To my Restaurant brethren, this is a call to arms. Society needs you!

Sorry for the dramatic title, particularly with Putin bearing down on our Ukrainian friends next door.?But if you don’t want to be squashed like a bug, the way Amazon destroyed bookstores around globe, . . . . ??Read on.

Two weeks ago, I noticed an interesting environment in the shopping centers and mixed-use projects of Warsaw.?The consumer is ‘done’ with Covid.?Masks were off and more people were freely moving around enclosed areas maskless.?As Covid will soon be treated as an annual (albeit nasty) flu, I have been feeling pretty good about how restaurant turnover is going to take off this summer because we humans are social animals and we all crave the wonderful and exciting social experience of a buzzing coffee shop, restaurant or bar with family and friends.

However. . . . just like in wartime, until the bombs start rattling close to home, you aren’t really all that worried about the risks.?See, I was not all that worried a couple of years ago when I read that the co-founder of Uber, Travis Kalanick, invested heavily into a company called Cloud Kitchens to open Dark Kitchens around the world.?I’m thinkin’ yeah… it will take them 3 – 5 years to pay attention to Poland. [I’m not a big fan of selling high quality food via delivery aggregators anyway, but I digress.]

BAM! I get a very well-crafted email last week inviting me to lease a unit in the Cook Lane Dark Kitchen project that will soon open in the Mokotow district of Warsaw opened by… you guessed it, Cloud Kitchens.?The enemy has attacked and they are already on our soil!

The web site is VERY slick (Look at that picture… it is perfectly crafted because it is the fear of any restaurant owner:?practically an empty restaurant and the only customer in the place doesn’t look like your desired customer and he doesn’t even have a plate of food in front of him.?He is just sitting in your restaurant to stay warm! Oh how the stomach knots up!)

Let me digress a bit….?I’m old enough to remember the large book sellers like Barnes & Noble and Borders Books in the US.?I LOVED to shop for a book at these stores.?These bookstores were physical spaces where you could enjoy the shopping EXPERIENCE of searching for and selecting your books.?In their later years of existence, they even added Starbucks coffee shops to improve the shopping experience.?Here is the short history of Borders and another book retailer that you may have heard of called Amazon.

·??????Borders was founded in 1971.

·??????Amazon was founded in 1994 to make the process of purchasing books more convenient.

·??????By 2003, Borders had 1,250 stores across the US.?Its turnover was $3.7 billion with profits of $120million.?In its annual report, Amazon was not even mentioned under “Competition” or “Risks.”?In the same year, Amazon operations generated $35 million, its first year of profits since its founding, on turnover of $3.5 billion – similar to Borders.

·??????2006 was its last year of profits for Borders.?Over the next four years, it would lose $1 billion.

·??????Borders, in its final year of full operations (2010), it had 510 bookstores and employed almost 20,000 people across the US.

·??????February 2011, Borders applied for bankruptcy protection and closed the remaining 226 of its stores.?

My point is this: ??We can’t ignore that food delivery aggregators are going to take an ever-larger percentage of the overall ‘food away from home’ segment – the industry that we all somewhat compete in. ?Pre-covid, this was probably 5% +/- of your turnover.?If you want to focus on food delivery, then move your menu into foods that travel well and you better find ways to drive down your product costs – because this is a very low-margin business.?However, if you are in the on-premise restaurant business like we are (where you need to motivate your guests to leave their home and walk, taxi or drive to your restaurant) and if you don’t want to get squashed like a bug, here are my recommendations:

·??????Focus on three things:?Guest Experience, Guest Experience, and Guest Experience.?Put relentless focus on your restaurant ATMOSPHERE and SERVICE.?Society now has the habit of hunkering down at home to sleep, work, and eat.?Delivery companies are offering only Convenience.?But we need to give our guests a compelling reason to choose to leave their comfortable homes to enjoy a social dining experience in our restaurants.

·??????We need to be really careful with our real estate decisions.?Pick locations where the landlord treats you like a partner in creating the high-quality dining experience.?Don’t shy away from competition; seek out those projects where the landlord understands you and your needs and where only the best operators want to be.?A crowd draws a crowd. ??Your neighbor’s great restaurant will draw customers who may visit you next weekend.?And, don’t be afraid to sign up to turnover rents – if you want your landlord to be your partner, he/she should also win when you are successful.

·??????Only certain foods travel well:?think sushi, pizza, Asian with rice.?If you are in those cuisines – look out because the delivery aggregator restaurants are going to eat your lunch (pardon the pun).?If you offer these cuisines, you are competing with delivery and will have to do an even better job of creating the on-premise experience.?

In just 60 or so days, Poland’s weather and covid situation will brighten unleashing a hungry community that has been generally locked up for eight months.??Eight months of primarily ordering food via Delivery.?Your guests can’t wait to get back into your restaurant.?

Ending on a bright note:?during my Valentine dinner with my lovely wife, the menu cover on the Mykonos Restaurant in Browary Warszawskie struck me:?“There is no life without EXPERIENCE”.?They get it.?The service was attentive, the food was good, the music was lively, and not surprisingly the place was packed.

Only sixty days my restaurant brethren . . . . . Society needs us to create the dining and drinking experiences that our community is craving.?Step up your game!?You can do it …. We got this! ??