While a loaf of bread and a jug of wine may have been ample fare for lovers in ancient Persia, tempting today’s American consumers with Middle Eastern cuisine is another matter. Eastern cuisine is another matter. Replete with exotic preparations and unusual ingredients, the dishes indigenous to countries such as Lebanon, Arabia and Syria have incited only a modest popular demand in the U.S., met by scattered eateries, shish kebab vendors and, most notably, pita bread sandwiches.
Unique Culinary Creations of Middle East
Yet falafel, hummus, baba ghanouj, kibble, and other culinary creations of the Middle East are healthful, tasty and unusual, offering a unique dining experience that can rival Chinese food in its ethnic appeal. Thus, to foodservice consultant Bill Palermo, the relative obscurity of Middle Eastern cuisine actually presents growth potential on which he and his clients are banking a $1.75 million investment in two years of research and two new prototype dining establishments.
Located in the Beverly Center, an eight-story mall in West Hollywood, California, Hala is a moderately priced table service restaurant featuring Middle Eastern cuisine and frozen yogurt drinks–its sister operation, Bazaar, offers a limited menu for fast carry-out service in an adjacent food court. The restaurants, which share a common kitchen, opened this spring. They reveal a concept that is the outcome of a scientific and sentimental commitment to the cuisine of the Middle East.
Local Remarkable Cuisine
Backed by a group of Middle Eastern businessmen, who had observed how few restaurants in America serve their native cuisine, Palermo two years ago commissioned a market study to find out how well such fare would be received. It revealed that Americans are becoming more adventuresome about dining out, and that they are particularly open to sampling ethnic and other exotic foods that are fresh and healthfully prepared. An encouraged Palermo shortly set off on a tour of the Middle East, netting approximately 200 recipes as well as the realization that, “We had two different concepts–fast food and full service.”
The collection of recipes was refined into the 35-item menu now offered at Hala, which means “welcome” in Arabic.
- Most of the meat in Middle Eastern cuisine in barbecued, in the tradition of the Bedouin tribesmen, and among the staple ingredients are lamb, beans, rice, eggplant and other vegetables, fruits and dates, yogurt, and such spices as dill, garlic, cardamom and cloves.
- Hala’s menu thus includes fruit and meat kabobs; cucumber and yogurt and silver beet and lentil soups; and a range of unusual appetizers, salads, and entrees. (For a fuller description of individual items, see page 126.) Also offered is a line of pita sandwiches, incorporating the round “pocket” bread that has become a great favorite of the diet- and health-conscious, to the extent that Burger King has put pita in its salad bar program. “We’re in the midst of a pita sandwich revolution,” Palermo claims.
Profitable Price for The Diet- and Health-conscious Consumers
The restaurant’s appeal is, Palermo claims, enhanced by the absence of liquor service made in the interest of providing a family atmosphere (this policy is consistent with the Moslem prohibition that makes alcohol a relative rarity in many parts of the Middle East). In place of cocktails aer “freezes” and “smoothies,” frozen blender drinks that incorporate such exotic fruits as papaya, guava and passion fruit, as well as the more conventional strawberry, banana and apple. (“Smoothies” also include frozen yogurt, while “freezes” are made with a base of crushed ice.) At $1.75, they “sell like crazy,” according to Palermo, who observes: “Our beverage sales are 23 percent–the same as restaurants serving liquor. We make as much profit on a fruit drink as on a glass of wine.” A range of coffees–including a house blend that typifies the strong brews of the Middle East–is also available.
- The Average Price
Prices range from $3.95 for a pita sandwich to $8.95 for lamb chops, for an average check of $7. With 160 seats, Hala is grossing approximately $50,000 per month. Customer counts are averaging between 450 and 500 on weekdays, and up to 900 on weekends. The clientele includes a substantial complement of diet- and health-conscious consumers.
- Lower Budget
But the restaurant’s low prices, fresh and exotic ingredients and complicated preparations are still profit-pinchers. Palermo’s solution is in a “cluster” restaurant concept whereby neighboring units are serviced by a central kitchen. Thus, Bazaar serves a limited fast food menu of pita sandwiches, appetizers, kabobs and Middle Eastern pizza, almost all of it prepared in Hala’s kitchen. “The whole menu was designed with a central kitchen in mind,” Palermo explains. “It’s not easy to duplicate the food on a location-by-location basis. There’s a lot of hand work–like the grape leaves–and labor costs are high.”
- Convenience with Monthly Choice
With an average check of $4.50, a monthly volume of about $34,000, and customer counts of 250 to 300 per day, the 600-sq.-ft. Bazaar is rated by Palermo as a definite success. He projects first-year volume for Hala and Bazaar combined at $2 million, a figure he says exceeds the square-foot average volume of eateries in Beverly Center. (The floor on which Hala and Bazaar are located is devoted entirely to foodservice and entertainment.)
