Barriers to entry for restaurateurs include space and financing
At The Hotel Show’s Middle East Hospitality Leadership Forum, a group of hoteliers and restaurateurs gathered to talk about ‘F&B Strategy’ and discussed concerns for standalone restaurants.
The barriers to entry for independent restaurateurs in the UAE currently include size of available spaces for lease, and financing, revealed the experts.
The Maine Oyster Bar & Grill founder & managing partner Joey Ghazal said: “One of the biggest issues today, specifically in Dubai, has to do with the sizes being created, and leased out and developed.”
He said that until spaces smaller than 3,500 square feet are made available, restaurateurs without backing will not be encouraged to enter the market. “The sooner the locations are smaller, offering under 100 seats, the better it will be because it will encourage people to enter. At the moment, locations are 5,000-6,000 square feet which needs millions and millions of dollars of investment and in this market, only developers or investors can do it.”
Ghazal noted that smaller leasing options are important for a sub-culture to be created in Dubai, where ex-maître d’s, ex-chefs, and ex-waiters (like Ghazal) can launch viable concepts, which currently “is non-existent in the market”.
The Steigenberger Hotel Business Bay general manager Stephen Meredith agreed and said that the risk of people “folding” in this market is very real. Fairmont Ajman general manager Francis Desjardins also agreed and said it was important for independent restaurateurs to see better commercial terms and smaller spaces to lease.
Whissle Hospitality co-founder Ramzy Abdul-Majeed added: “One barrier to entry is the financing aspect, so today it doesn’t allow debt for SMEs. If you don’t have the money in equity you’re not getting something started.
“The price point of these leases is very different. What we have been seeing is very high rentals around the market, and revenue share as a kicker. If your rent is more than 10% the revenue, you’re going to struggle to make money. That is a very difficult scenario. There are serious personal liabilities if your business doesn’t do well and that stops a lot of people from trying to enter the industry.”
Welbilt brings innovations to GulfHost
GulfHost marked the first time that Welbilt exhibited in the Middle East as a standalone foodservice company. Taking place at the Dubai World Trade Centre from September 18-20, GulfHost saw the regional launch of Welbilt’s new Xpress Grill — the latest innovation from its Garland brand, representing the next generation in two sided cooking.
Speaking to Caterer Middle East, Welbilt regional sales manager Middle East Leonard Parot said: “We have a lot of exciting new products. The first one is the Garland Xpress Grill, which is clam shell cooking. That means you cook the food on both sides at the same time. It’s the first time that we’re introducing it here to the region at GulfHost. It’s a fantastic product specially targeted to the quick service restaurants. The idea is that it’s efficient and it’s touch screen-driven versus the previous generation. There’s no language barrier.”
It’s a family affair for GulfHost exhibitor TSSC
Speaking to Caterer Middle East at GulfHost, Technical Supplies & Services Company L.L.C. business development manager Rashid Bahar shared his thoughts on the inaugural edition of the show.
Bahar noted that, although it was less busy than shows like Gulfood, the show attracted a specific demographic saying: “We see a lot of our customers as opposed to just random people.”
According to Bahar, an important factor behind the company’s success is the dedication of the team: “We have good people working with us. A lot of employees have been with us for 15 or 20 years so we consider them part of the family.”
Along with an innovative portfolio Bahar underlined that TSSC’s trustworthy aftersales service is what separates the company from its competitors: “My father started the company with the mission that we provide the best aftersales service in the market and we invest a lot in aftersales service. We even take on maintenance contracts with people who bought equipment from our competitors because that’s how focussed we are on service and maintenance. Our reaction time is very fast. It could be nine o’clock on a Friday night, there’s a breakdown in a dishwasher and we’re going to be there to fix it. That’s what makes us different to our competitors.”
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