Rethinking restaurant design can help maximise revenue, says DANIEL DURING
In cities across the world, which are populated by glitzy malls and swanky real estate, virtually every restaurant faces the same problem – how to maximise revenues when landlords still have an over ambitious five-year ROI goal, and high rental rates are forcing operators into charging equally high prices to stay in business.
This phenomenon is spurring operators to look at different uses for floor space to maximise revenue. In addition to increasing footfall and the average check through old favourites such as promotions, discounts and upselling, the more creative restaurateurs are turning to new mixed-use solutions.
Developing the retail side is one such opportunity, but is this merely a trend?
A leading Italian café and retailer in the UAE says its retail and deli sales mix varies from three to 15 per cent of the total revenue depending on location, with most averaging four per cent. While it allocated 10 per cent of its front-of-house space to retail in its current sites, the new sites will only have five per cent of the total space. In the UK retail represents up to 20 per cent of the sales for the same space.
It’s a similar story at Jones The Grocer, where retail sales represents 20 per cent of total revenue, while 15 to 20 per cent of the floor space is dedicated to retail. The obvious pattern when looking at the various suppliers is that stand alone restaurants and restaurants in community malls have higher retail sales than restaurants in touristic destinations and mega malls.
There is a lack of clear statistical data when it comes to analysing the two-way potential of customers coming for coffee and then picking up a ‘goodie’ to go, versus stopping by to shop for products and then opting to stay for a quick bite.
There is no doubt that displaying products enhances venue appeal and successfully communicates quality and freshness. Although this subliminal message is potentially false – as the produce on retail display is not necessarily used in the dishes served – it may well increase the average spend through visual incentivisation.
There are many other ways to maximise revenue, the most common one being take-out and delivery, but this is an area that requires some thought during the design process. Many restaurateurs forget to brief designers on the multifaceted nature of their operation, and end up with venues that look more like train stations. Deliveries and take-out shouldn’t compromise the dine-in experience and correct planning is crucial to avoid ugly crossovers, and to ultimately secure commercial success on all three fronts.
Another area of design that can drive sales is the subdivision of space into different concepts – from bar to lounge to dining. While this doesn’t actively increase revenue, it offers multiple revenue generation opportunities.
A more obvious opportunity is analysing the minimum table size required. Many designers forget to ask the client what size of plates are being used and the maximum number that may end up on the table.
Unnecessarily large tables waste space and even the spaces between tables need to be carefully planned. Casual dining can be cosier, while upscale experiences demand greater distance between diners.
And last but not least, there’s the issue of circulation. Designers in the region don’t take into account the prevalent high rents, and continue to incorporate two-meter-wide circulation spaces. Whereas in Europe you find yourself having to squeeze between diners to reach the bathroom and your waiter has to be an expert juggler to service his tables, and there is a clear need for middle ground.
Good design is where form meets function, which translates in the restaurant arena to a question of designing space so that operations maximise their revenues without compromising comfort.
An Argentinean native, Daniel During has been living and working in Dubai for over 15 years. He founded Thomas Klein International (TKI) in 2001, following the successful development and management of the Wafi Pyramids complex. Prior to that, During worked with Hyatt International Hotels across the world in a variety of executive management roles. He speaks six languages and is a keen traveller, sailor and equestrian.