New report reveals ‘deregulated’ lifestyles set to shape future of foodservice in the UK: A new report has revealed “deregulated” lifestyles are set to shape the future of food service in the UK as Britain becomes a nation of “passionate foodies”. Italian food company Sacla has published the study, called Eating Out – Today and Tomorrow, into the key emerging trends and habits shaping eating out in the UK, which explores the ever-evolving modern attitudes towards dining out. Produced by independent consumer foresight and futures consultancy Trajectory, the report shows the changing nature of work and the flexibility and freedom it brings is having an impact on daily routines, eating and spending habits. 56% of Londoners and 52% of non-Londoners described their working hours as irregular, changing or unpredictable. The research, based on interview with more than 2,000 pub and restaurant customers, also showed 66% of respondents described themselves as being passionate about food and drink. Trajectory managing director Paul Flatters said: “This provides a fresh perspective on UK consumer attitudes, behaviours and expectations. Consumers feel less constricted in their behaviour by traditional norms of time, place and social status, a core theme throughout the report and a concept we labelled the deregulation of life. The four fundamental elements of deregulation of life – time, place, individualism and mobile devices – demand that food service operators consider how they could or should offer the flexibility and choice to match today’s deregulated lifestyles.” The report showed 31% of respondents eat out at least once a week, whether that is in a pub or restaurant or grabbing a sandwich on the go. That figure was even higher among Londoners (44%), the self-employed (45%) and 18-34 year olds (41%) while 29% of families eat out together on a weekly basis. More than 30% regularly skip breakfast, rising to 40% of 18 to 24 year olds while 37% expect to go out to eat a sit down breakfast in the coming years. The report also revealed 62% of respondents are “totally adventurous” in terms of cuisine, including three in five over 65s. Some aspect of waiting frustrates 70%, which roses to 75% among 18-34 year olds. Smartphones and the acceleration of mobile technology is changing the way consumers operate, offering flexibility and fluidity in working practices, said the report. Just 37% of respondents would prefer a tech free environment with that figure dropping to 32% for 18-34 year olds. 34% of Londoners regard GPS navigation as an important feature in an eating out mobile phone app while 41% of all respondents want to see recent visitor reviews on the app. 22% of Londoners said automated payments would be beneficial, with a third of 18-34 year olds agreeing. The food service market is worth £89bn a year, including £14bn on snacks and treats against almost £194bn on groceries. That makes a total of £283bn spent by consumers each year on food and drink, of which almost a third goes to the out-of-home market such as pubs, restaurants and cafes. Managing director at Sacla’ UK Clare Blampied said: “The launch of Eating Out – Today and Tomorrow responds to the UK’s increasing passion towards food and consumers’ higher expectations when it comes to dining out-of-home. It delivers an in-depth look into the food service industry, and provides strategic insight for operators looking to improve their offering.” The report is based on interviews with 2,034 adults exploring their lifestyles, regular routines and habits, plus their relationship with food and eating-out. It also includes contributions from leading industry figures including JD Wetherspoon chairman Tim Martin and Casual Dining Group chief executive Steve Richards (see today’s Friday Opinion). The 63-page insight and future trends report produced by Sacla is called Eating Out – Today and Tomorrow. To obtain a free copy please email lauren@fsc.uk.com

The deregulation of life theme described in Sacla’s report in why our business, The ONE Group, exists – and why we are experiencing such high demand for what we do. Nothing so graphically illustrates the deregulation theme as STK, our steakhouse restaurant brand, which we are expanding across the USA and in major international European cities. At STK, the average dinner bill in London is about £80 per person. So it’s a high-ticket occasion, built on high-quality food where our guests expect to enjoy the very best experience. However, in the past, this sort of price point would have dictated exactly what was required or expected from such a restaurant – a tightly-defined experience where the chef, not the customer, was king. An occasion when people ate quietly, spoke in hushed tones, and generally thanked their lucky stars that they were fortunate enough to be sat at the table (or should that be alter?) of “fine dining”. Clearly, times have changed. At the heart of STK is informality, fun and atmosphere: it is the essence of the brand. It runs through everything we do, from how we shape the menu and design the restaurant to how we train and develop our front-of-house teams. White gloves, heavily-starched tablecloths and overly-stiff service led by a stuffy maitre’d, is STK’s antithesis. It is where the deregulation concept collides with reality. In the case of STK, it’s a top restaurant doing something very different to traditional fine dining, and it jars with an industry previously bound by social norms and convention. STK gives people “permission” to let their hair down, to have fun. In addition to the food and the way our teams are trained to host our guests, we bring this to life in a number of other ways. For example, we put a bar in the centre of every restaurant and we work hard to continually evolve our drinks menu and cocktail offering. It’s a key showpiece, setting the tone – guests know we expect them to unwind and relax. These days people would much rather feel like they are eating in the bar or the kitchen, as opposed to the dining room or, heaven forbid, the library. The bar is where the party starts at STK. And it pays – drink sales account for about 40% of our mix. It amazes me how many venues still treat music as background noise – an afterthought. It is crucial to STK and creates the right atmosphere. At The ONE Group, we’re big believers in what we call “vibe dining”, where music is central to the overall experience. This is not dining in a disco; it’s about music that enhances the experience, combining great food with informality and fun. Each of our STK restaurants employs a DJ to ensure we play the right music to the right crowd. The DJ’s job is to “read the room” – to find a genre of music that gets a strong reaction from the crowd and to stick with that style. If it’s an early sitting, it’s more relaxed; if it’s later it can be a little more upbeat. It works in Britain just the same as in Las Vegas (us Brits can be more reserved). STK is not a nightclub but music helps add a certain fluidity to the venue. What I mean by this is that often the place our customers leave, at the end of the night, does not feel in any way like the same venue at which they arrived. We recognise the deregulation of life concept because it chimes with our business. STK’s combination of food, service style and atmosphere is unconventional by previous restaurant industry norms. It works – because it’s what people want.

