Owners’ approach to F&B for Hilton in APAC

ASIA PACIFIC – Hilton aims to increase its share of F&B revenue/profit in Asia Pacific, where competition is reaching a boiling point due to factors such as a lifestyle hotel boom and an F&B pie that isn’t necessarily bigger than pre-pandemic days.

Hotel operators’ sentiment veers towards F&B margins in APAC staying the same between 2024 and 2025, a JLL survey found, with South Asia/Maldives and Southeast Asia doing better than other sub-regions. A report in August 2024 by HotStats concurs. Overall, F&B profit margins in Asia show “a region in recovery,” with varying progress across different markets.

Hilton has fresh F&B leadership in APAC. Vice President Marvin Alballi joined last year with 25 years of experience and a book he authored, Restaurant Excellence, in arm. A new hire, Remi van Peteghem, has just come on board as director, F&B hotel openings, APAC. The former F&B and culinary director of Sofitel Legend Metropole Hanoi will report to and assist Alballi in areas including kitchen design/layout, equipment selection, food quality, menu creation, culinary training and F&B concepts for new hotels.

The director should conduct a P&L analysis to determine if the cost of pre-approved vendors and suppliers can be shouldered by the local market. Having such a person will help prevent costly mistakes in pre-opening construction.

René J.M. Schillings

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The new job at Hilton APAC “shows our commitment to maximize return on asset for owners,” Alballi said. “For example, having the director ensure that kitchen flow and kitchen equipment costs are correct from the start is a great saving for owners.”

René J.M. Schillings, managing director of executive search firm TOP Hoteliers in Asia, said the role is advantageous for chains. For one, he said owners tend to be unrealistic about wanting a concept they saw somewhere else, not understanding the operational cost behind it, which they have to bear. “The hotel chain has to be transparent about it,” Schillings said. “The director should conduct a P&L analysis to determine if the cost of pre-approved vendors and suppliers can be shouldered by the local market. Having such a person will help prevent costly mistakes in pre-opening construction.”

‘Not an amenity’

Alballi is unable to share details such as F&B revenue contribution or the ROI profile for hotel restaurants in APAC, nor his targets for improving those metrics. Hilton, along with counterparts probably, does not publicly disclose exact annual F&B revenue.

But he did say F&B has a sizable amount of contribution, especially in full-service hotels. “We’re not an amenity,” Alballi said. “Our approach is centered around ensuring our restaurants, bars, banquets, catering and other revenue streams deliver the best-in-class industry top-line and bottom-line numbers.”

To be the bench-marker, he is embedding a culture whereby every restaurant manager operates as a business owner. “They are accountable for the P&L because it’s a business within a business,” Alballi said.

By now the asset management mindset on F&B isn’t a novel idea, but as usual success lies in the execution. For Alballi, it starts with intense training.

Under him, Hilton holds about three hours of training per month for restaurant managers, chefs, head bartenders and banqueting managers on how they can boost revenue and profitability further, be it by increasing outlets’ online reputation, managing costs, improving quality, or other ways. Scorecards track the progress of each manager.

Marvin Alballi: Changing mindset through training.

“We’ve improved our online presence on Google Reviews and TripAdvisor, and seen more restaurants optimizing their profitability,” Alballi said. Hilton operates and manages 1,147 bars and restaurants in APAC, excluding leases run by third-party outlets.

Alballi and his 15-person strong regional team also conduct regular online seminars, attended by up to 4,000 F&B employees in APAC. The calls are recorded, transcribed and translated into a manual for new and existing team members across all levels.

As well, for the first time, Hilton is hosting the world's '50 Best' chefs to create limited time pop-up experiences and events at its APAC properties in 2025 and 2026. “It's never done in this scale before,” Alballi said. “The aim is to align our chefs with the best in the industry, and to have our team and the visiting chef create amazing culinary experiences for guests. There’s a lot of learnings for our chefs from this initiative.”

The first pop-up, held in September at Oscar's restaurant, Conrad Singapore Marina Bay, featured Chef Reif Othman from REIF Japanese Kushiyaki, Dubai.

Hilton also sends its chefs to sister properties where they train and exchange culinary knowledge. In the past nine months, 34 chefs from 33 hotels in five regions have participated in the exchange program. “It creates excitement and engagement among our chefs, and additional revenue,” Alballi said. “If you fly a chef from Mumbai to Tokyo, guests will enjoy authentic Indian cuisine.”

Demand and competition

According to Hilton APAC, for 1H25, its F&B revenue, excluding conferences and events, saw a year-over-year increase across Australia, Southeast Asia, Japan and South Korea. Notably, Australia and Indonesia saw double-digit growth.

Despite challenges the industry faces, such as inflation, labor shortage and economic/geopolitics uncertainties, there is still demand for F&B. “The key to profit is revenue and cost, and the two controllable costs are labor and food,” Alballi said.

If we have smaller menus and focus on dishes that sell well, that repetition creates precision and perfection. It means you’ll have less inventory and fewer products in the storage area, and a positive domino effect on food, labor and energy costs.

Marvin Alballi

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He does not believe in “cost cutting” but “cost management,” and has launched a pilot to optimize menu and inventory size at 15 hotels, to be launched systemwide next year.

“If we have smaller menus and focus on dishes that sell well, that repetition creates precision and perfection. It means you’ll have less inventory and fewer products in the storage area, and a positive domino effect on food, labor and energy costs,” Alballi said. “It means less waste. Training will become easier and guest experience will become a lot better.”

Nevertheless, Hilton faces competition from lifestyle hotels in APAC, which flaunt their flair for creating more defining moments and experiences. According to a JLL report, lifestyle hotels in APAC register about 30% higher F&B (including MICE) revenue per occupied room than the broader market.

The region has seen a quadrupling of lifestyle hotel rooms in 10 years, mostly in upper upscale and above, with a further 34% supply growth by 2027. The top three lifestyle hotel groups in APAC, according to the report, are Marriott, IHG and Hyatt.

Hilton APAC surpassed 160 luxury and lifestyle hotels in operation recently and said this portfolio will grow by at least another 50% in the years ahead. Overall, it has a pipeline of 953 hotels, with more than 200 hotels scheduled to open in 2026.

Alballi said Hilton focuses on supporting all segments, not just luxury and lifestyle. “We don't have favorite children. Besides, we also have massive growth in focused service.”