The new world of food and drink : Part 3

"How many Heineken parasols do you want?" In the world of Food & Beverage management, 72 per cent of purchasing still takes place on the basis of wholesalers' leaflets, websites, industry associations and e-mail newsletters. The decision-makers in gastronomy - chefs, F&B managers, sommeliers, buyers - are thus largely guided by suppliers. That supply-driven approach is coming to an end. Category management is making its appearance in the hospitality industry. 

Category Management, also shortened to Cat Management, was once developed at supermarket chains to get the right product to the right consumer in the right frame of mind, thereby increasing your returns and improving your margins, while also making your concept and formula clearer to the buyer. 

Paul van Oers' journey began some 30 years ago in the traditional world of hospitality. He has spent the last 15 years visualising the creation of the new world of food and drink in the international food service arena. 

"One conclusion stands out: the old world of food and drink is finite. We need to transform the hospitality channel, develop new revenue models and form new alliances.

In this series, we portray the force fields in an international framework. We name the opportunities and encourage the reader to say goodbye to outdated thinking patterns. We need to work together. That applies to the
hospitality providers already as much as for vocational education."

While category management has been proving its worth in other sectors for decades, this approach is still virtually unknown territory for the hospitality industry. This may explain why only 19 per cent of decision-makers in the gastronomy sector buy what guests really want to consume. Time for a critical review: will we continue to buy products en masse where others actually determine how we translate their offerings into concepts and business formulas for our guests, or will we at some point be able to use category management to actually buy products and services that our guests appreciate?

Time for a reality check. Indeed, we have completely milked the flat concept of 'hospitality' and it no longer means anything. We find it increasingly difficult to explain why a steak in a restaurant costs 35 euros or a glass of icetea 5.5 euros, because the service no longer means anything and the products and services are available everywhere. 

If we want true hospitality, we have to start with the guest. That is what category management does. This means targeted purchasing based on an analysis of guest wishes. In fact, this turns common practice in the world of food and drink on its head, because in the current context, the hospitality industry has allowed itself to be led too much by suppliers who have successfully focused on marketing generic products that, according to them, would fit a trend or our concept. 

I have read many surveys and then it turns out: no chef works without convenience products anymore. Those days are over and we know why: there are far fewer people working in the industry and all those staff operations have become unaffordable in standard situations. Hence the use of semi-finished products. But even with that, we can start personalising. In fact, if you start applying category management holistically, you can develop an F&B offer that is tailored to the wishes of your guests during their digital customer journey. 

Suppose I have an international doctors' congress, then in my proposition and even already in my offer style to the guests, I can fully tailor my F&B portfolio to their needs. And that in line with the 4M model: guests' state of mind (Mood), momentum, budget and type of meal. 

That way, you create just-in-time delivery - and we have those logistics at our disposal - to develop new, distinctive hospitality concepts based on category management. As a result, we are able to make greater returns, achieve reductions in shrink and waste and, because the gross profit percentage improves, we can also reshape hospitality. 

We should also remember that already in 2030, i.e. in six years' time, more than half of our customers belong to the Millennials and Generation Z, and they are looking at us digitally. If we actually start putting the guest at the centre of our business - something we say we do now, when we don't - then we can build the relationships from our own identity and formula that support our businesses' development. If we don't, then, we will irrevocably run out of business. 

Category management has been used quite widely for some time in industries such as fashion, retail, automotive and also travel. The hospitality industry could learn a lot from this. It provides answers to questions such as: how do you steer your concept offer with customer journeys and how do you build customer journeys to engage new generations. And that against the backdrop of the need to achieve results with fewer staff and also to reduce waste. This is possible because we can start managing our stock better based on data, resulting in better returns, so that we can also be a decent employer for the people who want to work in our industry. 

You now see the sector struggling enormously with sustainability. If you really want to make progress here, you have to do it together with producers and manufacturers, because that is where the knowledge and skills are. You can already achieve a lot by keeping a core range that stands for the concept and the formula, and also by customising your F&B on a daily basis in relation to the guest populations in your hotel.

Many traditionally-minded buyers still have a long way to go, because they often suffer from 'Fear of Missing Out'. In order not to have to sell no, they buy 'safe', which results in unnecessary costs and waste. The fact that this often still happens is not only due to traditional thinking and acting, but also to a gap in what is offered in hospitality education.

The idea of linking procurement directly to customers is still completely absent in secondary schools and colleges, while the subject of category management is only now slowly making its appearance in colleges. So we continue to lag behind.

Several developments mean that the hospitality industry needs to catch up quickly. For instance, traditional hospitality concepts are quickly becoming unaffordable under the influence of increasing staff shortages. 

That staff operations in F&B concepts are becoming increasingly scarce certainly does not come out of the blue. For most chefs, the question has long been: how will I get through this day in one piece? Not surprisingly, the convenience product category is experiencing stormy growth. Its quality is also improving all the time. As a result, there are almost no more chefs who cook in the traditional way, they are increasingly becoming 'assembly cooks'.

The old way of purchasing is also no longer a guarantee for the survival of your hotel or F&B concept. Buying what others 'push' into the market with the necessary marketing violence, because they get a return on it, while it adds nothing to your concept, that's not going to be it anymore. 

Marketing's old thinking of just promising and then not delivering is going to work against you. Too many providers are stuck in their push strategy. If you open a new hospitality business, they still come up with "How many Heineken parasols do you want? 

And too little consideration is given to the question: what does this add to my concept? What do we allow, what do we communicate to our buyers and, above all, what do we not?

Instead, we should do less and what we do, we should excel in. We should also be able to do this cheaply, with a focus on convenience and enjoyment for the guest, and preferably personalised. 

In this new reality, category management provides the tools to create F&B offerings in a truly personalised way, develop powerful formulas and add value. 

The adage for today's hospitality industry is: what we are going to do must be very good. And that is only possible if we really put the guest first and base ourselves on good, relevant data. 

This is not as complicated as it seems. However, hospitality companies will now have to start bridging the gap with the new generations of digital nerds who want to shape data-based personalisation with them.