By Parag Deulgaonkar
"They are trying to get their return on investments in 24 months as supposed to five or 10 years," says Rotana CEO
Expensive food is forcing customers to skip expensive restaurants in Dubai and Abu Dhabi, according to a top UAE hotelier.
In an exclusive interview with Arabian Business, Rotana CEO and president Omer Kaddouri said “greed” to get back their investment in a short period of time is forcing restaurant owners to keep food prices high.
“In such a competitive market place today, it is not a good idea to keep raising your prices for restaurants. On the contrary, they should be making prices more accessible for people to come and eat and drink in their restaurants.”
“And that’s the problem that Dubai has today especially or may be even in the UAE. When investors open up restaurants they charge too much in the beginning and customers come once, but they don’t go back. They are trying to get their return on investments in 24 months as supposed to five or 10 years.”
The CEO believed high rents in Dubai and Abu Dhabi were compelling investors to get their money back as early as possible to pay their rents.
“However, pricing is the key. People will go to an expensive restaurant once or twice a month but people will go to a friendly nice restaurant that is great value for money much more that.”
Kaddouri revealed Rotana does not immediately pass on any price increase to customers.
“There are many years where we haven’t increased our prices but when something does increase out of the blue ... out of the ordinary, then we would have to effect that into our pricing."