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Morning Briefing for pub, restaurant and food wervice operators

Tue 14th Aug 2012 - Arc Inspirations, Asha’s and Chicken Shop

Story of the day:

Award-winning Arc Inspirations to return to expansion trail: Award-winning Arc Inspirations, which operates eight suburban bar and restaurant venues in Yorkshire, is to return to the expansion trail after several years of not opening new sites. The award-winning Leeds-based company, regarded as one of the most innovative operators in the UK, wants to turn a former chapel and printworks in Little Stonegate in York into a restaurant – the move comes after searching in York for the right site for several years. Arc Inspirations was set up in 2002 by Martin Woolstencroft, former Whitbread new concept development manager, and Chris Ure. Woolstencroft was also Whitbread’s youngest pub manager and ran the iconic Skyrack pub in Headingley, steering it toward becoming Whitbread’s first pub to take a million a year in drink sales. Arc Inspiration’s venues include The Banyan Bar & Kitchen in Harrogate and Nappa Bar & Kitchen in Leeds. The company reported pre-tax profits of £2,557,465 on turnover of £11,655,708 in the year to 1 April 2012. Arc Inspirations had turnover of £12,536,538 and pre-tax profit of £2,760,300 the year before. It stated: “It has been another challenging year and the business has suffered from poor market conditions, increased competition and the continued economic malaise. The threat to the industry from supermarkets selling cheap alcohol has continued to grow, further damaging leisure market sales and profitability and creating numerous alcohol-related issues for the licensed retail industry to deal with. We are continuing to maintain our standards whilst offering fantastic value-for-money and believe this will continue to maintain our high quality income streams through these difficult times. Sales have fallen during the year (by) £880,830 (seven per cent). Although this is disappointing we consider it to be a satisfactory result when compared to the rest of the industry.” The company reported liquor sales for the year were £8,421,909 (down by £672,000) while food sales stood at £2,936,633 (down by £265,000). 

Industry news:

Johnson - there’s plenty of private equity money out there: Private equity investor Luke Johnson, who has a stake in Giraffe and Patisserie Valerie, has claimed that there is plenty of private equity cash looking for good investments. He told London Loves Business: “Venture capital is quite scarce, but Britain is awash with private equity. Admittedly your company’s got to be of a certain scale before you raise that kind of capital. If you’re exiting, there’s an awful lot of private equity houses out there who will want to invest. But they’re finding it very difficult to deploy money because an awful lot of companies have blotted their copybook in the sense that, you know, they’ve had hiccups (in growth). So I think it’ll take a year or two more of recovery for businesses that have suffered in the downturn to resume their progress.” Johnson added that a short supply of high quality businesses is pushing prices up: “We go into an auction to buy a business, and if it has highly-regarded management, and wonderful track record growth and lots of great prospects, then prices are normally too rich for us.”

The West End in line for £250m visitor boost: The West End is set for a £250m spending boost as visitors from abroad flock to London in the wake of the Olympic Games, according to forecasts by retail trade bodies. Daniel Astaire, chairman of the West End Partnership, said: “It will be the cue for London to attract international events and conferences like never before. Visitors from both here and abroad are going to come back in numbers to stay in hotels, eat in bars and restaurants and go to the theatre.”

Nightclub sector sales expected to decline by 1.5 per cent: Nightclub sector revenue is expected to decline by 1.5 per cent in the coming year to reach £3.37 billion. According to IBISWorld industry analyst David Stephen, “changes in licensing regulation on the back of smoking bans have hampered industry revenue as the recession put a stop to growth in discretionary spending”. As consumers tightened their purse strings and binge-drinking came under fire, nightclubs lost favour with the public and attendance levels stagnated. The industry is expected to show growth of 1.4 per cent in 2012-13. Over the five years through to 2017-18 revenue is expected to grow only marginally. Music licensing fees, government regulation, low consumer sentiment, competition from off-licence stores and taxation have all weighed heavily on profitability of the industry. There are currently 6,077 nightclubs in the UK employing a total of 44,450 people.

Stroud launches own loyalty card: The local authority in Stroud has become the first in the UK to launch its own loyalty card. The council is funding the project in an effort to encourage people to shop local. Coun Roger Sanders, executive member for regeneration for Stroud District Council, said: “We hope this scheme will give businesses a boost in the current economic climate and continue to benefit them and their customers in the long term.” Participating businesses include JD Wetherspoon and McDonald’s. The scheme will be managed for the council by My Loyalty Card Ltd, which already runs similar schemes in several towns in the country including Swindon, Kettering and Northampton.

Denny’s to open site in Las Vegas with a wedding chapel: US foodservice chain Denny’s is to open a flagship 6,400 square foot site in Las Vegas with its own wedding chapel. The venue will be open 24 hours a day.

