Ramadan and the Hospitality Industry
The holy month of Ramadan has a significant economic impact on the hospitality industry, in terms of both hotels as well as food and beverages (F&B) venues. This impact can be either positive or negative, with some venues seeing an increase in footfall and others a sharp decrease. Executive sat down with various stakeholders in the hospitality industry to find out about the impact of Ramadan on their business.
Hotel Occupancy during Ramadan
During Ramadan, some hotels Executive spoke to reported a drop in room occupancy despite the holiday falling in the usually busy summer month of July. Majed Najjar, Cluster Food and Beverage Manager at Lancaster Plaza Beirut, a five star hotel in Raouche, explained that during Ramadan people don’t travel as much and prefer to stay in their home country, causing an almost 20 percent drop in occupancy across the globe. “In Ramadan, travel is mainly only for urgent business. This is why we hotels rely on the F&B department during that month,” says Najjar. He added that this drop is somewhat compensated for by the increase in occupancy which accompanies the week or ten days of the Eid holidays, with even some Lebanese who reside in Lebanon opting to spend a few nights in a hotel as a treat.
Impact on nightlife
Beirut’s many bars and clubs are the most negatively impacted by the onset of Ramadan, a month where, in addition to fasting, practicing Muslims usually abstain from drinking alcohol for the whole month. According to Toni Rizk, CEO of TRI Concepts, a bar restaurant management company operating several bars in Beirut, the percentage drop in business during Ramadan differs from area to area. Hamra Street’s bars experienced an almost 60 percent drop in footfall, Uruguay Street’s bars experienced a 40 percent drop and the bars in Mar Mikhael, an area still considered among Beirut’s most active nightlife destinations, experienced an approximately 20 percent drop in footfall.
“There is nothing we can do in terms of offers or promotions to compensate for this loss during Ramadan since those who don’t drink in Ramadan are doing so for religious beliefs and not for other factors. We just wait the month out and prepare for a hopefully very active Eid period which was the case this year,” says Rizk.
International cuisine restaurants
Rabih Nasrallah is the Operations Manager at Verdun Star, a compound of three restaurants which include Ward El Sham Lebanese restaurant, Caprice, an Italian and sushi restaurant, and Couch Potato, a children’s entertainment center and diner. Nasrallah noted that the footfall for non-Lebanese cuisine restaurants during Ramadan is low, with a drop of 60 to 70 percent as compared to the other months of the year. Nasrallah explained that Verdun Star chose to shut Caprice for Ramadan rather than incur the loss of a slow month, and instead use Caprice’s outdoor terrace to have more seating capacity for Ward El Sham which remains as popular during Ramadan. “Very few people choose to have an international Iftar before the last week of Ramadan, if at all, when they start getting bored of Lebanese cuisine,” says Nasrallah.
In line with Nasrallah, Najjar explains that Prime 18, Lancaster Plaza’s steakhouse and cigar lounge, closes during Ramadan because it is associated with wine and tobacco, for which there is little ambiance and even fewer clients during Ramadan, especially since the hotel is located in the middle of Beirut and their F&B activity is centered around Ramadan during this month. “We also prefer not to have Iftar there to preserve the mood and quality of the venue which is more European with wine bottles and the like on display,” adds Najjar.
Mary Choueiry, the director of marketing for the Phoenicia Beirut, says that their outlets, which don’t offer Iftars, such as the sushi restaurant Wok Wok or the Italian restaurant Caffe Mondo, have experienced a slight decrease in activity which is normal for the month of Ramadan. Some international cuisine restaurants, such as Verdun’s Shogun or Zaitunay Bay’s Al Forno, have tried to compensate for this anticipated decrease in their business by tailoring and marketing an Iftar formula created out of their normal menu, including a soup and salad with a main dish and dessert. Al Forno’s manager on duty says this formula achieved success during the last two weeks of Ramadan when people were perhaps looking for a change from the dishes they could eat at home.
Lebanese cuisine restaurants and Iftars
The most well performing venues in the hospitality industry during Ramadan are the Lebanese cuisine venues which offer Iftar formulas. “We are doing well, there is a rush to restaurants and this is especially good in Ramadan since we rely on these two venues (Daoud Basha and Fume Bar) to compensate for the closure of the steakhouse during that period,” says Nasrallah.
Ward El Sham, which extends to a capacity of 230 people when including the Caprice terrace, was fully booked every night throughout Ramadan, and especially during the last week, according to Nasrallah. “What is interesting is that usually it takes ten days for restaurants to start filling up during Ramadan as people tend to have their Iftars at home at first but with Ward El Sham, it took us three days before we started getting very busy,” enthused Nasrallah, who explained that even though it is only one month, Ramadan compensates for the slump in their other venues, especially since they have a set formula for all customers.
Choueiry also says they were fully booked for Iftar at Mosaic, which has a capacity of 330, during the whole month of Ramadan with a peak in reservations towards the second week of the month.
Aside from the casual gathering of friends and family for Iftars in restaurants, the bread and butter of the hospitality industry lies in the corporate Iftars which companies host for their employees and clientele during the holy month.
Choueiry says 60 percent of the Iftars at Phoenicia Hotel are corporate ones held at their banquet space with the number of guests reaching up to a thousand. Najjar says Lancaster Plaza has two banquet halls, one with a capacity of 350 and the other with a capacity of 150, in which they hosted 18 corporate Iftars this Ramadan, mainly for NGOs and pharmaceutical companies, who he says booked a week before Ramadan began.
For smaller corporations or bank divisions, restaurants are seen as more intimate settings. “We had corporate Iftars mainly for the banks in our region (Verdun) which have small groups of maximum 40 people. When a company has a hundred employees or more they usually prefer to go to hotels where space is guaranteed,” says Nasrallah.
Prepping for the Big Meal
Whether for a small group or a corporation, preparing for Iftars takes a lot of patience and the ability to remain cool under pressure, according to the restaurateurs interviewed.
“The most difficult service anyone can work on in the hospitality sector is the Iftar service because what we usually do in three hours during daily operations when guests arrive, sit down and have a leisurely meal, we have to do in forty five minutes during Ramadan,” says Najjar, who added that there is a lot of pressure when handling Iftars as people should all be served and eating at the same time.
Choueiry says Phoenicia Hotel’s executive chef starts preparing for Iftars and Souhours four months in advance with the selection of the appropriate menu.
Overall performance of Ramadan 2015
On the first day of Ramadan 2014, the suicide bombing incident in Duroy Hotel put a damper on people dining out in hotels. “The first ten days of last year’s Ramadan were a real challenge also because the World Cup was taking place at the same time and people were choosing to go out for that instead of for Iftar,” adds Najjar.
This year, all those Executive spoke to said they have had much more footfall and corporate Iftars during Ramadan than they did the previous year. Nasrallah says Ward El Sham, which is in its second year of operation, has 10 to 15 percent more footfall than it did last year: “this year we have a stronger reputation and many people tried us once and came back many times or for special occasions, which also gave us a push,” explains Nasrallah.
Najjar boasts an almost 100 percent increase in footfall for corporate banquets compared to last year, due to most of these events being cancelled last year after the bombing. He says that the restaurant Daoud Basha has 25 percent more footfall than last year. “It was a very good Ramadan for dining out; a very good month for our industry,” he concludes.