Palermo Envisions for the First Time
Palermo envisions the two restaurants as the beginning of a nationwide chain, comprising groups of Middle Eastern eateries. Initially, three or four more Bazaars are expected to open in the Los Angeles area, a market that has particular appeal with the ’84 Olympic Games coming up. These restaurants will be supplied by Hala, which actually has two kitchens–a commissary operation and a display kitchen, for the benefit of diners. Units are now slated to go up in the suburbs of Brentwood and Westwood, where Palermo faces the challenge of further popularizing the concept. “If we don’t expand. Hala won’t be too profitable,” Palermo predicts. “In terms of long-term investment, we should start seeing a good return after the fifth unit.”
Common Middle Eastern Concept
Free-wheeling Los Angeles was selected as the test site for the Middle Eastern concept because Southern Californians dine out frequently and are wont to be more adventure-some about sampling new and unusual foods than some other of their fellow Americans. Initially planned as free-standing restaurants, Hala and Bazaar were both modified to fit the accommodations at Beverly Center when a lease agreement with attractive terms became available. The unit in Westwood (which is the location of the UCLA campus) is thus expected to put the concept’s menu to a crucial test, for it will be competing for student customers against neighboring restaurants that also serve Middle Eastern cuisine. (There are approximately 20 restaurants in the L.A. area that offer this kind of fare.)
To modify Hala’s menu to appeal to the shoppers of Beverly Center (whom Palermo notes are 75 percent women), an emphasis was placed on lighter foods, such as salads, chicken and fish. While most menu items are selling evenly, an Israeli chicken salad incorporating dates, sesame seeds, lemon, mint and dill has proved extremely popular. Also well-liked are mezze (appetizers), which account for 30 to 40 percent of sales, as opposed to the more customary 10 percent. The appetizer selection includes two sampler platters, which sell for $6.95 and $7.95, and thus also have appeal as entrees.
Gorgeous Ambience of Ethnic Cuisine
Enhancing Hala’s unusual ethnic cuisine is its exotic and pleasant ambience. Decorated with archways reminiscent of the architecture of mosques and palaces, and painted in a cool salmon tone, the restaurant combines a casual, contemporary atmosphere with a faraway sense of the Middle East. Guests may observe dishes being prepared to order in the display kitchen, while an open serving line with hot and cold tables for pre-prepared items helps hasten waitress service.
At the front of the restaurant is a small gourmet shop, marketing some of the Middle Eastern grains and spices used in Hala’s kitchen, as well as teas, coffees, coffee makers, tableware and decorative items. Originally conceived as a large-volume operation featuring baked goods, the retail areas has been scaled down to 500 sq. ft. and is bringing in between $3,000 and $4,000 per month. Palermo expects both size and volume to grow, however, as Middle Eastern cooking gains more consumer acceptance.
Compare to Several Other Restaurants
“We’re competing with Japanese and Chinese restaurants,” Palermo says, “and in that market segment, Middle Eastern seems to be holding up, especially in fast food. Bazaar is a concept designed and ready to go into shopping mall food courts. But with Hala, we need time to refine the concept because we don’t have liquor. We have to be careful where we go.”
For future expansion, Palermo envisions the establishment of Hala/Bazaar clusters in such West Coast markets as San Francisco, San Diego and Orange County, with centrally located commissary kitchens supplying a full-service restaurant and four to five outlying fast food units. Initial investment costs for opening up a new market are set at $2 million, with a projected ROI of 25 percent. “We’re developing specific design criteria for a ‘cookie cutter’ approach,” says Palermo. He notes also that Hala’s recipes will remain proprietary when the operation begins franchising. “We’re very protective of the recipes, because it’s important to maintain consistency,” he explains. “Ninety-five percent of the preparation will take place in the commissary kitchens.”
Places for Vendors Sell to Passersby
This attitude reflects the painstaking investment of time and research that went into the menu. Traveling through Saudi Arabia, Egypt, Morocco, Lebanon, Jordan, Syria, Turkey, Greece and Israel, Palermo haunted the sucs, or bazaars. This is where vendors set up little hibachis and grill special delicacies to be sold to passersby. “It’s the equivalent of American fast food,” Palermo says. “The Chinese have egg rolls, the Mexicans have empanadas, and the Arabians have moutabal.”
Of the 200 recipes gathered in the tour, some proved too bland, others too spicy and others simply too esoteric. The field was initially narrowed through taste tests conducted on Americans living in the Middle East. Back in the U.S., the elimination process moved to the test kitchen, where certain ingredients proved to be problematic. Flour used in the moutabal (a grilled turnover filled with meat, cheese or fruit), could not be duplicated. “We finally tracked it down to one mill,” Palermo says. “The secret was a high gluten content.”
Palermo claims 20 years of experience in the restaurant and hospitality industry, including stints with Holiday Inns and Sheraton, as well as a decade as an independent consultant. Nonetheless, the two years he’s devoted to the development of Hala/Bazaar have afforded a uniquely absorbing and instructive experience. “It’s one of the most researched restaurant concepts I’ve ever been involved in,” he concludes. “We hope to do for falafel what McDonald’s did for the burger.”