Social media was abuzz last month when two billboards popped up on the highway outside of Jounieh. The first, an advertisement for Tripoli-based Abdul Rahman Hallab 1881, a stalwart of Lebanon’s sweets industry, read: “It’s in Jounieh? Sweet…”, which prompted Douaihy Lebanese Pastries, firmly established in the area for 15 years, to retort via another giant billboard: “You’ve arrived late to Jounieh, sweetie”.
“This is democracy! It was fun,” said Gaby Douaihy, manager and co-owner of Douaihy, summing up the ‘sweets-off’.
Although it has survived many turbulent periods, providing much-loved high-quality products to local and foreign customers for decades and employment for thousands of individuals, Lebanon’s sweets industry rarely features in the news.
The season of Ramadan — perhaps what pushed the battle of the billboards into the media spotlight — is the busiest period of the year for most Lebanese sweet-makers, and their approaches to product range and marketing strategies vary.
“In the last few years, [when] Ramadan has been coming during the summer season, people are more into the cold products than the fried ones, like kellaj,” says Amani al-Baba, executive secretary of Saida-based Al Baba Sweets. “Previously, kellaj was our Ramadan number one seller, but recently people prefer to have fresh dairy products or even ice cream.” Al Baba Sweets focuses its labor on qashta or cheese Ramadan products. Douaihy also sees demand for qashta products rise during the holy month.
Al Baba Sweets has special leather and velvet packaging boxes and silver trays available on their website’s “gift items” page. The company refrains from special offers but presents its products in new packaging. “The carton box is see-through, which makes for a nice box to present as a gift during Ramadan,” Amani al-Baba says.
Abdul Rahman Hallab is all about selling tradition. “We don’t try to modernize products during Ramadan. Even with regards to decoration, we believe it’s not the correct season to do something modern,” Ziad Jebara, marketing and advertising manager at AR Hallab explains. “We rather stick to what’s authentic.” Jebara goes on to say that AR Hellab does not do specials or offers, as their products are already an integral part of the holy month. “We are a ‘must-have’ and we don’t encourage people in that way with special items. Our packaging also stays the same,” he says.
Rafaat Hallab 1881, also based in Tripoli, started preparing three months in advance of Ramadan, one of the best months of the year, according to Omar M. Hallab, chairman and chief executive. “This year, we’ve introduced a point system. Through our magnetic strip card, customers will be given big benefits.”
The origins of Lebanon’s sweets empires are humble. They began as small shops in Saida, Ehden, and the souks of Tripoli. An abundance of sugar and milk in Tripoli and the influences of the Ottoman Empire encouraged confectioners to craft some divine sweets, which one Mohammad Hallab — hallab means milkman — came to master over a century ago.
In the hands of the third, fourth or fifth generation, these family businesses have expanded and diversified. These tiny confectioneries have morphed into large companies that have several branches within, and even beyond, Lebanon (see chart).
Catering has also become standard business practice among sweet-makers. Among other high-profile customers AR Hallab caters, to the Baabda Palace; Rafaat has expanded its catering services online.
“We registered hallab.com in 2000 and started our e-business then. [We] were surprised by the results,” Hallab says. The company’s website refresh, launched in July 2013, integrates a social media team that answers clients’ questions.
Al Baba Sweets also sells to online clients. “Our e-shop right now is around 5 percent of our sales turnover,” Amani al-Baba states. “We started 10 years ago but we had a problem with the [credit card] system, which was very complicated and was not secure.” After losing somewhere between $40,000 and $45,000, the company switched to Crédit Libanais.
“Our local sales still are the best,” Amani says. “Some products are in huge demand, especially Arabic sweets. Baklava is our customers’ first choice.”
For all tastes
As palate preferences change with time, sweet manufacturers often fuse modern and traditional flavors. Al Baba boldly mixes authentic recipes with contemporary, French pastry creations, such as tart dough with qashta and pumpkin, and carries “baklava pine fingers dipped in chocolate.” They even have diet sweets on offer.
“There are different tastes today. The younger generation prefer more dry, less syrupy sweets,” says Chief Executive Aouni al-Baba. The original ones, though, still sell best.
“The old generation wants the old sweet, the new generation new things, so we fuse and cater for both,” says Rafaat’s Hallab, adding, “The challenge is to make those products with the same taste as the regular ones. Among our new products is a malfoufe, which won an award at Horeca 2013, made of qashta, chocolate and sugar syrup.”