Discounts and vouchers re-appear as US faces foodservice slowdown: Starbucks and Darden have both put a fresh emphasis on value and vouchers as like-for-like sales slow in the US. Starbucks has brought back its morning “treat receipts” that give discounts to customers who return in the afternoon. Darden Restaurants is to step up value-priced promotions aimed at boosting traffic to its Olive Garden and Red Lobster chains. Meanwhile, Chipotle said it would put the brakes on menu price hikes, even though its food costs are more vulnerable to volatility because its ability to lock in costs is hampered by its use of organic produce and antibiotic-free meats.

Company news:

Collyer – Whitbread Premier Inn property pipeline to benefit from Travelodge disarray: Geof Collyer, leisure analyst at Deutsche Bank,  has argued that Premier Inn’s property pipeline will be the major beneficiary from current disarray at Travelodge. He said: “We see the major benefit to Whitbread of the apparent disarray at Premier Inn’s main rival as coming through in the pipeline increases that should be evident at both the interim and final results stages as opposed to better trading in the short term. We do not see the consumer’s decision to buy at Premier Inn or Travelodge as being informed by any view on any apparent or real financial difficulties at Travelodge, though maybe the absence of its TV campaign (which in our eyes has been significantly less successful than Premier Inn’s) due to financial constraints at a time when Premier Inn has been rolling out its new campaign could have had some impact.”

New Cross pub to become 60-bedroom hotel: The Walpole pub in New Cross, London, is to become a 60-bedrom hotel after it was acquired off an asking price of £2.25m by a Middle Eastern investment company – the venue was sold by a private overseas investor with planning consent in place. Anthony Alder, of agent AG&G, said: “There’s such strong demand for large plots in central London and it’s close to the terminus of the east London line, near up-and-coming Stratford and with that precious permission, so the potential was clear.” 

TCG sells Basford nightclub: Managed operator TCG Inns has closed its 550-capacity The Queens in Basford, Staffordshire. It is thought that the site has been sold to a developer who will re-develop the site for housing. The two-storey building previously traded as a public house until it was converted into a nightclub. It underwent a refurbishment in 2010 but went up for sale last year.

Marston’s sets November opening date for Chepstow new-build: Midlands-based Marston’s has set a November opening date for a new-build pub in Chepstow. The venue occupied a site previously run as a Spirit pub and hotel. The site, on the A48 approach to Chepstow, will also be occupied by a 22-bedroom hotel.

Prosecco bar opens in Glasgow: Fantinel, a family-owned Italian wine and spirits company, has opened Scotland’s first Prosecco bar in Scotland. The company is known for producing DOC Prosecco, an Italian white wine made from Glera or Prosecco grapes. It is mainly used as an ingredient of the Bellini cocktail and as a substitute for Champagne. Situated at Paperino's West End on Byres Road, Fantinel Prosecco bar is the brainchild of Fantinel proprietor Stefano Giovanazzi and will serve wine and breakfast. Said Giovanazzi: “Whilst prosecco bars continue to proliferate throughout Italy and mainland Europe, we are delighted to introduce Scotland's first specialist prosecco bar to Glasgow, offering customers an ideal meeting place to come and enjoy a superior quality prosecco at a sensible price with a bar snack, treat themselves to a cocktail with friends, or catch up over pre and post dinner drinks.”

Loungers plans sixth opening in Bristol: Loungers, the café bar chain led by Alex Reilley and backed by Piper Private Equity, is planning its sixth opening in Bristol – this time in the Westbury-on-Trym area. A planning application has been lodged with Bristol City Council to open a new site in the centre of Westbury village, which is currently occupied by Blockbuster. Several local residents have objected to the planning application but there has also been support from other residents. Loungers is applying for a change of use on the Blockbuster shop, which has been on the market for four months. Meanwhile, Loungers will open its latest Cosy Club venue in Salisbury on 22 August. Loungers has a long-term goal of operating 250 sites in the UK.

Burnham-on-Sea becomes the latest town to air concern over coffee shop saturation: Burnham-on-Sea in Somerset has become the latest provincial town to express concern over a new Costa Coffee opening leading to coffee shop saturation. Franchisee South West Coffee has applied to convert a former greengrocers closed since last October. A number of other retailers in the town have called for more control over the number of food stores. One stated: “I hope the council will step back and take a sensible judgement call on the number of cafes and think about the small retailers in the town.” Meanwhile, Costa Coffee has opened its first site in Malta – located in the check-out lounge at Malta’s International Airport.

Asha’s close to naming master franchisor in India: Upmarket Indian restaurant chain Asha’s, founded in Birmingham, is in discussions to appoint a master franchise for the Indian market. The concept already has franchised venues in Abu Dhabi, Kuwait, Qatar, Bharain, and Egypt. The restaurant group, which opened its first venue in Dubai in 2002, is aiming to open up 15 venues on the sub-continent in the next five years. Asha’s is named after Indian music icon Asha Bhosle, who is best known as a playback singer in Hindi cinema and has sung on over a thousand Bollywood movies. Ms Bhosle said: “Expanding the number of outlets was the logical step given the success and popularity of our existing restaurants around the world. I’m proud that Asha’s has rapidly become the leading choice among people of all nationalities who want quality Indian cuisine and an unforgettable experience. We will soon announce the name of the master franchise and open the first outlet by the end of the year in Delhi with an initial investment of $2 million.”

