Creating a line of merchandise seems like smart business, but the experts say make sure you maintain the quality of your brand. By Vivienne Reiner
Selling merchandise can add substantially to restaurant profits and help ease pressure during economic downturns. Restaurants that do it well, however, are motivated not by profit but by wanting to extend the dining experience.
For Stefano’s Cafe Bakery in Mildura, Victoria, the big sellers have included chef Stefano di Pieri cookbooks, DVDs and a huge range of branded wines, although a number of other retail items are also popular, in particular local Murray River pink salts and Lyndall Vandenberg jams, chutneys and relishes. Director Maria Elizabeth Carrazza, who bought the cafe from the leading chef in late 2010, says she has resisted requests from potential suppliers to expand the range, focussing instead on what they do well. “The whole foundation of our concept is based on local, fresh produce that we support and that’s seasonal and of the highest quality,” Ms Carrazza says.
She says the cafe has cut back on slow-selling items, such as some seeds for budding gardeners—“They may do well in supermarkets, but we’re specialised”. The branded products do best, in particular the cookbooks and DVDs, and the cafe’s overall retail sales comprise about a fifth of their total earnings. “The key is that Stefano’s is a brand… when people come to us they expect a certain level of quality,” says Carrazza.
Merchandise sales are even more significant for branding leaders Hard Rock cafe. Lennie Huntly, co-owner of Hard Rock’s Sydney restaurant, now located at Darling Harbour, says retail sales are responsible for about a third of total revenue. The Sydney outlet re-opened in the tourist district mid-year after the lease at the former premises in Darlinghurst came to an end. Despite opening in winter, Mr Huntly says sales have been strong and he expects this to continue in the warmer months, when patronage tends to be higher. And in the Gold Coast’s Surfers Paradise store, which Mr Huntley also owns, sales have grown year-on-year, even during difficult economic times. “It’s as common for people to buy a T-shirt from Hard Rock as it is to buy a burger, and that [branding] takes time to produce… there’s a lot of companies out there trying to do what Hard Rock does but it isn’t easy to get it right.”
Even the global casual dining success story, however, has found it pertinent to reinvent itself. About five years ago the brand decided that to go to the next level, it should evolve from being US-focused to franchises having more of a local flavour. “We are very clear that customers wouldn’t be wanting to celebrate that experience [through merchandise memorabilia] if it wasn’t a good one,” Huntly says.
“The whole foundation of our concept is based on local, fresh produce that we support and that’s seasonal and of the highest quality.” Maria Elizabeth Carrazza, Stefano’s Cafe Bakery, Victoria
The new Sydney destination has separate retail shops within the restaurant and Huntly has extended the merchandise range to include something for the whole family—including hats, jewellery, children’s clothes and men’s range. The Sydney and Surfers restaurants introduce seasonal short-run subtle fashion items that are not obviously from the Hard Rock Australian brand—making them more attractive to locals and encouraging repeat customers. “The bigger the selection, the more opportunity people have to buy something,” he observes. However, it is the original grey and black Hard Rock T-shirts, polos and collector pins that remain the biggest sellers.
Quality is important, with the franchise only using reputable suppliers that guarantee high standards. And floor staff, dressed in Hard Rock style, are on hand to explain the story behind certain merchandise. For example, a percentage of sales of popular signature T-shirts partly designed by music legends are donated to charity. These items raise a lot of money for the star’s charity of choice, and the celebrities also promote the product, which is good for business. Additional sales from the signature range are of course welcome but Mr Huntley says Hard Rock would be involved in philanthropy regardless: “We can reach so many people and have an opportunity to give something back.”
According to Tetsuya Wakuda of Tetsuya’s in Sydney, the impetus to expand his brand was born out of necessity because of the increasing numbers of diners asking for some of his wonderful unique dressings such as the oyster vinaigrette. Brand manager Marco Dal Corso explains that kitchen staff were satisfying customers’ desires by bundling up take-home bags but that the issue was not only time pressures but also the fact that the ad-hoc packaging did not live up to the gourmand’s quality desires. The solution has proven win-win, with happy customers helping drive traffic to the restaurant. “People can prepare a special meal at home with Tetsuya’s products for a fraction of what it would have cost to go to Tetsuya’s restaurant,” Dal Corso says. “They have a memorable dinner with friends who then think, if this product is so good, how good must the restaurant be.”
The products were launched in 2003 when he started supplying the product through David Jones food courts on an exclusivity basis for six months, along with an arrangement with the Pyrmont Fish Market—once his local seafood suppliers heard about the takeaway product they also wanted to offer it to customers. After the six months were up, Tetsuya’s was made available to airports in Sydney, Melbourne and Brisbane and a number of distributors nationwide. The products are now also exported to New Zealand, Japan, Singapore, Hong Kong and the UK, with cracking the US market the next aim.
The expanding brand includes Black Truffle Salsa, Nori Vinegar and Sliced Soft Smoked Ocean Trout, available in 100g, 200g and 1kg. As well, Tetsuya’s cookbook written in 2000 is still a popular restaurant seller and the renowned French-influenced Japanese chef has endorsed products reflecting his philosophy such as MAC Damascus knives that have the characteristic of each implement having its own unique patterning, and he is also an ambassador for the leading European cooking producer Electrolux.
Tetsuya’s take-home products attempt to use the same ingredients as those served in the restaurant—they have no additional sugars, salts or preservatives but rather use natural alternatives such as swapping fresh ginger or garlic for the dehydrated variety. As well, leading manufacturer Birch & Waite is used to ensure health, safety and cleanliness to Japanese standards.
Tetsuya’s ‘golden child’ branded dish—his smoked ocean trout—demonstrates well the success of his products. It is uncommonly smoked cold in a sushi style and the taste is so wonderful, it is best eaten without any accompaniments, Dal Corso says. The fish are bred off Macquarie Harbour on Tasmania’s west coast in heritage-listed waters, sourced from two rivers that come from wilderness areas. It is no wonder, then, that this Tetsuya’s quality-controlled delicacy is available in Australian supermarkets as well as in countries such as Italy, France and Switzerland—and the public cannot get enough of it.