How to organize a collaboration of catering and retail

Striving for multifunctionality and providing the maximum range of services at each square meter of space has become familiar in all types of commercial real estate, new functions, services, directions appear in retail. Partnership of retail (in the first place, the food retail) and catering has been developing for more than a year — this is one of long-playing trends around the world.

Vitaliy Timkiv / RIAN
Vitaliy Timkiv / RIAN

Catering and Food Retail Collaborations

Such an alliance has a synergistic effect, increases traffic and loyalty of visitors, helps to increase the audience. Increased competition, economic instability and new sanitation epidemiological reality contributes to the development of such unions. Today such collaboration is the opportunity to preserve the usual lifestyle and not give up your beloved take away coffee with pair of sandwiches, despite any restrictions.

What does grocery retail get?

The store’s own catering area extends the time of the visit and becomes a source of additional income and increases the level of loyalty of visitors. Such a zone becomes an additional attraction factor for the store and integrates well with the popular concept of slow shopping today. Also adding ready meals to the products’ list will increase the number of delivery customers.

Sales of ready-made dishes in retail are growing at a significant pace. (Izvestia, with reference to market participants, report that VkusVill in November 2021 recorded an increase in sales of finished products by 102% compared to the same period in 2020, Perekrestok — by 48%, Azbuka Vkusa — by 18.5%.) Such rapid demand growth is difficult to satisfy with own forces only, without attracting the capacity of large players of the catering segment with their own production bases.

What does catering get?

Catering in grocery retail can be organized locally or as a takeaway. When eating locally, the average check is higher. The specifics of the goods are also different – meals for snacking, pastries, snacks are purchased for takeaway, while for eating in cafes more often clients order salads, drinks, desserts. Catering in grocery retail versus traditional catering has a number of advantages — primarily guaranteed traffic, which is provided by the retail network itself.

For catering establishments, such a collaboration is also profitable with the ability to supply finished products to the shelves of the retail chain. Finished food on the shelf of a food store costs much less than the same dish in a cafe or restaurant. Given the stagnant/falling incomes of the population, this is an opportunity for people to maintain the usual level of consumption. And for catering it is an opportunity to increase sales.

In addition, studies show that some people begin to dominate introvertive character traits and they are less likely to visit public spaces. This reduces the traffic of classic catering establishments. If the catering point is in a food store, where a person goes regularly, he begins to purchase ready-made food with the products.

I see the greatest potential in the development of daily catering in food retail as a more affordable and healthier analogue of fast food. With a decent quality of products and thoughtful interior design, you can successfully compete with traditional catering (restaurants, cafes, food courts) for the audience of business lunches.

How does it work?

Case “Anderson” shows the effectiveness of a partnership with food retail: due to deliveries to “Okay” and “VkusVill” in 2021, the company received about 30% of the profit.

Another interesting example is the collaboration of two giants – X5 Group and McDonald’s. Within the framework of the St. Petersburg International Economic Forum-2021 (SPIEF), they signed an agreement to open up to 10 new McDonald’s enterprises inside the Pyaterochka and Perekrestok stores, as well as to deepen the partnership in the Okolo delivery aggregator.

Another example — premium and medium-level non-food retail (clothing, optics) actively installs coffee machines in stores, offering guests to drink coffee. Of course, in this case there is no additional income, but as a competitive advantage, such an opportunity increases comfort and sets up customers for a positive attitude.

Interior features

An important role in a successful catering project in retail is played by interior design and space organization. Previously, experts focused on colors that provoke a sense of hunger. The interior was filled with shades of red, orange and yellow. For a reason, the largest catering chains — McDonald’s, Burger King, KFC and others — have similar branded colors.

Space Organization Features

The first thing the visitor should meet is the staff of the institution, that will quickly talk about the menu and answer his questions in detail. For this reason, bar counter or cash desk zone is in the foreground. Upon placing an order, the visitor must go to the hall with tables. The toilet must be located at the end of the hall, however, depending on the establishments’ format it is logical to locate it at the entrance so that visitors can wash their hands before ordering.

A key point in the organization of space is native navigation. If room restrictions do not allow you to organize zones properly, we recommend to use navigation pointers, they will help visitors to navigate.

What are the best materials to use?

In catering establishments there is heavy traffic of visitors. Wear resistance and incombustibility become main criteria for the choice of materials. When choosing porcelain tile one that belongs to the PEI IV or V abrasion class is recommended. KM0 is considered most secure class of fire security of building materials. Also worth remembering is the need for sanitary treatment of all surfaces. For this reason interior materials must be wear resistant to aggressive detergents. Manufacturers of commercial materials offer a large selection of designs, so that even complying with all technical requirements, you can make an exquisite interior.

How to organize lighting?

Lighting for catering establishments is a separate industry. Every year producers carry out new tests of lighting equipment to achieve better results. The intensity of lighting affects the perception of food. Specialists from the University of Murray conducted studies in 2021 and found that the perception of food taste can change depending on the lighting characteristics of the room. With more muted light, food seems more intense in taste.

Features of taxation

Taking into account the existing norms of the Ministry of Finance, when combining a product store and catering points it will be easier to arrange them for different legal entities. Other than accounting, you may have to deal with a rather costly double accounting, because these are different types of entrepreneurship (so called common tax, or ENVD). Perhaps when big players’ lobbying of legislation simplification succeeds tax reporting is optimized. In addition, considering various epidemiological limitations, which will continue indefinitely, work using two legal entities and different types of activities is likely to be easier.

By Alexey Khomenok, CEO of G5 Architects

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