Hungry for a new challenge
Food and drink firms are adapting to succeed but a new lockdown is hard to swallow for some, says John Crowley
“THERE is no love sincerer than the love of food,” declared George Bernard Shaw. With Rishi Sunak’s ‘eat out to help out’ scheme a distant summer memory, and lockdown restrictions in force, independent food and beverage outlets are thinking creatively about how to deliver products their customers crave.
Samuel Mensah is the owner of Uncle John’s Bakery in Tottenham, a family-owned firm that supplies Ghanaian sweet baked treats to supermarkets and food service operators. With two factories and a staff of 15, Mensah has pursued a three-pronged approach based around a retail outlet, a wholesale arm and an online business-to-consumer offering.
When lockdown resulted in a fall in retail footfall and initial drop in sales of 20%, Mensah knew he needed to “pivot the business and challenge the status quo” – and that has meant developing the Uncle John’s internet offering. So last week, he expanded his online next-day delivery pledge from an eight-mile radius in north London to countrywide.
Being able to adapt quickly is vital. “For a family-owned business change is something that could take time to implement but the pandemic fast- forwarded a lot of things for us,” Mensah says. “In the ongoing situation, digitisation plays an important part in our growth.”
To ensure the new delivery service worked, Mensah sent the Uncle John’s ‘signature box’ of products to long-term customers in areas such as Kent, Edinburgh and Manchester. The tests went well, and now customers across the country hankering after the likes of bofrot – traditional Ghanaian doughnuts – can order them to their doorstep via the company’s website.
As for England’s second lockdown, he is bullish. “My mother uses the word obeyeyie, a Ghanaian term meaning ‘things will get better’, to remain positive. In every misfortune lies a chance for opportunity. It’s in our ethos.”
When Vinny Patel learned in March he would have to shut his Indian restaurant Doosra, he was succumbing to Covid-like symptoms. “I was ill, worried about my staff contracting it, and I was staring out at an empty restaurant. Before the pandemic, we had a limited takeaway collection before 7.30pm because we wanted to focus on our in-house customers.”
Soon it was apparent that takeaway food was the only game in town, but Patel had to move quickly: “We didn’t have an adequate ecommerce platform, packaging, equipment or drivers, let alone an established customer base for home delivery.”
Patel’s restaurant in Surbiton, Surrey, had received glowing notices when it opened in 2017. Keen to impress a restaurant reviewer as the spring lockdown eased, he home-delivered a ‘menu meal kit’ that could simply be heated up. On the drive back home, he felt he could scale up a proposition that would deliver chilled products by post.
Customers could order online when they wanted instead of waiting for a Friday night delivery to get through traffic. The Twitter hashtag #currybypost was born – but there were issues.
“Other enterprises had been delivering frozen products but curries are delicate and don’t freeze well. A lot of the flavour gets lost,” Patel says. Yet he felt the technical demands were not insurmountable. After all, Doosra already received free-range meat and poultry via couriers in temperature-controlled, insulated boxes.
He could do the same with curry boxes by post. “My graphic designer handled product labelling and branding requirements and I got on with packaging solutions, food photography and built a website with an ecommerce platform on it. By early June we were ready to launch. In the first week, we took orders for just shy of 50 boxes.”
Curry by Post enabled Patel to take his five staff out of furlough. Now his signature Tanzanian lamb curries and other delicacies have travelled as far as Aberdeen and Cornwall and up to 150 boxes are delivered every week.
“The beauty is that you get revenue and production outside your bottleneck Friday and Saturday nights,” says Patel. “My challenge is to get packaging costs down. For small orders the cost can be up to 25% of the order total. We absorb the packaging cost but customers pay an additional £8 flat fee for delivery to anywhere in the UK mainland.”
Stephen Magorrian is co-owner of The Horatio Group, an award-winning pub company with three bars in Northern Ireland, one of which doubles up as a small hotel. It employs around 100 people. The province is three weeks into a lockdown due to end on November 13, but which could be extended by the Northern Ireland Executive (NIE). All hospitality venues are currently closed and are allowed to sell food only as takeaway or delivery, but no alcohol.
Off-licences and supermarkets are allowed to sell alcohol until 8pm. This has caused consternation with pubs. “Publicans feel that prohibiting them from selling alcohol during this lockdown takes away the opportunity of selling food and alcohol together as a takeaway,” says Magorrian. “Not having this edge, they believe, makes the sale of takeaway food unviable.”
All three of his outlets are closed during the week, except for takeaway food at the weekend and where essential frontline workers stay at the hotel.
“The food element, which we started at the end of October, made a small loss, but we have implemented learnings and hopefully we will break even at least. This will allow us to pay some wages to the staff who fall though the gaps in the current furlough scheme – those who joined us since the last lockdown and don’t qualify for the scheme.”
While The Horatio Group has used government Covid-19 schemes, it is calling on the NIE for flexibility. “We are selling takeaway food, but there is no market except for Saturday and Sunday because everyone is doing it. If we had alcohol sales to go with the food, that might help.”
He adds sombrely: “We have no money coming in and reserves are dwindling. Apart from that it’s planning for the future, in the hope we have a future.”
Throw in the uncertainty over Brexit and you have a perfect storm. Asked what advice he would give to other SMEs, Magorrian responds: “Try to remain positive. Look at ways to diversify. Be ruthless with the cost base, and forget about profit for the foreseeable future. Cashflow is what matters most in the months and year ahead, along with keeping the level of debt to a minimum.”