AUGUST 2015
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Shop for your catering supplies in-store or online at Makro 1 WORKWEAR SHOP HERE
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ELECTRICAL EQUIPMENT SHOP HERE 3
GLASSWARE SHOP HERE
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COOKWARE SHOP HERE
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VIEW FULL CATERING CATALOGUE
makro.co.za
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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
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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.
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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
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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$t cope so we try not
have dishes like curry on the menu ”
take on franchisees with no previous
says /hris#e. “Now we do
experience in the restaurant industry.”
and they are very popular.” The menu is structured
around
hearty
healthy seasonal fare with an eye
on
trends
like
Ban#ng.
Neil Griffiths, who is operations director of the Doppio Zero group’s Piza é Vino brand
(
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* A new Doppio Zero costs
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around R6-million to develop with
are on track for the new stores at
;iza P Vino stores at around R3.5-
about F0m and 1 m respec#vely but
million and investors must put up
that food cost at F0m is a challenge
half the cash. Dranchisees who want
they are tackling head on looking at
to own mul#ple stores need to have
suppliers and adding value to the
the skills to lead teams so unlike
menu rather than cost.
with QSR franchises this is not an easy solu#on to growth. “The market went through a dip
“,e used to pay R 5/kg for calamari for example now it$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
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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.
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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.
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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 supermarketsâ&#x20AC;&#x201D;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.
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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 015â&#x20AC;&#x201D;which
ics and encompasses an array of compe#-
provides a dynamic synthesis of primary and
#ve strategies underpinned by progressive
secondary researchâ&#x20AC;&#x201D;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
exponentiallyâ&#x20AC;&#x201D;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 industryâ&#x20AC;&#x201D; 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 â&#x20AC;&#x153;are price sensitive but don't mind spending money on value.â&#x20AC;? ,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
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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.”