'The restaurant market in the UK was heading for a correction well before the Coronavirus outbreak'

Franco Manca and The Real Greek leader David Page believes that many hospitality businesses are failing - not because of the pandemic, but because bad practices were already taking them in that direction before the outbreak. 

Speaking to the Food Service Equipment Journal, the chairman of Fulham Shore said: “We believe that the restaurant market in the UK was heading for a correction well before the coronavirus outbreak. There were too many restaurant businesses with owners and managers convinced they could swim like Mark Spitz, but which were actually being kept afloat by some badly-made rubber rings and various leaky flotation devices.

The man may have a point, as the list of CVAs in the casual dining market continues to grow: First it was Chilango, the The Restaurant Group, Yo!, Pizza Express, Wasabi, Itsu... Not to mention administrators called in by Jamie's Italian, and saw Byron, Strada, Giraffe and Carluccio's before that. 

The reason for this, he argues, is that "they were driven to expand by historically cheap debt, supposed high exit multiples on sale of the businesses and run by management teams who had never experienced either a downturn in the UK economy or an oversupply in the restaurant sector.”

Shamelessly plugging what he sees as the merits of Fulham Shore venues (which to his credit have seen consistent revenue growth pre and post-lockdown), David Page argued that businesses that will be successful in the future will be those which deal in reasonably priced food made with quality ingredients and served by motivated teams. 

Additionally, unlike many of the failing businesses, he believes that Fulham Shore has made better real-estate choices, from location to the negotiation of realistic rent contracts.

He said: Our experience over the last six months has shown that the restaurants that provide what customers want will thrive under the most difficult of circumstances. Ploughing the same old hackneyed furrow of formulaic me-too offerings won’t work anymore in the UK, especially in times of societal turmoil and economic upheaval.

“We believe that the public want food sourcing that is trustworthy; they want to know that the owner of a restaurant knows the farm or vineyard that the food and wine on the menu comes from.

“Combine this with menu pricing that doesn’t leave them with bill shock and servers who are seen to be having a good time while working makes for a great atmosphere and, consequently, high customer numbers per site.

“Purchasing directly from our growers and producers cuts out one, two or even three wholesalers, agents and middlemen. This enables us to pass on these savings to our customers in the form of more affordable menu prices. This results in the high numbers of customers visiting our restaurants per week and means that our turnover per site continues to be strong. This is the future – high quality ingredients combined with low prices, delivering high turnover per site.”