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In 2019, for the first time, Foodservice selling in North America exceeded sales of a retail sales. Foodservice or out of home sales exceeded retail sales. The biggest question is when will Foodservice selling or out of home sales exceed retail sales in our part of the world? Well, stay tuned because that day will eventually come. And we are experiencing some of the best opportunities during this time of doing business and plenty of more opportunities to come. Today I have the privilege of having with me Ayman Arnous.
How are you Ayman?
I’m good. Thank you Ramez.
Ayman currently is the General Manager for Foodservices for Almarai Pro. I’ve known Ayman for almost 15 years now. Why don’t you just share a little bit of how do we get to know each other and how have you reached to where you are today?
First and foremost, thank you for having me today. I’m really excited to discuss few business topics with you Ramez. I mean, over the last five years, I’ve been following you. Tracking your progress and I must say great evolvement and this absolutely comes with a great effort so well done. Quickly about how we met, Ramez and I had the privilege to first meet in Bidfood, I remember that was in 2009. At that time I was a Key Account Executive handling few accounts with Bidfood.
We had the chance to learn the basics of selling. I can say, not so well developed in a way that I can say I used to be a master in sales, however, we were trying to learn the basics. I still remember the first question I asked you when I first saw you, is that I have that client who always asks me for a discount and I really don’t want to lose him. What can I do Ramez? And this is where we started the discussion of added value selling, how to understand the customer and how to advance new proposal. Mainly, that’s it how we started and it’s really astonishing to see over a decade where we are now. Let it be yourself or my progress in my career as well in the Foodservice industry.
Amazing. Thanks a lot for this. I sincerely have that as a blank spot. I don’t remember having that conversation. I’m sure you do better than I. So from Bidfood in 2009, you’ve worked within the Foodservice industries and then reached to where you are. If you were maybe to detect or say, what is the one thing that has been responsible for your growth and your success as a foodservice professional?
Foodservice as a business in this region, whether we like it or not, is undermined still. There is no one answer to your question. There are plenty of reasons and plenty of areas I can say that make the Foodservice professional a successful one especially in his carrier.
First and foremost are the people. Today, Foodservice in contrary to retail, it’s not about branding, it’s not about visibility. It’s about the ability to connect wire with people, to excel, understand the business, and connect and wire for the future. It’s about your commitment to understand short-term objective and really build the right focus to win in the long term. Also, about foodservice, what I’ve realized, it’s about the technology, the investment the speed to market. Hardcore follow up that you and the team can do in order for you to understand business needs, as well as to understand how to win overall in the market.
You said a whole bunch of things. The one that stuck to me is connecting with your client. I think from a food service perspective, when you say connecting with the client, can you elaborate a little bit more? Connecting in which way? I’m let say an F&B Manager, or a Chef or an Owner of a restaurant or a chain for that matter.
First of all, you have to break it down into 2. Whether you know the person or you know the business and you already have a solid relationship with the customer or you’re just recently have been advised to meet a new prospect and to really approach through a business proposal or to a potential business for the future. Second, when you have the ability to propose and introduce yourself. You have to be first of all, the right Ambassador for yourself and for your company. People in this channel and in this business like to meet smart as well as high potential people that not only can help them in the selling journey, but also can uncover a lot of potential that to them, it might be not discussed or not even thought of. When you meet a new prospect, show your ability as a person. Build on the likability and try to hook the customer a few personal skills that you have. So that when you propose a business discussion, the prospect will be the hooked and say I’m going to work with Ayman. I really like that Sales Executive or that Sales Manager and I’m going to build some kind of relationship with him. This is only as a start and then comes the commercial acumen. It is the ability to take one step back to understand the prospect business. What do they do? What are their plans? What do they want to achieve at the end of the day, by end of the year or maybe a little bit on the long run? All these will be able to help you to propose the right commercial as well as portfolio skills to help you win and advance in your proposal with such a prospect.
