Episode 1
Launching & Operating a Fast Food Chain in the UAE

[00:00:00.000] – Jean-Philippe

Imagine that profitability is now harder because you have those delivery aggregators consuming the world. Basically, increasing your profitability by investing in sales is tougher than before. And what have you done to try to solve that issue of profitability?

[00:00:14.310] – Alex E Debare

I mean, for us, I think the key, the key place where you can actually squeeze out profitability is looking at your supply chain and looking at your suppliers. And I think if you have data driven software which allows you to make better decisions, for example, what from your menu is actually generating you the most profit? Or is there a certain ingredient that you could switch with another supplier that would save you 2 or 3%? Suddenly those two and 3%, and changing the menu mix of what’s being sold to more profitable items than less profitable items goes a really long way when your EBITDA margin is 8 to 15%. When we were in kind of like the golden days, when it was between 35 and 41% here, 2%, there, 3%. Yeah. In the end, you didn’t really feel it. You know what I mean? You had a really healthy margin. But now in the restaurant industry, no, you need to be a hawk. And the only way to do that is to have real live data on your operation, which I don’t think traditional POS systems at the moment are capable of giving.

[00:01:20.550] – Jean-Philippe

POS systems have, uh, built quite a reputation in the market. Every restaurant has one because I think they understood the importance of, you know, just streamlining your front of house operations. But, um, funny enough, when you look at when you talk to restaurant owners and you ask them questions about their back of house, uh, not many of them are data driven, believe it or not. And, um, when you dig a little bit into how they do things, you notice that there’s just a bunch of discrepancies that are so obvious and so evident, uh, in terms of what needs to be changed. And yet none of them do that. And I think it’s because of a, maybe a lack of understanding of what software can do to you. When did you realize for you as an owner that you needed to look inwards to sort of to maximize your profitability?

[00:02:07.350] – Alex E Debare

Look, in the early days when we started Burger 28, which was in 2016, the price of ads on Facebook and Instagram were really cheap.

[00:02:16.390] – Jean-Philippe

All right.

[00:02:16.870] – Alex E Debare

So increasing your top line was relatively cheap. And also your margin was really healthy. Now as more companies and this is not before it was more smaller SMEs who were investing on social media. The big dogs didn’t really appreciate the power. Now everybody knows how powerful social media is and everybody is stuck on their phone. You go to a dinner and there’s a couple and they’re not enjoying the moment together. They’re enjoying the moment on their phone. You know exactly TikTok, Instagram or any of these different platforms. So really increasing your top line as a restaurant, considering that you could do an ad for your restaurant and you could receive it and I could be perfect timing, you’re hungry. You’re looking for a burger, and you like my pricing, my value proposition, but you’re too far away from delivery or not bothered to physically come, so that’s money wasted. There’s no conversion. So that measurement of your conversion of the money spent in social media is difficult to calculate, and it’s becoming more expensive. So, as you rightly said, the only other option to increase your profitability is to really look inwards and see, okay, what does my supply chain look like?

[00:03:32.850] – Alex E Debare

What am I ordering from suppliers? Could I reduce these costs? And there’s so many things going on. When you own a restaurant, there’s so many moving parts. You can’t keep going back and saying like, okay, can I reduce this by one drum? Can I reduce this by two dirhams? It’s also a taxing thing to keep going to suppliers all the time. You can’t knock on the suppliers door every five minutes and be like, by the way, can you do this cheaper? Can you do this cheaper? No. You might have once a quarter meeting, twice a quarter meeting. You know what I mean. Plus you have so many suppliers. Another thing where there’s value is aggregating everything you buy into 2 or 3 suppliers. Okay, and then hopefully having some sort of economies of scale with them to reduce your cost. But I don’t think a lot of restaurant owners have the time or have the competency, or realize how much money can be saved by looking inward and reducing. Actually, your cogs.

[00:04:23.530] – Jean-Philippe

Start at burger 28 several years ago. I don’t think we’re missing out on, uh, any shortage when it comes to burgers. Why did you decide to launch yet another burger concept? And how do you even develop? How where do you start when it comes to developing a new concept?

[00:04:39.190] – Alex E Debare

So I started burger 28 and 2016. So we were actually one of a handful of first better burger concepts to open in the UAE. Now, a better burger concept means that you’re not at the price point of McDonald’s and Burger King. You’re kind of more at the price point of Five Guys and Shake Shack and all over the world. And around 2015 to 2017, there were people who were setting up better burger concepts, which were locally focused. Yeah, so created for their local market. So I think for me, I saw this more as a business opportunity. I was living in Africa before, and I had moved back from Africa to the UAE because I was born and raised here, and I was looking at different businesses to start, and one of them was a burger joint, because I had gone to Sharjah when it was much less developed than it’s it is now. And I saw this tiny little hole in the wall selling burgers. And I had sat there and I watched how many orders they were doing for a two days in a row and did my back math, and they were making around 15 to 16,000 dirhams a day from this tiny.

