From a market perspective, my editorship of M&C Report (which is now MCA) was definitely a game of two halves.

The four years to 2008 were the halcyon days, when casual dining and fast-casual companies were changing hands for ever-increasing profit multiples, against a backdrop of a dynamic eating-out market in the midst of significant, structural expansion – on the back of Brits’ growing desire to eat out.

With 2008 came the banking crisis, and the market turned. It triggered an unprecedented financial era – and the contrast with what went before was extreme. Of course what ensued was a very challenging period for the sector (and an equally fascinating one for market commentators), which ultimately demonstrated how resilient the market was, and how engrained eating out had become in the nation’s psyche.

Capturing the essence of these two eras – and the significant forces driving the market – on a page feels challenging, but everyone loves a trier.

Procession of deals

Thinking back to that first half, the march of private equity was at full tilt with firms big and small, such as Bowmark, Cinven, Graphite Capital, Hutton Collins, Lion and Piper all playing leading parts.

Private equity was attracted to a sector undergoing significant expansion. Investors fought over concepts that possessed a compelling consumer proposition, an attractive (high-returning) financial model and, of course, high-calibre management teams. EBITDA multiple ratios were driven up by the increasing availability of debt – incoming buyers could pay more because they required less equity to fund deals.

The high water mark was the summer of 2007, with businesses such as Las Iguanas, La Tasca and Loch Fyne changing hands and attracting eye-watering valuations. The 55-strong Strada chain was acquired by Blackstone for £140m. It was also a busy time for Robert Tchenguiz.

A ‘new establishment’ of eating-out companies had emerged to challenge the big companies like M&B and Whitbread: Carluccio’s, Clapham House, Giraffe, Living Ventures, Wagamama and Yo! Sushi to name a few. They would be later followed by Bill’s, Côte and Loungers.

Changing times for pubs

Like casual dining and the out-of-home food market, the pub sector was also undergoing structural change too (again), although conversely, it was contracting. The fortunes of pubs versus casual dining seemed interrelated. Pubs faced many headwinds, including the smoking ban, the growing gap in pricing versus the off-trade, and changing consumer and social trends, but casual dining was taking its toll too, with a massive influx of dining-out capacity coming into the market, heightening competition for the eating and drinking-out pound. Highly invested and shiny new eateries shone an unkind light on tired pub offerings, rendering some venues redundant. It’s a contributing factor to the process that has seen 20,000 wet-led pubs shut between 2006 and today.

A brave new world

When the economy turned in the autumn of 2008, it was clear that many businesses were under pressure – some did not possess the consumer offer to compete, some were horribly over-levered (good business, bad balance sheet). Some businesses faced the twin issues and, starved of cash, had little room for manoeuvre. It was a busy time for restructuring specialists.

The industry’s focus – and the head space of senior management – pivoted from an aggressive growth agenda to one of operational efficiency and excellence. Everyone became more inward looking in recognition that with a tough (and slightly scary) trading environment, organisations had to get better. Better products, better people, better training, branding, marketing, digital capability, insight (and insight-driven decision making), productivity, processes and software. This process does not seem to have stopped – seeking continual improvement is the game.

Companies recognised the need to get closer to customers too. At that time, the digital side of the business really started to take off, in the wake of Web 2.0, the adoption of email-driven marketing and the emergence of social media. It created the opportunity for much richer content and gave companies direct access to their consumers (and vice versa). Smartphones soon followed, and with the emergence of 4G, this conversation can, as we know, now take place anytime and anywhere.

While most companies have clearly harnessed the digital revolution, it’s surprising how some still approach story telling today as if operating in a pre-2008 era.

The hand of government

In good times and bad, the spectre of interference and legislation was always near. There was the big stuff, like the smoking ban and licensing reforms (and now MRO), and then the constant stream of red tape and bureaucracy that companies had

to navigate.

In the past six months, the current Government has surpassed itself, handing the leisure and hospitality industry massive labour inflation pegged through to 2020, and then needlessly delivering huge economic uncertainty in the form of Brexit.

And what of now?

In 2011, I stepped down from M&C to launch a new business – as it was the height of the consumer recession, it seemed like the sensible thing to do. In the intervening period, the pace of change seems to have quickened. Aside from the way companies manage their brand and communicate with customers, two other trends I would highlight (among many) are premiumisation and technology.

We should find a new term for premiumisation (as it’s truly awful) but it’s evidence is everywhere. Driven by the ever-rising expectations of customers, and their desire for new and better, companies must continually enhance their product range and offer. Witness the way Fuller’s has transformed its food business in the past five years. Take a look at the drinks range at Hippo Inns – the new norm for good pubs.

Technology-driven ‘market disruption’ is everywhere. Deliveroo is the big one right now. Seemingly a driver of like-for-like sales growth, how will it impact operating margins, the customer experience, brand equity and in-restaurant dining? On a different tack, one of my contactless bank cards stopped working recently: it was surprising how inconvenient it felt for a transaction to take an extra 10 to 15 seconds via chip and pin. Yet it wasn’t so long ago that we were asking when wave-and-pay technology would catch on. It will soon be the same for payment apps like Velocity and the industry must adopt.

So there it is – a whistle-stop tour of seven years at the helm of this fine church. Happy 200th issue MCA.

Mark Stretton is managing director of Fleet Street Communications and a former editor of M&C Report (now MCA)