Mike Egan: Many ingredients to eateries' recipes for success

Restaurateurs need to keep dishing up what their customers want, says Mike Egan.

Is it the case that after thriving in their first 12 months restaurants can find the next couple of years tough going?
Every year is tough but there is some truth in the adage of the honeymoon period for a new establishment. You often find that after the start-up phase, most of the opening staff may have left and many of your early adopter customers have moved on to the next best thing. Hopefully by then you will have built a base of regulars who love what you are doing, so you should work to grow this core.

Restaurateurs such as Al Brown are expanding their eateries based on reputation - how easy is this?
With deep pockets and a great PR machine, I think SkyCity will probably invest in even more new eateries. Brewery-backed hospitality companies will use that funding to innovate and expand. Some savvy landlords will follow overseas models and fund proven operators to open in their properties, thereby adding value to existing or potential tenants.

Is it a good idea to locate your restaurant or cafe near other eateries?
It can be good to be. However, restaurants are very sensitive to rents. As a restaurant precinct becomes crowded with eateries, landlords generally increase rents. This can stifle innovation as the new breed of restaurateurs look at less popular areas to make their business case work. However, restaurateurs are often drivers of inner-city urban revitalisation, as was the case with Ponsonby Rd in the 80s. In Manhattan, certain areas have city-mandated rent controls on ground floors so they can be affordable to a variety of independent operators. This helps retain a neighbourhood's unique character.

What is your reading of the present restaurant market?
There has been a lot of new capacity added in Auckland in the past few months. All of these hundreds of new restaurant seats need filling. If the newcomers can sustain this, it would indicate a buoyant Auckland economy. Established eateries will stay relevant by being able to focus on what they are renowned for.

How are restaurant owners using social media?
They are getting better at it. We understand we need to use it in a way that reflects the personality of our brand and conversely not to overuse it so customers get bored. Some operators engage professionals to run their social media programmes.

What would be your advice to someone entering the restaurant trade?
Go and work for the best operators, either here or offshore. In a market where it is increasingly difficult to get the attention of the time-poor customer, it is important to have all the facets of your concept thought through and loaded with unique selling propositions.

Mike Egan is president of the Restaurant Association of New Zealand and co-founder of Osteria del Toro and Monsoon Poon.

- NZ Herald

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