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Fri 5th Oct 2012 - Domino’s, Fuller’s and Gaucho

Story of the day:

Domino’s Pizza reports £16,000-a-week in extra takings at 24 hour-a-day site: Domino’s Pizza has reported early success at the handful of sites that have opened 24 hours a day, with one site chalking up a remarkable extra £16,000-a-week in sales. The company has three stores open 24 hours, with one in Cambridge recently granted permission to do so. Chief executive Lance Batchelor said: “The potential is really good – the demand is there. There’s one store, that I won’t name, doing sales after 11pm at night of £16,000-a-week run-rate – the average store in the UK does £16,000-a-week in sales. So you’ve opened another store in the store. There’s no more fixed costs, no more rent, just the creation of some extra jobs. There’s a lot of people who want access to hot food at different times of the day. It reminds me of the Tesco revelation a few years ago that if you keep stores open 24 hours a day, you’ll sell more stuff. The demand might be low at 4am but you don’t need to sell very much given that you’ve already covered all your costs. As long as you make more money than the staff costs, then it’s financially sensible. But it’s also great for the consumer. If you’re hungry at 5am why shouldn’t you get a Domino’s pizza if you feel like it? Our challenge is planning permission because you need a licence to trade all night and communities can be nervous because they think that we’ll make a lot of noise, smell and litter. We don’t. We’re passionate about being a good neighbour.”

Propel Opinion by Paul Charity: The remarkable trading results at one of the three 24-hour Domino’s hints at the potential of the through-the-night market. During my year at an American university in a small US college town with a population of 40,000 there were six or seven restaurants that opened 24 hours a day. Even in London, there are only handful of venues that provide service through the night. From the Domino’s perspective, there is clearly potential for 60 or 70 Domino’s, in major cities and university towns, to deliver pizza profitably in the small hours.

Did you know that the 13 largest privately owned regional family regional brewers have a combined turnover of £815m? The Propel Info Hospitality Sector Turnover and Profits Blue Book ranks the 200 leading pub, restaurant and foodservice companies in the UK by turnover and profit, provides a five-year overview of performance and lists directors’ salaries. To buy a copy e-mail Jo Charity or Sharon Dickinson on or

Industry news:

Multi-site retailers bombarded with calls by suppliers in the wake of Waverley TBS collapse; speculation that administrator will not have long to sell the business: Multi-site retailers have told Propel Morning Briefing that they have been receiving lots of calls from alternative suppliers in the wake of the collapse of Waverley TBS into administration. One operator said: “I’ve had numerous phone calls from rival suppliers asking whether they can supply me.” Another operator said: “I thought Waverley lost its way a couple of years ago. I’m not a Waverley customer but I’ve been taking phone-calls from some of its competitors asking whether I have a supply problem.” Morning Briefing understands that the wine team at Waverley has been made redundant already as the administrator seeks a buyer for the business. The Times reported yesterday that Waverley had a credit shortfall of £14m, with suppliers reducing credit terms and wet summer weather hitting volumes. Reports suggest that administrators believe they have a very short time to sell the business. One observer said: “Wholesale is a confidence business and customers who have no contract and receive short deliveries are likely to look elsewhere.” Another industry source said that Booker is unlikely to bid for Waverley because it has its hands full dealing with its Makro acquisition – and will be picking up lots of customers anyway. Another industry source argued: “The value of Waverley will be dropping by the hour as customers look elsewhere for supplies. As a business its value is all about its customer list, something that will be in severe decline in the current situation.” Waverley had a turnover of £577m in 2007, which has declined to £309m by the end of its most recent financial year in 2011.

Guinness to treat pub customers like VIPs: Guinness has launched a UK promotion that treats Guinness drinkers to five star treatment on a luxury jet service - Guinness Class. Guinness drinkers in pubs across the UK will be in the running to be selected as passengers on the Guinness Class private jets, which will fly from various locations around the UK to Dublin every Friday and Saturday for a nine-week period starting today, 5 October. Guinness and stout-themed cuisine will be served aboard all flights.

