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How can food businesses survive a pandemic? An F&B expert gives his insights
How can food businesses survive a pandemic? An F&B expert gives his insights
ABS-CBN News
Published Apr 02, 2020 12:24 PM PHT
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Updated Apr 02, 2020 01:44 PM PHT
The sky has fallen. A disruption of this magnitude was nothing any of us in the hospitality industry could have ever imagined. With dine-in service closed down, staffing to consider, supply chains disrupted, how do restaurant operators move on from this new reality?
First comes denial, then comes acceptance. What comes after?
Talking with industry colleagues brings to mind that the basics and fundamentals of restaurant operations is what we need in order to recover from this business interruption.
“I think the first thing that other restaurateurs can do is to move on to the acceptance phase very quickly. The faster we accept that, the faster we can move on to making preparations,” says Nowie Potenciano, proprietor of the famed The Sunny Side Group of Boracay, as he recalls their experience during the closure of the island in 2018.
In times of confusion, honest and timely communication matters
Making employees feel secure is not just about what you say but also how quickly you can say it. Abba Napa, co-founder of The Moment Group (operating Manam, Ooma, 8Cuts Burger, Din Tai Fung), designed a “family tree of communications” using mobile apps. In the span of one hour, they are able to reach thousands of employees in their company. “Being in touch real-time, coupled with trustworthy and positive communications, is vital,” Napa says.
Getting staff to work was a challenge. Some were fearful of travel, others were stranded without mass transport. Some restaurateurs resorted to ferrying employees around in vans, limiting their number of passengers to observe social distancing protocols.
When I was in the corporate side of F&B, there was a time that living 10 to 15 kilometers away from the branch was a hiring criteria so that employers could draw from resources that were within reach in case the stores needed to be manned in times of emergencies. This may be a hiring criteria worth revisiting.
Cash is king
Only cash will get us through this situation and the recovery months thereafter.
In hindsight, we should have budgeted two months of operating expense as emergency funds. We should have channeled 20 percent of sales to savings. We should have set aside 13th month allocations every month. There are numerous should haves, but truthfully, most businesses are unable to afford to do this. Now that we find ourselves in this situation, we can only recall our parents’ voices loudly in our heads saying that it’s okay to save only PHP 1, for as long as you get to save.
No one is left unscathed. Even quick service restaurants have resorted to converting inventory directly to cash, skipping the process of selling finished goods.
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Our instinct might be to push back on supplier payments, not realizing they are in this as much as we are. “Since we have already ordered… we have and we will be paying duties and taxes for all of these containers which will end up in our warehouses and premises, untouched and undelivered,” says Jojo Vega, president and managing director of Don Revy Philippines Inc., an importer and distributor of wine, beer, and spirits.
Don Revy’s extensive portfolio of wines at The Bevvy in Makati. Photo by Chris Clemente
In this mad scramble of finding and stretching cash, we have to remember that for a smooth path to recovery, our supply chain has to recover first.
Marketing should always be strategic, never ad hoc
Just as we thought, The Moment Group could not get any more amazing as they came up with the timely launch of their Moment x 7-11 collaboration and “Moment the Grocer.” Who would say “no” to having their famous Manam sisig at arm’s reach to comfort them during these times?
Like I always tell my students and clients, restaurant marketing should increase foot traffic, average check, brand awareness, or sell more of your stars. If these criteria are not met, then your marketing budget is nothing more than money poorly spent.
There are many marketing lessons to be learned from The Moment Group on restraint, planning, and confidence. “I think the first thing we really did was to stop marketing as we know it. We all felt this was not the time to do that,” says Napa. “A lot of the things we are rolling out now… have been ideas we have been dreaming about and developing for some time now. Each of them were in different stages of ideation and planning before the lockdown commenced. Needless to say, we were extremely busy once the lockdown went into effect noting that ideas in the back burner were quickly moved front of the line.”
Miguel Vecin, owner of Bar Pintxos and Txoko Asador, is already looking at what’s ahead. “The first hurdle after this would be actually just opening, making sure all our staff are okay and fit to work, and preparing the restaurants for operations again.”
The just-opened Txoko Asador just a few days before it had to close down temporarily. Photo by Chris Clemente
“Definitely the dining scene will change. People will be more wary of crowded spaces. We may need to space out our tables or accommodate 50% capacity at a time.”
In our eagerness to recover lost sales, we must remember to gear up to 100 percent slowly but surely, re-train staff and, if needed, revise menu items to avoid spending much needed money sourcing ingredients from supply chains that are not yet efficient.
If there is one thing to take away from all this, when it’s time to get back in business, there is no need for fancy plans. Take the time to get back to basics and your business will be better for it. Remember, all disruptions shall pass.
For those food business owners with questions about how to keep their businesses afloat, here are a list of handy resources on legal, human resources, taxes, and other related concerns:
The author is an F&B Operations Consultant. His firm, Mise en Scene F&B Consulting, coaches first time restaurateurs as well as those who need to expand or professionalize. He is also a member of the academe.
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