Is ingredient choice killing your restaurant brand?

We asked 100 people why they pass up eating out. Their answers point to what is on the menu, not just the cost of living.

It is no longer financially viable for many restaurants in tier-one global cities to open on Monday or Tuesday, for breakfast, or late into the night. Many owners attribute it to remote working, the cost of living crisis or inflation. Why are some eateries thriving while others are just surviving?

You don’t need a crystal ball or an analyst’s hefty price tag to see the struggle in the F&B sector.

A quick walk around Soho early morning or late at night, and you will realise something is wrong. It’s too easy to get a table at lunch, few are eating breakfast, and even the hottest restaurants appear dead after 10 p.m.

We played detective and asked 100 homemade breakfast and lunch-goers, “Why pass up on dining out?” Skipping the obvious money-saving spiel, their answers stirred the pot:

  • Food doesn’t taste good / Food quality has deteriorated.
  • I can make it better myself and control portion size or ingredients.
  • I’m trying to stay in shape / poor healthy options.
  • I want to get home early and/or don’t want to be pressured to drink alcohol.
  • My employer provides free food.

Consumer questions, comments and concerns we uncovered on probing further.

  • ☕ What coffee beans and milk are used? “🥛 “My office coffee runs circles around the overpriced latte from x.”
  • 🥬 Where are the ingredients sourced, and are they organic? “For real, how do I know they are not lying.”
  • 🛢️ What oil do they cook in? “I heard cheap oil is bad for you.”
  • 🍳 “Eggs from a carton? That’s no yolk.”
  • 🥛 Organic whole, UHT or fake milk? “I walk out of a coffee shop if I see bad milk”.
  • 🥐 Are croissants made with butter or whatever fake oil/spread/gunk can be acquired cheaply? “Did the French ever intend croissants to be made without butter to appease the vegans?”
  • 🥗 Is the salad dressed with extra virgin olive oil or engine oil?
  • 🥓 Is my bacon made from reconstituted turkey?
  • 🍊 Is it made fresh on-site? “I asked them if their Orange Juice was freshly squeezed, the f**kers said yes, then went on to pour from a carton.”
  • 🗒️ The menu is too restrictive. “XXXX will only let me have one selection of toppings on my porridge. I want all the toppings from all three options. I can’t even pay for all the toppings because the computer says no.”

It is clear from our small sample that ingredient choice, transparency, trust, health concerns and menu engineering are key reasons many are choosing not to eat out. If you can get away with the above and still make your food tasty without churning your customer base (some can), well done. For everyone else it is worth looking at…

Global brands that are scaling against the odds

Sweetgreen and Cava in the US are scaling fast with impressive results. Both are going beyond providing simple calorie counts. They are transparent how food is cooked and where ingredients are sourced. Most importantly, they are able to offer healthy meals without sacrificing flavour, and it is paying off financially for them.

Dishoom in the UK has been able to buck all negative trends, scaling without sacrificing quality. Their profits tripled in 2022, with revenue pushing £100m as their sites recovered from the pandemic. Late-night success for an Indian is predictable, but who would have thought ten years ago that an Indian restaurant could pack people in for breakfast, let alone generate £100m on the back of it? While they operate flawlessly over all areas, none of it would be possible if they chose poor ingredients and their food didn’t taste good.

Sacrificing taste, health or quality to cut costs will do as much damage to your brand as the cost of living crisis. You can cut more fat without damaging your brand through efficient menu engineering and sourcing.

What about technology?

Once you have menu engineering and sourcing dialled, technology will become a significant lever in your global growth story. At that point, you can go all out on product requests and bespoke integrations to differentiate your experience and help you scale. At Shopwave, we will help you scale faster than anyone else in the industry. Self-serve kiosks? Need transformation, data stack, app or service integrations (inc menu engineering) but can’t afford or don’t want to use the usual big four management consultancies? You’re in the right place.

Earlier on in your journey? You can join our scale-up academy. We will take a bet on you, offering our service at a deep discount for your first two sites.

Need help with any of the above points or want to plan your journey without being sold to?

Come and chew the fat with our CEO and CTO. Your choice of Zoom call or in person at our London office. Are you fed up with meeting rooms? Select your preferred F&B venue for tea, coffee or a stiff drink on us. Use medium@getshopwave.com to book now.

Disclaimers:

  • Based on the WeWork style open office venues we have chosen to survey, the results will skew to a slightly younger, more affluent sample, but the trends will remain the same for many tier-one global cities.
  • We want our customers to be successful, scale revenue, and be profitable. The article aims to help win back potential customers who chose not to eat out for reasons other than budget. If you are selling $1 hot dogs or sausage rolls, much of the above will not be expected of you from customers; our aim is not to push boutique ingredients on everyone. Pushing $/£5 for a coffee or £/$10 for a sandwich? It quickly becomes essential to scaling revenue and, in some cases, survival.