Throughout the hospitality industry there is worry that there will be little growth to look forward to in 2009 as on both sides of the Atlantic, consumers are cutting back on the non-essentials such as dining out and hotels. Now, it appears, restaurants are using one of their lifelines – discounts!
In the States, 23% of all restaurant visits in Chicago during this year's third quarter were made to take advantage of some sort of special offer – an increase on 9% the previous year. In the UK too, Lastminute.com are getting in on the action and since the summer have been offering dining deals at between 20 and 30 restaurants at a time, including places such as the Ritz.
Deals and gimmicks
A report conducted by consumer research group Mintel found that 54% of Americans had cut back on dining out since the start of the year, however special offers are seemingly working well for the beleaguered industry. The fast food industry, which has never been a stranger of a 'meal-deal' or two, is apparently benefiting from the economic downturn as consumers turn to cut-price options when eating out. Mintel reported a new $5 phenomenon which is happening across well-known chains such as Subway, Dominos Pizza and Pizza Hut, where customers can buy meals for the attractive price of $5.
Maria Caranfa, director and registered dietician at Mintel says: “Foodservice has been hit hard by people cutting back. When we surveyed Americans last January, over half said they were trying to reduce restaurant spending because of the economy. Many people’s finances have worsened since then, so it’s smart for restaurants to advertise lower prices. The key to making these lower prices work, however, is maintaining food quality and making sure every customer’s experience is optimal. Restaurants need to make cheap chic.”
Top restaurants still greedy
One question remains though – will the worsening of the economic crisis affect high-end restaurants or will they continue to charge more for less? Earlier this year, top restaurants in the UK owned by high-profile chefs such as Jamie Oliver, Gordon Ramsay and Heston Blumenthal, were targeted by the Telegraph national newspaper for charging extortionate prices for wine. In one case, Blumenthal's restaurant The Fat Duck in Berkshire charged £58 for a bottle of Bourgogne Aligote, whereas suppliers revealed the true cost to be £12.12.
Anthony Worrall Thompson owns The Lamb restaurant near Henley-on-Thames and boasts far smaller profit margins on his wine list. He says it's all down to avarice: "I do think restaurants are greedy generally when it comes to wine mark-ups. I hope that restaurants will start listening to their customers and that prices come down."