Marston’s – huge interest in pub jobs: Marston’s chief operating officer Alistair Darby has reported “huge interest” in jobs being created in the company’s new-build expansion programme. The company is investing between £50m and £60m a year in building around 25 new pubs per annum. Darby told The Express and Star: “We are experiencing huge interest in those jobs. Our latest pub in Port Talbot had 800 people applying. That experience is not unusual. We are also seeing that people are taking a career in pubs seriously.” Marston’s now has 11,000 staff in the UK.

Jenson Button restaurant closes: A Harrogate restaurant that saw investment from Formula 1 driver Jenson Button has closed. Victus was launched in September last year. Button opened the business and worked with the manager Samantha Bradbury and her husband Gary on the concept – to provide “good, tasty food in a relaxed atmosphere”. He said at the time: “It’s something I’ve always been interested in. It’s great to invest with people I know – I think that’s the right way to go into it.” But the restaurant has now closed its doors, with a sign on the door saying it could not continue in these “difficult financial times”. In a letter to its customers it said: “Through necessity it has been decided that we can no longer keep Victus open for business. We appreciate all our customers’ support during the development of the restaurant.”

Attibassi opens in Chichester: Italian espresso company Attibassi has opened its first UK site in Chichester. The Attibassi Espresso Bar offers Italian breads, salami and hams, and there are also plans to have breakfast pastries and squeezed orange juice on the menu. Marc Perry, managing director of Attibassi UK, said: “I decided to open the Attibassi espresso bar in Chichester because I thought the concept would be appreciated here as in the past few years a lot of continental-style cafes and restaurants have popped up with good success. I think the best asset of the espresso bar is the quality of the coffee together with the training we have received in Italy to produce coffee that is exactly as it is in Italy. All the baristas on site have been trained by Attibassi at the roasting plant in Bologna.”

Punch licensees look to raise £320,000 to buy pub: The licensees of Punch’s Dusty Miller in Mytholmroyd are looking to raise £320,000 to buy the pub’s freehold. The pub closed after the recent flooding in the area and Punch decided to sell it. Tenants Angus and Anne Downie have set up a “Save the Dusty” campaign and are looking for investment from the community to raise the six figure sum in exchange for a share holding in The Dusty Miller Inn Limited.

PizzaExpress picks up Doncaster site: Pizza Express is to take one of two restaurant units that form part of the extension of the existing Vue cinema in Doncaster’s Leisure Park. Currently the leisure park, based off Herten Way, consists of a Vue cinema offering seven screens with approximately 1,559 seats and over 150 free parking spaces. The demise will be extended by two further screens at the rear of the cinema with two restaurant units being built at the front providing 3,000sq ft at ground floor with sufficient head heights for full mezzanines to be installed.

Soho House to open Chicken Shop end of August: Soho House will open its new Chicken Shop concept beneath a planned Pizza East in Kentish Town on Tuesday 28 August. The opening builds on the current trends to do a single menu item to a very high standard - rotisserie-style chicken in this case. Soho House chief executive Nick Jones said: “I’ve been thinking about this for a long time - chicken would be my last meal and so I wanted to get it exactly right. The best chicken is the one you cook at home. We’ve tried to recreate that, but affordably.” The chickens, sourced from Banham’s farm in Norfolk, will all be marinated overnight using a specially developed recipe and steamed to lock in flavour and to keep the meat succulent. Just before serving, the whole chickens will then be transferred to the bespoke rotisserie grill to be cooked over charcoal and wood, resulting in “juicy, perfectly cooked meat and crispy skin”. Chicken will be served quartered, halved and whole. Sides offered will be triple cooked chips, creamy coleslaw, corn on the cob and salad. The look of the restaurant is designed to mimic that of a 1950s American general store and will seat 40 people with takeaway available too.

Drake & Morgan to open two sites in 2013: Drake and Morgan, the privately owned bar and restaurant group, is set to launch two new sites in 2013, bringing its portfolio to seven. Both will occupy new AXA Real Estate developments in the City with The Happenstance opening at No.1 St Paul’s Churchyard and The Haberdashery at Sixty London, Holborn. The Happenstance will feature floor-to-ceiling windows allowing customers to take in the view of St Paul’s Cathedral. The 238-cover venue will incorporate an open kitchen, deli, mixology table, florist, bar and private dining room. The Haberdashery is just over 10,000 square feet, and will include a florist, cheese and wine room, deli, kitchen and bar. The 478-cover venue will be spread over three floors, including a mezzanine level. Managing director Jillian MacLean said: “We are delighted to be opening these new sites next year, and it’s fantastic that we can continue to provide the City with something that’s a little bit different, fresh and innovative.”

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