Subjects: Hot to trot, Ted’s talk, keeping millennial staff engaged, and making the tourism sector deal work
Authors: Glynn Davis, Ann Elliott, Robert Darling and Brigid Simmonds
Hot to trot by Glynn Davis
One of the most enjoyable aspects of travelling around the UK for me is visiting villages, towns and cities and popping into independent bakers to sample their specialities. Most communities still proudly produce local delicacies to a loyal clientele but one store I don’t hunt for when I travel is Greggs.
Greggs chief executive Roger Whiteside openly admits nobody else goes on the hunt for one of his outlets either, stating if a unit isn’t near a customer when they’re hungry for a sausage roll or sandwich, they won’t go looking for one and will shop elsewhere.
To address this situation the business has worked to position its outlets next to customers. Four-fifths (80%) of Greggs stores used to be in high streets but, under the stewardship of Whiteside, 300 have been closed to leave about 700 at present. Instead, units have opened in secondary locations away from the high street – in office blocks, garages, motorway service stations and industrial parks, where Greggs puts pods outside the likes of Wickes DIY.
Whiteside is basically putting Greggs units in locations you’d never dream of placing a bakery. The big play he’s reaping tremendous rewards from is to reposition the business as a food-to-go operation and away from being an old-school bakery chain.
Whiteside says: “We’ve slashed the range of cakes and virtually taken out bread. You have to say ‘no’ to customers and explain we’re not that type of business any more. I can’t escape the logic people buy bread in supermarkets.”
The company still adheres to the founders’ original purpose of making “fresh, properly prepared food available to all”, it just happens different food now emerges from Greggs’ production facilities. The prize for Whiteside is to eat into a food-to-go market that’s worth £22.5bn a year, according to The NPD Group, and that continues to grow at a healthy rate.
When launching his strategic shift, Whiteside will have taken into account four-fifths (80%) of bakery purchases are consumed on the move. This is something independent bakeries should look to leverage greater value from, especially as the bakery industry currently accounts for a modest 5% of those £22.5bn sales.
Taking into account the growing delivery and click-and-collect segments, the opportunity is enormous. This hasn’t been lost on Whiteside and he’s experimenting in all these areas as well as developing Greggs’ digital footprint. This includes a clever use of social media, which came into its own during the incredibly successful launch of its vegan sausage roll.
If any baker doubts the size of opportunity the food-to-go gravy train offers, remember Greggs aims to operate up to 2,500 units – a 3.5-times jump from where it stands today.
Whether these shops will stock the local delicacies I seek remains to be seen as Whiteside has said such lines will only appear if they “sell in sufficient numbers”. In reality, many localised items such as Tottenham cake will only appeal to fervent Tottenham locals, with the rest of the country not interested. This is a fair point because although I hunt out such local items on my travels, I live close to Tottenham and I’d be hard pressed to walk to the end of the road for one of those garish pink creations.
Glynn Davis is a leading commentator on retail trends
Ted’s talk by Ann Elliott
I have known Ted Kennedy for a while, more than 30 years I think, working with him fairly closely when we were both at Beefeater. I was in marketing and he was in operations but despite that we had a healthy respect for one another. He brought a lively and entertaining approach to his annual ops review meetings with the board, which were so popular he could have sold tickets.
He now owns Pebble Hotels and is regarded as a “veteran operator of pub assets”. Despite knowing him such a long time, I had never seen him present on stage so I was keen to hear his key learnings since starting out in the sector at last week’s Propel Multi Club summer conference.
It seems anyone over 50 with more than 25 years’ experience in the sector is labelled a “veteran” but Ted doesn’t act, speak or, indeed, present like a veteran. His enthusiasm is infectious, his passion for the Alan Yau-inspired Duck and Rice – the “eclectic Soho pub with a world-class Chinese kitchen” where he’s a director – is wonderful to hear and his sense of humour and self-deprecation are infectious. As you might have gathered, I’m a huge fan.
I thought it was worth sharing some of the learnings from his presentation. These are my notes but, as I find it difficult to listen and write simultaneously, they don’t reflect what he said word for word but rather the sentiment.
