In line with KPMG’s latest Food and Beverage survey, this month Hotel News ME, hears from some of the region’s leading beverage specialists to find out how dining trends are shaping the dynamics of beverage related revenues with new innovations stemming from London to New York.
In 2015, the UAE’s food and beverage industry was estimated to be worth a staggering AED 52.4 billion according to Euromonitor. Despite more challenging times in recent months across the region due to socioeconomic issues and a lack of investor interest, new bar and restaurant openings have stifled. Yet, despite market conditions, the F&B industry across the Middle East – the UAE in particular has shown remarkable resilience, with restaurants finding new tactics and leaning on beverage income in order to drive accelerated revenue streams.
What are some of the beverage trends being seen in the local market and where are these trends originating from?
Abdulla: Guests are more informed than ever before, and they have a clear understanding of their preferences. Some are specific about their favorite drinks while others stick to popular classic cocktail mixes. Younger guests are more flexible and are open to bartenders’ recommendations. They are most likely to order signature drinks from the list, which are creative mixes shaken or stirred with fresh ingredients.
Ramanathan: Over the past few years, we have received great feedback on the selection of our exotic drink selection. We have created many beverages with exotic fresh fruits on a frozen basis which has been very well received by our customers.
Lottier: We are seeing an increase in the old fashioned style cocktails originating from the pre-prohibition era – before 1930. George Kappeler, the famous mixologist, provides some of the earliest published recipes in his 1895’s book.
Bakar: The UAE, and Dubai in particular, is fast evolving in terms of beverage trends and we are seeing an increasing focus on quality beverages that showcase the skill and flair of the bartender. Over the past three year’s classic cocktails have been making a comeback alongside the quality ingredients that go into them. If we’re predicting trends for the future, we really need to look outside of the region, and to London in particular as a market leader.
Avram: Much of Dubai’s trends can be attributed to the fact that it is a melting pot. Everyone brings their own travel experiences, tastes, and preferences, and that influences what products are then offered. In the local market the Old Fashioned has been one of our most requested and customers are willing to try different varieties of spirits to suit their needs.
Mallins: Given the diversity of nationalities in Dubai’s hospitality work force, beverage trends come from all over the world but I still see London, New York and Japan as key global trendsetters. They have dominated the evolution of drinks creativity for some time.
Sreenivasan: The most influential trends have come through means of tourism as people become better travelled, they encounter new experiences which they bring back to Dubai. As the world has become more connected it has definitely left its mark on the beverage industry. We are talking about gastronomic driven beverages and the use of ingredients that might either be too rare or uncommon for a drink, for example truffles or edible gold. Whilst luxury bars continue to surprise customers with exquisite ingredients and presentation styles, I believe the local trends hint towards a more casual and relaxed settings.
Corallo: Old school favourites are currently making a comeback.
How can an outlet maximise revenue with an expanded beverage menu, including the likes of mocktails?
Avram: With Luna Sky Bar and Churchill Bar we don’t really focus on mocktails. We have found that there is not enough demand to substantiate us creating additions to our menus. We find that keeping things simple and refined creates the best possible experience for our guests.
Mallins: You need to understand your clientele. Your offering needs to be diverse but not overwhelming as guests get bored very easily reading menus and long lists of ingredients. Bar staff need to know their menus like the back of their hand so their guests feel confident in what they are being recommended and ultimately paying for. A good understanding of costing and the psychology of menus will help keep your GP up.
Lottier: As opposed to just an expanded beverage menu, promotional tactics can help drive revenue, especially when it comes to selling slow moving items, you can never beat a good special promotion.
Ramanathan: An expanded selection of beverages is always going to be beneficial to an outlet, and this has generated good revenue for us. This theory works really well in fine dining restaurants. For example, mocktail and drinks selection can be adjusted to match seasonal occasions and themes, for example in summer we use more fresh fruit bases and frozen drinks.
Sreenivasan: Offering a wide variety will present the chance for 10% of your customers – the adventurous diners, to try something new and be amazed. However, the majority of your transactions will come from standard beverages.
Bakar: Cocktails are big money spinners – the ingredients, presentation and of course the mixologist – are key representations of your vision for the bar and sets the tone for the kind of guest you want to attract. Essentially, your menu is your soul – you need to get the details right if you want to bring in the right people and keep them coming back.
Abdulla: It’s all about offering our customers choice and quality. It is best to have a beverage list with a lot of options as it creates the opportunity for the bar staff to offer different varieties of drinks to their guests. This also increases the opportunity to upsell and showcase the signature cocktails and mocktails in the bar.
Corallo: At Hendricks Bar we are keen on rediscovering classics and adapting them into mocktail form. The idea behind this is to give everyone a place in our establishment. It should become an inclusive community for people to enjoy.
How big of an influence does brand orientated training have on selling drinks?
Avram: It is true that we are in a brand-oriented market. We cannot ignore well-known names, and for us it is about creating new and exciting offerings based on existing customer preferences that will intrigue and expand their taste buds. We want them to understand that we are willing to take the time to develop a drink to their taste and that we care about their experience and want to craft something exceptional for them.
Mallins: Brand training is important though I always emphasise to my team and guests alike that certain brands are not necessarily ‘better’ than others, just different. Most brands have become very smart about how they conduct their training and they now know that claiming to be the ‘best’ product in their category doesn’t sit well with professional bartenders. A humble and open approach is always best.
