Hotelier: Pricing is also a consideration?
Mikael: Going back to the financial aspect, there’s a huge burden on the owner who brings these people, because there’s an extra fee.
Niki: The big difference from hotel to independent restaurants is your cost of sales margins. As an independent restaurateur, I bank cash not a gross profit. I want to turn that product as quickly as humanly possible. So I’m looking at cash margins over gross profit percentages. The problem is that doesn’t look so tidy on a P&L. Obviously if you’re hitting your topline revenues, no one cares, or the bottom line. That’s the thing, trying to negotiate your way through — that’s when, if they’re true independents, they are paying you a lease and it’s brilliant. But if it’s the new trend emerging, which is creating in-house and rolling it out through the portfolio, that’s the big challenge, which is in this market, if you want to play ball with the independents, you can charge AED 150 for that bottle of wine instead of AED 195 and it’s starting to make waves. You make a stand and give house water instead of selling Voss. Because consumers locally are starting to get annoyed by it and you see it in social media diatribes that kick off as soon as new restaurants open.
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Adam: There’s always the mind-set here that you’re either the cheapest or the most expensive, and the thing in the middle… I still struggle to convey to our business partners and owners that a good value offer which is maybe above average is what will fit the market.
Marc: In the past, there was much less competition and you had to go to some key places to get alcohol — and these places would charge whatever they wanted, and not always be focused on the right quality and deliverables.
Adam: Fine dining has democratised across the world. Everyone has taken out half of their silver, tablecloths, all the clutter which became the very Swiss-style of fine dining. All the big guys with Michelin stars are doing more casual places today with spanners or spoons, or whatever it is.
Marc: You don’t want to attract one person once or twice a year, you want to attract them more regularly and the price has also to match to create repeat customers.
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