It is a stark reality that faces any restaurant operator around the world. It’s the hard fact that on some occasions — despite all the hype and enthusiasm built around a special occasion — many of your confirmed ‘booked’ guests fail to turn up for some reason or other. This is a truly heart-breaking moment for any operator and the team running the outlet. All the focused efforts put in to put up a great show turns into a damp squib.

One such day where many a Dubai restaurateur had to face such disappointment was Wednesday, February 14, 2018. The city’s culinary industry had really put in all their efforts to make it a truly special day for Feast of Saint Valentine — which can, of course, have a lot of sentimental value attached to it.

Unfortunately, it was not to be. Frantic calls to get confirmed guests in or get waitlisted bookings confirmed did not materialise. It was a sad day for the entire industry. When the peak of business is expected, and in reality hits a trench, there is a huge sense of disappointment and frustration.

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Frankly speaking, we can say that what we are experiencing in the food and beverage business in Dubai is a golden era of multi-cuisine and various concept dining — guests are essentially spoiled for choice and spoiled for options. The synergy exemplified in the coming together of international brands and home-grown establishments all over Dubai has given the consumers a remarkable range of choice. Moreover, the mentality of the Dubai clientele, following years of financial prosperity, combined with a cosmopolitan attitude, has opened the mind-set to a wide array of exotic tastes beyond the realms of traditional cuisine. It is truly a wonderful time to be in the culinary industry.

Having said this, I want to add that we have not experienced a more difficult period for restaurant operators, at least from an operational management thought process. This is why it proved to be a reality check that the Valentine’s Day debacle can have far reaching consequences for the future of the industry.

Let me explain. It is a known fact amongst restaurant owners that most of us did not start the business just to make money. It is the unending passion for the culinary arts that makes us hold on for so long despite all the adverse market realities.

Market realities-related problems, especially with the independent restaurant model, is a known issue. Rents and related operating expenses, especially in Dubai, though true for any part of the globe, have been skyrocketing continuously for the last few years. VAT was introduced this year, which penalises restaurants significantly as much of what they purchase cannot be reclaimed (food is bought zero-rated, but restaurants have to sell it with the tax added). Living costs in Dubai are, as with rent, escalating at a rate which necessitates a constant climb in staff wages. Ingredient costs have also been soaring, especially when it comes to staples like flour and dairy. The fluctuating international currency value has pushed up the price of wine dramatically, and has had a detrimental effect on our diners’ sense that what little of their income remains after essentials have been accounted for is best spent eating out.

On top of this, there have never been more restaurants doing business, nor fewer trained professional staff to support them up, competing aggressively over a rapidly declining clientele base — all of which feels like some heavy weather is brewing on the horizon and the number of restaurant closures is only a sign of reality.

Summing up, it is an unfortunate reality that restaurant operators lost a lot of money on Valentine’s Day, from all the excess food wasted and labour costs involved in cooking the spread, and waiting staff standing around for the many guests expected who never showed up. For some it was as high as 40% of the total bookings confirmed. This bad experience would indeed tempt many an operator not to resist the unkind pretext of demanding a deposit and imposing a no-show charge on such occasions. But given the reality, Dubai is not ready for such! Will this be the only recourse in the future?

I agree that restaurants can be expensive, but so is much of our modern life, and the hectic competition demands that business operators keep their margins feasibly low. We need the support of authorities, landlords, visionaries and the clientele to help us sustain this industry which has survived many a debacle. And I’m sure that we will survive this too.

About the Author: With more than 28 years of hospitality experience globally, Naim Maadad is the founding CEO of Gates Hospitality, which owns and operates hospitality concepts including Ultra Brasserie, The Black Lion Public House & Dining, Bistro des Arts, Reform Social & Grill, Publique, and Folly by Nick & Scott. It also has ownership of Six Senses Zighy Bay. Email: Naim@gateshospitality.com