Top tips from Dubai entrepreneurs to avoid restaurant business pitfalls

Chef working at Mitra Indian fusion bistro at Al Seef on Dubai Creek. (Supplied photo)
Updated 07 June 2019

Top tips from Dubai entrepreneurs to avoid restaurant business pitfalls

  • A big mistake is to underestimate cash requirements in the crucial first few months
  • Sometimes a contrarian approach can help brands stand out, says one entrepreneur

DUBAI: More than a thousand — 1,109 to be precise — new restaurants opened in Dubai last year, in one of the fastest-growing industries across the UAE.

That’s one restaurant for every 265 people in a city of 3.1 million, so it’s no wonder that so many new restaurants quickly go out of business. 

Beyond business plans and funding sources, Dubai industry insiders suggest a list of questions anyone looking to break into the food business in the Middle East & North Africa (MENA) region should ask themselves.

Have you budgeted enough cash until break even?

Underestimating cash requirements in the crucial first few months while letting costs balloon out of control is a big mistake that new restaurants make, said Mazen M. Omair, founder and president & CEO of Momair Trading.

“Create a cash-flow budget for the first three to six months using conservative revenue estimates and allowing for unexpected expenses. This will help you track cash on hand, business expenses and how much revenue you need to keep your business afloat until revenue starts growing.”




Mitra Indian fusion bistro at Al Seef on Dubai Creek. (Supplied photo)

Have you got a contingency fund?

For Shivam Goyal and Shipra Khurana, who opened Mitra Indian fusion bistro at Al Seef on Dubai Creek last year, unexpected expenses were a constant headache. 

“While signing the (rental) agreement, you (may) invariably ignore many mall charges that haunt you later, such as chiller charges, gas charges, mandatory annual maintenance contracts for different things,” Goyal said. “So don’t be in a haste to sign the lease agreement without thoroughly going through it even though it may run into hundreds of pages. Also get them ratified from a law firm to save hidden costs later.”

Does your restaurant reflect your brand?

The need to keep “sunk costs” low often has entrepreneurs settling for cookie-cutter interiors.  

“The number one design mistake entrepreneurs make is trusting that their passion will transfer to the interiors and branding organically,” said Jacqui Shaddock, partner at H2R Design, an interiors architecture and branding agency.

 “The most important thing, when a concept is strong, is that the story is told cohesively. There’s a strength in consistency.”

Do you know your message?

Consumers respond to clear messaging but sometimes a contrarian approach can help brands to stand out, said Bhavika Bhatia, a 24-year-old former graphic designer who relied on family catering expertise to launch Moreish Restaurant & Cafe last year.

“Vegetarian and vegan food has surged remarkably over the past two years, and it’s only going to grow exponentially,” she said. 

But in a city that loves meat, using those labels can work to a restaurant’s detriment.

“Not marketing our restaurant as vegetarian/vegan has helped us avoid filters and brought in customers who would otherwise think little of a meatless meal.”




Dessert cafe Pastryology. (Supplied)

Do you have enough practical, and local, knowledge?

Ahmed Abdulla Tahnoon, a 31-year-old Emirati, took the leap of faith without hospitality experience when he decided to bring Japanese street food to Dubai with Spheerz, a restaurant that grew out of a kiosk at Global Village.

“I had no business background or experience, but as an engineer — and problem-solver — I put a lot of effort into reading books and online publications until I felt ready,” he said.

Reading wasn’t enough, though.

“At the end I needed to learn from the field itself.”

Do you know when to bring in the specialists?

“As entrepreneurs we tend to be perfectionists, especially when it comes to our business and getting things done. We often find ourselves doing more than we can. This approach is inefficient and distracts us from making more important decisions in growing the business,” said Aisha Mohammed Sharaf, a 25-year-old Emirati who has been running the dessert cafe Pastryology with her husband Tariq Yousef Taher, 32, for more than a year now.

She said it was important to realize when to trust in outside knowledge.

Do you have staying power?

Starting your own business will test your patience, said Zubin Doshi, the 27-year-old founder of ice-cream Scoopi Cafe.

“No business takes off immediately,” he said. “Keep in mind that you’ll need a minimum period of three years before you start seeing actual results.”

• This report is being published by Arab News as a partner of the Middle East Exchange, which was launched by the Mohammed bin Rashid Al Maktoum Global Initiatives and the Bill and Melinda Gates Foundation to reflect the vision of the UAE prime minister and ruler of Dubai to explore the possibility of changing the status of the Arab region.

 


Virus sees Booking.com slash quarter of global staff

Updated 04 August 2020

Virus sees Booking.com slash quarter of global staff

  • The company warned that “up to 25 percent” of employees could go in what it called an “extremely difficult step”
  • Booking.com’s Amsterdam headquarters was expected to be among the sites affected

THE HAGUE: Online travel agency Booking.com said Tuesday it will cut up to a quarter of staff worldwide due to the ongoing coronavirus pandemic, leading to thousands of job losses.
The Amsterdam-based booking site, which employs around 17,500 people around the world, declined to give an exact number of posts that will be slashed, saying details would become clearer “in the coming weeks and months.”
But it warned that “up to 25 percent” of employees could go in what it called an “extremely difficult step.”
“The Covid-19 crisis has devastated the travel industry, and we continue to feel the impact as travel volumes remain significantly reduced,” the company said in a statement sent to AFP.
“While we have done much to save as many jobs as possible, we believe we must restructure our organization to match our expectation of the future of travel,” it added.
Booking.com’s Amsterdam headquarters was expected to be among the sites affected, Dutch media reports added.
Hard-hit by the slowdown in international travel resulting from the lockdown, Booking.com follows in the footsteps of other digital travel sites such as Airbnb and TripAdviser, which have also laid off around 25 percent of their workforce.
Booking.com applied in April for state support.
Last month it received some 61 million euros ($71.8 million) from the Dutch state, making it the third-largest recipient of support behind flagship airline KLM and Dutch Rail (NS), the ANP national news agency reported.
Founded in 1996, Booking.com has some 28 million listings on its website which is available in 43 languages.