Diageo seeks to carve out more aspirational market position for Baileys: Diageo is launching a new Baileys advert that celebrates “modern womanhood” and reinvents the brand as a more stylish and aspirational drink. The TV advert has been created in the style of a music video, inspired by the kaleidoscope style of 1930s Hollywood film director and choreographer Busby Berkley. It is set to the Blondie track Rapture.

Company news:

Beer writer hails Fuller’s “massive and exciting departure”: The Union Tavern in London, re-opened by Fuller’s a few months ago as London’s “finest craft beer house”, serving the best beer from the capital and craft brewers around the world, has been hailed as a “massive and exciting departure”. The pub features Fuller’s brews alongside those of microbrewers from across London and imported beers from America, Belgium and the Czech Republic. The pub also serves fresh food including home-smoked meat and fish, plus freshly made bread. One well-known beer writer, who asked to be remain anonymous, told Morning Briefing: “You wouldn’t even know it was a Fuller’s pub but it’s definitely a massive and exciting departure, a bold step in a different direction. Fuller’s beers are fantastic but there’s a lot of other exciting stuff going on in beer. The battle in retailing isn’t with other quality brews, it’s about matching the range and excitement for consumers in discovering the beer range you might find in the supermarket. It’s been executed very well – the right kind of innovation from a quality cask ale brewer.” Morning Briefing understands that Fuller’s asked British Guild of Beer Writers three-time winner of Beer Writer of the Year Ben McFarland to put the beer menu together for it. Fuller’s managing director Simon Emeny told Morning Briefing: “This is an excellent opportunity for us to showcase a wide range of Fullers brands alongside an ever changing range of beers from up and coming breweries in London and microbrewers from around the world”.

Simon Wilkinson – there were 85 written complaints the week I arrived at La Tasca: La Tasca chief executive Simon Wilkinson has reported that the company had received 85 written complaints the week he arrived to take charge at La Tasca. Now, 18 months on, La Tasca scored seventh in the CPL Training Customer Satisfaction Index, produced by Propel Info, the highest ranking for a brand with more than 60 sites and also came third in a Peach Brand Tracker survey of service. (See the separate Propel Friday Opinion for Wilkinson’s commentary on the La Tasca service journey in the past 18 months)

Steakhouse chain Gaucho reports turnover up, Ebitda down: Upmarket steakhouse chain Gaucho, which runs 14 restaurants in the UK, one in Holland, one in Lebanon and one in the United Arab Emirites, has reported turnover rose to £55,628,000 in 2011, compared to £50,646,000 the year before. However, Ebitda dropped to £10,539,000 from £11,012,000 the year before. The company paid loan note interest of £11,269,146 and other lumpy interest payments of £13,032,517 meant it made a nominal pre-tax loss of £10,295,269. A total of £50,819,945 of turnover comes from the UK, which means the company turns over around £3.6m per site.

Mitchells & Butlers shareholder ups stake: Mitchells & Butlers shareholder Elpida, which is the investment vehicle of Irish businessmen John Magnier and JP McManus, has upped its stake in Mitchells & Butlers (M&B) from 21.2 per cent to 22.47 per cent. Elpida bought just over seven million shares, which is likely to have cost £20m. It still owns less than Joe Lewis’s Piedmont vehicle, which bid for the company in September 2011. It is thought that Elpida was the main stumbling block to Piedmont’s bid for the company a year ago – and has since appointed its own representative to the board.

Cloverleaf plans another north east site: Cloverleaf, the pub restaurant brand acquired by Greene King last year, wants to open a 1,291 square metre restaurant on the Team Valley trading estate in Gateshead, offering informal meeting facilities for local firms. Jennifer Winyard, senior planner at Turley Associates which is handling the planning application on Cloverleaf’s behalf, said: “The trading estate is home to a range of leading businesses employing over 21,000 staff and it currently has no integrated meeting facilities. If permission is granted, Cloverleaf’s presence would no doubt help attract occupiers to current vacant commercial space and make it a better place to work or visit.” Gary Douglas, director of Cloverleaf Restaurants, said: “This is an important strategic location for us as part of our future expansion plans in the north east.” The brand has already opened a branch at Doxford International Business Park in Sunderland.

