Digitalizing the F&B industry.
The Pandemic has heavily impacted the hospitality industry with regards to how restaurants operate on a day to day. A decreased staff force and the inevitable truth that diners are choosing to have their meals at home for safety reasons, has driven restaurants to find new ways to stay afloat and serve customers.
Contributing editor, Saja Elmishri, spoke with Mohamed Fayed, a successful C-Suite executive who’s worked in US Fortune 100 companies and local family conglomerates in Dubai. Fayed has leveraged his technology affinity with deep retail industry knowledge to lead a variety of international brands through digital transformations. Having successfully launched the region’s largest luxury online player, Ounass.com, Fayed’s recent venture is currently acting as CEO and Co-founder of grubtech, an end to end AI powered digital platform enabling restaurants to successfully manage omnichannel operations.
Read on to discover the latest restructuring trends in the hospitality industry and the benefits of centralizing operations online.
1. You have had a variety of experiences in planning at Macy’s in USA then omnichannel growth at Al Tayer in Dubai – do you recommend that everyone should try more than one type of job role if they are able to? How have these experiences influenced your career journey until date?
I think everyone’s journey is different based on their goals and aspirations. If I reflect on my track, adapting to the digital transformation of retail was a necessary evolution, omnichannel trends were manifesting across the region and this presented an opportunity for growth; I am honored to have had the opportunity to lead that transformation in Al Tayer. My advice is: when presented with an opportunity that complements your existing skill sets and that gives you an opportunity to grow in an area you are interested in, seize it! Don’t be scared to suck at something new, that’s how you learn and grow.
2. Tell us about the process of launching Ounass in 2016. Why then, and how did you realize there was a gap in the local market at the time for such a platform?
Ounass was a natural extension of Al Tayer’s core competency in luxury retail. We recognized early on that our customers were channel shifting their purchases from brick and mortar to online and we had to be there to satisfy this journey. Digital penetrations in the GCC were growing at double digits and presented the greatest opportunity for growth for the group. Months of study went into planning the right approach, the positioning of the brand and going to market strategy. The internal machine was well positioned to capitalize on this opportunity and every function banded together to make this a success, it was a once in a lifetime opportunity to be part of a great story.
3. In a 2017 BoF article, Khalid Al Tayer claimed that the region has ample potential to shop digitally and catch up with the rest of the world. Do you think we’ve reached those goals since then and especially with the Pandemic?
Absolutely! The pandemic has accelerated digital adoption across every sector. Consumer behavior has permanently changed to relying on online channels for basic needs to wants. From our food, to groceries to our luxury purchases, digital is the new norm. I strongly believe we will continue to see that growth carry forward at an accelerated rate. The post pandemic world is the new norm and businesses who fail to adapt to this will not survive.
4. Why did you switch from fashion retail to F&B recently?
I am fascinated by digital transformation patterns. In early 2019 I began to see the same trends we witnessed in fashion and beauty retailing unfolding in food. Online penetration of restaurants’ revenue was growing in double digits and constituting over 30% of sales. New business models like cloud kitchens, which in effect are large food fulfillment centers, were taken root across the world. The difference between the two sectors was speed; what took retail 20 years to achieve was happening in food in half the time. Technology has not kept pace, the F&B space is rife with antiquated technology that dates back to the 90’s and this transformation needed an enabler. I couldn’t unsee the problem and we started grubtech in July of 2019 with a view to tackle this problem.
"Consumer behavior has permanently changed to relying on online channels for basic needs to wants."
5. Tell us more about your recent venture, grubtech and how it’s aiming to help restaurants during these challenging times?
grubtech was born out of a belief that the food delivery order cycle will be fully digitally enabled. From the discovery phase on food aggregators like Deliveroo and Talabat to the in-kitchen execution and ultimately the delivery of the order. In a pandemic world, dine-in revenue is all but absent and our restaurant clients rely heavily on food delivery where online is the largest channel. We have automated the entire order life cycle, from eliminating the need for tablets across all the food aggregators, central menu management, smart in-kitchen display systems and dispatch applications. We enable our clients to turn their existing restaurants into micro-cloud kitchens by using their supply chain and stores to create new concepts, multi-tenant them across all the region’s food aggregators and fulfill their orders in a seamless manner. In addition, we are a native purpose built cloud kitchen technology stack powering many of the brands and kitchens in the region including Talabat’s cloud kitchen, IKcon, Leap Nation and many others.
6. How is the competitive landscape evolving as a whole when it comes to food aggregators, online ordering and cloud kitchen platforms?
It’s interesting to watch the evolution as food aggregators adjust their pricing and commission structures to the times. It’s clear that restaurants are heavily reliant on these food aggregators for survival, but I think it’s a symbiotic relationship where both parties need to find a sweet spot where both can win. As new players come into the market like Noon, competition will ultimately help find that equilibrium.
7. Are virtual brands (online-only restaurants) the future?
It’s too early to tell, but what we are seeing so far is that it definitely helps our clients’ revenues. It’s not as easy as throwing up four to six recipes under a new brand and expecting it to work. The brand equity, marketing, value for money and food quality all play important parts for success. The organizations that have strong digital playbooks, large delivery radiuses and execution excellence have done spectacularly well during the pandemic. We will continue to see the evolution of this trend with new marketplaces for virtual brands, micro-cloud kitchens and other iterations.
8. If a restaurant aims to expand and launch online for the first time, what quick tips do you have on getting started?
Focus on your existing strengths; this could be supply chain, the chef’s creativity on creating new recipes or the neighborhood demographics you are serving. The basics apply, value for money and consistent quality will always win over customers. Lastly, automate as much of the process as possible. That’s what we do and we love helping our clients achieve their digital goals. Reach out and we will help you get started!