The debate about the future viability of German city centres has gained further momentum in the wake of the lockdown months. Existing structural challenges such as a monotonous offer, declining visitor numbers and rising vacancies were massively exacerbated by the closures. In their current study #Innenstadtinitiative (“City Centre Initiative”), IFH and METRO AG focus on the needs of small and medium-sized restaurant businesses. 250 restaurateurs were surveyed in July 2021 on current challenges, their future plans and requirements for the city centre as a business location. The aim of the study is to identify initial approaches to political action in urban and district development. “After the comprehensive analyses, it is now time for action. The order of the day for all local stakeholders is to work together to increase the attractiveness of the cities and to fulfil new functions. In close cooperation with the municipality, retail businesses, but also with new partners such as the skilled trades as well as cultural and educational institutions, it is important for restaurateurs to take an active part in implementing new concepts for city centres,” says Boris Hedde, expert on city centres and managing director of IFH.
Result: Gastronomy as a trailblazer for inner city revitalisation
Places to go out are a central factor for city centre development because they have a positive effect on the atmosphere of the area and increase the time visitors spend there. Across all age groups, the motives for visiting the inner city continue to be the culinary experience, going out and shopping. In order to make city centres fit for the future, catering businesses must therefore be given greater consideration in urban development. “The results of the study show that lively city centres are not possible without restaurants, cafés and bars. That is why policymakers must pave the way and simplify, among other things, the allocation of rental locations to entrepreneurs in order to give small businesses a chance. The restaurant industry has its sights firmly set on the future and this is an opportunity for all stakeholders,” says Ivonne Julitta Bollow, Global Director Public Policy at METRO AG.
Location allocation and shortage of skilled workers as the biggest challenge for gastronomy
Currently, about 60 % of the restaurateurs rate the situation as average to very bad. Nevertheless, the sector is looking to the future with motivation. Planning is made more difficult by the search for suitable and qualified staff (71 %) and dealings with authorities (52 %).
Another problem in the eyes of many restaurateurs is the allocation of locations. A large part of the respondents criticise that the rents for attractive locations are too high (46 %). The non-transparent allocation process “under the table” is also a problem for restaurateurs (43 %). The active promotion by policymakers of targeted mixed use and repurposing of spaces on the part of tenants can remedy the situation in order to also offer attractive locations to small restaurant businesses. It is the owner-operated, small restaurants and cafés particularly that bring a city centre to life. Furthermore, a municipal platform for the allocation of restaurant spaces can provide transparency about the local real estate market
Location and district development as important factors for the future
Cleanliness and ambience (69 %), number of potential customers in the catchment area (68 %) as well as public transport connections (66 %) and good accessibility for suppliers (63 %) – the general conditions of the area play an important role in the choice of a location. That is why policymakers are called upon to create diverse mobility concepts for visitors and to promote the urban ambience. This requires clean pedestrian zones, intact buildings and facades, sufficient green spaces and more liveliness in the city centres.
In order to offer young and innovative projects in particular a chance in city centres, but also to support the exchange between businesses and the authorities, a municipal commissioner responsible for the restaurant industry can help. For 61 % of the respondents, simple legal framework conditions and approval procedures are very important. Acting as an interface between restaurant businesses and policymakers, constant dialogue can be ensured, administration and authorities are supported and, at the same time, mediation is provided for new businesses and when networking within the urban community.
About the study
The “City Centre Initiative” by IFH and METRO AG examines the status quo of the German restaurant industry and focuses on current challenges such as the shortage of skilled workers, high rents, and economic developments with a focus on the political framework. For this purpose, 250 restaurateurs in 20 selected major cities in Germany were surveyed by telephone in July 2021. Data from the IFH studies “Vital City Centres 2020” (2021), “Future of Retail – Future of Cities” (2021) and “Corona Consumer Check” (2021, all studies in German) were also included.
The detailed results are available for download on politics.metroag.eu (German only)
About the IFH COLOGNE
As an industry insider, the IFH COLOGNE provides information, market research and advice on retail-relevant issues surrounding the successful shaping of the future and the development of suitable business models. The IFH COLOGNE is the first point of contact for independent, well-founded data, analyses and strategies that make companies and retail locations successful and fit for the future. By looking at markets, customers and the competition, the IFH COLOGNE offers a 360° view for the derivation of strategies for retail-relevant topics. In customised projects, clients are supported in strategic questions around digital strategies, in the development of new markets and target groups or in questions of channel excellence. With its subsidiary brand ECC KÖLN, the IFH COLOGNE has been active in e-commerce since 1999 and is dedicated to community and know-how transfer for digitalisation in retail. More at: www.ifhkoeln.de
METRO is a leading international wholesale company with food and non-food assortments that specialises in serving the needs of hotels, restaurants and caterers (HoReCa) as well as independent traders. Around the world, METRO has some 16 million customers who can choose whether to shop in one of the large-format stores, order online and collect their purchases at the store or have them delivered. METRO also supports the competitiveness of entrepreneurs and independent businesses with digital solutions and thereby contributes to cultural diversity in retail and hospitality. Sustainability is a key pillar of METRO’s business. METRO has been listed in the Dow Jones Sustainability Index for 7 consecutive years. The company operates in 34 countries and employs more than 97,000 people worldwide. In financial year 2019/20, METRO generated sales of €25.6 billion. Additionally, have a look in our online magazine MPULSE.de, where we report on what moves our customers, employees, partners, and suppliers – and what we move for them.