Presentation has also become an important selling point. Al Baba Sweets realized seven years ago that presenting their sweets in new packaging boosted sales as well as product and brand perception. “Especially in the Gulf this has helped us, and it gave us the idea to develop our product presentation,” Amani al-Baba recalls. There are some packages for which customers pay; for others, the company cuts a small percentage of its profit to give packaging for free in the hope of selling more and offsetting the expense.
“The authentic products back in the day were bought to have at home, or when you visit someone at hospital. Now that we have innovated the product and the perception of the product, people buy them for all occasions, and that’s where presentation plays a huge role. This is a novel trend that started in the last 10 to 15 years.”
In order to re-brand itself as more than a sweets maker, Douaihy opened Beit Misk along the Zalka West Highway in 2007. “We wanted to attract younger customers and target a new, young generation who thought that Douaihy was only about Lebanese sweets,” Douaihy explains. Offering French pastries, salads and snacks 24 hours a day, all year round, Misk is Douaihy’s biggest branch, and the concept has paid off. A younger and more diverse clientele now frequents Douaihy shops.
Innovation in some areas notwithstanding, production has remained close to the traditional, artisanal mode of making sweets. Al Baba Sweets, like all other sweets manufacturers, have machines, but 80 percent of Al Baba’s local production is still hand made. For ingredients, however, sweet-makers import at a hefty price to get the best quality.
“Our ingredients are not cheap and have to be imported. Only water, pine nuts, and labor are locally sourced. Not even the flour is made in Lebanon these days,” Aouni al-Baba explains.
Al Baba Sweets sources pistachios from Iran and Afghanistan at $25 per kilogram. Butter and butter ghee are imported from Europe, and the price depends on the euro. “Generally speaking, over the last month, all the dairy products have gone up 20 percent,” Baba says.
Aouni al-Baba says the price of baklava hasn’t risen in accord with the cost of ingredients because that would make it too expensive for many Lebanese. He says a fair price would be between LL40,000 ($27) and LL60,000 ($40) per kg. “One kilo of chocolate years back was LL25,000 [$17] and baklava was LL15,000 [$10]. Now good chocolate costs LL75,000 [$50] but baklava can’t go up from LL35,000 [$23], although chocolate is much cheaper to manufacture!”
“We are faced with sales decreasing and raw material prices going up,” Hallab says. “We cannot increase prices as consumers’ purchase powers are low. So the best solution is to resist increases and find some ways to introduce new products and promote these.”
A sticky time
Times are not always sweet for Lebanon’s confectioners, especially this past year. According to Rafaat’s Hallab, the last twelve months in Tripoli had a dramatic impact. “We’ve seen a tremendous decrease in our businesses. We are used to and have experienced these fluctuations before, but the past four months [March through June 2013] have been particularly hard and it’s all due to the security situation. We hope that this will pass and that we can resist,” Hallab explains.
“Two years back, tourists would frequent [AR] Hallab every day. They’d come to Hallab for sweets and for the Palace [Kasr el Helou] and go back to Beirut. We have lost those,” Jebara laments.
The losses AR Hallab has sustained over the last year have eaten up 30 percent of its profit. “Since we do not want to lay off any employees, our expansion strategy is what we chose to do in order to cover our costs and create job opportunities,” says Jebara. They expect to open their newest branch in Kuwait City this fall.
Likewise, Al Baba Sweets faces turbulence at home as well. “The recent events in Saida have resulted in a 25 percent downfall in sales turnover. The only solution is to cut from our profits to cover our overheads,” Amani al-Baba says.
Al Baba Sweets has opened new shops, the latest being Dar El Baba on Emaar Boulevard in Dubai in July.
Despite the dire situation in Tripoli, Rafaat is focused on expansion. “We’re opening three major projects, including restructuring the company’s catering division, which will include international cuisine and a franchising concept,” Hallab says. His company is also running a pilot for franchising.
The effects of the situation in Syria have delayed some of Al Baba’s projects. “We’re waiting for change… but we may also just do it anyways,” Aouni al-Baba says about opening four new shops in Tyre, Chtoura, Khaldé and Byblos.
While the security situation and economic downturn has left a bittersweet taste in the mouths of many, Lebanese sweet-makers are finding ways to keep churning out those delicious confections that one can take comfort in.