Your analysis of the quick food sector and the problems it faces (MW April 28) may be about to be rendered obsolete by the introduction of the new licensing laws.
Although most media coverage of the new rules centres on late drinking, the Government’s purpose is also to encourage the 50,000 quick food outlets to obtain drinks licences, as part of a drive to promote a “café culture”. The intention is to create combined drink and food consumption, eroding the drinks-only heritage of the on-trade.
The adoption of drinks licences by coffee and sandwich outlets presents a perfect brand fit for wine and premium bottled beer brands. The result would be to increase traffic in these outlets, at the expense of both burger-based fast-food providers and pubs.
The situation faced by the likes of McDonald’s is precarious, but the pub industry could reverse its recent poor performance by adopting the clothing of successful high street coffee and sandwich chains. By increasing the range of food and drinks they sell, pubs will become more inclusive places. At the moment, most pubs cater to a young, male lager culture. As a consequence, they exclude older consumers and women. The sector must change its positioning if it ever wants to prosper.
What is more, there are big opportunities for the owners of upmarket spirit, beer, wine and soft drinks brands. Selling directly to pubs increases choice for consumers and significantly increases profits for manufacturers and pubs. There are many examples where brands have achieved significant sales growth through widening distribution in the on-trade.
As a specialist in on-trade sales, I never cease to be surprised by how many brand owners invest huge sums in marketing without ensuring that distribution enables consumers to buy their goods.
The future may be bleak for the burger chains, but the rest of the quick food industry, drinks manufacturers and pubs all have major new opportunities.