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2018 Winter Report

By Neil Mukerji |

2018 Winter Report

It’s 2019, so I’d like to start by wishing our followers, clients, and their customers a Happy New Year!

We are proud to have concluded 2018 with a useful 14% net growth in Kobas venues across the calendar year. While this isn’t as remarkable as the 88% growth posted in 2017, last year was notably tougher for the hospitality industry, with even the general press reporting that pubs were closing at a rate of 18 per week in the first half of 2018.

Despite this, 2018 saw Kobas installed into amazing venues all over the UK, with yours truly even involved in installations in London, Chelmsford and on the Isle of Man. The Christmas trading period was busy as ever, and at times we saw trade in excess of £120,000 per hour across the Kobas network.

We are delighted to be working with so many successful, experienced and supportive operators, and look forward to channelling their ideas and feedback into our offering in 2019 following the much anticipated launch of our all-new stock control system this coming quarter.

I’d like to publicly thank our team for their resilience, brilliance, commitment and operational excellence in 2018. The fruits of their efforts are laid bare for all to see in our 2018 Change Logs for Cloud and EPoS.

Industry Heartbeat

2018 was a complex year for the hospitality industry with so many factors influencing consumer spend. The year started with a fierce and elongated winter, colloquially known as the Beast from the East, delaying the onset of any springtime spending and perhaps even casting a shadow over key events like Mothering Sunday and Easter.

We then saw a complete reversal, with outstanding weather covering the two May bank holidays, a royal wedding, and then that long, hot BBQ summer – crucially timed to coincide with my second dose of parental leave, which was exquisite. Oh, and of course The FIFA World Cup.

Did this feel-good factor make up for the wintry blast in Q1? What about the long shadow cast by the political turmoil surrounding the UK’s exit from the EU? The year concluded with a parliamentary impasse and the announcement of an immigration policy which could be detrimental to the hospitality labour market, yet Christmas spending appeared strong and resilient to all that.

Analysis of trade across Kobas venues suggests that the summer really did the trick. In our Summer Report I announced that established Kobas venues were tracking an average of 1.25% below 2017 when comparing the first half of those two years. Yet looking at the year as a whole, the average is now broadly even, implying that the second half of 2018 outperformed 2017 enough to make up for the initial shortfall.

Certainly spend in December was significantly up on 2017, which is something we can all celebrate. Though even if 2018 was no worse than 2017 at a turnover level in the average venue, this doesn’t take inflation into account, so this and the rising cost of labour will need to be offset with some smart and slick operational improvements.

We enter the first quarter of 2019 in the hope of some political clarity, and seeking to better understand our businesses so that we can make the improvements needed to thrive.

Product

After a long wait for everyone involved, the all-new Kobas Stock System is now live in a handful of trial accounts. It has been an epic voyage, involving changes to one-in-three pages within Kobas Cloud, an absolute replacement of the underlying stock control architecture, and an investment in excess of £150,000 to date. I include that figure to again demonstrate the power of Software-as-a-Service (SaaS). The Kobas per-venue fee is just £355 per month, giving immediate access to a multi-million pound software service which just keeps getting better on a near daily basis.

Not only is the new stock control system more intuitive and easier to use on tablets and modern devices, it now permits our clients to operate with more flexibility and efficiency. Going forward, Kobas will natively support multiple suppliers for single ingredients, multiple pack sizes for single ingredients, and accounts for all stock movement on a First In First Out (FIFO) basis. This means our clients are now able to use more than one supplier or pack size for ingredients in any one venue or across their estate, safe in the knowledge Kobas will automatically calculate their gross profit based on the costs of what have actually been sold, and that their holding stock will always be accurate.

The new Stock system is available to any new clients and will be rolled out to existing clients across the first half of this year, as the migration process is a significant exercise, especially for larger and well established accounts.

This process will take significant resource in the coming quarter, yet we also have a number of integrations coming online in the same period:

  • Inn Style – An online booking system for accommodation businesses
  • Design My Night – An online booking system for hospitality businesses
  • Hastee Pay – An innovation cash-flow smoothing service for employees

Beyond all this there are a number of exciting plans to offer improvements such as a Deliveroo integration, a preparation display screen system as an alternative to docket printers in kitchens and at drink preparation stations, single use discount codes for marketing promotions, and a whole lot more. We will of course deliver as much as we can just as soon as is possible.

Infrastructure

Looking at 2018 as a whole, Kobas Cloud has been available for 99.998% of the time outside of scheduled maintenance windows, comfortably exceeding our 99.99% target, and amounting to only 13 minutes of the year where Kobas Cloud wasn’t available when expected.

Three outage incidents occurred with 5 minutes in February, 3 minutes in March, and 5 minutes just last week, all as measured by the third party availability monitoring service, Pingdom.

Kobas EPoS suffered an outage in the small hours of the morning in late February, related to the then forthcoming clock changes at the end of March, due to a session length of 2,500,000 seconds (nearly 29 days) landing in that “missing” hour in the GMT to BST transition.

The two actual clock change transitions in the spring and the autumn went smoothly both on EPoS and Cloud. Handling time changes is tougher than you might think, and I noticed that a number of high street banks including NatWest and Barclays entirely closed down their online and cash-point services for a period of hours enveloping the time changes to avoid risk of malfunction. Kobas can of course afford no such luxury!

Kobas enters 2019 running the latest technology stacks both in terms of language (PHP 7.2) and database (MariaDB 10.3). Maintaining a contemporary technology stack allows our engineers to assemble features and fixes faster, while everyone benefits from improved security and performance.

Staying up to date is especially challenging given the distributed nature of our in-venue EPoS. Updating Kobas Cloud, where we run relatively few servers in an environment designed to be resilient is one thing; smoothly updating hundreds of disparate EPoS servers without interrupting venue trade is quite another!


That’s all for this quarter. Without wanting to wish our lives away, I’m looking forward to the brighter, warmer days of spring. See you there!

About Neil Mukerji

Neil is responsible for the sustained growth of the business and for keeping our technology super-keen. Prior to joining Kobas, Neil has over a decade of experience running an online marketing platform, and before that engineered solutions for the MoD. He loves working in growing software companies and he loves the hospitality industry - what a combo!

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