The year 2018 was one of the most challenging to date for franchising, but fortunately, there is light at the end of the tunnel.
With the global economic slowdown biting hard, many people have opted to save money by eating at home. As a result, sit-down restaurants have moved toward fast-casual upscale menus with reduced costs and lower checks. To cope with dwindling traffic, restaurants have also taken to delivery like a moth to a flame. No longer confined to the fast-food category, applications like Toters in the Middle East make it possible to order from fast-casual and even fine-dining restaurants that might not have an in-house delivery team and don’t necessarily cover all geographic areas. Supper in London, the first delivery service sourced from Michelin-star restaurants, uses a fleet of custom-made bikes and specially trained delivery drivers, using new technology to ensure food won’t get thrown around in a backpack.
Ghost restaurants or delivery-only establishments have mushroomed, while brick-and-mortar eateries are trying to adapt to the new reality, incorporating more experiential dining, plant-based meals, ethical menus and Instagrammable dishes. The retail-eatery is also back, as evidenced by concepts like Arket, H&M’s new upscale European chain/Nordic food destination, and 10 Corso Como, Milan’s living magazine, where editorial choices in food, fashion, music, art, lifestyle and design are constantly made by the visitor.
Breakthroughs in technology have prompted restaurants to work harder and get creative. New concepts like Spyce from Daniel Boulud, Creator and Zume from our Hospitality News 100 are fully automated restaurants that we predict will soon be extending across the Middle East.
One thing is certain; with supply clearly outpacing demand in some Middle Eastern markets, the franchise sector needs to set competitive prices for products and services, regardless of category, in order to stay afloat in the coming year.