News

Insights


Death of the chain?

restaurant

Trends come and go. In the hospitality world, there’s no denying the fact that chain restaurants have been booted off the catwalk. But what’s gone wrong, and what does the future hold for chains? Is there even a future?

I remember seeing a queue outside Jamie’s Italian in Bath stretching all the way down Milsom Street, the city’s main shopping street; hungry diners prepared to wait over an hour to get their hands on a bowl of his pukka pasta. For a period of time, from around 2010 to 2016, it seemed like the UK’s interest in affordable, casual dining was insatiable.

But, to put it simply: the ‘cookie cutter’ approach just won’t cut it in 2018.

Like that familiar pair of jeans or comfy old trainers, people once enjoyed the safety and predictability that chain restaurants brought – when you were out exploring a new city, or out in your own city for that matter, why would you take the risk of trying somewhere new and unfamiliar? Why would you part with your hard-earned cash, only to be brutally disappointed? Or, perhaps just as bad, leave feeling that your experience was completely unmemorable?

The fact is that times have changed because standards have gone up. In our ‘Instagrammable’ world, people want – and expect – to be wowed. ‘Adequate’, ‘satisfied’ or ‘average’ are three words restaurant businesses should want to avoid like the plague. Diners – millennial diners, in particular – have higher expectations and are now more experimental when choosing where to eat out. Just as we eventually get bored of those comfortable jeans or trainers, diners become bored of having the same experience, time and time again. 

Over the past 12 months or so, there’s been a steady stream of household-name chain restaurants reporting financial troubles or plans to restructure – from Jamie’s Italian and Carluccio’s to GBK and Byron Burger. This is due to a number of factors: from diners wanting unique experiences and markets becoming heavily saturated, to an increase in property rental prices and food inflation – all of which affect the bottom line.

So, which businesses are booming? The short answer is those that focus on continuous improvement. Continuous is the key word here: they must be constantly evolving, changing, developing and adapting. Wagamama is a great example of one such brand: a chain that is thriving because it never stands still.

Others are chains where the ‘chain’ part is hidden, or not immediately obvious. The Lounges Group springs to mind here: with scores of Lounges scattered over the country, each and every one is branded slightly differently with its own name and interior style, giving the feeling of an independent restaurant but falling under a chain. Language is important here too – note the use of the word ‘group’ as opposed to ‘chain’; it feels friendlier. The same goes for many pub groups, particularly smaller ones – if people have a positive experience in one they’re very likely to try another and, in that sense, knowing it’s part of a group is a positive thing.

So, what’s the future for chains (or groups)? I believe there is a big future. To answer my own question – we’re not going to witness ‘the death of the chain’, so long as there’s a constant focus on the offering and ensuring the intended guest experience is regularly reviewed and that guests’ perceptions are listened to.

Here at HGEM, we help chains to frame what they want their guests to experience and then measure the standards, behaviours and processes to ensure consistency. We can also create branded survey sites to engage guests and collect their feedback, and we can monitor reputation in online reviews. All of this can be viewed through interactive reports in The Hub to help support continuous improvement.

Back to Blog