The whole of the UK has its eyes on the 4th of July. It’s being described as an Independence Day for the hospitality industry, and consumers, as well as business owners are champing at the bit for the moment when doors can officially open. Brewdog, for one, has made it known that it will be amongst the first to throw open the gates and by saying on Twitter: “We can’t wait to welcome you back to our bars so will be throwing open the doors the minute we’re allowed to.” The beer brand plans to run midnight events at its bars throughout England.
Given the levels of anticipation and excitement gripping the nation, it would be easy to see 4th July as the beginning of the end of the sector’s challenges. Unfortunately, that isn’t the case. While under lockdown, many business owners have been able to make ends meet through government grants, reduced rents and mortgage breaks; operators haven’t had to pay staff and produce hasn’t been required from the supply chain. When lockdown ends, these financial cushions get taken away. It will, once again, be up to businesses to generate the cashflow they need to pay the bills and keep their doors open. On top of this, prices along the supply chain will rise as suppliers look to compensate their own losses and recover post-pandemic.
This is not meant to be a prophecy of doom. Far from it. But it would be naïve to think that businesses are going to be able to return to normal within weeks. There is a sizeable hurdle to overcome first: namely social distancing. In a sector where margins are notoriously slim, prices are going to be going up at a time when tables and customer numbers are necessarily limited. Operators need to find a way to balance the books and aim for profitability.
How to make money
Brands could put their prices up, but this can only go so far before customers turn away. Our recent consumer survey showed this when 40% said that they would think twice about eating out at their favourite brand if the prices increase. But besides price hikes and negotiating with landlords and suppliers, what else can they do?
The emphasis must be on increasing business productivity and on turning tables quickly – while maintaining health and safety standards and keeping a consistently good customer experience. It’s that positive experience (experience being a combination of enjoyment and trust in the safety of the environment) that will keep customers returning.
The right technology suite will be essential for achieving this. Digital ordering and payment solutions, whether off- or on-premise, promote social distancing through safe and secure touchless commerce. By placing the ordering and/or payment journey into the hands of the customer, brands can streamline the experience without diminishing it; removing common bottlenecks such as waiting for a server to take an order or release the bill. This, naturally, leads to faster table turnover.
Why size matters
Whether it’s on- or off-premise, or a combination of both, what a business needs depends on factors such as location, audience and, most important, size.
Venues with small drinking or dining spaces, where tables are already limited and often squeezed together will experience the greatest struggle. Here, no matter the speed of table turnover, keeping revenues high while reducing covers and spacing seats further apart would be impossible. These brands should utilise an Order Ahead solution, letting customers place an order for collection (or delivery) and taking payment, digitally, in advance. By fitting customers into timed slots, they can manage traffic and optimise output; adding extra revenue to that they take from their dine-in guests.
Pubs and restaurants with larger sites will be better placed to deal with social distancing and may still be able to fit large numbers of guests into the dining area without violating distancing guidelines. However, these companies are likely to have greater overheads: more employees, higher rents and greater stock requirements. In such cases, on-premise digital ordering and payment technologies are the ideal way of reducing staff-customer contact. On-premise might include a touchless payment solution, where customers can tap their phone to an NFC token or scan a QR code to bring up and pay their personal bill. Alternatively, it could be an ‘Order to Table’ platform – working in a similar way to Order Ahead, but with the customer requesting their meal/drinks be delivered to their given seat as soon as it’s ready.
Of course, an interaction-free meal out isn’t what every customer is looking for, nor what every venue wants to provide. For them, there is a way to remove the physical menu touch point while keeping a degree of human interaction: digital menus. Viewed on a person’s mobile device, a digital menu is more than a simple upload of a PDF; it works to optimise the consumer experience and can be updated in real time to show changes in item availability, offer deals or highlight add-ons, thereby influencing greater customer spend. This solution is one that can easily be used alongside a touchless payment technology.
This all sounds great, but aside from letting customers order and pay at will, and increasing table turnover by removing service bottlenecks, how do such technologies maximise profitability? Primarily, they reduce the number of waiting staff needed on site during a shift. Without the requirement to take orders or fetch and retrieve bills, staff need only interact with customers when delivering them their food. It’s a two-pronged solution as businesses look also to manage staff safety and social distancing back-of-house.
As a final point, it has been seen time and again that ordering from a digital platform increases basket size by 30% and more. Digital menus can employ modifiers, tags and meal deals to encourage greater spend and increase spend-per-head. Any opportunity brands have to boost spend should be embraced wholeheartedly.
The 4th July represents the next phase in an ongoing journey for business operators in the hospitality industry. The opportunity to reopen, welcome and reconnect with guests is an exciting one. Brands simply need to think and plan; consider how they can streamline operations, boost customer spending, reduce costs and give customers the experience they’re hungry for in a post-lockdown world.
By Dan Rodgers, president and founder of QikServe