[00:05:44.860] – Alex E Debare

Yeah, from this tiny little location. So I thought, if that’s going to work in Sharjah, there’s no reason why it wouldn’t work in Abu Dhabi. It’s roughly the same, you know, clientele, same demographic potentially in Abu Dhabi, there’s a higher purchasing power. So I went straight away to look for a location and then started building the burger 28 brand. Yeah. You need to keep in mind when you’re looking to open a restaurant. It. The simple, simple, macroeconomic, sorry microeconomic of supply and demand. Yeah. If you open up in somewhere where there’s a lot of demand and no supply, you’ll be able to make supernormal profits. But don’t think that anybody is going to just let you stay in a market and make supernormal profits indefinitely. No. As soon as somebody sees that there’s opportunity, someone will open a similar concept next to you. So I think one of the success factors for burger 28 was that we had identified Mohammed bin Zayed, which is a suburb of Abu Dhabi, as an up and coming area where there were a lot, a lot of residential villas being built.

[00:06:46.550] – Alex E Debare

And as we opened, a lot of people relocated there and there was nothing there. We were literally on the strip of buildings and we were the first, I would say, cool restaurant to open. And everybody loves burgers.

[00:06:59.270] – Jean-Philippe

Isn’t that a risk for a new business to launch their first location in an area that’s not yet developed?

[00:07:05.690] – Alex E Debare

I mean, every single business decision you make, there’s going to be a risk. And usually the higher the risk, the higher reward. And that’s how it played out for me. Uh, by opening in Mohammed bin Zayed from the day we opened, it was incredible. Literally the amount of business we were doing. I was like, okay, I’ve made it. That’s it. Like, I can retire. Before we finished the first year of operation in Mohammed bin Zayed, we opened another location because I got hubris, to be honest, I got ahead of myself and this is something that I would tell anybody who’s in business or opening a restaurant just because your first location works, don’t be so sure that the second one is going to work as easily.

[00:07:41.780] – Jean-Philippe

So you mean to say a lot of people start with their first location, look at profits and margins being quite high, and then just jump the gun and go for that second location.

[00:07:52.190] – Alex E Debare

Makes sense, right? Because technically, if you’re going to talk about business, what are you looking for? You’re looking for product market fit, right? Once you’ve found product market fit, if you were to open a literature book about running a business, what do you do? You scale straight away, especially when you’re first or new to a business and you’re creating a name from scratch. We’re not talking like Tim Hortons or Shake Shack or Five Guys, but you know JP. You know, whether your success is attributable to there being a lot of demand and no supply? Is it because you actually have the best burgers in the world? And if you were to take JP burger, you know, to another part of the city, would you still have the same success? You know, and that’s something which I think a lot of people, they just get caught up in the money. They get caught up in the success of the initial concept, and they don’t take a moment to step back.

[00:08:43.710] – Alex E Debare

In retrospect, if I look at my journey now opening restaurants and in total, I think at one point we had eight locations open. I would have wanted to be a bit more careful about looking at my bottom line before expanding.

[00:08:59.370] – Jean-Philippe

That’s what you’re.

[00:08:59.790] – Alex E Debare

Saying. Like, I rather have 1 or 2 locations, which I had really squeezed all the profit possible in order for those locations to be so optimized, then to just open like 6 or 7 locations as fast as possible.

[00:09:13.740] – Jean-Philippe

What is the price that you paid doing just that, opening several locations without optimizing the first two locations?

[00:09:20.730] – Alex E Debare

I don’t know how I’d be able to quantify it, but I would think maybe over the six years, like about $1 million maybe. If I look at because I was just focused on top line and growth and some entrepreneurs are like that, they just want growth, growth, growth. And if we look at the past ten years where interest rates have been relatively low, that’s what everybody’s been looking for more order numbers and more revenue. Now it’s changed. What’s your profitability? What’s your bottom line? That’s what matters. That’s how I’m going to value your business. I think I was sucked up in just more orders and more growth. I was also young. I started when I was 28 and you have something to prove. All my friends were in good jobs working for it to.

[00:10:00.120] – Alex E Debare

Ernst and Young and all these different, you know, massive names. And I was starting a burger joint. I remember, I remember going to a party and like everybody, you know, saying, okay, I work in Ittihad, I work in Ernst and Young, I work in McKinsey. And then like it came to me and I was just like, uh, I’m opening a burger joint in Mohammed bin Zayed City. And like, everybody was like, good luck, you know what I mean? So when it did open and it was successful, I was happy, obviously. You know what I mean. You took a risk. You allocated capital and then it worked. So I think I just got way too consumed and too excited and just scaled, scaled, scaled, scaled without looking at my bottom line. And if I did have a data driven insight into how I could increase that bottom line, I think today I’d be sitting on more retained earnings, and I think it would have allowed me to spend more time not focused on growing, but looking at how to make a really profitable business, which is so important.

