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Hotels & Restaurants: Challenges and Opportunities during Ramadan

Apr 2022

As we look forward to the Holy Month of Ramadan, the objectives of these sessions is to discuss how best we could serve Muslim consumers during this month of fasting, and the opportunities and challenges that hotels and the restaurants face. 

During Ramadan and Eid Dialog 2022, we talked to Rushdi Ibrahim, the Country General Manager of one of the largest fast food organization chains in Saudi Arabia, Olayan Food Services and Shaji Abu Saleh, the Director of Business Development, Shaza Hotels, a well-known hotel chain in the Middle East. This session was moderated by Irshad Cader the CEO of Global Think Consulting Services for Australia and the Middle East. 

Let me start the session out with  Mr. Rushdi. Why is the month of Ramadan so important for restaurants? 

There is this general notion that goes around, the general perception that during Ramadan, people abstain from going to restaurants or abstain from going to hotels. When you actually think about it, this is the period that all restaurant chains should pause and think of a way to take advantage of. It is about understanding how the month of Ramadan operates. There are three different periods in Ramadan that restaurants need to understand; the first ten days, the second ten days and the third ten days or the last ten days; and how the consumer behavior shifts during these blocks of ten days. By catering to those needs, it becomes an advantage rather than a disadvantage.

From a hotelier's perspective, why do you think this month is so important Mr. Shaji? 

Shaza operates in a Muslim environment as well as a non-Muslim or in a collaborative environment. We have to separate these two environments because preserving Ramadan in Saudi Arabia is a given. The job schedules and the work roasters are created based on Ramadan. It's very important to create an awareness among the staff to cater to the customer coming to our hotels.

There will definitely be a drop in our hotel business during Ramadan because of less business trips generally people tend to stay home. The drop in business travel affects our room business. However, the F&B part is actually very active. Ramadan from the earlier days has evolved into a time of celebratory moments like being with family. And we look forward to welcoming Ramadan in not just a spiritual but also a very celebratory mood.

Therefore, Ramadan is very important, especially at shadow hotels who are among the ambassadors of halal food and halal experiences wherever we are.

So, have you started planning for Ramadan already Mr. Shaji? 

Yes. Actually, within our hotel, we have the design phase and the experiential phase.

There are two kinds of business operations; pure iftar and  suhoor, which is an all-nighter. While Iftar is like a rush one-time jam-packed operation because of limited capacity, Suhoor has become a very social and communal networking kind of time where people spend a lot of time in conversation with family and friends after taraweeh prayer until around Fajr time.

We thus have to plan the food and the guest movement accordingly, which starts a month or few weeks prior. We already prepared proper role plays and training programs, raw string menu planning, and even designing. People want to experience something new and fresh, therefore design makes a lot of impact into hotels, especially in the luxury sector.

When you look at the restaurant's perspective, the consumer behavior is somewhat different over the course of the three parts of Ramadan. Is it the same for hotels Mr. Shaji?

It's the same. For example, the first week generally the turnout for iftar tends to be very low because people spend their time at home with family. People start going out by the second week,  and by the third week they start inviting their families and friends. By the last week, they are outside again with others. So this rotation of guest movement impacts us generally from the second week onwards.

Iftar turnout increases while the Suhoor  one diminishes towards the last ten days since people tend to spend more at the mosque.

From your experience, what are the challenges that hotels and restaurants usually face in the month of Ramadan Mr. Rushdi?

One of the things that Shaji said was how the consumer behavior pattern changes. That first week or the first ten days that are initially about spending time with the family you're not going to restaurants, especially not QSRs. I can't imagine people eating burgers for Iftar. That by itself is a challenge, the first challenge.  So, here's where the QSR restaurants become very creative in ways to attract a group of people who are not going to come to you because they'd rather spend time with the family, which is tradition.

Our body clock changes during Ramadan as the majority stay up late until fajr time. Even the working hours change. Now how do you then adapt to those body clock changes and the consumer needs that come with it is our second challenge.

Third would be how to package the current menu in a way that will attract more customers, especially for QSR.

From your experience, what are the challenges that hotels and restaurants usually face in the month of Ramadan Mr. Shaji? 

One challenge hotels face is in terms of capacity since they  are not prepared to cater to 100% of the room accommodations at the same time and Iftar means everyone needs to come at the same time.

The staff are also fasting and we therefore need to make them understand that they will be serving people who are also exhausted from fasting the whole day. We have to train the staff to practice tolerance.

Another challenge is guests who are non-Muslim and need their breakfast and lunch. While I do understand, there are many who are not aware of Ramadan. We have to enlighten them of cultural challenges and fulfill their needs inside their rooms.

Otherwise, the biggest challenge is the wastage of food. Ramadan has become the month of the most food-based dates in the hotel industry and the hospitality industry faces a lot of food waste during this time while it is very important for us to sustain proper iftar experience.

What do you think about the wastage of food during Ramadan Mr. Rushdi?

I think in QSR it is different to that in hotels.

You have this buffet in hotels where people very often serve more than what they really need, which leads to wastage. I actually would like to turn this into an advantage, given Ramadan is a month of giving. We can take advantage of the wastage and convert that into giving by establishing an emotional connection with consumers.