Amazing! I couldn’t stop you because you were just on a roll. You talked about commercial acumen. So what’s in it for the other person? Today, we know that most outlets or most people that start a business mainly, it’s because they maybe want to bring something unique to the market. They are keen to differentiate; they’re passionate about their recipes, their craft and in a way they are fulfilling a need in the market. Today, especially in this part of the world, Saudi is the recent coming to this a recent entrant, after the pandemic. Research is showing that one in every two Saudis are choosing to eat healthier meals. If you go back 10 years ago, that was unheard of back in 2009 when you started Bidfood. That was total exception as supposed today one in every two that’s 50%. The market in the UAE is a little bit more multicultural. The health trend was something that people was in. People start their business idea to want to give to the market, want to be different and fulfill the demand in the market. At the end, they want to drive value. They want to offer the client the right menu, the right offering so that they can help the clients achieve their health consciousness and then they can achieve their profitable goal. First is understands the objective of the prospect and of the Enterprise that they are dealing with.
About the latest trend, 1 out of 2 Saudis is choosing the healthiest option actually, this is not only a regional trend. This is a global trend. It’s not only about choosing, also the variety of choices. It is helping a consumer or a person who would like to dine out to have variety of options and prioritize based on those options. What is the healthiest menu that he would like to see from an operator? That creates by itself a great opportunity for a lot of Operators in KSA and in the GCC to invest in that segment. And this segment is organically growing. As well I can say, today, what we see from The Operators is the tendency of changing menu is increasing. Which means creating more varieties for Consumers. And that by all means create also great opportunity for more products in the near future as well more advanced, healthiest products to be proposed by companies and suppliers to the Operators.
Absolutely. One of the trends that are on the rise is the healthy option. Deliveries are rising, eating on the go and then percentage of deliveries has risen drastically because of covid-19. But now even after, it’s still rising, people are enjoying that. I can even add something interesting, the vegetarian. There’s a rise of vegetarianism. So maybe not everyone is just going to eat vegetables, yet, people are realizing the impact of eating meat on the environment. So people are choosing to slow down intake to be more conscious with the environment. Is this something that you’re seeing in the market?
Absolutely! The protein segment is still high, however, we noticed the fast growth of the vegetarian options and the healthiest seafood. We also understand that there’s a nice shift in the consumers. They are wiser in their choices specially when selecting operators. Honestly speaking, visibility plays a big part of awareness today. Visibility of the menus, the aggregator apps and everything is helping the consumers quickly. If you compare just 10 years ago or 15 years ago, we don’t have the option to understand what is the operator offering in terms of menu. Today, everything is on the click of a button. You’ll be able to have the full visibility and that by itself, increases the choices as well as create the right visibilities for better and wiser decisions when it comes to dining out.
And building on that. I think operators today that will go and say my menu has always been my menu, why do I need to change. If you do not change and the competitors are evolving, they’re offering to meet the current demand of the consumers, where will you be? We talked about selling ingredients, selling a product versus selling a concept, versus selling a menu. Looking at what we call trends, implications and opportunities. What are the trends? We spoke about health trends. The implication of this health trend is if you don’t have anything healthy in your menu, you could be left out and you’d be a dinosaur. The opportunity is hey, let me help you evolve the menu. Let me help you evolve what you have and together we can grow up. So, this is what maybe you started by saying, it’s understanding the industry, understanding the Operator and using your know how, your business acumen to really come and add value to the operator.
Let’s look at managing a Foodservice business, the Foodservice team. When you look at your current role and maybe we generalized certain things. What were the challenges and what are still the challenges that you see in the way that Foodservice needs to be approached in this market Ayman?
I believe managing Foodservice for this region started approximately 20 years ago. Unfortunately, whether we like it or not, the approach for this business was, if we had good people in the retail and we want to create a Foodservice business, we let those people come and they will help us. Not only this, the approach also started by if we’re not able to sell certain products in the market, then we will have the dumping strategy. Foodservice would be a reason to move stocks away. This created the environment of incompetent employees working in the Foodservice that affected this business for almost 10 years in terms of pricing. If you don’t know how to sell and you’re using a dumping strategy, you’re taking away all the value. The power over the products goes back to the operator. You’ll be a facilitator only or what we call it the order takers, instead of order makers.
