Idea in a Nutshell
A Reflective Pause is a Raqtan group initiative to share the experience and expertise of Saudi restaurant and cafe pioneers. This initiative aims to put the focus on the local Saudi market rather than foreign markets, helping fellow Saudis hoping to enter the restaurant industry. In the following sections, we will analyse the role that local culture plays in the success of restaurants and cafes. Raqtan will also provide content in Arabic, and we hope that A Reflective Pause will aid in the recovery of restaurants and cafes as members prepare for the reopening of their establishments post COVID-19.
Success story: The Hamburgini Restaurant Chain
In this report, Raqtan CEO Muthanna Abdulaziz discusses how Entrepreneur Nawaf Al-Fouzan CEO and co-founder of Humburgini started this chain of successful Burger restaurants in Saudi Arabia.
Hamburgini: The Beginning
Nawaf Al-Fouzan started the Hamburgini restaurant concept from home cooking recipes. He used to make burger meals for his friends during their regular visits and gatherings, he would use exclusively home ingredients from the hamburger meat to the bread and the hamburger sauce mix. Though, he did not think about turning this passion and his special art of cooking hamburgers until his friends suggested that he take it to a professional level and open a restaurant.. During that time, Nawaf was a pioneer working on several projects and looking for a new project idea. From there, he decided to research the founding of a Hamburger Restaurant project.
Naming “Hamburgini”
The name is derived from hamburger, but it does not have a specific meaning. The goal was to come up with a name that is pronounced easily with a musical sound by everyone from adults to teenagers and children.
Hamburgini Success Factors
1.
Passion and Concentration
Knowing your passion fuels your concentration and hence your success. Sometimes one gets stuck in a job that does not truly identify them. However, Nawaf Al-Fouzan made the decision to leave his job as an accountant with a high salary and move to the field of entrepreneurship. He has founded projects in various fields and then entered the Saudi restaurant industry. Therefore he advises not to get attached to the salary, position or field of study, you should search for what makes you passionate enough to keep going towards the road of success.
Pursuing your passion and chasing the dream has many pros and cons. Whilst some of us get too carried away by life that they forget about their long-sought dreams, others never stray from what they constantly believe to be their aim. One of the most important reasons to follow the dream of opening your own restaurant is that you will find your passion in life. Passion is a valuable source of encouragement that converts you into an avid reader and a quick learner. Therefore, when compared to other entrepreneurs, you will be the one who has vast knowledge and digs up for any information related to the F&B industry.
Following your all-consuming passion, you might get charmed by it to the extent that you don’t really consider the weaknesses of your business, resulting in a doomed failure. Being passionate could drive you to stay open even though your small business is not reaping any profits. Yet, you still somehow feel connected to it. Blindly fond of what you are doing, you can no longer take an overall look to see the forest for the trees and clearly take the decisions that benefit your business.
2.
Partnership: Be an Owner or a Partner?
Co-ownership involves owning stock in the restaurant that could be in the form of actual shares. On the other hand, partnership comprises more obligations and contributions. When establishing a partnership, each of the parties shall contribute to this business as much as possible and as agreed. Even if it is in the form of money, labor, skill, or a broad network; contribution is key to achieving the eagerly-awaited success. Nevertheless, being an owner could make you less productive as you might feel on some days that it’s your own business, and you have the right to run it remotely. At some point, you might slack a little or act at a more sluggish pace.
Working with partners, you become obliged to stick to a certain pre-planned strategy and have to abide by it to meet the moral and ethical aspects of such a bond. Partnerships bring together extensive expertise; relying upon a partner of a long experience in the F&B industry is a valuable asset. Financially, having a partner could be beneficial since you will not bear all the risks, profit, loss, and costs alone. Yet, Harmony and understanding are of paramount importance when choosing your partner.
Hamburgini was distinguished by the fact that their hamburger meal is priced at a much cheaper rate than the competitors while maintaining high quality.
3.
Business Model
Coming up with a business plan is crucial for running a profitable business. It includes a detailed presentation of your products, services, target audience, marketing campaign, and financial matters. In other words, it is a road map that shall entail profitability.
4.
Competitive Price
Hamburgini was distinguished by the fact that their hamburger meal is priced at a much cheaper rate than the competitors while maintaining high quality. Nawaf conducted opinion polls himself with a number of restaurant visitors from different ages to set a suitable price for teenagers and adults. With this price and product quality, he managed to grab their target audience’s attention from other restaurants.
5.
The Size of the Burger Sandwich
Nawaf has adopted a smaller hamburger size with the goal of accommodating all groups, from children to adults. At the same time, the price is suitable to order two hamburgers if the customer prefers.
6.
Expansion and Opening Branches
Opening branches has become a necessity in the hamburgini restaurant due to the low prices, they needed to attract the largest number of customers. Also, hamburgini achieved success from the first restaurant, which made customers queue to order the special hamburger meals, so the branches became important because of the wide demand and success too.
Nawaf advises following the expansion or franchise concept among specific factors to ensure profit, as follows:
- The type of project, the product and the demand on it.
- Country size and population: for example in the United States it is necessary to open several branches and follow the franchise concept to reach the large number of states and populations. But in Saudi Arabia, despite the large area of the country, the population is not large compared to other countries. So research into the likelihood of a restaurant's success by region and population is necessary and important.
7.
Quality Control
Quality control is a top priority for Nawaf to ensure that the product is presented with the same high quality. The hamburgini staff includes a quality control team that monitors all branches 24 hours through cameras, in addition to field visits.
Another point to consider is controlling the restaurant’s inventory, it might pose a daunting challenge for you, owing to the fact that the employees have constant access to it. Such an issue is pressing enough to determine the course of your business.
8.
Compensating the Customers for any Negative Experience
There are two types of customers, the first of whom might voice their dissatisfaction through posting negative comments on social media. In fact, this is a positive scenario as you get the chance to be informed of what crosses their minds; they are indirectly benefiting your business and driving you to enhance your services or products. Other customers are those who have gone through a bad experience yet stay reluctant to express their feelings. Instead, they no longer return to your restaurant. From now on, when your customer goes through a bad experience with your restaurant, you have got to adequately compensate them, even if you had to slightly exaggerate to win their trust back.
Challenges that restaurant owners may face
Challenges may vary from a restaurant to another, depending on whether you own a single branch or a restaurant chain. One of the challenges is that you might get extremely focused on your competitor to the extent that you forget about your audience.
F&B industry revenue is deeply impacted by the slightest of things, whether it being the holy month of Ramadan or weekdays. One of the most critical issues these days is the current dilemma posed by Coronavirus, wreaking major havoc on the F & B industry. Deeply concerned to get back to their normal habits, customers might hesitate to go to their favorite restaurant nowadays. As a business owner, you need to stay patient and plan carefully to address this challenge and powerfully return to the market.
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