As John Lewis reveals plans to step up its food offering with a new restaurant brand, Retail Week takes a look at retailers’ forays into the restaurant trade.
Why are we talking about this now?
Department store John Lewis has revealed it is to develop a new “cutting edge” restaurant format to improve on its existing “middle of the road” food offering, according to managing director Andy Street. Details of the new brand, due to be launched within weeks, remain scarce but Street said it will complement its move to bring partner Waitrose’s offer in store. John Lewis opened its first Little Waitrose convenience shop in its Watford department store in June.
While using cafes and restaurants to drive footfall is not new, they are becoming increasingly vital as retailers look to enliven the physical shopping experience with leisure pursuits amid a digital age.
Which retailers have restaurants?
Tesco’s use of restaurants to address its issues with excess space has been in the spotlight in recent weeks. The grocer has brought in its recently acquired family restaurant Giraffe to fill space vacated by categories now shopped for online, and to drive footfall. It has also set up new company Tesco Family Dining to run wholly owned carvery brand Decks, which last week opened in its Coventry store.
Elsewhere, Waitrose last month revealed plans to build on its in-store cafes with a new restaurant next year while it is understood Hotel Chocolat has found a site to open a version of its Boucan concept, first developed at its hotel in St Lucia. It is likely to open later this year. Debenhams, too, is upgrading the restaurants in its flagship Oxford Street store and is launching a prosecco bar. Most department stores have eateries, including Marks & Spencer, Selfridges and Harvey Nichols. Topshop on Oxford Street, Dunelm and some B&Qs also have food offers.
Are we likely to see more?
With retailers looking to regain footfall lost to online shopping, cafes and restaurants are likely to continue to be attractive footfall drivers. Retail analyst Nick Bubb believes that shopping centres have also recognised their increasing importance. “It’s interesting that all the big shopping centres are also evolving and refocusing their space, by upgrading their catering and leisure offer to enhance the destination experience that a large centre can provide,” he says.
What is the impact on the leisure market?
Bubb argues that in shopping centres the established restaurants including McDonald’s and KFC are moving upmarket to compete with increased competition. He adds: “The highly successful and extravagantly decorated Trafford Centre in Manchester shows how important catering can be to a destination shopping centre, with over 10% of its total sales and a higher proportion of its rents estimated to come from the restaurants, bars and coffee shops in its huge food courts, but at the recently opened Trinity Leeds centre, the developer Land Securities went even further with some 20% of its space let to catering operators.”