Keep your enemies as close as your friends
“There are lots of twists and turns in this sector and a business on the way up can easily be on its way down in the future.” I think in essence he was saying “don’t criticise people when they are in trouble as you never know when you might be there yourself”.
Understand your role, expertise and position in a brand’s lifecycle
“Some people are better at starting businesses, some at expanding them from five or six sites to 40 or 50, and some at growing them to float or beyond. Few can do all roles well and it’s important to know where your skills lie.” This provoked a lively debate with the audience, who shouted the names of founders they believed had grown their business to PLC status. Ted was having none of it (nor the email suggestions I have subsequently sent him).
Know where you’re going but be flexible about how you get there
“Business plans that encourage investment are rarely used once investment comes into the business.” It’s an interesting observation but Ted believes it’s key to have clear values that are consistent across the length of the journey while providing a road map for the future. He’s testament to that belief.
‘Magic dust’ is the differentiator
“If a business doesn’t have ‘magic dust’ it can easily end up becoming a discount rather than a value-added operator – and only one business can be the cheapest.” A warning to many.
Recruit the best people and outsource all except operations
At one point Ted had hundreds of pubs but only his operations team in-house, which helped bring fresh thinking in and ensured quick decision-making. Of course, I rather like this idea.
Paper is the devil’s own work
“Have digital/social activity that’s genuine, proud and eclectic. Don’t use vouchers.” Enough said.
Customers, front-line, manager, then board
Not the other way around. Ted had a snappy model I can’t replicate here. Most successful operators would echo this sentiment.
I must admit to posting a shorter version of this on LinkedIn after the conference – comments included:
“I worked with Ted 14 years ago at Mill House Inns. One of the best chief executives I’ve ever worked with. Inspired and empowered everyone!”
“I worked with Ted way back in the day at Whitbread Bowland Inns. Inspirational leader of the very highest quality.”
“An honest and inspirational talk from Ted. You can’t buy wisdom.”
“The legend Ted Kennedy – a top man and a top operator.”
“Ted is an absolute legend and a top guy.”
“I worked for Mill House inns almost 20 years ago – a lean, focused and efficient operation. You knew the value of a pound if you worked for Mill House as a manager and that’s meant as a positive statement and testament to Ted Kennedy.”
Ted Kennedy – a great operator, leader and person. If you get an opportunity to hear him speak, leap at the chance.
Ann Elliott is chief executive of Elliotts, the leading integrated marketing agency in the hospitality and leisure sector – www.elliottsagency.com
Propel Premium members will receive the full video of Ted Kennedy’s summer conference presentation at 5pm today. An annual premium subscription costs £345 plus VAT for operators and £445 plus VAT for suppliers – plus £50 each for additional team members. Email anne.steele@propelinfo.com
Keeping millennial staff engaged by Robert Darling
Once a week my work takes me to a different city, which means checking into a lot of hotels with differing quality of room, staff and overall experience. Some I look forward to visiting again, others I vow never to return to.
Earlier this week I met a young receptionist, John, while checking into a central London hotel. As I approached the desk it appeared John was settling into his shift, taking over from a young woman who was getting ready to leave. “Don’t forget the late check-out for room 203,” she said as she packed her things. “Text me the details,” John replied as he took my credit card and started processing my payment. He later told me he doesn’t usually handle that shift but was taking over for another colleague who had just quit. His manager was hopping between branches and could only check in once a week. “I’m sorry, it’s all a bit chaotic at the moment,” he told me.
Two things about this encounter made me think about employee engagement in the hospitality industry. First was the fact John and his colleague texted each other about an internal work process. It reminded me of something Bob Cotton, an expert in the hospitality industry who received an OBE for his services, told me – millennials are used to sharing information online. They chat on Instant Messenger, tagging friends in news articles and learning about the world on online forums. This is hardly breaking news but what can hospitality employers take from this?
“These young workers communicate best through technology. They don’t really speak to each other face to face,” Bob explained. “If that’s the way the majority of the workforce likes to communicate, gain knowledge and share information, the industry has to embrace the technology required.”
