How the west was won

DSC_4570Kate Lamont is not only one of Australia’s highest profile chefs, but also one of the country’s smartest businesswomen. She talked to Matt Preston about making money out of food, wine and those elusive high-yield customers.

Kate Lamont is peeling a huge pile of prawns when I call. She’s blaming a kitchen hand shortage for her predicament, but you can tell that she’s the sort of chef-turned-businesswoman that sees major value in spending time actually working in her business. “I know a lot of people would say it’s a ridiculous thing to be doing… that I could have organised things better. But you notice a whole bunch of things when you work in your business compared to when you are just wandering through them,” she says.

While many chefs might credit their sense of taste for their success, there is a definite feeling that it’s what this 43-year-old actually sees and hears that underpins hers. It’s a success that saw her named a finalist for Veuve Clicquot’s Australian Businesswoman of the Year Award last year and Telstra’s WA Businesswoman of the Year in 1996.

“Being there [in your business] is the best way to see what works and what doesn’t and how people are working together,” she explains.

“To see what customers are ordering and what they are prepared to pay. It also gives customers faith that you’ve got your fingers on the pulse when they see you at your business.”

Even though Lamont sits atop an empire that includes the family winery in the Swan Valley, three successful restaurants (one at the winery, one in east Perth and their new place in Margaret River) and a booming career as an author and columnist, she still works at the cellar door every weekend. But then this is how Lamont has developed her keen sense of who her customers are, a knowledge that comes from observing and talking to them.

And it is the theme of the customer that Lamont returns to again and again during our conversation. About the value of understanding who they are and where to find them. About knowing what they want and being prepared for what they are going to want next. And most importantly about meeting their expectations, so they become one of those valuable regular patrons that, after 20 years, make up so many of her 3500 customers each week.

The strange thing is that Lamont admits she stumbled into hospitality aged 25 as much by accident as design. She studied viticulture at Wagga but had an unspectacular career following in her grandfather’s and great grandfather’s footsteps as a winemaker. “I had failed ‘organic chemistry’ and knew that my life as a winemaker was not to be,” she recalls.

“But there was a real naivety in me believing that I could open a restaurant and cook for service with extremely limited experience.”

There was no business plan and no bank loan let alone any formal training behind Lamont and her sister Fiona when they opened their original restaurant at the family vineyard in the Swan Valley, about 20 minutes from Perth. “As I hadn’t any professional training I relied on ingredients rather than recipes or experience,” she remembers.

This need for prime ingredients meant a very seasonal menu, but then that was the way that the Lamont sisters had been brought up by parents Corin and Neil. “Growing up in the Valley I had a clear understanding of the seasons. We’d only eat grapes in January and February; peaches and apricots in summer; and we knew which school holiday it was by the oranges we were picking. We lived off the vegetables and tomatoes we grew,” says Lamont.

It was also an environment where wine and food was an everyday event and not something to be in awe of. Unsurprising when you know that Lamont’s maternal grandfather was Jack Mann, winemaker for over 50 years at Swan Valley’s Houghton winery and the man who invented Houghton’s White Burgundy.

It was a natural progression when Lamont’s parents decided to make their own wine in 1978, especially with old Jack’s experience to rely on. Those customers that started seeking out their cellar door also wanted somewhere to eat, so opening a restaurant at the winery some 10 years later  was the next logical step.

While the underlying principle of the restaurant was to offer food that would sell the family’s wines, ask Lamont whether it was the food or the wine that was the hero at the restaurant and her reply is instant. “Neither. It was the customer,” she says bluntly.

“I wanted people to leave our property saying they’d had a fantastic day rather than say they’d had great food or great wine. I now realise that I understood then that people wanted a genuine product and an honest delicious experience. We based our growth on what the customers were looking for.”

Not that this was always the way. Lamont admits that the business has changed quite significantly since those early days and not just because they are now making twice as much wine. “Back then we made the wine we wanted to drink and served the food we wanted to eat. The trouble is that that’s not always what customers want to buy,” she says.

Initially, the Lamont sisters ran the food side of the business and their mum and dad ran the wine side, but when their parents separated the sisters bought their dad’s share of the business. Now their mum is semi-retired and leaves much of the running of the business to them. It was, as Lamont calls it, “easy succession planning”.

The fact the combined winery and restaurant business had to sustain two generations including Fiona’s new family meant it had to grow. First there was a gourmet food and wine store, Lamont’s City in Perth’s CBD, launched in 1996. It also sold food-to-go. It was an idea too far ahead of its time, so it was sold in 2001. The basic principle of taking the Lamont name into Perth and to the corporate customers who drove out to the winery at weekends was sound. As Lamont says, it doesn’t matter how phenomenal your product is, you have to be an easy destination for your customers.

