On Friday 15 July 2022 Arena brought together a number of hospitality and foodservice industry leaders to discuss ‘The Future of Eating Out’ at the stunning 5-star Rosewood Hotel in London. Scroll down to read the event review.
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The Rosewood Hotel is a stunning venue. It’s no wonder that their suites are fully booked at a rate upwards of £20k a night, according to Michael Bonsor, MD of Rosewood Hotel, who spoke at the latest Arena Event – The Future of Eating Out – last Friday.
Just off High Holborn, one turns into an elegant courtyard like something out of a movie – in fact, it really is used for movies – through a welcoming reception and down one of two sweeping staircases into the Arena event.
Around 100 Arena members, plus a few familiar faces from the first Arena Futures event, were in attendance to listen to topics 'Preserving Customer Value in Time of High Inflation' and 'The Future of Eating Out'.
For the first of these talks, David Read, Chairman and Shaun Allen, CEO, Prestige Purchasing, provided an overview of inflation and the impact on our industry. As an Arena Futures attendee, I found this presentation particularly insightful. Of course, many of us in the sector are aware of the impact of COVID lockdowns on the foodservice supply chain – from staff shortages to diminished manufacturers and less supply than demand as a result. This has led to four key drivers impacting inflation, which are wages, energy, fuel and supply shortages as alluded to above.
For those who, like me, could benefit from a knowledge refresh, we were reminded that Inflation can be measured as 'Year on Year' – comparing pricing in one month one year to the same month the previous year, which takes into account seasonality – or 'Month on Month' which compares one month in one year to the previous month in the same year – which gives an indication of pricing movements live in the market. CPI is the Consumer Price Index, which tracks pricing at a retail level – as impacted by promotional activity such as when retailers use loss leading products to drive footfall and FPI is the Foodservice Price Index which measures pricing amongst wholesalers. Generally, the FPI number tracks above CPI, since price increases are felt sharply and quickly in foodservice.
We also learned that when businesses reopened post-lockdown in May 2021, FPI stood at just under 1%. By the end of the summer, it had toppled over 1% and by the end of the year it was at 5%. What many of us didn’t see coming is the Russian invasion of Ukraine in February 2022, which has taken inflation to 10% due to the global reliance of fertiliser, white fish, sunflower oil and wheat which are all produced largely in these two countries. Sadly, Shaun told us that inflation is only expected to rise further as the conflict prevails and prevents not only export of existing stock, but also scuppers the production of next year’s crop too. As a result, we were told that these new prices we are seeing across foodservice and many parts of our lives, must likely be seen as a new step-change in business rather than something temporary, and so businesses (and consumers for that matter) need to get used to and manage these.
David and Shaun presented an array of ideas for how businesses can manage this increasing inflation by looking both internally - from menu ranging to SKU rationalisation, looking at product substitutions to deciding whether to outsource - and then externally, looking more at market reviews of pricing to see where you stand.
Following on from the presentation, Robin Rowland, Operating Partner with TriSpan LLP, Andrew Selley CEO Bidcorp and Bruce Isaacs, Partner at Hospitality Management Solutions LLP took to the stage to talk about how businesses can manage value in the food system. Themes included differentiating yourself with exceptional food and experience, whilst being sure to remain relevant on price. Selley added optimistically that “If you are still here after the past two years, you are already a survivor” and the trio discussed how people will still eat out in the future, even when times are tough, and therefore it’s important to find ways to grow beyond the natural revenue growth one will see through price increases – which must be achieved by working harder and smarter as well as differentiating.
After the heavy yet important discussion, lunch ensued, which was a delicious three courses of Roasted Peterhead Cod, Miso & Mirin; Baked Loin of Lamb Wellington and Citrus Raspberry Lemongrass Ice Cream – presented beautifully and providing a real reason for one to request that this isn’t Arena’s last visit to Rosewood Hotel. Beautifully complemented by a trio of wines from Unity Wines too, which included a fun competition for us to guess which wine we were being served with each course utilising the tasting notes on the table. There was even a prize at stake!
Post lunch, we heard a panel discussion led by Ann Elliott of Ann Elliott Hospitality Consultancy who interviewed Julie Ennis MBA, CEO Corporate Services UK & Ireland and Country President Ireland at Sodexo, Fred Turner, Retail Director, Fuller Smith & Turner PLC and Michael Bonsor, Managing Director at Rosewood London, who all spoke about how they’ve adapted in their businesses over the past few years and what this might look like for the future.
Turner spoke about the huge investment in technology across the out of home market, which has lead to a lot of learning around consumer behavior. Pre-booking continues too, which gives venues the opportunity to speak to their customers before arrival. And, where we have seen venues invest heavily in their outdoor areas – which is a huge win for those of us who get to enjoy them –table-ordering technology has enabled businesses to double head covers without necessarily having to staff up to cater to the full area.
We learned also of the enviable Luxury hotel market, whereby Rosewood Hotel is selling out of suites at £20k a night and hosting Oscar parties for some very famous names. The challenge for businesses like this one, Bonsor confirmed, is to ensure they get back to full service luxury and this doesn’t often lend itself well to replacing labor with technology – which is good news to those new to the industry and looking for work!
Turner added about the need for companies to have sustainability stories to talk to consumers. Experience and convenience are key, but this will no longer be enough! Future customers will want to know more about how businesses are protecting the environment.
Ennis also report that the sports and leisure business booming, where people are prepared to spend for experiences such as Ascot, which is a stark contrast to B&I (or office catering), where Sodexo believe footfall is never likely to return to where it was pre-pandemic, which has led to them innovating with the food offer and service they can provide.
During the Q&A, I asked, “If you could have one quick wish for the hospitality industry, what would it be?” and the trio they could all agree, along with the theme of the day, that it would be for the energy crisis not to be in the same place it is now in the years to come. It was also nice to hear a wish for people to “want their children to work in hospitality”, which is part of the shift change in perception which we can all play our part to drive.
Following the talks, and a little cameo from me as a reminder like this one is, that we would love for people to spread the word about Arena Futures as soon as we launch our next event, we were all given time to network further over more wine. For Arena Futures members, this was a chance to practice some of the skills we learned at our first event, and for Arena members, it was a chance to have some more discussions with business associates, old friends, and new connections.
Overall, the event was insightful and somewhat luxurious, and I hope that it becomes a regular on the Arena annual calendar, so that even more of you can enjoy the luxury with us next time. However I must also thank our generous sponsors Délifrance, Unity Wines, Nutritics, Nestlé Professional and Britvic Soft Drinks who helped made it possible.
Look out for more news on Arena and Arena Futures events, and I hope you found this overview insightful. You’ll have to join us for more detail next time.
Karis, Chair of Arena Futures.
|10.30am||Arrival coffee and refreshments|
|11.00am||‘Preserving Customer Value in Times of High-Inflation’ plus audience Q&A|
|12.00pm||Drinks reception and canapés|
|1.00pm||Three-course seated lunch with wine|
|2.30pm||‘The Future of Eating Out’ panel discussion plus audience Q&A|
|3.30pm||Drinks and networking|