. Graphics adapted fro1 Insight Surve 5

The annual turnover of the fast food industry in 01F was estimated at a stag-

DES;ITE RISING /OMMODITY

gering R30 bn. Durthermore we are see-

;RI/ES MARKET SATURATION HYGIENE S/ANDALS AND

ing the expansion of fast food into previously-disadvantaged parts of South Africa. ;eri-urban and rural communities constitute a new market for the franchise industry— one which is being unlocked by the development of retail centres in these areas. Increasingly it is now the lower LSMs who represent the greatest potential for the growth of restaurant franchises driven by the same salient factors applicable to higher LSMs such as affordability convenience and value-for money.

LOAD-SHEDDING DAST DOOD IS EX;ERIEN/ING EX;ONENTIAL GRO,TH ,ITH LO/AL /ONSUMERS IN/REASING DROM 66m OD THE ADULT ;O;ULATION IN 009 TO 80m IN 01F RISING BY /LOSE TO 10 MILLION IN DIVE YEARS.


HEAL HIER F

100.0m 90.0m

P I N A FA

F

context of local mar-

U LE

ket dynamics 90.5m

Noakes' prophecies

Do you think there is a need for heal thier food op#ons a t fast food outlets ? -n=336.

80.0m 70.0m 60.0m

are actually having little impact. Yes

50.0m F0.0m

No

30.0m 0.0m 10.0m

,here they may have had some effect is in the higher

9.5m

LSMs where the pro-

0.0m Yes

portion of LSM 9 and

No

10 has dipped by m Source: Gopaul. Graphics adapted fro1 Insight Surve5

This was ratified during one of our pri-

between 009 and 01F. However this m needs to be understood in a context in which

mary interviews with Natalie Ruwers Mar-

the local fast food industry is experiencing

keting Manager for King ;ie who says low

exponential growth.

LSM consumers “are price sensitive but don't mind spending money on value.� ,e are also seeing reactive product dif-

Durthermore this may just be the start of an explosive upward trend as additional growth is forecast with compound annual

ferentiation strategies manifesting in menu

growth rate -/AGR. numbers expected to

alterations to cater for the burgeoning

rise to F -million by 018. ,hether this pro-

health trend. This hypothesis was confirmed

jected growth materialises however will

during our many interviews with key indus-

largely depend on the efficacy of future com-

try stakeholders and leading academics who

petitive strategies.

claimed that health trends in higher LSM

The Dast Dood Industry Landscape Re-

markets were forcing the crafting of compet-

port provides a dynamic synthesis of primary

itive product responses such as McDonalds'

and secondary research including extensive

recent partnership with ,eight ,atchers.

interviews with stakeholders and industry

Together with drivers such as I/T prod-

experts across the value chain6 from fran-

uct innovation and I;Os and private equity

chises to independent outlets street traders

Involvement it is easy to see that within the

consumers and academics.


Some key questions the report answers are6 ● ,hat are the key factors driving the growth of local and g lobal markets? ● ,hat are the local and global industry challenges restraining market growth? ● ,hat competitive strategies are being implemented at the local level? ● ,hat were the relevant global multinational corporate franchises -GM/D. overall financial performances for 01F? ● How are street food and independent traders able to compete for market share with GM/Ds? ● ,hat are prospects for local retailers and what were local consumption trends between 009- 01F for the

IT IS THE LO,ER LSMS THAT RE;RESENT THE GREATEST ;OTENTIAL DOR GRO,TH DRIVEN BY THE SAME SALIENT DA/TORS AS HIGHER LSMS— SU/H AS ADDORDABILITY /ONVENIEN/E AND VALUE DOR MONEY. THIS MAY JUST BE THE START OD AN EX;LOSIVE U;,ARD TREND AS ADDITIONAL GRO,TH IS DORE/AST ,ITH NUMBERS EX;E/TED TO RISE TO F -MILLION BY 018

industry? ● ,hat factors have contributed to the

F RE A

N UMER R , H RA E 2014-2018

exponential increase in local consumption in recent years? ● ,hat consumer trends are forcing reactive product differentiation strategies?

The 1 0-page ;ower;oint report is available to purchase from Insight Survey. /ontact info@insightsurvey.co.za or 0 1 0F5 0 0 or go to www.insightsurvey.co.za.

Source: Euro1onitor. Graphics adapted fro1 Insight Surve5


JAMES DIA/K /OOBS

“The food is slightl y simpler than a t /oobs but jus t as beau#full y presented

M(

( +

)

(

(

opened his second restaurant The National in ;a rktown North Johannesburg. ;osi #oned as a speakeas y and every-

and jus t a li'le more rus#c ” sa ys Diack. As wi th /oobs The National will be supplied by Brightside in the Magaliesberg the fa rm where Diack grew up. His mother

da y ea tery The Na#onal features s moky

Janet is passionate about farming and sup-

Texan South Ameri ca n and other interna -

pl ying the restaurants – what they can$t

#onal dishes with a rus #c feel .

grow themselves they source from suppliers

The Na#onal$s menu incl udes an assortment of fla vour profiles and dishes

who sha re their passion for provenance. “/oobs and The Na #onal a re now

includi ng burgers paella hot bowls and

two of the onl y res taurants i n South Afri ca

pulled-pork buns . An en#re sec#on of the

tha t can accura tel y tra ce the provenance of

menu is inspi red by the restaura nt$s Texan

thei r food – meaning we know exa ctl y

Reverse Smoker built on Brightside fa rm.

where our ingredients come from ” sa ys

Dia ck opened his firs t restaura nt /oobs in ;a rkhurs t in la te 013. It has since become one of Jozi $s mos t popula r bis tros .

Dia ck. “It also means our menus a re seasonal and based on what$s a vailable.” Two three-hectare veggie ga rdens suppl y the restaurants wi th herbs vegetables and frui t – the fa rm even makes its own ricotta. The farm also supplies /oobs $ now legenda ry a corn-fed wild board lamb duck and the occasional pigeon or guinea fowl. “Ha vi ng a second outlet means we can offer di fferent ingredients and broaden our cooking s tyle to offer both fine dining and an every-da y eatery.”




Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.