[00:10:54.360] – Jean-Philippe

So once you decide to launch a burger joint, how do you go on about to develop the whole concept, the menu that you want to sell, the brand identity that you want to market. There’s so many decisions that you have to make, especially when it’s your first brand and you know you’ve never done it before. How do you do that?

[00:11:09.480] – Alex E Debare

First thing that I would suggest you do is actually go into the market and see what’s in the market, you know, who are the people who are successful and why are they successful looking strictly from like a menu development point of view. And then you’ll kind to start to see some trends. When it comes to brand development, you need to create a concept, an idea like why are you creating this name, you know, and why is it how it is? Burger 28 the reason why it’s burger 28 is because we started on 28th Street and I was 28 years old. Should be burger 27 because I should have opened when I was 27. But that’s for another, another conversation. So that was us really creating a name. And the logo is a street sign if you look at it. Okay, interesting. So that’s where we started. So we’re proud of where we started. That was the idea behind it. And then burger 28 as a concept is what would a burger joint look like if it was created for the UAE market.

[00:12:06.900] – Alex E Debare

Because I was born and raised in the UAE, so I wanted to create something which was culturally in sync. That’s why, for example, we have these patterns which are taken from the gutter. From a menu perspective. We wanted to create something which was fun, something which was young and something that would build nostalgia for people. So when we were growing up in the UAE here, we used to eat chips. Oman, we used to eat the cows, we used to eat all these different things like Cheetos. And I wanted to bring that into the brand. So you kind of felt like a kid again. You felt that innocence and that happiness. And I felt that that would build an emotional connection with the customer and the brand. As a brand, you’re looking to try and build that emotional relationship because as a human, it’s difficult to love something which is inanimate. Yeah. So if you personify your brand in such a way or you manage to connect your brand. With things that evoke emotion, you can start to build that kind of emotional love between a consumer and a brand.

[00:13:07.240] – Jean-Philippe

Once you’ve decided on the the the brand identity of your concept, how do you craft a menu? How do you test it out? Do you give it to your family? And you’re like, okay, taste test ten burgers. Tell me what you think and then you launch it. How do you go on about to even decide what the recipe of your burgers are going to be? Did you do it? They do give it to food professional. How do you. How do you do that?

[00:13:30.830] – Alex E Debare

So I worked and collaborated with a good friend of mine in order to create the menu. And that was the initial menu that we came up with.

[00:13:38.660] – Jean-Philippe

He’s a chef.

[00:13:39.470] – Alex E Debare

He’s not a chef. He’s he’s a foodie and he has a food production company. So we did that together. And then from there there was also a lot of, you know, interaction on YouTube, like looking up different recipes. Like if you see any menu, you can type that into YouTube and get a recipe. It’s not rocket science, you know what I mean? It’s not that difficult. Now. Information is everywhere. So I would suggest firstly you need to come up with the menu. Like what does it look like and what items do you want. We started with a really small menu and now it’s an enormous menu with so many items on it. And that’s just because of constant iterations over six years and customers asking for something new and us, you know, pleasing our, our really loyal customers.

[00:14:20.330] – Jean-Philippe

Once you’ve got your initial menu crafted, how do you go on about to develop a menu? How do you decide what items to make more of or how do you develop one burger into five different burgers, a fried dish into five other five dishes? Or kill it? Maybe because it’s not. It’s not selling.

[00:14:36.980] – Alex E Debare

Basically, want to be looking at your sales? Okay, your customer is going to tell you what works and what doesn’t work. Now, the trick there is obviously the first time a customer comes to your location, they’re going to ask you, what’s the best seller? They always ask the staff, what is the best seller, you know? So that’s a decision you need to choose yourself okay. What is our best seller? In order for the first time, a customer interacts with you for them to like your product. Right now, in order to find out what your best seller is, what I suggest is you invite your friends and family and you give them an item, let’s say 5 or 6 burgers, and you tell them to say which one they think is the best. If you take a sampling of ten to 20 to 30 people, you’ll start to see that there is some sort of coherent answer. They like number one more than they like number two, or it’s one, two, three depending.

[00:15:25.940] – Alex E Debare

Like I like barbecue or I don’t like barbecue, I like spicy, I don’t like spicy, but that’s a really important, you know, step you have to take in order to be sure. If you show like ten people your product and nobody talks about it after and nobody really, they support you as a friend or as a family member, but they’re not actually genuinely excited. You need to start to look inwards and say, okay, maybe this product isn’t actually going to be what I need to launch with because it’s just not going to sell.

[00:15:52.670] – Jean-Philippe

What do you think is the most important skill to learn to market your restaurants?

