Date
14 December 2017
Restaurants have begun to outsource key services in a bid to cut costs and cope with a difficult macro environment. Photo: HKEJ
Restaurants have begun to outsource key services in a bid to cut costs and cope with a difficult macro environment. Photo: HKEJ

F&B players redraw strategy amid a tough environment

The food and beverage industry has always been complaining about “three highs” — high wages, high rentals and high ingredients costs.

To alleviate the cost pressure, more restaurants are using outsourcing services.

Some are using external delivery service to bring food to customers’ doorsteps, thereby increasing business volume without having to hire their own delivery staff.

Dishwashing is another tedious part of running restaurants.

Very often, if the dish washing workers call in sick, and the chef or even the manager has to pick up the slack.

An increasing number of restaurants are using outside dishwashing service.

Some players cited cost savings of nearly 20 percent.

“The place is also a lot cleaner. You know how easy food waste brings insects or bad smell,” a restaurant manger told RTHK.

Restaurant owners, meanwhile, are taking advantage of the retail sector slowdown in Hong Kong to bargain for lower rentals.

Tsui Wah managed to reduce its rent on a Tsim Sha Tsui outlet by one third starting from this month.

In mainland China, operators are also trying to cope with a slowing economy.

Hop Hing is responding to the challenging environment by closing down underperforming outlets. The company told the media that it is also switching to smaller shop formats to save costs.

Hop Hing owns the rights to operate Japanese beef noodle chain Yoshinoya and Dairy Queen QSR in some northern regions of China.

Like the Hong Kong counterparts, the company is negotiating with landlords to bring down the rentals.

It is also joining major review sites like Dianping to draw customers to its food delivery service.

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RC

EJ Insight writer

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