Almost three-fifths (58%) of UK front-line hotel staff are aged between 20 and 30. Introducing a tool that’s familiar to them brings an array of benefits. It saves significant time and money teaching them how to use it, while familiarity means they’re more likely to want to actively engage with it. There’s nothing worse than spending huge budgets on a system no-one wants to check.
However, on top of their reputation for being technology-obsessed, millennials are also notorious for their willingness to hop from job to job. Studies have shown that once employed, there’s a 50% chance an entry-level hotel employee will leave their job within one year. With such high turnover, it’s hard to maintain a positive company culture and eventually makes more people want to leave. John told me tasks were left unaccounted for, team spirit had fallen and he was having to work longer hours as a result of his colleague quitting. Eventually John is likely to quit his job too – and the cycle continues.
With the right internal tool, however, John’s manager could recognise his hard work for taking on the extra shift by thanking him remotely. John’s colleague would be able to inform him and his manager about the late check-out in room 203, while keeping a record of it on the system. All these things would have helped to make John feel more engaged with his job and more informed about his tasks while creating a better connection with his colleagues and manager.
Strengthening workplace relationships and boosting employee engagement in a non-desk workforce doesn’t have to be difficult. In fact, young workers’ close-knit relationship with technology makes it easier than ever. These days, talking to each other in a chat room, receiving a management announcement or seeing someone acknowledge your message can be enough to build a sense of connection. One phone notification from your boss recognising your hard work can make you want to go that extra mile to serve a hotel guest – and sometimes that’s enough to make a difference between whether you stay or leave the company.
The next time you look to implement a new internal tool for employees, you may want to consider one crucial factor – would a millennial want to use it?
Robert Darling is chief commercial officer and chief operation officer at Eko
Making the tourism sector deal work by Brigid Simmonds
As the prime minister announced the sector deal for tourism on her way to Japan for the G20, those who had worked on this for two years heaved a huge sigh of relief, tinged with trepidation the hard work begins now!
Recruitment is an issue across the hospitality sector for three main reasons – fewer people from the EU are coming to the UK to work, full local employment, and the perception our sector doesn’t offer a real career. Skills are a key element of the sector deal and UKHospitality chief executive Kate Nicholls and I are working with government to set up a skills board with the aim to raise £1m to fund a major recruitment and retention campaign. A variety of targets – or key performance indicators – are written into the terms of the sector deal, from apprenticeships to mentoring and in-work training. In addition we’ll reach out to those who want to return to work and those hard-to-reach groups for whom finding work can be a challenge.
It was appropriate, therefore, that as Theresa May was launching the sector deal, I was on my way to Newhaven Job Centre to talk about how we can help its clients find work.
From the British Beer & Pub Association (BBPA) and UKHospitality to the British Institute of Innkeeping, a range of associations have long supported the Hospitality Works campaign, which helps job centre teams better understand our sector. Earlier this year the Department of Work & Pensions, which leads this government campaign, invited me to speak at its awards ceremony in Birmingham. While there I met two wonderful ladies from Lewes and Newhaven job centres, which are near where I live. One of them was taking part in the world championships for Sussex pub game toad in the hole – so there was a real interest in our sector and they were happy for me to visit so they could learn more.
Universal Credit has come in for criticism and it remains to be seen whether wider concerns with the system can be satisfactorily resolved. The team in Newhaven, however, clearly supported the system change, pointing to a myth-busting Telegraph article as evidence you no longer lose your allowances if you work for more than 16 hours, and any reduction in allowances is purely based on how much you earn.
The team said it can now use more discretion to help single parents, for example, become work-ready through skills training, interview techniques, CV writing and customer presentation. The team is looking for local employers prepared to guarantee an interview for those who have undertaken that training and, if that employer says a client also requires health and safety training, the job centre can help with that too.
Job centres used to have a reputation for sending anyone to an interview, now they are looking to match specific skills with employers. They also help disabled people find work and the online portal means face-to-face meetings aren’t required on a regular basis. They can send money for housing direct to the provider and work with charities to help the more challenging find the right role.
The care and enthusiasm of those who work in Newhaven was clear. To any employers reading this, are you in touch with your local job centre, can you guarantee an interview for candidates who have undertaken relevant training? It’s certainly worth making the link.
Brigid Simmonds is chief executive of the BBPA