[00:15:56.390] – Alex E Debare

I think right now the most important skill is really understanding and harnessing the power of social media. Um, how do you create content that resonates with your target audience, and then how do you try and convert that audience to come into the store or order online? One of the key difficulties of a restaurant is that if I was an e-commerce business selling, let’s say, cups. I could hit you with a targeted ad on social media, or an organic ad on social media, and you could then order that no matter where you are. But as a restaurant, that individual either needs to be in geographic proximity so he can order on Talbot or Deliveroo or another aggregator, or he has to get out of his house to drive down and come and visit you. Which is becoming less and less likely of a solution for people. People want to order at home, or if they’re going to drive, they might drive once or twice. Don’t forget that a customer who orders online is way stickier than a customer who just ad hoc passes by.

[00:16:55.770] – Alex E Debare

Customer lifetime value of a delivery customer is way higher than somebody who just passes by for dine in.

[00:17:01.860] – Jean-Philippe

Your TikTok videos, you make really nice ones. You’ve been a lot of controversy.

[00:17:06.780] – Alex E Debare

Some people don’t. Don’t appreciate the honesty. Yeah, I.

[00:17:09.630] – Jean-Philippe

Was so the last one I saw was this video where you explained the cost distribution of of a burger, you know, what are you paying for when you pay 30 dirhams for a burger? Yeah. Um, how did you decide to do that? And, uh, what has it done for your business?

[00:17:24.660] – Alex E Debare

In my opinion, I want to I realized the power of social media. I’ve built a business off social media. If it wasn’t for social media when we started burger 28, there’s no way I could even take any market share from McDonald’s. I can’t afford a billboard. I can’t afford to be on the radio. I can’t afford anything. But I can make a video. And we now live in an age where I could post a video on TikTok, and a million people could see it for free.

[00:17:47.840] – Jean-Philippe

Yep.

[00:17:49.060] – Alex E Debare

That is so incredible and such a massive opportunity. But as more and more people create, you know, create content, you need to figure out how to cut through the noise. So you can’t just do a pretty picture of a burger anymore. Nobody’s going to watch it. You need to think out of the box. So in TikTok, what you need to do is, is you need to test different things and see what clicks, what does what resonates with people. Sometimes what resonates with people is something that you would not assume for it to be. You know, like breaking down the cost of a burger. Like, why does somebody want to watch that? But the truth is, is that people are really intrigued by it. So I kept doing it. And every time I do it, I get a, you know, a substantial amount of views and comments. And for me, it’s just breaking down a business like I love FNB, but at heart I’m just an entrepreneur. I’m a business owner.

[00:18:38.080] – Alex E Debare

So if I can break down a business so people can understand it, I think we both stand to benefit. You understand why I’m charging this price. Whether you agree that the price is correct or not, that’s up to you. And no one’s forcing you to buy anything. I’m not coming. And like sticking a knife to your throat and saying you need to pay 35 dirhams for a burger.

[00:18:55.030] – Alex E Debare

I think what a lot of businesses don’t do well, actually on social media is a is to appear authentic or to create a human connection with our customers. Today, I can pick up five different restaurants that I absolutely adore. And if you go on there social media, it’s a hyper promotional content with very little engagement. It’s sometimes it’s an offer or maybe a picture of a dish that they’ve made, but there’s not much of a human connection. And I think one of the things that that you do great is, first of all, you put a face behind the brand. You almost want to say I’m going to eat at Alex’s rather than I’m going to eat two burger 20 at 28. Um, so that’s number one. And number two, you also put forward your employees, which is so nice because, you know, it just feels more human. And, uh, yeah, I think that that’s something that you’re achieving, that you’ve achieved and that many businesses don’t, don’t, uh, don’t understand.

[00:19:51.610] – Jean-Philippe

They don’t harness the power of social media.

[00:19:53.800] – Alex E Debare

I think the key point there is that you said you need to be authentic. Yeah, yeah. Because the amount of content that you need to produce in order to stay relevant on social media is minimum of one video every single day.

[00:20:07.030] – Jean-Philippe

And that’s a lot of time.

[00:20:07.900] – Alex E Debare

Pictures are gone. People interact with short form video. Right now. If you’re going to have to be creating 30 pieces of content every single month, you better be sure it’s genuine content of who you are. Otherwise, you’re going to be so burnt out trying to create content on a daily basis that there would be no benefit at the end to you. And at the end of the day, what you need to look at is I rather have five people who actually like what I’m doing interact with me, who I could actually sell to, than 50,000 people who don’t care. Attract the right kind of customer and you just want the right kind of customer. You don’t want every customer. Another thing in FNB is everybody tries to please everyone. You cannot please everyone. I rather have a small group of raving fans who talk about me all the time, who love my product, love my brand. Then to have a bunch of people who are like, huh? Yeah, it’s okay. It’s all right.

[00:21:04.720] – Alex E Debare

No, some people love burger 28. Some people hate it. I have no issue with the people who hate it. It’s perfectly fine. There must be some people who love it. Otherwise, how am I sitting here for six years? I’m not funding it from my pocket just for fun. You know what I mean? I agree with you. Anybody who wants to start an FNB business. Unless you’re a highly regarded name. You need to be the face, or you need to have some human beings involved in your content in order for it to resonate. Harnessing the marketing technology on the aggregators is also very important. You need to understand, and especially from a performance marketing background, which kind of resonates more with you, is that I can actually see my ROI. I can see how many clicks, you know, and I can see what my conversion ratio is. I can see how many new customers I got. So all that data is really, really important for you to make performance marketing decisions.

