“Restaurants run as a hobby or interest have gone under in the pandemic. The rest have survived,” says well-known Perm restaurateur Nikolay Kanischchev.
The restaurant business is one of the sectors which has suffered most acutely during the pandemic. However, in Perm the worst forecasts have not materialised: a few restaurants have closed, but the main players continue to operate. One of the city’s most successful restaurateurs, Nikolay Kanishchev, talks about what is keeping his establishments afloat at the moment, and even reveals details of the profitability of the business.
Nikolay, you run a variety of restaurants with different clienteles. Tell us how they have been affected by the pandemic.
Compared with Moscow, it is quite difficult to succeed in the restaurant business in the Russian regions. Of course, the strict lockdown measures last spring made everything that much harder. Our group has establishments with a variety of formats, and they responded to the challenges in different ways. We were surprised by Rob Roy and by the noodle bar. Rob Roy, which is aimed at the middle classes, took a lot of orders for cooked and prepared steaks. It isn’t easy to cook them at home, so people preferred not to experiment and to order them from us. The small noodle bar also made it through this period successfully. Simple and inexpensive food is now enjoying considerable popularity. The noodle bar has in fact helped our whole business; you could say we made money here for all the other restaurants in the group.
Bar establishments, such as Nolan, have found it particularly challenging. People go there mainly for the atmosphere, but unfortunately the courier doesn’t deliver that with the food. Atmosphere deliveries have yet to be invented!
Did you ever investigate the idea of street food trucks when the pandemic started?
Food trucks are new in Russia. Until quite recently they were regarded as strange trailers with food, but gradually a whole industry is developing. However, because of Perm’s climate, running food trucks as a business is difficult. The concept is better suited to warm regions. Food trucks are better used in the Urals as part of a promotional or marketing campaign. To be honest, I would happily cook a cutlet or a burger on the street. Promotions like this are a real plus for any restaurant.
In your opinion is the market in Perm suffering since the coronavirus pandemic?
The main players in the market are still there. The businesses which have closed down have been those run for fun or as a hobby etc. If we have another lockdown and we go back to deliveries only, then the impact will be serious. But if there are no more restrictions then the market will not change a great deal. Those entrepreneurs for whom the restaurant was not their main business will be the ones to go under.
Looking at the market as a whole, which restaurants are now doing better and getting a quicker return on investment – those at the lower end or the higher end of the market?
In Perm, restaurants with a simple menu and food that all types of customers understand are seeing a better return. In our region, the cooler the establishment, the worse the return. However, in Moscow, if you open a premium restaurant, promote it and sign contracts with sponsors, there is every chance that it will break even in 3-4 years. In Perm it takes longer.
How profitable is the restaurant business in Perm at the moment?
Nowadays, profitability in the restaurant business has to be at least 15%. Yes, during the crisis there was a drop of up to 7%, but a restaurant can’t survive in those circumstances. If we look at the situation overall, good establishments in Perm are now seeing a profitability of about 25-30%.
Is there a problem with staff in Perm?
Not with finding general staff, but there is a problem finding highly skilled workers. They are in short supply in Perm. Many are leaving to work in bigger regions such as Moscow in search of better pay. The main reason is that some restaurants in Perm are sacrificing staff pay to chase profits, and also people are also looking for a better life. We are trying to maintain a normal level of staff pay and to take on new entrants to the profession and provide training.
Nikolay, a final question: how did you become involved in the restaurant business?
It’s very simple. I began by pouring beers and cutting up chicken for the grill in a summer café. Then I worked in night clubs where I learned how to be a barman and I even put on my own show where I juggled bottles (he laughs). I then found myself in France, where I saw how seriously people take running a restaurant. That’s probably when I fell in love with the restaurant business. The biggest boost to my career was when I opened my first bar, Speakeasy, and got to know people who have remained my partners to this day.
It seems that many people see the restaurant business as a hobby or a fun add-on to their main business. But my attitude is completely different. In France I saw what family tradition means, when several generations of one family run the restaurant in turn, and when the head of the family and his grandchildren work with the customers in the restaurant at the same time. This is inspiring, and I very much hope that my children and at some point, my grandchildren, will continue my business in Perm.