What I’ve seen is that in this region, we’ve witness a lot of evolution when it comes to managing Foodservice. One of the challenges that I personally faced is that the company decided to recreate a Foodservice strategy. They hire the best in class manager to manage the business. Then all of a sudden the expectations were rising but the current reality in terms of structure and how he is managing were not really changing. I don’t expect a manager to come in and have the magic stick to create all this kind of added value selling as well as the B2B approach to win over the next five years as a solo.
It is a culture transformation of how we used to sell and how we need to sell is really the driver.
That’s right. That’s why one of my famous statements is that you win by design. Why you win by design in Foodservice? Because the moment you embed the right structure, the moment you hired the right people, the competent people in selling as well as the people that have the behavioral element of prospecting, meeting, hunting ability, understands the businesses and the ability to add value to those businesses. Then the training comes as a second weapon for you to focus on your team. All this will help you to win by design, by creating the right structure. But this is not only it. There, will be the element of development, the human element of how to smartly attack the market or approach the market in a more strategic way. And this would require patience, time and a lot of effort from the organization, as well as the leaders.
Amazing! Just to build on the key element you spoke about and just to go back to the drawing board. Ayman, what you said is music to my ears. And knowing the requirements, so we want to find these better individuals that are able to engage with clients. Those that are able to go in and do the prospecting, presenting, adding value, doing the analysis especially in the market were there is a war on talent where you don’t find a lot of these individuals. So I’m going to throw it back at you. You know and I know that it’s not easy to find these people. In the absence of such a thing, what have you done that is working for you and or can recommend? I know we’re still in the process. We never reach. We’re always evolving and driving. What are some things that you can share with our audiences that they can do in case they cannot find the best people?
That’s right. Definitely there is a scarcity in the market when it comes to attracting professionals when it comes to B2B. But again, we cannot pause and say this is it. And until we have the talent, we cannot proceed in the business. This brings us to the second key element in developing and managing Foodservice, which is the training and the human element. It’s your responsibility as a Leader to invest your time, your knowledge, as well as to connect with professionals in the marketplace and industry to help you design the right materials. The right training, the right packages that can help the team not only learn the basics but also touch base on the behavioral element of the approach. How to win in the marketplace, how to approach a customer, what’s in it for me as a Salesman in the Foodservice? What’s the purpose that drive potential and improvement in the long run? The moment we invest in that area over time, and we have to be patient as a leader because this takes time. So many people and so many leaders want to have fast results. But guess what, it will take time. At first you will suffer. Sometimes results will be impacted, however, if you believe in that journey, and if you have a solid long-term vision for your organization, and for your people, you have to invest in enough time for your team to be on a different frequencies and period of time to have the right materials, the right training so they can expand and explore possibilities while they’re learning.
What I love about what you’re saying Ayman is, don’t wait for you to have the perfect conditions, create the perfect conditions. First of all, what I love about you is you’re hungry for knowledge. You said five years ago you started following me and because I maybe have had started putting more content online. We’ve stayed in touch and we’ve always have these conversations. I would say in the pandemic, you invested in a program. You sat with 20 other Sales Leaders. Remember From Sales Confusion to Sales Certainty? That was a course we created for Sale Leaders, sales people that manage teams. Ayman was like yeah, I’m in. He wasn’t even thinking twice about it. And, you know what? Today people listening to this program, I say you have a big responsibility as a leader of your team to model the way. There’s a big saying out there that says the speed of the team is determined by the speed of its leaders. And you as a leader, I’ve seen you grow and evolve.
You talk about how did you find out about Foodservice opportunities. You always reading, you’re always part of networking events. You’re rubbing shoulders with people that are at your same level and you’re learning what’s out there. I believe today, Foodservice will not happen, you make food service happen. You take the bull by the horn, you plow that fertile ground, you spend a little bit of time getting better and the outcome is just unlimited.
