A Detailed Report on the F&B Industry: Analysis and Management

This report provides a comprehensive analysis of the Food and Beverage (F&B) industry. It begins by outlining the different types of businesses within the sector, including restaurants, beverage companies, farming, and fruit and vegetable businesses. The report then examines the various rating systems used to assess food quality and hygiene, such as Scores on the Doors, AA Rosettes, and Michelin stars. It also explores current and future trends affecting F&B businesses, including changing consumer preferences (such as the rise of veganism and health consciousness), the impact of technology (e-commerce and online reviews), and the importance of professional F&B management skills. These skills include addressing customer concerns, complying with food standards, and managing food service staff. The report also details the legal requirements and regulatory standards that F&B outlets must adhere to, such as the Food Standards Act 1999 and the Food Safety Act 1990. Finally, the report compares various marketing and operational technologies used within the F&B industry, highlighting their impact on business operations and consumer engagement. The report emphasizes the importance of adapting to changing consumer behaviors and leveraging technology to enhance business performance.

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INTRODUCTION
The hospitality industry includes several businesses that provide services to the
consumers with the main objective of making guests feel comfortable and satisfied. It mainly
emphasizes on the idea of luxury, pleasure, enjoyment and experiences. The hospitality industry
is one of the fastest growing industries in the world and it mainly comprises f&b,
accommodation, recreation and travel & tourism. Hilton Hotels is an American multinational
hospitality company that was founded 100 years ago in the year 1919 by Conrad Hilton. The
company provides employment to more than 170,000 individuals and has spread its operations in
113 countries. The current study will highlight the different types of businesses within the F&B
industry, rating system used, external factors affecting the industry and ways to influence
consumer decisions in the f&b industry(Chen and et.al., 2015).
MAIN BODY
P1 Different types of business within f&b industry.
F&b is the fastest growing sector in the United Kingdom because from small local
farmers to global food chain brands, the country has a great record of being a world-class
exporter and producer of alcohol and cheese and the primal hub for different businesses related
to F&B industry. Several businesses included in the following sector are:
 Restaurants: Restaurants and fast food joints are the biggest source of revenue in the
F&B industry. In the view point of, there are more than 39000 registered restaurants
located in London thus providing employment to more than 100,000 people. Also, the
restaurant business is growing at an unprecedented rate in the UK where every 1 out of
12 people are employed in this business thus making it an integral part of country's
economy.
 Beverage sector: Companies in the Beverage business produce and sell soft drinks,
bottled water and alcoholic beverages. The beverage sector consists of bars, pubs and
liquor stores and is considered to be an integral part of the industry (Xiong and et.al.,
2017).
 Poultry farming: Poultry farming is concerned with animal husbandry that raises
domesticated birds like chicken, duck, turkey and geese to produce meat and eggs for the
purpose of human consumption.

 Fruits and vegetable business: The sector includes all the farmers that produce the
fruits, vegetables and spices that distribute it to retail and other grocery stores so that it
can reach the final consumers. In the view point of Agwa, Aziz, and Khalifa, 2018, the
fruit and vegetable business in United Kingdom provided employment to more than
32000 people with total revenue crossing 11 billion pounds.
 Farming: Farming is the most important business in the F&B as this segment includes
manufacturing of wheat, rice, corn, barley and other malted grains. No business in the
F&B industry can survive in the absence of Farming (Contreras-Manzano and et.al.,
2018).
P2 Different rating systems used for the f&b industry nationally and internationally
Rating system are basically concerned with analysing the quality of food and related
services and then rating it accordingly. There are various food rating organizations established by
government and other companies. Some major rating systems are:
 Scores on the doors: The scores on the doors is a food hygiene rating system that
provides rating to food outlets and restaurants on the basis of the level of hygiene, taste
and overall cleanliness in the kitchen area. The scores on doors have evaluated and rated
more than 538,000 in the United Kingdom. The rating are given out of 5 stars where
stands for excellent food and hygiene, 4 stars state that there is a scope of improvement, 3
stars mean some areas need to improve whereas 2 and 1 stars signifies that there is a little
or no hygiene in the dining place.
 AA Rosettes: The AA Rosettes is an award provided by the auto mobile association,
United Kingdom as it deals with car insurance, mortgage, loans and other services. The
restaurants and food outlets are given AA Rosettes on a zero to five star basis. The
standards set by AA Rosettes are very high and only about one in ten restaurants are
worthy of this title. There are currently a total of 2000 restaurants in the UK and Ireland
who have been awarded with this title (Contreras-Manzano and et.al., 2018).
 Michelin stars: The Michelin star is a hallmark of fine dining quality given to restaurants
that excel in their food, techniques, overall presentation, service, and hygiene. The
Michelin stars are awarded on the basis of 0 to 3 stars by anonymous users. The Michelin
stars are considered to be a stepping stone in the success of a restaurant company as it
establishes the brand image of the place and increases its overall profitability. The one

