Suppliers take stock at CESA Conference

Over 200 delegates attended last year’s CESA Conference.

How to move forward in a changing world was definitely a timely theme for the 2017 CESA Conference. During the event’s main business day on 16 November at the De Vere Wokefield Estate Hotel in Reading, the specially-selected presenters tried to advise catering equipment suppliers on how to cope with today’s uncertain market conditions thanks to factors such as the Brexit vote impact.

The BBC’s Steph McGovern acted as conference facilitator, and she kicked off proceedings with an economic update. “Businesses that are doing well are the ones not letting uncertainty cripple them,” she commented. “Companies have to embrace disruption rather than worry about it.”

McGovern underlined that margins are so tight that businesses can’t increase wages, so they have to think innovatively about how to recruit and retain the right people. She cited examples of firms offering workers’ relatives work experience or moving staff into departments where they were happier, to ensure they are motivated to stay on.

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“We are still feeling the after-effects of the financial crisis 10 years on,” she said. “The UK has created more jobs but not more productivity, but that is tricky to measure. More reliable indicators would be profits, sales, margins and turnover.”

Next up was Steve Gotham, director of insight at research firm, MCA Insight. Giving an overview of the restaurant and dining trends in the UK, he detailed that the national out of home foodservice market generates around £88bn annual turnover. “It’s dynamic but fragmented,” he said. “The long term trends are for a growing amount of expenditure going out of home for foodservice, but it is static at the moment.”

He reported that the eating out market is set to grow by 1.7% this year, but tempered this with news that the Brexit fallout has caused the growth rates to moderate or there may even be a net volume decline. “The frequency of eating out is under pressure this year. People are being more selective in where they are going and spending money. But average spend is growing fairly healthily, boosted by menu price inflation and capturing trading up by consumers.”

Forecasting that the eating out market should be worth £92.3bn by 2020, he revealed that coffee bars and sandwich shops are buoyant, while pub trade is encouraging and branded contemporary fast food is on the rise.

However, he concluded: “Continuing restaurant supply but falling consumer demand will put emphasis on existing site performance. We are looking at turbulent times as this mature market rebalances. Operators who are able to more skilfully manage price will be better placed to succeed.”

Regarding the public sector market, the next speaker, Dewberry Redpoint MD Andrew Archer, said that significant growth has been seen over the past few years. “The expectation is that public sector investment in catering will continue, but we are not expecting huge growth,” he believes.

He welcomed the continuation of the UIFSM scheme and predicted a growing equipment replacement market for this sector. Reporting that hospital sector catering is currently worth £215m and residential care £173m, he forecast increases fuelled by an ageing population.

But for possibly a more youthful demographic, Wired Magazine’s Jeremy White looked at the latest design, material and technological innovations which could shape businesses. He revealed that globally the population is incredibly creating as much data every 10 minutes as was created up until 2003.

“Augmented reality and virtual reality are being used for training,” he said. “Plus lots of factories are becoming completely automated and using robots.”

White added: “Between 1993 and 2015 computing power increased by a factor of 1m for the same cost. Data processed with AI can give companies a massive advantage over their competitors.”

Data and connectivity were also on the mind of the next presenter, consultant Gary Meehan, who analysed the possibilities of the smart kitchen. He warned: “If each piece of catering equipment is controlled by a different app, it will be ridiculous for chain operators to manage.”

On the definition of a smart kitchen he outlined: “You can’t assume that just because one piece of equipment is smart that it is a smart kitchen. A smart kitchen is a kitchen that thinks for itself, runs itself, is predictable, productive and profitable.”

He cautioned: “Chains are holding back on smart kitchens because they see complexity. We are going in a direction that will cause folly. Manufacturers have assigned connected kitchen development to the IT department but you need people who understand how to develop products to meet demand.”

Concluding that manufacturers need to find a common standard to develop connected equipment that works together, he said: “Operators and manufacturers don’t want more data, they want insights they can act on. Smart kitchens can help operators alleviate challenges. Inaction on connectivity is not an option for manufacturers.”

The afternoon sessions began with past CESA chairman Simon Frost detailing the latest CESA-developed training course, Principles of Foodservice, which gives an introduction to the catering equipment industry for newcomers. The nine-module short course is designed to be delivered in-house in around 2-3 hours by CFSP-certified personnel.

Following that, Semta/EAL’s Allan MacDonald continued the push to educate the industry about new apprenticeship standards, after delivering a similar presentation at the 2017 joint Industry Technical Conference. Groups of employers (a minimum of 10) can now request industry-specific apprenticeships.

The standards should be written on no more than two sides of A4 paper, but then an assessment plan supports this. Furthermore, there should now be an end point assessment as part of the apprenticeship process.

Next to the stage was Just Eat’s restaurant services director, Robin Clark, who revealed that the takeaway industry is worth over £9.9bn to the UK economy, and the delivery market represents £6.1bn of that.

The takeaway delivery app has grown to £1.5bn worth of orders recorded in 2016, with Just Eat now providing add-on services for the local takeaways it represents. These restaurant services could soon be joined by a catering equipment provision. “We asked 1,000 partners what add-on services they’d like to see from us next and kitchen hardware came out top,” said Clark.

New Fresh Montgomery portfolio director Ross Carter waxed lyrical about the overhaul of the Hotelympia exhibition, as from next year it will be split into four shows, including The Professional Kitchen Show specifically for catering equipment, which currently has 87 exhibitors.

The day concluded with keynote speaker and former chief treasury secretary, Michael Portillo commenting: “National stability came to an end with the Brexit referendum and plunged the country into an adventure. This level of instability hasn’t been seen in the UK since 1979. If parliament votes down a Brexit deal there would probably be another general election.

“The ready availability of European labour helped keep the country stable. This enabled long periods of growth as it depressed wage inflation.”

However, he believes: “Free movement of labour is fundamental, not free movement of people. One day the EU will have to move away from the free movement of people to the free movement of labour.”

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