UK: Turning Halal can Increase Restaurant Margins during the Recession

Restaurants, nationwide, appear to have been hardest hit by the “Munch Crunch” as many diners opt to eat at home, saving that meal out for a special treat. Whilst staff and running costs remain the same, what do you do to keep profits up and over heads to a minimum when turnover is down by 30% year on year?

Inventive Edinburgh restaurateur Michael Yip, owner of Dragon Way, Newington, believes he has found the way and has recently received a quality Halal Seal of Approval, to become the capital’s first certified Halal Chinese restaurant. This is not the first time Michael has looked at ways to increase profit margins and retain customers in the current economic climate.

He recently launched his first Halal noodle bar WaWa, which offers his widening customer base, the chance to “slurp and surf” on one of six iPads whilst eating takeaway Halal noodles. The bar, on West Causewayside, in Edinburgh has proved such a hit that it now looks set to be rolled out to other cities in Scotland initially, followed by further expansion throughout the UK, as applicable.

Michael said: “Halal focuses on ingredient purity, traceability, product content and production excellence, however this is only part of the reason for the change at Dragon Way. Halal meat has a longer shelf life, is fresh rather than frozen and has no added water”

Prior to turning Halal, Dragon Way, Newington would use 100kg of frozen chicken per week at a cost of £365, however 20-25% of the weight was ’lost’ in the cooking process due to the added water. Since turning Halal, the restaurant orders just 80kg, costing £280, from Mr. Afzal Bokshto of Elite Wholesale Ltd, Edinburgh, to produce the same number of servings, which represents a significant annual saving.

Michael added that “In addition to the economy of scale and financial implication, restaurant users enjoy a tastier meal as the fresh chicken soaks up the marinade giving a more authentic depth of flavor.

Customer satisfaction is crucial to my business so finding ways to ethically save money on stock, means I can pass on the benefits direct to my customers.  In an economic ‘slow down’ where competition, procurement, quality, service and price sensitivity are the name of the game …… it has proved to be a win win situation for all!”

Dragon Way, Newington may be leading the way as far as Halal Chinese restaurants are concerned, however industry estimates suggest strong demand has resulted in about 40% of poultry and 25-30% of lamb consumed in the UK meeting Halal specification*. Halal meat is sold in many of our high street retailers including Tesco, Boots and McDonalds as well as leading Scottish food producers Crombies and Burton’s Biscuits Ltd**.

*Farmers Weekly

** Scotland Food and Drink Halal Food in the UK.