[00:22:01.110] – Alex E Debare

But I think they need to work in, you know, in unison. You need to have organic, cool content that people you know, interact with and want to resonate with and fall in love with the brand. And then also, you need to be seeing how those metrics kind of translate into your delivery platform. And at the end of the day, your bottom line through orders.

[00:22:17.400] – Jean-Philippe

Can you tell me about how. Data has helped you uncover something that you weren’t aware of in your businesses. Number one and number two, why is it difficult to get accurate data when you have several branches that you need to manage?

[00:22:32.720] – Alex E Debare

The first thing that came to me through having, you know, a really data driven approach, especially on my Cogs and my cost of goods sold, which is my ingredients, is that in this past one year, we’ve seen such massive disruptions in supply chain that prices are just fluctuating so much.

[00:22:51.170] – Jean-Philippe

Supplier prices.

[00:22:51.950] – Alex E Debare

Yeah, exactly. Yeah. Now, I can’t change my price to my customer every week or every two weeks. You need. And when you do make a decision to increase price, which a lot of people have increased their price, you know, that’s a big decision to take. What? What if the demand actually decreases, you know, and how do you measure that. So difficult. So I think having data driven decision making on the supplier side, knowing when those prices are changing, you know, and catching them out, there’s no one to say that a supplier might increase the price to see if you notice, you know what I mean. And if you don’t have a system in place to catch that, you might be thinking, okay, I’m doing fantastically well on my sales. They’re stable, but then suddenly your profitability isn’t so stable. It’s starting to get smaller and smaller and smaller and you don’t know why. Yeah. And it’s coming from there. I think it’s difficult to capture accurate data because at the moment, the key, uh, the key software tool that every restaurant has is a POS system.

[00:23:48.350] – Alex E Debare

And yes, the POS system can capture sales, can capture discounts, can capture order numbers. It’s really, really weak at the back of house part. It’s really weak at the Po and calculating whether your supplier has changed his price, or calculating which of these items is more profitable for me to be selling or calculating that. Okay, look, there was a price change here. There was a mistake, you know, and I think one part of the restaurant industry is that the accounting is so complex, and it’s something that a lot of people don’t take seriously. You know, and because it’s a cash flow business, you see a lot of money coming into the bank. But if you’re not careful, more than that is going out to pay suppliers because you have 30 days, 45 days. So you think everything is fine unless you have your proper numbers. I think that POS software at the moment is enough for you to make really, really informed, data driven decisions when it comes to looking at your Cogs.

[00:24:44.560] – Jean-Philippe

Food suppliers. How do you find the best ones?

[00:24:47.470] – Alex E Debare

So one of the key challenges when you open a restaurant is like which food suppliers do I use? And obviously there’s some big names, but there’s no transparency on pricing. You don’t know what they’re charging you versus me. Really. Yeah. There’s no idea. Right. So I think that finding the right supplier is so important because you build a really strong relationship with them, you know, and if you have the right supplier, then they will support you. They will help you, especially in tough times, like, for example, during Covid, uh, one of our suppliers, chef Middle East, honestly, they supported us. I couldn’t ask for more the way that they were there for us and they supported us. And to be honest with you. Suppliers come in and they offer a cheaper price by 1 or 2 dirhams. But I’m a guy I liked, I look at, I look at everything in life compounds. Yeah. Whether that’s wealth, whether that’s health, like it’s a long term game.

[00:25:42.300] – Alex E Debare

So I prefer to play long term games with long term people. So if I have a relationship where you took care of me, I’ll take care of you later on, you know? So the relationship with the supplier is important. But when you’re first starting, it’s so difficult to find who the right supplier is and see really, are you paying the right price or not for the product?

[00:26:02.850] – Jean-Philippe

Can you define what you mean by the right supplier? Is it someone who gives you the best prices? Is it someone who delivers on time? Is it someone who gives you discounts?

[00:26:12.870] – Alex E Debare

Yeah, key things are number one, they supply on time because that can be a massive headache. You know, if you’re getting supplied at eight at night when you needed the product at five before dinner, that’s a disaster. Number two like accurate invoicing. You know, don’t constantly make mistakes with your pricing. Don’t constantly make mistakes with how much is being supplied. If I open a Po for ten bags of fries and you’re like, oh, sorry, I only have nine, that whole process, it’s fine if it happens once a month. If it happens on every order, it’s a nightmare because then there’s someone with a pen who, like, crosses it out, then a signature, then this, then that, and then it gets lost and then it’s a mess, you know what I mean? So I think pricing, uh, not making mistakes and then supplying on time. Now price is important because you obviously care about your bottom line. You want to be getting the best price. But sometimes you need to know that you have to pay a premium to get a better service.