star signifies a good restaurant with quality food, two stars state excellency and skilfully
crafted dishes whereas three stars mean that the restaurant has achieved perfection in
food making with outstanding combination of different cuisines. In the view point of
author, there are only eight restaurants in UK that hold the title of 3 Michelin stars.
P3 Current and future trends affecting f&b businesses
There are various trends and innovations that have affected the F&B business both in a
positive and negative manner. Some recent trends are as follows:
 Changing consumer preferences: Change in consumer needs and wants has hugely
impacted the f&b industry. There are various socio-cultural factors that influence the
consumer preferences like increasing awareness about fitness and animal protection
has led to reduction in the annual consumption of junk food and meat products
(Tefera and Migiro, S., 2018). According to National diet and Nutrition survey, the
consumption of red meat among the adults has reduced by 19 grams over the period
of 9 years and among children it has reduced by 15 grams because more and more
people in the Great Britain have adopted veganism which restricts the consumption
and use of animal food and products like leather and fur jacket. Therefore, many fast
food and restaurant companies like McDonald's have started adding vegan food and
salads in their menus in order to meet the changing consumer needs effectively and
efficiently as it would help in achievement of organizational goals and objectives.
According to Huang, and et.al., 2017, the restaurants have started providing complete
information about the ingredients, level of fat, protein and energy in their food
products .
 Technology: According to O’Mahony and Lobo, 2017, with the increasing use of
digital technology the consumers have become much more aware and selective
regarding the choice of restaurant they wish to visit. The consumers get complete
information about the food they wish to consume and whether it will provide benefit
to them or not, pricing, services, ambience are some factors that people analyse
before finalizing a restaurant. Therefore, many restaurants and hotel companies
request the guests to write good reviews so that it enhance the image of the business
which leads to increase in their consumer base. However, the Davis and et.al., 2018
argues that the customers must not rely on internet while making a choice because

most of the times the internet provides false image of the dining place and
manipulate the consumers.
 E-commerce: With the increasing use of E-commerce applications, consumers tend
to prefer ordering food and groceries online rather than visiting a retail store or
restaurant. As a result, many retail store companies like Tesco have started providing
the facility of home delivery of groceries in order to maximize their sales and
profitability. Moreover, many restaurant companies have also started delivering food
packages to the customers for increasing their revenue(Silva and et.al., 2019, March).
P4 Professional f&b management skills within a f&b organization
The f&b industry is more of a service based rather than product based industry
therefore it is imperative to have management skills in order to ensure customer satisfaction.
The Hilton Hotels provide adequate training and development to its employees so that they
can learn the management skills efficiently and effectively. These skills include:
 Addressing customer concerns: Ensuring maximum customer satisfaction is the top
most priority of the hospitality industry therefore it is imperative for the F&B
manager to ensure that all the consumer queries and complaints are addressed
adequately. The F&B manager also have the knowledge and skills to notice potential
issues related to the consumer service therefore they interact with consumers which
helps in mitigating the risk related to the brand image of the restaurant. It is an
important management skill as it helps in building strong customer base for the
organization.
 Complying with food standards: It is the fundamental duty of the restaurant or hotel
to comply with all the food standards and also to educate all the staff members about
maintaining hygiene and cleanliness in the restaurant. Hilton Hotels have all the
licences related to the food and alcohol as it helps in avoiding government
interference and leads to smooth running of the business. The F&B managers also
prepare checklists and internal procedures to ensure their compliance with food,
safety and hygiene related standards as it would help in maximum consumer
satisfaction (Fortin, 2016).
 Management of food service staff: The F&B managers are also responsible for
recruiting, selecting and hiring of employees in the food and related service

department. The F&B manager keep a continuous check on the changing trends in
the industry and then take actions accordingly. The managers also ensure good
communication and management skills so that the right people are assigned to right
job at right place and at right time. Furthermore, it helps in creating a cohesive and
empowered team that is customer oriented and profit driven (Hua and Ickovics,
2016).
P5 Legal requirements and regulatory standards that f&b service outlets must comply with.
It is imperative for all the f&b companies to follow all the legal and regulatory
standards in order to avoid government interference and to build the brand image of their
company. Major legal and regulatory standards required by F&B outlets are:
 Food Standards Act, 1999: The food standards act was established by Food standards
agency (FSA), a government organization and their main motive behind establishing
the act was to ensure that the people of the country can eat out with having trust that
the food is safe and healthy. Also, it has made the sellers and restaurant companies
more cautious about their activities that they must refrain from selling anything
which can cause potential damage to the health of consumers and also the food
outlets must provide clear information about the ingredients that are involved in the
making of these products.
 Food safety act, 1990: The major guidelines of food safety act include that, a
business must not include anything in the food or remove anything from it or treat
food in any way which means it would be damaging to the health of people eating it.
The act also includes that a restaurant must not label, promote or advertise the food
products in any misleading or false manner.
 The food safety order, 1991: The food safety order, 1991 is another legislator and
regulatory framework that was established in Northern Ireland and it focuses on
maintaining hygiene and cleanliness while preparing food. It also states that, the
business must ensure complete transparency regarding the food offered to
consumers.
It is imperative for all the restaurants and food outlets, be it small scale or large scale to
follow the legal and regulatory frameworks otherwise the UK government holds the right to
seize the food licence of the company and ban their operations in the United Kingdom. Also,

