RBTE 2016: Mitchells & Butlers is improving menu transition periods

Multi-branded leisure and hospitality firms have a much tougher time with supply chains than retailers, suggests a director of a leading pub chain, as he looks to improve efficiency when replacing menus.

Speaking at RBTE 2016, Ian Ferguson, head of supply chain at Mitchells & Butlers, said over the past 18 months the “achilles heel has been menu transition” during which time the availability of food items comes under pressure.

This is complicated by M&B operating 16 completely different brands, with each delivering a specific offer and menu options. Adding to the challenge is the fact individual pub managers still have great autonomy over buying decisions.

“This is the unique challenge of the hospitality industry. Whereas retailers have one format we’ve 16 very different formats and 16 brand marketing teams versus one in the supermarkets. We’re at least 10 years behind the high street retailers with replenishment systems – because managers still have control over the order pad,” explains Ferguson.

But progress is being made – especially around the menu transition periods – as M&B is working closely with its suppliers to reduce lead times of goods into its depots. “In 2014 it was seven days for our top 20 suppliers. We’ve given them a target of four days by Q3 this year and two days have already been taken out,” he said.

Rather than investing in “whizz bang wallop” systems, Ferguson explained it has been more sensible to initially segment the group’s inventory (around the 80/20 rule and also volatility) to better understand how individual items are performing in its supply chain.

“We can then make sure that as we move in and out of different [menu] periods of the year our pipeline of supply is absolutely ready to go,” he says, adding that only then would it be worthwhile looking to implement any new supply chain technology.