Costa Coffee launches “market leader” campaign: Costa Coffee has adopted a different tone in its first television advertising in two years. The new campaign, launched today, avoids comparisons with rivals in favour of demonstrating people’s passion for its coffee. The advert stars Costa baristas up to their necks in Costa coffee beans singing along to the Kiss track ‘I was made for loving you’. Kevin Hydes, Costa’s marketing director, told Marketing Week: “I felt that as we’ve become market leader it’s appropriate to adopt the tone of voice of a market leader and in our advertising be more concerned with what we do, and not worry about what are competitors are doing.” The TV campaign is backed by Costa’s biggest ever investment in digital marketing. An app that allows fans to recreate the advert with their own photo, similar to the popular festive app ‘Elf Yourself’. Costa will then pick the best 50 consumer videos and create a user generated TV ad starring Costa fans.

Pret A Manger takes on 12 apprentices: Pret A Manger is taking on 12 new apprentices in support of a campaign in London to tackle youth unemployment in the capital. The soup and sandwich firm will train the apprentices in both food preparation and customer service as part of the London Evening Standard’s Ladder for London campaign. Clive Schlee, chief executive of Pret A Manger, told The London Evening Standard: “These young people are the bedrock of Pret and of the country’s future. Pret A Manger has been helping to tackle youth unemployment through our homeless apprenticeship scheme since 2008, with a healthy retention rate of 79 per cent.” The new Pret apprentices will be paid £7.25 per hour, as well as completing further training one day a week at young people employment charity City Gateway towards an advanced NVQ qualification. Pret will also provide the dozen recruits with £100 in vouchers towards work clothes, a monthly travel card and free lunch.

Healthy eating chain Pod lines up three more openings: Pod, the healthy eating chain founded by Tim Hall, has openings lined up in Victoria, Canary Wharf and Paddington to take site numbers to 26. The new openings continue a period of rapid expansion – it had nine sites in May 2011.

Metro Inns plans fifth site as a “fightback against Wetherspoon”: Metro Inns, headed by Sean Driscoll and Gary Wood, will open its fifth site with a strong emphasis on cask ale as a “fightback against JD Wetherspoon”. The company has taken over The Masons Arms in Bury St Edmunds’ Whiting Street where there will be a £100,000 joint investment with landlord Greene King. Driscoll said: “It’s a quirky, old place and it is going to be having a major refurbishment and it’s going to become one of Bury’s premier cask ale pubs with ten hand pumps on the bar. The fight back starts here really. Although we cannot compete with Wetherspoon’s buying power, we hope to offer something a little bit different.” 

Café/wine bar hybrid to open in Lincoln: Lincoln entrepreneur Matthew Wilson is to open a café/wine bar hybrid in Lincoln. His venture, New York, on Lincoln High Street, will be an upmarket coffee shop and wine bar with an American feel. It will open from 8am until late, acting as a cafe offering snacks and drinks to eat-in or takeaway during the daytime. At around 8pm New York will turn into a wine bar providing a variety of alcoholic and non-alcoholic drinks.

JD Wetherspoon buys Sowerby Bridge pub from Punch: JD Wetherspoon has bought The Wharf in Sowerby Bridge, near Halifax, West Yorkshire from Punch Taverns off an asking price of £340,000. Wetherspoon intends to extend the property and re-open in 2013. CBRE was the agent for Punch. 

Carluccio’s and Hamilton’s set for Worcester: Worcester’s Crowngate shopping centre, owned by The Crown Estate, has signed up Worcester’s first Carluccio’s and Hamilton’s coffee bar & kitchen. Both restaurants have taken units in the shopping centre’s Chapel Walk area. The new Carluccio’s branch will be one of the only openings this autumn. Hamilton’s coffee bar & kitchen is part of the Echelon Group and owned by the husband of Atomic Kitten pop star, Natasha Hamilton, has also signed a lease.