This has been predominantly one of my strategies over the last 18 years of my time spent in the Middle East. How do you make an emotional connection with your consumer? It's  not about just wishing consumers a happy Ramadan and welcoming them by putting a sign on your door  like any other religious festival. Establishing that emotional connection with your consumers ensures that they come back to you because you really care about what the need is.

Do you run any programs as such, Mr. Rushdi, in your chain of QSR?

Yes. We've done a few creative things in the past, but we also link it to a lot of QSRs during the month of Ramadan. And if anyone saw a video from Terminal Five last year, one brand was plastered all over Terminal Five for three days. We had no promotions and just highlighted the fact that it is a month of giving. If you can take advantage of that message, consumers will pull in.

What opportunities can hotels and restaurants potentially achieve in the month of Ramadan Mr.Shaji?

Ramadan is an opportunity to acquire new customers especially in a nonhalal environment by offering iftar and suhoor experiences, different from the usual breakfast, lunch and dinner. People tend to explore new Iftar and Suhoor venues.

Additionally, we have started food on table service as opposed to the usual Ramadan buffet where we serve food made to order. Customers have an option to pre book a table or preorder before arrival, which is really helpful in reducing wastage. This is a way of customizing the consumer experience to what they need in a menu of their choice, a strategy that put Shaza ahead of the game in terms of  competition in the Ramadan experience.

Suhoor is a new developing program we offer for corporate companies booking Suhoor events that is now very popular among families and friends, even more than iftar programs. That is something we are expanding to other hotels as well into other regions. The suhoor experience is more not just the food, but it's also about that whole environment you're creating. A serene environment where customers can talk or listen on what they wish to. Where Iftar is all about food, Suhoor requires spending more on the experiential side of consumers. A lot of investments can be put into creating that environment to create new opportunities for hotels outside the Middle East as well.

So, in that aspect, what is your advice for the hotels which are operating in Muslim minority countries Mr.Shaji?

First of all, cultivating awareness within the staff since they are the ones serving therefore should know what is expected of a fasting person. If possible, employ external consultants to come and train the staff about the whole month of Ramadan.

Secondly, hoteliers should ensure Muslim travelers have choices when booking and during the pre-arrival e.g., if they need suhoor to be served inside their room. Additionally, hotels normally wouldn’t have a buffet ready at five, six or even later on in the evening, which is the general Iftar time depending on the location. Like European or Asian hotels who don’t have 24/7 room service. It’s important that they start to offer services to Muslim customers’ convenience.

Thirdly, restaurants and hotels should provide iftar and suhoor family packages delivery for Muslim communities nearby. This is a great opportunity which we found as there are also families who don't wish to go out during this month.

Lastly, there are a lot of non-Muslims who are intrigued about Ramadan. Non-Muslim families are inviting Muslim families for Iftar, a revolution in the communal and social networking phase. That is definitely something worth exploring and promoting.

When it comes to QSRs in Muslim minority countries, what's the advice would you offer Mr.Rushdi?

I would like to go back to that emotional connection by understanding your consumer, which is also in line with the advice Shaji alluded to earlier, education and promotion. For example, making a connection between intermittent fasting and Ramadan.

The second piece of advice is to come up with a creative menu and not just throwing dates and porridge. A variety in menu shows effort that will be reciprocated by the targeted consumers.

Thirdly, given that we are just coming out of the pandemic, it is more pertinent now more than any other time for QSRs especially to establish competitive pricing.

The fourth thing that I'd say is to create events that would attract audiences even to a QSR. And again, QSR is one of them. But there are other events that you can create e.g., creating a suhoor buzz, which is a time we have not taken full advantage of.

Lastly, don't make it awkward by trying too hard. Make that emotional connection a success. Consumers understand when you genuinely care.

For the we have mix of Muslim and non-Muslim participants from around the world who are here today, what is your message would you wrap up this session with?

Halal consumers are a very niche but sizable community that keeps growing and can't be disregarded. The younger generations are especially getting closer to their faith and culture. Halal is a lifestyle which needs to be understood and catered for through establishing a connection, as insisted by Rushdi. You need Halal lifestyle experts for guidance and  at least an employee from the Muslim faith. Finally, be authentic. When we are doing business, we say be real, be authentic and do it for a cause. And the cause is tapping into a huge world of halal industry and that is existing. It's not a marketing tab but an existing market that needs to be tapped into in a proper manner. Don't cut corners by looking to unqualified people for guidance. Find the right people who will help you reap all the benefits.

Over to you Mr. Rushdi, what are your final comments?

First, this dialogue should be the first of many, to understand the market we operate in. It is not a copy paste. Even within the same market, city to city, the consumer behavior changes, the perception changes. Majority of the cities I'm going to have to customize according to consumer needs.

Secondly, drive your unique selling proposition and don't put a tag to it. And again, this links to the kind of authenticity that Shaji spoke about.

Finally, I know I have kind of used this as my golden thread but I'd say make that emotional connection with consumers so that they understand you genuinely care about what they want. In all my 28 years’ experience in the QSR sector, the most successful or satisfying moment is when a customer is thankful for your careful service. 

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