Growth in Foodservice will by far exceeds growth in retail. Currently, a lot of the businesses who are investing and developing their foodservice businesses are achieving much higher growth rates. Maybe the volumes aren’t there yet, but it will eventually catch up. And it all started because you decided to learn, you decided to evolve. And guess what? You’re taking everybody with you. Now, you’re one and the team is many. The key now is how do you put systems and processes in place and that’s where the structured approach training development that you would then drive into the organization. I think our audiences would really enjoy this bit of information.
To build on this point, you said something interesting about the foodservice growth is bypassing the retail growth. That’s a fact. Today, when we compare in percentages the growth in the operator counts. In KSA, five years ago, we’re talking about 38% increase as total count. When we look at the UAE for example, we’re talking about 25% increase in the total count. That tells a lot. Unfortunately, the pandemic slow down the growth of Foodservice. However, what’s really interesting was the ability to bounce back quickly. We are still in the pandemic; however, with the ease of the restrictions now, we see a very nice and positive movement in the Foodservice again. We see high traffic in the restaurants. This channel is growing faster again than retail and the future is really promising despite all the challenges.
What I see happening is the Foodservice is quite a resilient channel. We see customers are tired of being home. They want to go out, they want to enjoy. It’s quick to bounce back, its volatile. I think it’s more than volatile. There is a word out there called brittle. Brittle means it could break at any point in time. And seriously, anything happens and the whole thing would stop again.
We’ve seen today operators that are smart enough to adapt to the changing need in the market. We’ve seen at one point in time customers reducing the size of kitchen. I have a friend who designs restaurants for clients in this market and she said just recently, we’ve seen that the kitchen are growing again because today operators are realizing that dine in is not happening. So they have to increase the capacity to become mini ghost kitchen. Have multiple concepts out of this kitchen. Leverage their entire infrastructure to drive things.
I believe today there is an opportunity for this market to grow and evolve based on what’s happening. So it’s not about this is how it is and that’s all. We’ve got to be creative. We have to find what else is out there and how can we better serve customers in the market.
The ability to embed creativity in this channel is one of the core elements for success.
Creativity, finding opportunities based on change in the market. I know, being in the current environment we’re seeing some very volatile, sudden changes in the current world economic condition. From shortages of supplies, to shortages in delivering products and services, supply chain difficulties. How is all these impacting Foodservice in particular from your perspective?
Foodservice, if we want to zoom out a little bit to redefine the channel, has always been a price-sensitive segment. Because it’s very dynamic as well as because of the operator expectations, especially when it comes to prices, always been a very dynamic and price sensitive segment. What’s happening with all the challenges that you’ve mentioned is the cost input to run the operation is increasing drastically which is affecting the ability of keeping the price as is. The pricing strategy is dynamically changing. The fact is, it’s changing now on quarterly basis. If you recall, 2 years ago or 3 years ago before the pandemic, usually the commodity side of the business used to have a static pricing strategies. Rarely to see a 4% to 5% increase. Today were talking about extremely dynamic. We cannot foresee the next quarter on how the prices would be impacted. And that’s by itself, for the Foodservice industry is extremely challenging.
Whether we like it or not, the operators will always suffer and that’s why my only advice to the team and to organization is to continuous consultation, to explain this fact. And I’m sure operators know because they have their own toll of challenges as well when it comes to managing their cost. It’s the ability to keep continuous consultation to operators to help them as much as we can in terms of managing costs as well as keeping the service ability high on the agenda to ensure that we are not letting them down in such a very hard period. As well as securing the supply chain elements from the entire value chain. Let it be from producing the product all the way to have the product at the operator kitchen is something that we are focusing on in such a very challenging period.
This is a very real threat for everyone. At the end, the consumers are the one paying for that. We’re going to go up and have to buy more. Not to go very far, I have a 1 year old and 3 year old and the price of milk for my 1 year old. He has to get a special milk and it was AED90 for 900 grams. The pharmacist said it’s now AED116. Do you think I said I don’t want it? I said bring it on because I had no choice. That milk is for my son.
