10427 The Retailer Autumn 2018_Final Draft Pages

Foodservice - the recipe for success or the kitchen nightmare?

Ken Higman Director JLL Foodservice Consulting

In the battle between clicks and bricks, physical retailers are looking at an ever-diverse range of strategies to drive engagement, footfall and ultimately sales. Foodservice, the delivery of restaurants, cafés, kiosks or even food trucks, is being used more and more to tap into the desire for providing a more “experiential” offer. The simple reason for this is that foodservice is playing a bigger role than ever in the success of physical retail. 40% of visitors base their choice of shopping centre on the dining options available (ECE), and the same is true of which high streets they shop at. The food offer doesn’t just impact choice, it also impacts spend – recent research from Coniq shows that consumers spend 12% more on retail when they eat out during their trip. The results are clear – a strong food offer that is carefully curated to complement the surrounding retail, will drive footfall and revenue for the whole area. At JLL Foodservice Consulting we have been supporting landlords for 25 years on developing the foodservice within a wide variety of retail real estate locations, from Shopping Centres to Urban Regeneration projects. We have also worked direct with retailers from Department Stores to Supermarkets, but the interest direct from retailers has been at its peak in the last 12 – 18 months and from a much wider range of retail types as well. Department stores have long-recognised the benefits of a compelling food offer – Selfridges continues to innovate with rooftop pop-ups and the likes of Debenhams are working with a wide range of third party brands to really enhance their foodservice offer. Luxury brands have been quick to pick up on the added value that foodservice can deliver to their customer experience. Recent examples include Tiffany’s Blue Box Café serving locally sourced dishes on signature turquoise crockery. Then there is the Gucci Garden which blends retail with dining and leisure to provide a forum for the brand to express its heritage to potential customers, and offers a more affordable way to buy into the brand: a three course meal will set you back around €60 whereas the plain white Gucci logo t-shirt costs a substantial €390. This helps to broaden their market without detracting from the exclusivity of their apparel. It serves as both a visit driver and a powerful PR mechanism, alongside an additional revenue stream.

But it isn’t just luxury brands exploring what a foodservice offer can do for them. There are benefits that work just as well for high-street brands, such as providing a resting point for tired shoppers in an environment where something attractive might catch their eye. You can see this in Jack Will’s Espresso Hut, Farm Girl who have partnered with Sweaty Betty and, H&M’s “It’s Pleat” café in Stockholm. These enliven the atmosphere in the store and can make a brand more ‘front of mind’ by working it into customers’ routine. Most of all, these in-store dining experiences offer something that online shopping cannot – brand immersion. H&M has chosen a young, fun, health conscious offer to express itself whereas Gucci has chosen luxury and heritage. These are qualities that you can live, breathe and taste in-store in a way that you could never do online. Developing the right foodservice offer for your retail space can be a challenge, which is often why we are brought onto a project, and whilst I cannot give you all the answers in this short article, what I have done is set out a series of questions that you should consider when looking at the potential for delivering foodservice in your retail spaces. • Do you have the right amount of space for the offer that you want to provide? Foodservice units can range from 60ft² – 6,000ft² depending on what you want to offer, your proposed space must match your proposed concept. • Is the space right for foodservice? A bad retail space can be a decent foodservice space, but this is not always the case, sometimes a “dog is a dog”. Throwing foodservice into spaces just because they don’t work for retail is not a solution. • Do your trading hours match the offer you want to provide? 50 - 60% of restaurant sales come after 6pm. Lots of retailers aren’t even open at these times. If your retail closes at 6pm, then you need to provide external access to give your foodservice offer the best chance of success. • Do you want to partner with a known brand or do you want to develop something yourself? Doing it yourself gives you control and allows you to match foodservice to the retail offer, but you will need to recruit and employ specialists to deliver it. • Do you have the right level of physical infrastructure? There are the “simple” requirements like gas electric, water and exhaust but what about things like waste routes - foodservice is much more noisy, smelly and dirty than traditional retail. Do you really want the same service lifts to transport both £500 hand bags and bags of food waste?

18 | autumn 2018 | the retailer