Chris M. Tara-Brown – coffee bar network owner – about current situation in restaurant businessBack to list
High quality restaurants of Novosibirsk are vigourously fighting for customers. The ones sticking to the high pricing policy are loosing a lot of clients, and these customers tend to choose cheaper places: coffee shops, pizzerias and so on. People prefer to get more meals and beverages for the same money. For example, instead of taking one expensive dessert customers would rather have two cheaper ones. At the moment coffee shops with their reasonable prices have an advantage over the restaurants with higher pricing.
Also, the market seems to be in decline. If the world financial crisis gets any worser, the advantage will be on the side of those dining places which were vaguely popular during the 1990s in Russia: canteens, «pelmennayas» (a kind of snack bars serving the national dish «pelmeni» – Russian dumplings; NovosibirskGuide.com), kebab houses, etc. When it comes to potential opportunities of development and network expansion (such as of Tara Brown's coffee bar network Travellers' coffee), I would say that now this should be done very carefully, with weighing down the chances and making precise, economically verified decisions.
All the business proccesses of the enterprises that wish to succeed on the market should be optimized: they should be ready to demand the rent decrease, trying to keep up with the today's market rates; optimize wages; reasonably and thoughtfully cut down other expenses. It should be done so that employees are ready to adequately perceive the new corporate culture and working business model. Franchising projects are becoming very interesting now. People, who have some capital or savings, are extremely eager to invest in the so-called «cash business», and restaurant business falls into this category. I think that now «the last man standing» credo is on the agenda. This business model is based on taking minimal loans, whereas employees become an integral part of the company's development and prosperity. The owners' determination towards implementing «horizontal» management and all-in direct participation in everyday's decision making process constitute the type of company that will survive and develop further. The current motto nowadays should be, «We have only one king – and that is our clients». There is no place left for those ones that cannot provide quality service or do not have allegiance to their clients.
Based on NewSib.ru interview.
Translated by Ernesto Garcia Melijov, Artem Sukhoroslov.
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