Shop Talk: Eating out part of social lives of most SA consumers
THE food service market has a new sweet spot: sit-down casual dining. It’s a happy medium between, say, Steers and Luke Dale-Roberts at The Saxon. Dress code: a jean pant rather than tracksuit bottoms.
Over the past decade, it’s been the fastest-growing category in the restaurant industry, with players like Famous Brands making room in its portfolio for the addition of fancy-but-not-too fancy restaurants like Turn ’n Tender, Mythos and, this week, Salsa Mexican Grill.
Quick-service restaurants, or fast-food joints to you and me, are highly susceptible to shifts in spending because of the very nature of the diners they target.
That is why SA, in the chasm of its economic impotence, is seeing a mad scramble for footfall with aggressive campaigns like “buy one burger, get one free” and bottomless everything: chips, ribs, coffee — you name it.
Late last year McDonald’s sold Big Mac Medium Meals for R19.95. What ensued were queues to rival Apple launch-mania, as burger devotees lined up to get their fix.
They sold more than 100 000 Big Macs in the first two hours across the country.
CEO Greg Solomon said that given the current environment, it wasn’t about growing market share organically anymore, but about stealing market share.
For some time, the industry benefited from a shift towards convenience over the cost and effort of preparing food at home — largely driven by the rise in double-income families.
At the height of the fast-food boom Spur CEO Pierre van Tonder told me: “Moms don’t have 4½ hours to stand at the stove to make spaghetti bolognaise ... economic factors have dictated a lifestyle change.”
And these days, with markedly less disposable income, eating out is seen as a luxury, particularly at the bottom end of the market.
Monthly treats are now the order of the day for stretched families who previously would have eaten out two to three times a week.
Consumers would far sooner give up their burger for bus fare. If you look at the listed players in the sector, pain is being felt across all their more mainstream brands.
In a “down” economy the well-heeled also tend to trade down, but in a different way. They usually cut back, not cut out — whether it’s on art, clothing or travel.
So when it comes to eating out, paying under a thousand bucks for a meal against R3 000 is a considerable “saving” (and you don’t have to make a booking nine months in advance).
Research from NDP Group suggests that the appeal of casual dining is not just about price.
Consumers like the combination of the ambience and quality of food of a full-service restaurant and the speed and delivery of a fast-food/quick-service restaurant.
For the frugal, it’s kind of like the best of both worlds.
There is also something about niche brands that exudes freshness, authenticity and personalised service.
It was Famous Brands’ buyout of Tashas that taught it the power of the casual-dining category.
The chain now has an almost iconic status and has been a money-spinner for the group. Who’s seen that meme on Twitter? “Bedfordview — like the Wild West, just with a Tashas!”Famous Brands has added a few more premium brands to its portfolio — including Lupa Osteria and the soon-to-be-launched Paul. The idea is to grow their presence, albeit at a prudent pace to retain a semblance of exclusivity, as well as consistency in service.
They believe that eating out has become part of the fabric of the social lives of the majority of middle-income and high-income consumers in SA.
They’re simply following the money.