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“Keep in mind a focussed menu, optimum pricing, lean manpower”
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Monday, 14 September, 2020, 08 : 00 AM [IST]
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 What began as a difficult choice to make in terms of career or passion, quickly turned into a success story for Shikha Shetty, founder, Chief Foodie Officer (CFO). The identity has been designed not just to speak about food but also to the attachment, care, concern of everyone’s food cravings. A visionary and achiever at a very young age, Shetty shares her insights on the current situation in the food and beverage industry in light of Covid-19, in an email interview with Kimberley Fernandes. Excerpts:
The food and beverage industry has suffered a huge loss due to the outbreak of Covid-19. Comment.
Due to the pandemic, all sectors have suffered a huge loss which is going to take a long time to recover. However, the food and beverage industry is most impacted and will take longer to revive as food comes into direct contact with the people cooking as well as the ones who are serving. Human psychology obstructs people from eating or getting parcels from outside as they believe, this is not safe and the virus is contagious. Due to social distancing and certain norms, restaurants are completely shut and home delivery is the only medium for the food industry in the next few months.
Do you anticipate brands reinventing themselves in the food and beverage industry in order to gain back support and loyalty of patrons? Elaborate.
In my opinion, the food and beverage industry will need to rebrand itself more in terms of processes, serving styles and healthy food. I don’t see them reinventing the food but the concentration should be on the service, social distancing, hygiene, abiding by all the compliance norms and stretching themselves to create and display a dining experience by which the customers feel secure and safe.
What do you foresee restaurant revenue managers doing to stay ahead of the struggle towards cost management, price wars, and special reduced rates on ordering food through various food delivery platforms?
3 things that I can think off would be –
- Waste Management has been a primary source of optimising revenue in the food industry and will be even more importance in today’s times.
- Manpower planning in restaurants will become crucial - to ensure the people flab is cut down and it’s mainly the kitchen which is staffed with efficient people
- Menu designing and having only fast moving items on the menu is another way revenue managers will have to plan to stay ahead of the income curve.
How can the food and beverage industry put into action a plan for overcoming the economic downturn and low expenditure due to Covid-19?
The food & beverage industry caters to the basic necessity of human beings and in reality this industry has the best opportunity to revive the economic wheel. Other than providing employment, the sourcing of the raw materials and transportation itself sets the economy in action. However due to low expenses by customers, the menu needs a complete revamp which can offer limited variety, fast moving items, healthy options and a very hygienic meal. All of this will require a smart pricing strategy which caters to the revenue of the restaurant and also meets the customer pockets.
What types of policy interventions are required from the government to mitigate the issues faced by the food and beverage industry due to Covid-19?
- The largest policy which I can immediately think of is the control and management of fuel prices. F&B is maximum impacted if there is a delay in raw material supplies or an increase in transportation which carries the raw materials. Therefore my immediate reaction would be the management of the fuel prices which can help restaurants to plan their pricing strategy.
- Governance on restaurant timings and the social distancing norms which the government should put in place.
- Regular and sincere audits are also critical.
- Licence fees on restaurants and beverages needs to be relooked considering the downturn of revenue by and large.
What is the magnitude of the impact of loss of business due to the circumstances caused by Covid-19 upon your major clients in the restaurant industry?
Like I mentioned earlier, all industries are impacted in this pandemic and the restaurant industry which has always seen new heights, new menus and new outlets every month definitely will face a slowdown now. Real estate prices are always the major capex for any restaurants. Rentals in prime localities are almost 20-25% of the operating cost. In a situation like this where revenue is a challenge, baring this cost is huge and the impact is that we are hearing and seeing some outlets shut down. The magnitude is so large that we see popular restaurants having to shut due to inability to pay rentals in the given situation – they are just compelled to work with delivery/parcels service. This has also resulted into huge clientele loss.
What measures would you suggest to newcomers in the industry during Covid-19 and post-pandemic, to help them keep their businesses afloat?
Like in my earlier comment, I would suggest the upcoming outlets to keep in mind a focussed menu, optimum pricing, lean manpower and affordable low priced well bargained real estate place to operate.
Most importantly the voice of the customer must be heard and the menu should be designed accordingly.
Collaboration with peers in the food and beverage industry and outside it will be a norm post-Covid-19. Share your thoughts on the same.
Collaboration with peers may or may not be a great idea.
It all depends on how well this collaboration can be driven. In a space which is small, cutting the pie smaller may eat into one’s own business which could possibly lead to unhealthy competition instead of helping each other survive. I think we need to wait and watch for this space.
Do you think it is advisable for restaurants to hire local staff from within the state? Why? Yes, may be a good idea to hire local staff. We do not know how long this pandemic is going to last. Even if we are able to address the issue, confidence in clients and building trust in eating outside will take a while. Having local staff will help contain the problem and movement across borders will also be less.
What are your key short-term and biggest long-term challenges post-Covid-19?
Key short-term challenge is to establish confidence in clients and bring back the memory of the brand. Biggest long-term challenge - is how do you balance revenue with the operating cost in a situation post-Covid, where the confidence will take its own time to rebuild.
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