While the economy suffers from major setbacks brought about by years of political turmoil, local restaurants on street corners still manage to overcome the odds and build a reputation without relying on a heavy marketing strategy.
To stand out in a sector already packed with local and franchise options, a number of young restaurateurs, equipped with a passion for culinary arts as well as love of risks, have taken on the challenge of opening diners, each with a unique identity that focuses on a specialty product and a selected menu. In a short period of time, several examples of such businesses have emerged as successful brands.
This may come as a surprise, since political uncertainty has underscored the risk of basic nutrition for the poorest, World Food Programme director in Egypt Gian Pietro Bordignon told Reuters in April, referring to 25% of the country’s population of 84 million.
According to a 2011 report published by the Central Agency for Public Mobilisation and Statistics (CAPMAS), a middle-class household, which earns EGP 740 a month (equivalent to $105), spends approximately 40% of its income on food and drinks, making most of these restaurants above the economic reach of many.
The Daily News Egypt spoke with specialty restaurant owners to discuss how their restaurants became the new “it” idea for entrepreneurs, even in bad economic circumstances.
“Passion for food”
Laila and Adel Sedky started their family cupcake business in October 2010. The now famous Nola Cupcakes has several branches in Maadi, 6th of October and the North Coast’s Porto Marina.
Laila Sedky said after finishing their school studies in Montreal, Canada, the siblings decided to open a small cupcake shop with the same quality and flavours they enjoyed abroad.
“We liked the welcoming feeling that cupcakes bring. They are small and you can just chew on them without a fork or a knife,” she said.
Another recent success was the oriental food restaurant, Zooba, located in up-scale neighbourhood of Zamalek, which opened its doors after the 2011 revolution.
“I wanted to start a small and unique business,” said Chris Khalifa, Zooba’s owner, adding that the start-up costs were manageable: “[I] didn’t spend above the normal average it would take to start a local restaurant.”
Another Zamalek enterprise and relative newcomer, Burger Factory, has received rave reviews for the high quality meat and rich flavours of its burgers.
“I love Burgers and I wanted to fill the market gap in Egypt,” Said Amir Soliman, one of the owners and co-founders of Burger Factory.
“When I first opened my restaurant in November 2012, there were only the gourmet burgers served in restaurants or fast food burgers, so I wanted to bridge the gap between these two categories,” he added.
Soliman said the project cost around EGP 700,000, noting that local restaurants normally invest around EGP 1m.
“I started the business with several partners so as a start-up capital this number is within normal ranges,” Soliman said.
The economy as a whole has been stranded in a downward spiral for the past three years, according to World Bank figures. Economic growth decelerated to 2.3% in the first nine-months of 2012, with expectations of a 2% growth this year, as opposed to an average of 6% in the five years preceding the 2011 uprisings.
These restaurants arrived at a time when a number of factories and other large businesses in the country have had to halt expansions and change their strategies, as a means of adapting to problems such as a security vacuum, fuel shortage and scarce financing.
While most franchise restaurants in Egypt rely on television, and local restaurants depend on brochures to spread the word, the younger start-ups chose different platforms for their advertising.
Soliman said although he relied on word of mouth, location selection was a key element in his marketing plan.
“I chose Zamalek because it has become a food hub with good brand names and products,” he said.
To add a personal style to set his restaurant apart, Soliman decided to “play with Graffiti on the walls.”
Sedky said internet presence is extremely important: “We are a local bakery and a very young business so we relied on Facebook,” she said.
“Word of mouth, which deepened through social networking websites, was the main factor behind our reputation and success,” Sedky added.
According to the statistics on Nola Cupcakes’ Facebook page, the company has 33,500 likes and the age of the majority of people who liked their brand is between 18 to 24 years old.
Sedky continually adds pictures of the latest creations to her page to connect with her customers, which are seasonally themed: “In Ramadan, we had the mango and konafa cupcakes and in Eid we created the sheep-shaped frosted cupcakes.”
“It was important for us to become trend setters,” she added.
Zooba’s owner, Chris Khalifa said: “I believe that social media is the strongest marketing tool that one can utilise to create a brand,” adding that his restaurant constantly updates its Facebook page with images of its specials.
“Our priority is to concentrate on the operation, but if I must label it then we can say that our marketing plan focused on the conversation approach. The marketing will come from people talking about us,” he added.
According to Khalifa, the catchy name was selected to create a nostalgic feeling that Egyptians can relate to. Zooba, a derivative of the name Zeinab, is traditionally associated with heroines in classic films as well as current TV series.
“We wanted a straightforward name from the Egyptian streets. A unique name that brings about old memories,” he said.
Overcoming the economical obstacles
“Rough water defines a good sailor,” said Laila Sedky about the effects of the current the economic crisis and its effect on the family business.
According to Sedky, not only were they able to sustain their business’s success during the revolution, they were also able to increase their customer base and expand in other areas.
She said they cater at many events at universities and are requested as speakers to discuss their success.
“We are the ambassador of BlackBerry in Egypt,” she boasted, and said they enjoy a relationship with a number of prominent companies.
Despite the harsh economic climate created by political instability, Burger Factory has managed to thrive as well. “I’ve had protesters walk in my restaurant, eat burgers then tell me they are heading to Tahrir,” said Soliman.
The restaurant has decided to expand, he said, adding that they’re more interested in the local market and that expansion abroad is a long-term plan.
“We’ve received offers from quite a few countries, including Kuwait, to become a franchise and open several restaurants,” Soliman said, adding: “We are thinking about opening branches in October, Maadi and Masr Al-Gedida.”
Khalifa said he had no fear the about further developments, because food is a part of everyday life, and his business was born in the current political climate: “[I] have not known my business before the political unrest.”