CESA’s recent and well-supported Annual Conference ran this year in association with the FCSI and BHA, adding valuable perspectives and delegates to the mix. The conference is a relative rarity in successfully running over two days, and enjoying highly effective networking throughout. It began with two outstanding sessions.
Update on the economy
The day was started by Dennis Turner, the well known and highly entertaining former Chief Economist for HSBC Bank. His quick-fire, anecdote and quip-filled style ensures attention – one blink and you miss a gem – at the same time as he imparts real insight into what’s going on.
His view? Consumer confidence is fragile, which means consumer spending is also fragile and not to be relied upon. The corporate sector is in good shape and sitting on deposits of £750 billion: it will have to start spending at some point in order to remain competitive. Government spending is slowly reducing, but may be used to stimulate growth.
The economy is expected to grow by 2% this year, and needs to get to 2.5% – expect this in the fourth quarter of 2014. And manufacturing output is the key going forward –in the form of added value knowledge, science, technology.
And it could all be blown off course by drama elsewhere – the Eurozone, perhaps?
The future of Foodservice in multiple retailing
Jason Danciger, Head of Hospitality and Counters for Marks & Spencer outlined some of the developments and thinking behind M & S’s very substantial business in foodservice. We all know about the success of the M & S food halls, but do we realise the scale of their foodservice operation:
- 450 in-store bakeries
- 52 deli counters
- 305 cafes
- 100 eateries
In fact, M & S is the third largest UK coffee shop operator in sales.
Bakeries
The bakery operation is being transformed: 20 to 30 converted every week to the new look; 1,000 bakers on a two day training course out of store; baking opened up to customer view (theatre); staff motivated and pride in the products; investment and development of equipment – from dough machines to the smell of baking…
The result: positive impacts on customers and sales – triple digit growth.
M & S Cafe
Another turn round story whose success retains shoppers in store for longer, increasing footfall and sales. Kitchens have been opened up to view; all food attractively showcased; re-design ensures that counters display products to best effect (successfully encouraging customers to ‘treat’ themselves); equipment selected and designed for visual qualities as well as performance – adds to theatre; staff selected and trained for more effective customer service; customer flows studied and improved to reduce waiting times – the queuing has much improved!
All change at M & S
M & S has recognised that Foodservice – whether Bakeries, Deli Counters in the Food Halls, Cafe, or Eateries – contributes very substantially to the success of its stores. Not just in showcasing food products and being profit centres in their own right, but in attracting and retaining customers – thereby increasing footfall and sales throughout the stores.
In order to ensure success and growth, all aspects of these operations have been and are reviewed and analysed – from design and packaging, to the equipment used, opening out kitchens and bakeries so that customers can enjoy the ‘theatre’ of food production, using equipment that adds to the visual spectacle – and training staff fully and effectively.
All these changes may have been carried out without general awareness outside the stores, but the scale has been very considerable – and with significant, measurable success.
And M & S is not alone: Tesco is another that has caught the headlines with its considerable ambitions in Foodservice – and has not been afraid to invest by acquisition or investment (Giraffe, Harris + Hoole coffee shops…).
It’s clear that multiple retailers will be competing hard and successfully with many other foodservice operators across the UK in the years ahead, and that we should watch to see how the application of their ‘retail’ skills will enhance their foodservice businesses.