One of the most common narratives in the restaurant industry, and the economy as a whole, is the difference between London and the rest of the country. What is the reality of the differences between London and beyond? Sacla’s Eating Out – Today and Tomorrow report highlights some variations that are not entirely unexpected – such as a greater frequency of eating out and a higher spend in the capital, or a greater penetration of high-frequency morning coffee purchases. These examples chime with our own data. However, much of what consumers expect from the eating-out experience and sources of associated frustration (such as poor service or speed of bill payment processing) are the same, as well as other behaviours, such as frequency of dining out as a family. The overall impression is that, if anything, we are becoming more alike. Certainly the boom in informal eating-out is a UK-wide story. Indeed, the biggest growth in new restaurants and eateries is now being achieved outside of London. Our own data at CGA Peach shows that the year-on-year rate in the number of new food-led venues in major conurbations such as Birmingham (+7%), Cardiff (+11%), Edinburgh (+6%), Leeds (+12%) and Manchester (+8%) is outstripping that rate seen in the capital. It’s important to note that London is still growing in terms of number of outlets, at about 4%, which is a fair lick for what is a big and more developed market. Most of this growth is being delivered by the branded chains, in particular emerging names like Benito’s Hat, Leon and Red’s True Barbecue, as well as mid-sized companies such as Carluccio’s and Ed’s Easy Diner, or the bigger corporates like Casual Dining Group, Nando’s, PizzaExpress and The Restaurant Group. In the past decade – for the country as a whole – a total of 8,600 restaurants and food-led pubs have opened. Our research at CGA Peach suggests that we are now seeing a significant acceleration in site openings as Britain emerges further from recession. In the past 12 months alone (to April 2015), a total of 2,000 new food-led venues restaurants have launched. These numbers are important because they address the distortion of pub closures, which are still closing down at nearly 30 sites per week. In the past ten years, 21,000 drink-led venues, or to use industry parlance, “wet-led” venues, have closed. So what we have seen is a massive exodus of pubs and historic drinking venues leaving the market amid an explosion in food-led venues. These latest growth numbers also high light that there is a high level of capacity hitting the market, suggesting that the competition will only intensify from here. Ultimately it is good news for the customer.

To supplement the Sacla food service trends report – and the main focus on emerging consumer trends and behaviours – I have been invited to write about the dining-out sector in the context of the leisure market, the economy and a significant part of UK business. It is a substantial, flourishing and continually evolving piece of the wider hospitality and leisure industries. Eating and drinking out companies account for 8% of all businesses in the UK, of which 70% are SMEs. The sector reaches 34 million customers per week, serving 42 million meals and pouring 6.5 million cups of coffee. As an employer, casual dining businesses create eight out of ten new jobs for 18-24 year olds and 10% of UK employment as a whole. Each restaurant generates £209,000 for its wider local community. This is a successful and imaginative sector providing jobs, driving innovation and growth across UK high streets. As this report shows, the demand for eating out in the UK continues to grow. We are now a nation of foodies – the majority of people say they are “passionate” about food. A third of us eat out at least once a week, Generation Y consumers (aged 18-34) even more. We expect to be able to dine out at any time of day, settling the bill via our mobile phone app. The eating-out sector is meeting this growing demand with an array of innovative concepts and increasing capacity – 2,000 food-led venues have opened in the past 12 months alone (CGA Peach, April 2014 to March 2015). But operating companies need the right business environment in order to continue to flourish. As eating-out brands continue to prosper and become an ever-present on the UK’s high streets, it is imperative that the Association of Licensed Multiple Retailers’ (ALMR) lobbying efforts keep pace with, and reflect, the shifting nature of the business – particularly in the face of significant political and regulatory challenges. To better represent the interest of our members and to reinforce our status as the leading voice for all of licensed hospitality, the ALMR has launched its Casual Dining Manifesto promoting a fairer deal for this inventive and valuable part of the UK’s high streets. Our work will focus on three opportunities to promote the casual dining sector: addressing property costs for high street businesses; cutting costs and simplifying regeneration and development; and unlocking the potential for growth and investment. We are calling on the government to push ahead with its promised review of business rates. Root-and-branch reform is required for a hopelessly out-of- date system that stifles investment. A much more flexible system, with regular reviews and linked to an annualised inflation measure such as CPI, backed by an updated Code for Businesses Leasing Premises, can drive investment in the property market. Additionally, outdated local retail plans, restrictive lease terms and use classes, and EU-wide restrictions are all hampering the sector’s ability to make a bigger contribution. Cutting costs for businesses and ensuring that local authorities have regard for economic growth when making planning and licensing decisions, will alleviate much of this prohibitive cost. Casual dining businesses are important employers of young people taking their first steps in the job market. Scrapping employer national insurance contributions for under-25s, and direct funding for training and bonuses for small businesses each time they take on an apprentice, will incentivise take-up and encourage further investment in our young workforce. The emergence of savvy, affordable and popular casual dining brands has been one of the recent success stories in the UK. Eating-out brands are leading a reinvigoration of the high street. But they can do more. Our manifesto is a call to government to recognise this thriving sector and to act now to ensure continued growth and prosperity.