I think if there is that transparency that you talk about. If there is that hey, this is what’s happening on the price of oil, this is what’s happening on the price of commodities, and even the availability of certain ingredients. Because of certain parts of the world are now restricted, automatically there’s a shrinkages on supply. And when supply is low price goes up and so forth and so on. I really believe that says professionals need to have a little bit of background in economics to understand this demand and price relationship so they can communicate more confidently with customers.
They say winning happens in the preparation phase, not in the execution phase. And what I mean by that is you showing up or the team showing up to a customer afraid of communicating that news, that fear will automatically be felt by the person on the other side and it would make them react negatively. However, there’s a way of passing on bad news in positive way so the person would feel more relief. Any input on that topic?
This is a hardcore topic. Today, one of the most difficult task to be honest for any sales organization to manage, especially in B2B is price increases. It’s not easy at all. Trust me, if selling a product is difficult, you have to try to upsell the prices for the existing operators. One of the things, in my opinion that can help the organization succeed and the team to succeed is the leader’s ability to instill confidence in explaining the reasons with full integrity. It’s not about painting a positive picture and tells them we have an opportunity to increase prices and we are going to make profit. No! Estate the facts why we are increasing prices, the purpose of increasing prices. What’s really affected us as an organization if we don’t? Most importantly, what’s going to happen to our bottom line, to our business and even to your incentives and salaries? And God forbids, if we are going to continue on the long run, some of you who are now sitting on that meeting room will no longer be there. That’s why as a leader, because I really care, we have the chance to protect ourselves, protect our organization as well as be extremely honest to the Operators. Today, the world is not fine when it comes economy. Everybody’s talking about inflation, the whole world was hit by a severe pandemic. We have shortage of laborers and then all of the sudden you can see the cycle of consumption bouncing back but you don’t have laborers and you don’t have ingredients. It’s very tough to manage.
Before, we used to say we could manage a five-year plan. Today, if you manage a quarter with full visibility of the second one, you’re doing a great job. Full visibility about the scenarios, the confidence that you’re going to bring to the team and how are you going to approach the Operators. If you are going to approach the operator and say this is our new price and sorry we cannot do anything about it, he would remember and he’s going to hunt you in the future. Most probably you will not be able to do business with him again. This is why it should come with empathy, with the right explanation and with the right approach as well. How are you going to communicate, what are the preparations that should be shared prior to the approach? All these should be smartly managed by the leader as a role model to his team to go and approach the Operators.
Also, I would like to say something here. You used to always say the art of reciprocity. Whatever you are going to give you are going to take back. But also the Operators manage to enjoy extremely solid prices over the last 2 years especially in the pandemic. One of the stories that I share with the Operators is that despite Mr. Operator or Mr. customer, your volume dropped drastically in the pandemic less than 50% to 40%, I was still giving you the same prices that we’ve managed to agreed on because we really wanted to support you in the pandemic when we as a business got impacted. Now, that the business is flourishing and you’re back to doing well, it’s the right time for you to understand that we have to compensate our P&L a little bit to increase prices up because we want to make money. I believe this kind of relationship, not only will allow you to win on the short-term, also will allow you to invest on the long-term. Nobody knows. Maybe the cost will be dropping in the future. Maybe you’ll come back to the Operator with better prices and customers will remember.
Ayman, thank you for sharing this. First, I love the integrity, the ethical way that comes across. The very sincere way of you sharing with me, explaining it to me and I can only imagine you taking the same approach with your team. And when your team understands the history, how you’ve helped clients in the past and how to remind them. People always remember what have you done for them lately but if they have a short-term memory what have you done for them when things were a bit difficult. I believe this is a time for leveraging all of the people skills, understanding the laws of influence, reciprocity, as you mentioned and finding ways to create this what I call proper approach. It’s a win approach for everyone. We want to still help you achieve your goals and we can’t help you achieve your goals and us not achieve ours. We are in the same thing together. Amazing and great insights.
I really thank you so much for the time today. I believe this is just the beginning of many more segments to come.
Until next time, sell more, sell faster and profitably.