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Boom, Bust, or Somewhere In Between

For the F&B industry, Dubai has long been fertile fields famous for fruitful yields and bountiful harvests.  For years, the Dubai residents and citizens have embraced the F&B market, allowing even the most mediocre of operators to carve out a viable living.  There has been no end of companies and individuals happy to pump investment into this industry – a movement helped by an enthusiastic retail landscape supply. Hotels frequently have upwards of double-digit restaurants servicing just five hundred or so guest rooms.  As an example, the newly opened QE2 hotel has thirteen F&B outlets planned.  As a fun comparison, the Bellagio Hotel in Vegas has fourteen outlets.  However, they have over four thousand guest rooms, a casino, and significant convention and events centre.  The new Pointe on The Palm due to open late 2018, has space for another one hundred retail outlets, many will be allocated for F&B.  Blue Waters will also have over two hundred retail spaces when it comes online.  Dubai has the highest ratio of restaurants to people on the planet.

However, our industry has become fat with empty dining rooms, discounts and meal deals as restaurants clamour and scratch for customers.  We have farmed the land so hard and without respite, that the soil is fast becoming void of many essential nutrients and minerals.  Our audience is fatigued and weary.  Our costs are out of control and passing it onto the consumer is no longer a strategy that is being accepted.  Many of us are in survival mode, and I hear it almost every day from colleagues and peers.

There is a whiff of desperation out there, and growing signs of panic.  Questionable management tactics are being utilised by popular restaurants we all visit regularly.  One restaurant has enforced a minimum spend on all tables – and if the server can’t convince the table to eat that amount, they get reprimanded.  I hear of staff tips being used to pay suppliers.  Restaurants are drastically reducing staff numbers to control costs, resulting in one restaurant expecting a single waiter to look after eighteen tables by himself.  Substandard ingredients are being passed off as premium and commodity products like water are way overpriced to try make that bottom line.

Alas, we are perhaps in a situation of our own making, though.  There is an argument that says the global F&B industry, (of which I include landlords, investors, suppliers, governing bodies and restaurants), spurred on by the initial success and prosperity, have grossly overstretched themselves.  They started wanting more and more, finding little satisfaction with previous achievements and goals.  There was a desire to open more restaurants, make more profit, grow beyond their means, and their ambition became grotesque and self-serving.  The fall out can be seen across the globe – it is almost as if we have forgotten our why because we were too busy chasing that big private equity buy out.

In these challenging economic times, I hope that, as an industry, we remain ambitious and positive, but do not allow greed and panic to sully the fantastic progress and advances we have made.

However, the very fact that I was recently charged 48 dhs for a 500 ml bottle of water means someone, somewhere along the line has decided to get greedy.

Although the line between ambition and greed can sometimes seem quite thin, thanks to both being goal-driven, there is a clear difference. Simply put, ambition serves a purpose while greed is self-serving.  I think our ambition has blurred somewhat over the years.  Greed is the desire to take everything you can.  Ambition is the desire to give everything you’ve got.

You see, in some ways, everyone is a stakeholder in our industry.  Virtually everyone in a city or community has an interest in creating and maintaining a healthy F&B sector. From the government to the landlords, to the suppliers, to the operators, to the consumers, everyone has a vested interest.  A strong, robust and healthy restaurant market is one of the best indicators of a thriving economy.

Ambition serves a purpose.  It’s important to remember that.  I hope every business involved in our wonderful industry remembers their original purpose and stays true to it.  Adopt a long-term strategy, not short-sighted apathy.  Yes, by all means, do what you need to do, to survive, but hold your integrity tightly with both hands.  Put your mission statement back up on the wall, reread your company vision, remind yourself of your core values, and don’t let panic turn your ambition into greed.  Our purpose ultimately is to serve the customer, and at the end of the day, we are all customers to one another.

I know we all have targets and goals for growth and KPI’s and ROI’s and expectations to meet – I get that – those goals are important but so is the longevity of our broader community.  We have a responsibility to one another.  Ambition is not self-serving, where any means justifies the end.  It is time for us to realise that greed is not good, never has been and never will be.  Let’s consider for a moment that our choices are not just limited to boom or bust.  We don’t have to work within such extremes.  There is a middle ground between the two and it’s ok to find safe harbour there once in a while.

As Edward Dearborn says, “Let us emulate in our actions and words that ambition is the heart and soul of success and lasting prosperity.”

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