Rex Restaurants plan soft opening at Colbert next Monday: Rex Restaurants, which operates The Wolseley and opened Brasserie Zedel earlier this year, plans a soft opening at its latest site, Colbert on the site of the former Oriel restaurant in Sloane Square, next Monday (8 October) – formal opening is on Monday 15 October. The new 6,000-metre square restaurant is billed as “a true all-day ‘grand cafe’, providing eating and grazing from breakfast through to later evening”.

Wine bar opens in Suffolk bookshop: The owner of a bookshop, Bowsers, in Woodbridge, Suffolk, has opened a wine bar on the site. The shop already runs a cafe during the day. Owner Martin Whitaker said: “I was having a drink one night and I thought ‘if you don’t like pubs where is there to go and have a quiet drink in the evening?’, especially if you are a single woman and maybe don’t feel comfortable going to a pub. There are only a handful of bookshops in the country that have something similar. We have created a friendly, warm environment and so far it has been very well received.”

Pizza Hut in the US downsizes sites and puts the emphasis on delivery: Pizza Hut in the US has made a major change in strategic direction by downsizing and remodeling sites to grab a larger share of the delivery market. Pizza Hut began developing this new model, nicknamed “Delco Lite,” about three years ago when it realised delivery—which is the way most Americans prefer to receive their pizza—wasn’t representing as much of the business as it once did. Delco (company shorthand for delivery and carry out) swaps Pizza Hut’s traditional red roofs and dining rooms for a more contemporary design that fits in to tighter places and focuses more on delivery and carry-out. Pizza Hut has opened more than 300 Delco sites. The small-format stores are still called Pizza Hut.

City Pub Company to re-launch Oxford site with X-factor competition: City Pub Company, the Enterprise Investment Scheme company headed by David Bruce and Clive Watson, is to re-launch its refurbished Oxford site with an ‘X Factor’ style talent search to celebrate its official re-launch party next week. The St Aldates Tavern has reopened following a £150,000 revamp, with the pub encouraging local one and two-piece bands to audition to be the live entertainment for customers at the opening party on 18 October. Talented musicians are asked to upload videos of themselves playing live music onto the pub’s YouTube or Facebook pages. The band that gains the most ‘likes’ will win the gig and a chance to impress the locals. The venue was operated by Pubs ‘n’ Bars which ran it until entering administration in 2009.

Ex-footballer Neville eyes chain of hotels: Former Manchester United defender Gary Neville wants to open a chain of hotels across the UK. At a hotel conference held in Manchester’s Hilton Deansgate hotel, Neville told the 500 delegates that the 140-bedroom hotel he is developing close to Manchester United’s Old Trafford ground could be the first of a string. “We’ve got to deliver a profit with the first one, but I hope we can go on and open more across the country,” he said.

Hostel operator Generator recruits Hotel Du Vin marketer: London-based hostel operator Generator has recruited Hotel du Vin marketing director Emma Benney as its head of marketing. Generator wants to move the image of hostels upmarket. Generator hopes to open two new sites next year to add to its current six in locations such as Barcelona, Berlin, Copenhagen and Venice.

Fuller’s signs up with 02 for free Wi-Fi: London brewer and retailer Fuller’s has signed a deal with O2 to provide free Wi-Fi to consumers in its managed and tenanted pubs. The deal replaces an in-house system previously only available to managed pubs. Installation has already begun and by the turn of the year, consumers in the vast majority of the company’s 385 pubs in the south of England will be able to enjoy super-fast mobile broadband service on their laptops, tablets or mobile phones. Enabling its tenants and lessees to be included in the deal was a key factor in the decision to choose O2, said tenanted operations director Mike Clist. He added: “The internet has changed the way pubs communicate with their consumers, but has also changed the way those consumers use the pub. Wi-Fi, and free Wi-Fi in particular, has become another service that pubs are increasingly expected to offer, but for many tenants it was seen as just another cost that was difficult to justify.”

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