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Mon 22 Nov 2010 12:00 AM

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To have your cake and eat it

In a world full of competition and fickle customer trends, finding the right niche market for your F&B business is crucial to survival.

To have your cake and eat it

Just how do you go about finding that slippery and elusive idea
that can make an F&B business? It’s the niche, that sliver or wholesome slice
of the market for which you find that perfect product fit — a marriage of sorts
— that keeps the customer coming back for more.

There are the big hitters with high-end ideas and then, flying
just under the radar, are the smaller independents happily chomping on their own
slice of the cake and not concerned with putting too much dressing in the shop window.

They are the savvy and imaginative operators who want to create,
rather than import ideas tried elsewhere.

A case in point is Just Falafel. The humble vegetarian snack
food, deep fried in side streets across the Middle East has been taken to a new
level with a fledgling chain that is about to go into orbit with plans for international

After testing the market successfully in Abu
Dhabi in 2007, before moving on to Dubai, co-founder and managing director, Mohammed
Bitar, is now thinking globally. Further expansion is on the way and franchise experts
Francorp are now plotting a course that will introduce Just Falafel to the world.

Bitar explained: “I’m Lebanese and grew up with falafel and when
I came to the UAE I wanted to find falafel and couldn’t. With the help of my partner
I decided to open a shop. A lot of cultures claim to have been the first with falafel,
so we decided to bring that theme under one roof. That was where we found our niche,
by giving falafel an international feel.”

That was the conception of Just Falafel, a simple idea, a keen
eye for branding and a gap in the market.

Just Falafel’s menu is a quirky expression of this; there’s the
Italian falafel sandwich, the Indian sandwich, even a Japanese sandwich and various
other international incarnations of the basic falafel recipe. All of this is supported
by tongue-in-cheek branding and slogans like: ‘I fell for falafel’.

“I had an idea and this is taking off,” added Bitar, “We are
now investing in one central kitchen and our plan is to take Just Falafel globally,
to have a shop in many big cities.”

“We are going to take this to the next level,” explained Bitar.

Such fresh ideas and detailed market research will be key to
the survival of F&B outlets in the Middle East,
industry professionals agree. However, the quest for the niche market is a complex
one. It can be a risky business.

Bitar admitted that market testing for Just Falafel involved
two years of financial losses and continuous investment. Happily for the business,
economic downturns don’t test the public appetite for a cheap convenience snack
like falafel.

At the higher end of the scale, F&B managers are digging
deep and tapping into their imaginations as the customer matures. Finding the right
balance can be difficult and more is at stake financially. Failure can be a very
costly business.

General managers of major hotel outlets have agreed that a greater
empowerment of F&B managers may be the way forward in approaching the market
in the Middle East.

Bars and restaurants continue to make huge contributions to the
revenue of properties in the Middle East, estimated
to be in the region of between 40% and 50%.

In 2010, finding a niche in the back draft of a world-wide downturn
calls for innovation and strategic thinking.

The recent Hotelier Middle East Great GM Debate at Jumeirah Beach
Hotel heard some of their views on how the market is evolving.

Muin Serham, general manager of Tamani Hotel
Marina said that celebrity
and big-brand concepts were generally working well.

Hilton Jumeirah Resort and Residence manager, Christian H. Muhr,
said that carving a niche required extensive market research.

“Finding a niche market will require detailed market research.
There are many challenges and quality, consistency and the customer getting value
for money are very important. In my mind we have not grasped what has to be done.
We need to find niche markets. All of the discounting that is going on is dragging
the F&B product down.”

One high-end and independent F&B outlet that has successfully
carved out a niche and has a solid customer base is Okku Luxury Japanese Restaurant
and Lounge in the Monarch Hotel, Dubai.

Okku — a home grown F&B concept — has enjoyed considerable
success during economic tough times since its opening in 2008.

Co-founder, Markus Thesleff is realistic and frank in his reading
of the UAE F&B market. For him, hotel general managers either don’t care about
niche or if they do, they can’t do anything about it.

“For us it came to difference,” he said, “Especially in Dubai — it was all about franchises
and there was no creativity. We wanted to show that something could be created locally
and taken elsewhere. So we deliberately chose the hardest cuisine in the world to
get right, Japanese cuisine.

“The cuisine is more of a lifestyle than just about the food
alone. To be honest we just wanted to do a decent job on it, but as it turned out
it was better than we ever imagined. In the market we are owner-operated and the
approach to the customer is consistently the same. The biggest secret in this market
is simply the staff and the food and that’s where our corporate culture comes in.
We have to survive and do well — when you are in a big hotel the people, the customers,
are sometimes taken for granted. We are the opposite of that.”

Thesleff said that Okku’s identification of its niche market
was pinned on people who live in Dubai,
not tourists or hotel guests. It proved to be a winning formula.

“We wanted something created in Dubai,
for Dubai and which
could be taken elsewhere. It is for people who live here. We push the food, we push
the service — we very clearly identified that niche. We also focus on the bar and
the drinks.”

Thesleff and the Okku management have succeeded in carving a
niche with a point of difference that has it turning more than 400 covers on a busy
night in a 78-seater restaurant.

“We focus on the food, we don’t call the people behind the bar
bartenders, we call them mixologists. The future of F&B is niche, everything
now has to be niche. It means everything to everyone, it’s about identifying a lifestyle
and buying into that lifestyle.

“As for hotel general managers, they don’t really care about
this. They either don’t care or they do, but can do nothing about it. F&B managers
have to be more empowered in the big outlets, I would certainly agree with that.”

According to Guy Wilkinson, partner and general manager at Viability
consultants, ‘niche’ simply means exciting and fresh.

“There is a niche for people
who want to service those who simply want a quick sandwich. There is still a hunger
for new and exciting brands from the customers point of view.”

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