Following on from the previous post about the March Propel Multi Club event, we have continued to consider what lessen could be learnt form the speakers and the people we met.
Part 2 – The sector is changing and quality is key
Against a backdrop of media reports that some sectors are currently suffering, it was great to hear from Graeme Smith, co-head of financial advisory service AlixPartners, that there is still a real appetite from corporate finance and real estate funds to back and make hospitality acquisitions over the last year and will continue to do so next year. He noted that there have been a lot of consolidations and mergers of the strong, well managed brands in the UK. Here are three factors that are expected to drive success this year.
- Operational excellence. These are businesses with not only great people, but those that have solid systems and process in place to ensure great service levels.
- Offer a visitor experience. Businesses that are able to give their clients something to tweet or Instagram about is crucial in adding value. This point was backed up by Katy Moses, founder of KAM Media, whose research shows that nearly 50% of 18-24 year olds would chose a place to eat or drink based on how good they looked on Instagram.
- Able to broaden their trading windows. Business are looking to maximise their real estate by making more of the hours in the day available for trading. For example, we are seeing pubs offering breakfast and rooms, restaurants such as Wagamama are being really successful by offering a takeaway service.
This changing nature of business is something that was spoken about by veteran publican and chairman of Stonegate Pub Company, Ian Payne. Ian had noticed that wet led pubs have gone from being open over two short windows in a day, to being open 16 hours a day, every day. Ian also warned against the increased sale of high ABV beers, believing that their prominence had coincided with the decline general decline in drinks sales as they were simply too strong to drink several pints of on a regular basis.