Having the store in the CBD did allow Lamont to access new revenue streams such as corporate catering and sales of picnic hampers and wine, but she modestly admits this wasn’t so clear when they set up the business. Next, they opened a second restaurant in a beautiful riverside location in east Perth that was still close enough for that high-yield corporate clientele that she’d worked so hard to nurture. Given Lamont’s reputation they kept coming back, but the challenge was to ensure the high expectations were met every time. “I know we’ve heard it many times before but that 170th flat white has to be as excellent as the first one,” she says.

Lamont also identifies consistency as important because it removes variables, allowing you to see better when something is wrong with the business. That’s especially important if like Lamont you are constantly monitoring your customers’ reactions and using this knowledge to make decisions about improving the business.

The lessons learned by her experience with the gourmet food and wine store also helped to strengthen the clarity of what Lamont was trying to achieve with the Lamont brand. It is the principle—‘wine drives the food but the food is our way of selling the wine’—that inspired the opening of their original winery restaurant.

Lamont’s equal clarity about her vision for operating the business is what she believes helps her maintain quality across three far flung restaurants with over 60 full-time staff. “All the senior people are clear in why they are there and what they are doing, but I am also highly accessible to them,” she says.

This in part explains the reason why she likes giving them both autonomy and responsibility to run the businesses. Having great staff who have confidence also helps.

That operating vision turns out to be blindingly simple. “Lamont is about serving delicious wine and food in a genuine way. That is what we do. The issue for us is to do it consistently every day.”

Lamont believes that too often the absence of a clear vision like this can thwart restaurant operators. “It gets missed a lot but you shouldn’t be misled by the simplicity.”

She doesn’t see that she makes huge costs savings operating three places and explains that while food is the major contributor to their turnover, it is the wine side of the business that is the major contributor to profit. With a business that comprises both a winery and three restaurants, Lamont is also well placed to identify a threat to the profitability of restaurant wine sales. “Alcohol sales subsidise food and that will become problematic. At some point the wine industry will say ‘how come I charge you $16 for the wine and yet you sell it for $45’. They’ll want a bigger slice of the pie.”

With this in mind, Lamont is acutely aware of the need to get the customer to start to pay the real cost for their food. Sadly it’s not a problem for which Lamont has an instant panacea. While the use of premium produce like local marron is one proven route, she suggests that one can’t rely on branded sexy products alone to lift price points. Those customers who will wear that are still just a small niche, albeit one that she admits can grow.

Certainly she is better than most at attracting this type of high-yield customer. What is interesting is that she believes that you can create high-yield customers by how you structure your offering. “You need to have absolute confidence that the customer’s expectation is delivered on. Another part is to do with location and being available when the customer wants you,” she explains.

Lamont’s new Margaret River restaurant is a case in point. While the winery has always sourced fruit from down south, the restaurant is not on a vineyard but by a picturesque lake. “I know I’m probably out of kilter with the industry, but I think customers just want to be in a beautiful place and that doesn’t have to be with barrels behind you,” she says.

While Lamont’s confidence can be seen in mains that push the $30 mark, ‘being available’ means opening for lunch longer than just between noon and 2pm. “In a region where many people are on short breaks they don’t necessarily want lunch between those times. You’ll have a much better chance to up your yield when they are having a leisurely late lunch. They are more likely to order that other bottle of wine or dessert.”

The actual offering at Margaret River also differs slightly from the Swan Valley restaurant. While Swan Valley serves only Lamont wine, here that is augmented by a list of some of the best wines from Margaret River and comparative styles from France. That’s another good opportunity for boosting yield.

When it comes to food, watching customers has shown Lamont that people are now eating less and that has resulted in a list of smaller tastes on the menu at Margaret River. “People on holiday want to eat less. They want wines by the glass and also like to eat more interesting things,” she explains.

Lamont is an ardent trend watcher and she admits that’s just another reason to constantly watch and listen to customers to see what they want. It also helps in preparing for the future. For, as she explains it, the most exhausting thing about running a smaller business in hospitality is that just when you’ve got things right you have to change them. “You always have to have an eye to the future of your business. For example, I see people increasingly wanting to eat less and eat better,” she says.

While she believes her market is not yet ready for five small courses matched with five glasses of wine, she has introduced what she calls ‘wine and food conversation evenings’ where that is exactly what is on offer. “I want the business to be ready when the market is ready,” she explains.

Lamont was married earlier this year to WA wine identity John Jens, a founding owner of Devil’s Lair in Margaret River and 44 King Street in Perth, who now runs Invinity Fine Wine Brokers.

While this relationship may have helped Lamont achieve more of a balance between her social and business life, she still gets fired up by having to meet the challenges that the hospitality industry faces. For her it is as much about seeing her fellow operators as commercial partners rather than competitors. Even if one suspects that this is in part so she can convince those who still think that running a restaurant is just about the food, that it’s not. It’s about the customer.

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