[00:27:10.360] – Alex E Debare

I think also another important one is expiry dates. You don’t want to receive something that has a shelf life of two weeks, let’s say when it should be 2 or 3 months. Whether we’re talking about sauce or rice, or.

[00:27:20.410] – Jean-Philippe

Have you ever cut off a relationship with the supplier? Why and how did you find out about whatever they were doing if they weren’t doing something?

[00:27:28.150] – Alex E Debare

I never cut off a relationship with a supplier because I don’t believe in burning bridges. And I don’t think that there’s been suppliers here who. Who have gone and done something behind my back, or done something which was shady. It’s just a matter. I never also don’t want to just have one supplier. I want to have options all the time. It’s important because you never know when somebody, especially the past year when somebody runs out of something, you know, and then you burnt a bridge with this guy and he’s the only one who has it in the market, and then you can’t go to him. So I think it’s important to maintain strong relationships with all your suppliers, but to make sure that they know that you’re on top of them and you’re aware of price changes, you’re aware of what’s going on in the market because you’re getting data from a bunch of different people.

[00:28:10.830] – Jean-Philippe

Why is it so hard to have good data in the business?

[00:28:14.010] – Alex E Debare

I think it’s so difficult to have good data because we just right now, I believe that there’s a lot of restaurant or hospitality companies which are running legacy systems, you know, which made sense five years ago or six years ago, but today don’t have the correct capabilities for them to make the informed decisions that are going to make like a big difference to the most important thing, which is their bottom line. Another. Another thing that I’ve seen is that there’s a lot of restaurant owners where they have a lot of data, but it’s unstructured, you know, it’s not presented in a way that can actually help them make better decisions. And. When you receive so much data and you don’t know what to do with it, you’re kind of just like, oh my God, you know what I mean? The direct response is, that’s way too much information. How am I even going to use this information? And it’s up to start ups and it’s up to new companies to come in and say, look, we can clean up all your data.

[00:29:10.960] – Alex E Debare

We can present it in a visual, which is easy to understand, easy to read, and allows you to make a decision which is going to help your bottom line. And I think there’s a massive opportunity there. And I think that any business owner in the FNB and hospitality space will appreciate anything like that.

[00:29:27.370] – Jean-Philippe

Do you think that restaurants are up to date when it comes to using software to manage their operations?

[00:29:32.500] – Alex E Debare

I think that smaller restaurants like myself, who have a tech savvy founder are really, really up to date and understand the value that certain software can bring. You know, I love my POS system. I it’s probably one of the stickiest apps on my phone, you know what I mean? It’s my POS system, Instagram and TikTok and maybe Bloomberg. Okay, so I use it all the time, and it’s very important to me and any other piece of software that could come in into my operation and allow me to save money, I think, or save money and have control would be something that I would be extremely interested in. Now, when we look at these bigger, bigger groups, um, and maybe older groups, I think some of them are less mature when it comes to how tech can improve their business. And I think it’s going to take some time for them to see the value that newcomers into this space are going to bring. So to answer your question, I think you have different types of owners and operators.

[00:30:38.650] – Alex E Debare

I think the smaller restaurant owners understand the value straight away because they can measure it. But then more legacy brands which have more bureaucracy inside the organization and more layers, it might take a bit more time, you know, especially as these guys have maybe invested a significant amount of money in in these legacy systems, which cost a fortune, which are right now being disrupted by smaller companies who are coming in and doing different parts of what they had as a whole. Big part. Restaurant software is so important to be on top of it. Why it’s so important? Because the data that certain software gives you is going to allow you to see the health of your business, to understand the nitty gritty of everything. And I think that there’s a lot of kind of bigger groups or more legacy brands who are older, running software that is too complicated for the end user. You know, it’s too complicated for the staff and the restaurant to use, and it’s too complicated for, you know, the management level to understand the information which is being processed.

[00:31:36.220] – Alex E Debare

And that’s a key driver of success. Now, you know.

[00:31:41.410] – Jean-Philippe

What driven decision.

[00:31:42.160] – Alex E Debare

Making. If you’re not able to make your decisions based on data, you’re going to lag behind and there’s no way that you’re going to succeed. And this is in every single industry. But I think it’s rampant in the FNB industry because you have all these legacy systems, because there’s so many moving parts. You know, like in accounting. How many invoices do you have when you have 20 suppliers supplying every single day? One guy supplies caviar, the other guy supplies hotdogs. The other one bread like, it’s unbelievable. If you had some sort of software which could funnel all this information in and again present it in a way which is easy to understand, easy to read, then people are going to be able to make better decisions, which are going to save them money at the end of the day.

[00:32:22.090] – Jean-Philippe

Yeah.