the employer may have to face imprisonment and have to pay a heavy penalty in case if any
person gets sick or ill after consuming food from their restaurant (Huang, and et.al., 2017).
P6 Comparing various marketing and operational technology for the range of f&b business
The food and the beverage sector is been seen as evolving at the fast pace with regards to
technological innovation in respect of marketing and the operational function. Different
technologies adopted by different firms are as follows-
Flow-through sortation- In order to keep the inventory stocked, f&bs companies
bringing for the distribution centre, stages, sequenced for the purpose of restock shelves quickly
on same day. This operational technique makes the stock more simple and automated so that
time consumption get improved and accuracy of the store shelves also improves.
Equipment innovation- Creation of the e-commerce websites made it easier for the
business operating in f&bs as they can order the product in accordance to their convenience and
this leads to bent focus of the food industry towards the order profiles.
Voice technology- It is a kind of marketing technology that has been adopted by different
f&b companies which had allowed them in putting a hold on various costs like online transaction
and increases their networking with the customers on a large platform.
P7 Factors influencing consumers decision while choosing f&b outlets.
There are various factors that influence consumer decisions while choosing the f&b outlets
like:
 Location: Location plays a major role in influencing consumer decisions because
many consumers have the mentality to choose a restaurant which is nearby or far
away or if it is located at some good location and offers great views. All these factors
vary from consumer to consumer and therefore it is imperative for all the fast food
outlets to analyse the needs and wants of consumers and their preferences and after
they must select an appropriate location. Moreover, it is also important for fast food
joints to identify the location of their target customers, suppliers and employees and
then select a suitable place accordingly.
 Consumer service: The Hospitality industry is majorly concerned with providing
services to the guests and therefore the consumers expect to be treated well with
respect and dignity. Also, it is important that consumers feel comfortable, and they

are taken of as it would lead to maximum consumer satisfaction and would help the
restaurant in increasing their profits.
 Affordability: Affordability is the major factor that influences a person's decision
while selecting f&b outlets. No matter how good the food is, how excellent the
customer service are, and how beautiful the ambience is, if the restaurant does not fit
into the budget of the consumers then they will not select it. Therefore, a restaurant
must price its products and services keeping in mind the income level of its target
customers.
 Menu variety: Consumers often select a restaurant or a f&b outlet by keeping in mind
the kind of food they wish to eat. Therefore, in majority cases the restaurant is
selected on the basis of kind of cuisine a person wishes to eat. Menu variety plays a
psychological role in the minds of the consumer.
P8 Strategies used in a range of f&b outlets to attract and build a loyal customer base.
Strategies used by f&b outlets to build a loyal customer base are
 Communication: Communication is an integral strategy to build a loyal customer
base because it is imperative for a food outlet to know their customers, their needs
and wants as it would build strong relationship between the parties and would also
incubate a feeling of trust and togetherness between both customer and business. The
restaurant must also remember special dates like birthdays and anniversaries of the
customers and celebrate it to build a loyal customer base.
 Rewards: The F&B outlets must also provide certain rewards like special discounts,
buy one get one free and other exciting offers that help in retaining the consumers.
The outlets must initiate a loyalty program for their premium customers as it would
make them feel special, and they would not think about switching the restaurants.
Furthermore, it can help the restaurant in achieving a competitive edge over other
players in the industry.
 Customer service: The best way to attract customers to the restaurant is by providing
them good customer services. Good services include timely delivering of the order,
treating them with a smile, complimenting them and also listen to consumer
grievance and problem with patience and finding immediate solution for their

problem. This would help the organization in building a strong and loyal customer
base.
 Human interaction: In accordance with Davis and et.al., 2018, it is important to use
technology in the day to day operations of the business as it would help in reducing
cost and maximizing profits but real human interaction is also very important as it
helps in creating an impression in the minds of guests and thus establishes an image
of the restaurant. It is an important strategy in retaining consumers and thus building
a loyal base. However, Folkvord, and et.al., 2016 argues that technology is more
important because it reduces costs and helps in managing the operations more
effectively and efficiently. Use of latest and modern technology attracts customers
and influence them in a positive manner which further creates loyal consumer base.
CONCLUSION
From the above study, it can be concluded that the F&B sector is an integral part of
hospitality industry and significantly contributes towards the organization's profits. Also, the
F&B sector is further made up of various business and there are certain trends that have affected
the sector in both positive and negative manner. Moreover, the report also included various legal
and regulatory framework that a F&B company has to follow or else it may have to face legal
consequences. Thus, at the end it can be stated that in order to make F&B business successful it
is imperative that an organization provides maximum satisfaction to their customers as it would
help in building loyal customer base.

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