Seán Carey: Brick Lane, curry and the delivery economy

Seán Carey: Brick Lane, curry and the delivery economy

It’s nearly 3pm on a Monday and Brick Lane is mostly deserted. However, near the mosque, there is a flurry of activity. Nine young men on ebikes, six of whom are students from Bangladesh while three come from war zones in the Horn of Africa, wait patiently outside a former curry house that, even before the pandemic, had reinvented itself as a “dark” (or “ghost”) kitchen producing pizzas. When the orders are ready, the delivery riders enter the premises and reappear moments later clutching one or more cardboard boxes, which they load into distinctive green Deliveroo backpacks.

Inside the pizza kitchen, which operates from noon until 10pm seven days a week, a lone, middle-aged British Bangladeshi chef, standing next to a flaming oven, is going about his numerous tasks – rolling out dough, adding toppings and boxing the finished pizzas. The owner, Ali, also a British Bangladeshi, tells me that, unlike other dark kitchens in the neighbourhood that produce a variety of dishes, such as burgers, peri-peri chicken and sushi, his focus is exclusively on pizzas. How does he manage to compete with powerful, locally represented brands, like Domino’s, Papa John’s and Pizza Pilgrims?

“We have a contract with Deliveroo, which is a great help,” he explains. “If people like what we offer, that’s good because they’ll reorder. If they don’t, well that’s bad for us, and we just have to try that little bit harder.”

Our conversation is briefly interrupted by the arrival of a rider, squinting at his phone’s app to figure out where he is going next. A major criticism levelled at delivery platforms such as Deliveroo is that vital information, such as customers’ names, contact details and locations as well as their meal preferences, are effectively hidden from business owners, preventing them forming direct long-term relationships with customers and collecting and analysing market data.

“The people who order our pizza live somewhere in Tower Hamlets, in houses, flats, and even the riverboats in Docklands – I don’t know exactly where,” Ali says with a smile after the order clears. Is that a problem for him? “It doesn’t bother me one bit,” he replies. Ali clearly believes he is succeeding: he earns enough money to support himself and his young family.

His optimism stems from his entrepreneurial perception of time. Ali believes that if the immediate future in terms of turnover and profitability resembles the present and recent past, everything will be fine. He might be right, he might be wrong. If it is the latter, he will almost certainly move on to another venture.

The UK’s online restaurant-to-consumer delivery market is estimated to be worth £6.3 billion. Its size reflects the global trend for economic growth through services and value generated through “dematerialisation” or “weightlessness” – intangibles such as branding, design and the building of marketing relationships.

It’s not surprising, then, that companies such as Just Eat, Uber Eats and Deliveroo, the last of which is unquestionably the dominant player in this densely populated area of east London, do not see themselves as traditional ready-to-eat delivery companies, but as tech platforms using increasingly sophisticated software that produces ever faster delivery times.

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Such businesses, of course, benefited greatly during the lockdown phase of the pandemic from March 2020. Indeed, ecommerce was critical in supporting the UK economy during that time. The downturn would have been worse without algorithms.

Some British Indian-owned restaurants in the capital, such as the Parsee-themed Dishoom chain and Michelin-starred Gymkhana, discovered that partnering with delivery platforms and introducing new products and packaging (meal kits, for example) allowed them to maintain brand awareness while retaining highly-valued employees. That was not an option for Brick Lane restaurant owners, whose businesses had long depended on dine-in out-of-town City workers and international tourists.

Takeout has traditionally accounted for only one to five per cent of a restaurant’s total revenue. What’s more, if local Bangladeshis, who make up at least a third of Tower Hamlets’ population, want to eat chilli-infused cuisine outside their homes, they go to the Bangladeshi cafés on Bethnal Green Road, Mile End Road and Whitechapel Road.

Even during the lockdown, when most of those establishments were closed, comfort food, such as snacks and biryanis, could still be purchased from the growing number of Bangladeshi home kitchens. Significantly, such transactions were facilitated by WhatsApp, the free-to-use messaging platform, rather than operating on revenue-deducting delivery platforms like Deliveroo.

Despite early attempts by several family-run Brick Lane restaurants to enter the home delivery market, all eventually closed and only reopened after lockdown restrictions eased. Some restaurateurs reported that, aside from the much-needed government assistance package, they struggled to get mainstream credit. As a result, they frequently relied on their savings, or those of other family members, to survive. However, that only a couple of eateries (one restaurant and one cafe) closed in the aftermath of the pandemic speaks volumes about the resilience of the Bangladeshi-dominated curry sector. Seventeen restaurants and three cafes remain open on the Lane.

It would, of course, be incorrect to conclude that just because food delivery platforms captured a sizeable market during the pandemic and some restaurants closed down (14 per cent in the City of London), the dining-out market is permanently diminished. The food market in London (and other cities) is constantly changing. It operates in a number of multiple, hierarchically organised segments, with consumption influenced by geographical accessibility, social class and disposable income, and brand value and experience. While the pandemic blurred the boundary between eating take-out and dining out, this is no longer the case.

Despite the impact of “disruptive” delivery platforms that have shaped and continue to reshape contemporary capitalism, many food delivery platforms have yet to turn a profit. The hope of large players, backed by venture capitalists, is to gain market share, acquire smaller competitors, and then leverage profitability in the medium and long term. Regardless of ambition, if cash flow significantly decreases as the economy takes a turn for the worse, these small-margin, large-scale digital businesses may face difficulties.

Back on Brick Lane, a street teeming with hospitality venues that require far more creative digital marketing assistance than they currently receive, two curry restaurant owners, Abdal and Ayub are enjoying a cup of tea at a curry café before their own businesses get busy. When asked about current challenges, they, like other curry restaurateurs, lament long-standing staff shortages and recent rising costs for such as food, energy and VAT.

They also reveal that they decided a while ago not to partner with any food delivery platform, partly because their kitchens could not produce more dishes than they already do during peak times, but primarily due to the impact on margins. ‘The cost to my restaurant would be around 25 or 30 per cent, so it’s not really viable,” says Abdal.

Unlike Ali, the owner of the dark kitchen, Abdal and Ayub are clearly concerned about the long-term impact of delivery platforms on the entire UK curry sector. Eighty per cent of the industry is run by British Bangladeshis (some are relatives), with annual revenue of £3.5 billion from restaurants and takeout, the latter being especially important in the capital’s suburbs and nationwide.

‘The food delivery companies have all the data,’ says Ayub. ‘They know exactly what’s going on. If they choose the four most popular dishes from various cuisines, like Indian, Chinese and Thai, and open [branded] hubs across the country, then our community, the British Bangladeshi community, will lose out in a big way.’

All names have been changed. Photos by Raju Vaidyanathan. Dr Seán Carey is a senior research fellow at the University of Manchester’s School of Social Sciences and a member of the Centre of Dynamics of Ethnicity (CODE). He is also a member of the Beyond Banglatown project team, which is led by Professor Claire Alexander of the University of Manchester. The Banglatown study was funded by the Arts and Humanities Research Council (AHRC) and the Economic and Social Research Council (ESRC).

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Categories: Analysis

1 Comment

  1. Dan says:

    Choosing the most popular dishes from various cuisines, like Indian, Chinese and Pizza, and opening newly branded hubs across the country, is exactly what Deliveroo did, including a 10 kitchen hub in Whitechapel. It largely failed, despite always being at the top of search results, likely due to bland food and no brand recognition.

    If you have the passion and drive, quality will always rise to the top, one way or another.

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