[00:32:22.510] – Jean-Philippe

You know, you’d be surprised when we talk to two restaurants that use legacy systems. Um, one of the most common complaints is my data is not accurate. And when we ask why, uh, and when we dig a bit deeper, we often find that. It’s not because the software is inaccurate. Uh, it’s more because the the staff, the people you know, on the floor aren’t able to use it because of how old it is.

[00:32:49.840] – Alex E Debare

Are they not able to use it or they don’t trust it? Because I found, for example, I was using the back end of my POS system. But I was finding that the data at the end of the month was completely wrong. As soon as soon as I don’t trust something and this goes for everybody, you know you’re not going to use it. So if I’m at the top and I’m saying, you know what? This system doesn’t work. It’s not worth it, then I’m not going to push the people at the bottom to input anything into the system. And then we just say, you know what? We’re just not going to use that functionality. So it’s so important for the trust factor to be there. And I think a lot of these old systems haven’t really figured out how to do it properly. And therefore over time, nobody trusts it. So why does anybody bother to use it?

[00:33:33.890] – Jean-Philippe

Usability is also a reason why you maybe would not trust a system. If a system is too hard to use and you’re not going to do it. As simple as that. Whenever you get an invoice, you’re not going to register it. Whenever you’re counting your stock, you’re not going to input it in your system because it’s just too damn hard. Um, and so that results ultimately to just inaccurate reporting.

[00:33:54.080] – Alex E Debare

Also, if you look in a restaurant, for example, the people who are going to do the stock count, the people who are going to receive an invoice, I think now we have software that works on smartphones and everybody’s smartphone native. You know, no matter where you are in the restaurant, everybody knows how to use a smartphone. They know how to use an app. So you’re you’re taking out the human error as well. Like if I can take a picture of an invoice, then it translates all that information into text. And I can just edit something if it’s wrong and then press add. And then it goes into the system. And then higher level management is capable of seeing that the accounts are capable of seeing that. I think it makes it much easier. And that’s why these people who are disrupting this area with technology that is iPhone native that syncs across from iPhone, sorry, not I mean, from smartphone to web browser to my accounting software, which comes into, you know, another integrated POS, that whole ecosystem can be so valuable and make so much more sense than bits and pieces of a legacy system where nobody trusts it.

[00:34:57.650] – Alex E Debare

And you almost you get to start fresh, right? It’s very difficult to get somebody to trust something they don’t trust. Whereas if you come in and say, look, this is a new solution. This is going to help you. This is going to save you money and time. People are open, open to, you know, experiment and open to try it.

[00:35:14.240] – Jean-Philippe

When you first started, how much were you spending on social media ads?

[00:35:17.180] – Alex E Debare

I think at the height of how much we were spending was around 60 to 70,000 dirhams a month on Facebook and Instagram ads, and now more like 10,000.

[00:35:28.580] – Jean-Philippe

How come?

[00:35:29.660] – Alex E Debare

To be honest, I think.

[00:35:31.220] – Alex E Debare

That.

[00:35:32.030] – Alex E Debare

Times have really changed in the sense that before you could spend a lot of money on an advertising and get like a very direct ROI, you know, extra sales meant that you would have extra sorry, extra sales would lead to extra revenue and then obviously more profitability. Now, it’s not really the same situation as more and more of your sales come from online aggregators, and they’re taking like a 30 to 35% cut on every single order. You really need to kind of look inside and see how you can run a more profitable business by looking at your cost of goods sold, which is your ingredients, your packaging and your food. That goes into that because the more and more of your revenue which is coming online, the more important the lean efficiency of your operation has to be. And the only way to squeeze out that extra 1% or 2% is to really see, okay, where am I buying my products? Can I buy them cheaper? And can I save money? Those are the key things which are going to affect your bottom line.

[00:36:30.630] – Alex E Debare

Whereas before it was very much okay, I can spend 10,000, 20,000 dirhams. I know I’m going to make 60,000 dirhams in extra revenue. That isn’t the case anymore.

[00:36:39.750] – Jean-Philippe

What’s a secret that every restaurant owner should know?

[00:36:42.720] – Alex E Debare

I think if you’re opening your first location, you really need to understand your site really well. Like, do you need an extra electrical upgrade or not? Because if you need an extra electrical upgrade, that could cost you anywhere between like 30 or 60,000 dirhams, which you didn’t even think about when you were coming up with how much this is going to cost.

[00:37:01.560] – Jean-Philippe

What’s a hack you would share with someone who’s just launched their restaurants?

[00:37:05.820] – Alex E Debare

I think you can’t please everybody. You know, you you came up with your concept, you created a brand, you created a menu, and now you should have done your back testing in order to say that you feel confident that this is the product that you want to sell, and then you need to give it some time. I think to many restaurant owners and people who are operating react too quickly to a customer saying that’s too salty or there’s too much sauce, you know, and if you’re your foundation of your business is built on SOPs, standard operating procedures, and if you’re going to constantly be changing those, not only are your staff going to get completely confused and start making a lot of mistakes, but you’ll never really get a grasp of what’s working and what’s not working because you’re just changing too many of the inputs all the time.

