Author: Harri Jaaskelainen, 06 April 2017

Three topics have dominated the business news over the past couple of months and many a commentator has pondered over the likely impact of the sliding value of the UK Sterling, thanks to Brexit; the uncertainty over business rate changes and the increase in national minimum wage this month and how these are likely to affect businesses over the next year.

I am going to take a slightly different position. I will focus on the area that is arguably the biggest asset of many employers – the staff – and what the future is likely to look like for the middle market retail and F&B once the UK has finalised its divorce from the European club.

As the two-year countdown to leave the EU has now officially begun, one thing in particular has been of some considerable personal interest; immigration. Speaking as an immigrant, I can relate to the mild apprehension of the 3 million strong EU diaspora living in the UK who might have been left wondering 

‘what next?’

Indeed, taking back control of the UK borders has been high on the government’s agenda since the vote. The majority of the current EU immigrants in the UK are employed in what the government calls “low-skilled” jobs. Unfortunately, the current perception is that retail and F&B belong to this unkindly named cohort which is likely to mean that the “low skilled” workers will face significantly tougher times trying to enter the UK once Brexit has become Brexit.

Whilst some will no doubt stay, many others will return to their respective home countries once they feel they have had enough of the UK adventure. 

The inevitable problem UK employers will face over the coming years is that the pool of people willing to work within these industries will reduce.

To illustrate this point, I only need to look up from my laptop screen. I am sitting in a well-known Café in the heart of the City of London and, just by listening to the people serving the motley of busy workers, I can say with a high degree of confidence that none of the 10 odd staff are UK-born. Now, that may not be news to you and me, but it represents a significant business problem in the making and something business owners, big and small, are having to face up to within the next two years and beyond.

Rather than get gloomy about the prospect, let’s ask ourselves why it is that the F&B industry in particular seems to attract more foreigners than British people? The main issue, in my opinion, lies in the common, somewhat negative, perception society holds about working in service industries.  That is exactly what we should be setting about changing.

As savvy retailers and F&B operators know, service makes the experience. Converting that experience into increased turnover takes skill. Unfortunately, it all too often seems that it is only the high-end retailers and operators across different industries who have understood the importance of highly knowledgeable staff with a great attitude towards customer service.

A case in point is the Ritz-Carlton hotel company’s slogan: 

Ladies and gentlemen taking care of ladies and gentlemen

Indeed, the more upper-end of the market the company sits in, the more prestige the job exudes. Think of the airline industry. Why does the career as an Emirates stewardess appears so much more glamorous than the same role within some of the more mid-market airlines when actually the job at hand is still the same irrespective of the company one works for?

Why does the mid-market, which is where the most of us shop and eat, seem unable and unwilling to equip its staff with the same level of product knowledge and servitude, as its more upmarket equivalents and one that today’s experience driven consumers have come to demand? The mid-market of the retail and F&B industries should set the bar high and, as such, aim to make it a career to be proud of. Surely, that would represent a huge opportunity to differentiate from the rest of the mid-market pack. The more companies would focus on this, the more pressure it would put on the rest to follow and therefore creating a positive chain reaction.

In an ideal world the outcome would be one where customers would receive the personalised, face-to-face customer service they feel they deserve (watch out, Amazon!); the more knowledgeable staff would feel prouder about the work they do and businesses would reap the benefits through higher sales and, with a bit of luck, bigger profits. Profits can be ploughed back into expansion and, along with rewarding the shareholders whose faith has put the company where it is, some could be allocated to rewarding the hard-working staff and funding their continued professional development. These measures would be sowing the seeds of a virtuous cycle that would benefit the business as well as improving the image of working for companies operating within that space. If we aim the resources in the right place today, I truly believe that we can become the standard bearer for these industries on the global stage tomorrow.   

Albert Einstein once famously said that in the middle of difficulty lies opportunity. Despite the unexpected outcome of the EU referendum, I choose to remain optimistic about the future and the opportunities that lie ahead for not only the retail industry but for the UK as a whole. I hope the rest of the country will too.

Tags: F&B, FSP View

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