Sreenivasan: Brand oriented training is extremely useful in expanding an employee’s knowledge base.
Lottier: Training is really important, especially if the brand takes care of the bartenders – if someone wants to take care of us, we’ll take care of them! Knowing a brand inside out makes you feel part of the brand and you want to share that feeling with the customer.
Corallo: It can and does have a strong influence on the selling of drinks but our goal is to encourage people to try new drinks that open up their palates to new experiences that they will enjoy.
Bakar: Brand-orientated training has a big impact here in the Middle East as the industry is still fairly young and knowledge of spirits can be quite limited. The effect of the knowledge provided during such trainings is obvious – there is a clearer understanding of the product’s heritage and attributes, which makes creating menus a lot easier, and also enhances engagement with guests. Ultimately, being able to talk with passionate and confidence about a particular product is certain to have an impact on sales.
Abdulla: It has a significant impact on sales and other aspects of the bar operations.
This is a great opportunity for the staff to gain more knowledge about the product and it builds their confidence to upsell that particular drink to the guests. Conducting this type of training motivates the team and combining them with promotional sales, creates room for incentives.
Ramanathan: We have several training sessions based on a weekly and monthly basis, the top selling beverages will be identified by the team. We then brainstorm to generate ways of upselling and promoting these brands to the clients. It is essential for our colleagues to have good knowledge on the product and to promote it to the customers, irrespective of the brand.
If a bar manager is trained using a specific brand, how likely are they to experiment with other brands, and is this transition challenging?
Avram: One cannot become too brand loyal because it can create a situation where you are closed off to important developments. Bar managers should be brave enough to try and experiment. You may fail to create a smash hit but by doing something different you have opened your palate even further.
Abdulla: When it comes to drinks most people know exactly what they want. Having a limited selection on the menu or restricting the bar to a specific brand could be challenging when it comes to the guests’ satisfaction. I always recommend promotional sales for a specific brand while maintaining alternatives for more discerning guests.
Lottier: It’s vital for a bar manager to have good general knowledge of all the spirits on the market, but once they find a good fit, there are certain brands a bartender will favour.
Corallo: Irrespective of brands, all bar managers and bar-staff should strive to create new beverages with an innovative twist. Brand loyalty won’t encourage creativity.
Mallins: A good bartender or bar manager should always compare tasting notes and experiment until they are happy with the end product. There is so much available on the market it would be detrimental not to experiment.
Bakar: Experimentation is vital for anyone who wants to progress in the industry, as you need to understand the different facets of each product before you can make informed choices on what product to stock and the overall makeup of the menu.
What are the challenges in terms of regulations surrounding beverages here in the Middle East compared to other markets, and how do you overcome these challenges?
Mallins: From a regulation perspective, advertising and sourcing new products presents a lot of challenges for outlets and brands. On top of that, the cost of beverages is very high compared to the U.S, Europe, Asia and Africa, which can be a big turn-off for tourists, especially in a high end or fine dining outlet.
Corallo: Much of the difficulty in the region has to do with the availability of products from suppliers. It can at times be a limiting portfolio. It is often challenging to acquire newer products that European or North American markets would have access to. To overcome this, we work a lot on internal innovation by creating our own homemade ingredients because it adds a unique value to our customer’s experience.
Abdulla: Every market has regulations and I don’t think we face any particularly concerning challenges in bar operations in Abu Dhabi. By strictly following the rules and regulations advised by the authorities it is fairly straightforward.
Lottier: Once the license is approved, I personally do not see any challenges, but from a marketing perspective it can often be tough when trying to position spirit based drinks.
Bakar: The main challenge is the cost of bringing spirits into the region as this has a direct impact on the price of drinks. Guests, especially those from Europe, are often surprised at how much beverages cost as it is typically much higher than what they are used to in a similar establishment back home. The way around this is to create exceptional menus which showcase the skill of the bar team and inspire the guests.
How difficult is it to source, train and retain bar staff here in the region?
Avram: Sourcing staff in Dubai isn’t too much of a challenge. I have been fortunate to have very low turnover on my team, which is not necessarily the norm here.
Mallins: Getting CVs is the easy part, but finding the right candidate can be an arduous challenge as negotiation of salaries varies from company to company. Pre-openings tend to have larger budgets and can sway good staff to leave their current jobs for higher salaries and with the excessive number of openings it’s very competitive. On the flip side, not all of these new venues survive in th
is volatile market and good staff can be left jobless in a matter of months. From my experience, the vast majority of staff I have trained are very keen to learn and develop and it’s always a great feeling to see your staff grow.
Bakar: It is not difficult to train bar staff; it is hard to find the right candidates with a real passion for the craft. Once we find these gems, we can provide all of the training they need and if they have the right passion and attitude, encouraging and nurturing them naturally helps with retention.
Sreenivasan: No matter the industry, employees want to work in place they see development and future growth in. Sourcing the right staff can be difficult but training is usually transited smoothly as most hires have similar experiences.
Corallo: Sourcing bar-staff isn’t an issue, the difficultly lies in the ability to retain and train them well.
Ramanathan: Bar staff need to be energetic with an outgoing personality and this isn’t something that you can train into someone. It is the bar staff’s duty to upsell beverages and promote the new drinks, so trying to instill this in the staff can sometimes be a challenge.