[00:37:49.020] – Jean-Philippe

What would be the single success factor that you would look at to determine the success of your restaurants?

[00:37:54.030] – Alex E Debare

Honestly, as corny as it sounds, I think that hiring the right people that you trust is is the key factor in the success. At the end of the day, I’m not going to be able to take every single order, nor am I going to be able to cook every single burger. So I believe in in finding the right people who fit the organization, who are willing to stand next to you through thick and thin. Because when you’re opening a restaurant, there’s ups and downs. It’s not always just, you know.

[00:38:22.470] – Jean-Philippe

How do you find that in the person that you’re interviewing? Does it take time or can you see it while interviewing someone?

[00:38:27.870] – Alex E Debare

Honestly, my radar for how I evaluate somebody is really strong now, and that goes not only in hiring people, but I can smell bullshit really quickly and like I’m really good at that. So within 20s, I can determine whether the person in front of me is a good fit or not. But what I like to do is I like to do a little practical exam. So if they want to be front of house, I get one of my team to teach them in ten minutes how to take an order, whether you should smile, the sequence of service, all of that. And then I test them quickly and I read their body language, and I see how they talk to me, whether they’re smiley or not. And then back of house, I do the same thing. They try and learn something in ten minutes and then repeat it. At the end of the day, attitude is everything. Yeah. If you have the right attitude, you can teach the skills, but you need to also feel that person, you know, are they genuine?

[00:39:17.280] – Alex E Debare

Uh, what’s their background? What’s their motivation to everybody in the UAE obviously to work. So what’s their motivation. And I think finding the right team and playing long term, you know, a game with them, like some of my staff have been with me for years, five years. I have one guy who was been with me for six years. So there’s there’s a trust between me and him which and bond, which I can’t quantify. And I believe that that’s what makes burger 28 a bit different to other, you know, other restaurants. And that’s kind of like a unique selling point from our service perspective.

[00:39:51.980] – Jean-Philippe

So, Alex, we’ve been working together. Uh, burger, 28, and Sarpy for a while now. Can you tell me a little bit about how you were doing everything when it came to your back of house? How were you counting your stock? How are you measuring supplier performance? How are you managing your inventory um before supply and how you’re doing it now with supply?

[00:40:11.450] – Alex E Debare

So we forced up, to be honest, we did have a back of house, um, element to our POS system, but there was an issue of trust and it wasn’t accurate. So to be honest, after seven months, six years ago of using the back of house module, we stopped using it and we did everything manually. Um, from tracking my suppliers, there was really nothing tracking them. To be completely honest, there was no data that allowed us to understand if prices were being changed. There was no data to allow us to see whether this product was more profitable than another product. And certainly there wasn’t something that allowed us to kind of increase our bottom line through controlling our Cogs. Now, with all that, I think the data was within the business. I could have I could have accessed that data. It’s not like that data didn’t exist. But the way that it’s presented is just so easy to digest and so easy to take in with the dashboard that I can make decisions on the go which positively impact my business every single day.

[00:41:15.710] – Alex E Debare

And for me, that’s priceless, honestly.

[00:41:19.120] – Jean-Philippe

Can you tell me a little bit more about how the operations have changed under the in the day to day of your of your team? How were you counting your stock before? How are we doing it now.

[00:41:28.210] – Alex E Debare

So counting stock was just manually in an Excel sheet. And we do that once a month to come up with our closing stock to do our accounts. And now we’re doing it once a week with SOP.

[00:41:37.420] – Jean-Philippe

And how has that changed, uh, the way that you measure your variance if you do it, if you count your stock once a month, then you’ll only find discrepancies in your stock once a month. Um, so tell me a little bit about how you manage your variance.

[00:41:51.580] – Alex E Debare

So at the very beginning of the business, I was there every single day for six months. So I know exactly what my food costs should be and whether some at the end of the day, you’re curious whether somebody’s stealing something, right? And then, I mean, that’s the key point there. So I know with the variance of 1 or 2%, if that makes sense, or it doesn’t make sense now as all these prices have changed. And from six years on from now, like the world looks a very different place. I think supply helps because we take a weekly stock count, and that allows me to be on top of the variance and make sure that everything. And I think by forcing the team to take that weekly stock count, and it’s not in a way where it’s so irritating on, on an Excel sheet, you know, in tiny small little pen and paper, which, no, it’s actually quite fun and interactive and cool. So I think they’re more entitled to use it.

[00:42:39.370] – Alex E Debare

I’ve trained them and has also trained them on the value of it. You know why it’s important for us to do this? Why this is important for the business. And at the end of the day, they want the business to succeed, right? If you have the right staff, they’re rooting for you, hopefully, or they’re the wrong people, you know. So all of that together has built like a more interactive way for us to be on top of of our cogs, which is the lifeblood of any business, especially in F&B.