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Thu 14th Nov 2013 - Busabi Eathai, multi-site management, VAT campaign, Punch

Story of the Day:

Propel and Professor Christian Edger launch multi-site management masterclass: Propel has partnered Professor Christian Edger to launch an industry first – a multi-site management masterclass. A leading authority, Professor Edger is the author of two major books on multi-unit leadership. He teaches multi-site managers at Birmingham City University and was formerly human resources director at Mitchells & Butlers until 2010. The one-day masterclass, to be held on Thursday 9 January, will provide insights on the skills required for effective multi-site management. Professor Edger’s seminar, which will include input from industry leaders, looks at how the UK’s most admired companies operate multi-site units effectively and what winners do and losers don’t. The seminar also examines the essential practices of effective multi-site managers and how successful multi-site companies accelerate the development of multi-site managers. Paul Charity, managing director of Propel, said: “Our masterclass will provide, for the first time in the sector, an intensive overview of the key skills and attributes required for effective multi-site management – and a perspective on how the best companies out-perform through effective multi-site organisation. The seminar is ideal for founders of small and medium-sized companies to add to their knowledge base. It is also a very time-effective way for larger companies to develop their multi-site managers.” Tickets are £295 for ALMR members and £345 for non-ALMR members. To book or find out more e-mail The event will be held at Tanner & Co, 50 Bermondsey Street, London.

Industry News:

Monster and Kopparberg join industry VAT campaign: VAT Club Jacques Borel has recruited two worldwide drinks brands to its campaign for a reduction on the level of VAT in the hospitality sector – both Kopparberg and Monster have joined the campaign. The news comes shortly after leading drinks company Matthew Clark joined the VAT Club. Jacques Borel said: “The campaign is continuing to attract high profile members. Both Monster and Kopparberg are excellent additions to the roster of companies who are supporting this important campaign. They each understand the benefits of a thriving hospitality sector and the benefits that a reduction in VAT to 5% will bring. Their inclusion within the VAT Club strengthens our position and highlights the importance of the campaign.” Monster vice president, Europe, Middle East and Africa, Alan Clark, said: “Monster Energy is delighted to support the VAT Club in this crucial campaign.” Kopparberg owner, Peter Bronsman, added: “We are pleased to support the campaign to reduce the level of VAT in the UK hospitality sector. The recent tax parity day showed how much support there is for a reduction in the level of VAT amongst publicans and their customers.”

US brewer hails the power of Facebook: Anheuser-Busch says Facebook now beats any US broadcast network in terms of consumer reach when marketing brands such as Budweiser and Bud Light, with one key driver: rapid smartphone uptake. Lucas Herscovici, VP of digital marketing at Anheuser-Busch, part of AB-InBev, argued that digital surpassed TV this year for the first time, in terms of time spent on the platforms by consumers. “We are moving from targeting males 21-35 with a single TV ad to being able to deliver different pieces of content to very specific audiences,” Herscovici said. “We view mobile as the first screen.”
Busaba Eathai trials new QR code technology: The next generation of easier-on-the-eye QR codes have been trialed at Busaba Eathai, the Thai chain founded by Alan Yau. Known as Aestheticodes, the initiative has evolved out of a joint project between designers and computer scientists at Nottingham University’s Horizon Digital Economy Research institute and takes its name from the new technology it has created. Aestheticodes aims to revolutionise embedded computer codes that allow the user to access more content digitally via their smart device. It designs visually beautiful images and encodes them, resulting in the same interactivity of a QR code, while offering a more engaging experience.

Company News: 

Punch wins national recognition for tenant support: Punch Taverns has been recognised for its innovative business approach at this year’s National Business Awards. Punch won the Business Enabler of the Year Award for its Punch Foundation Tenancy (PFT) lease agreement, a fully supported way for new entrants to get into the pub trade. Punch was one of ten innovative businesses across different sectors nominated as national finalists from the hundreds of businesses that entered. National Business Awards judge Charles Ward, the former chief operating officer of Intellect UK, praised the Burton-based pub company for its PFT model, saying: “The traditional pub trade is suffering from a similar malaise to high street retail. Failure rates are alarming, so the Punch Franchise Tenancy model is a true innovation in supporting pub entrepreneurs to buck the trend through up-skilling managers and encouraging differentiation.” Andy Slee, Punch’s external affairs director, said: “We are delighted to win this year’s Business Enabler award. This is hugely important for us, to be recognised for all of our support we give our licensees and those entering into this challenging industry. This year, we have introduced a number of initiatives, such as the Punch Foundation Tenancy, to get our licensees off to the best start while continuing to support them throughout their journey with us. The Punch Foundation Tenancy Agreement has fundamentally changed the way we work with our licensees. We are on track to have 200 of these agreements by the end of 2014.”

Cains Brewery redevelopment set to be green-lighted by planning officers: Plans to redevelop Cains Brewery’s site into a visitor destination which could generate 800 new jobs for Liverpool are set to get the go-ahead. The Dusanj brothers, owners of Cains, want to create a Brewery Village for the site with a new craft brewery and visitor centre as well as a hotel, cinema, food store, designer retail market, apartments and multi-storey car park. At the same time, the construction company Henry Boot is believed to be on board for the proposal to turn the brewery site into a leisure and tourism destination. Planning officers at Liverpool City Council have recommended the approval of planning permission for the £50m project. The scheme was first unveiled earlier this year and a hybrid application was been submitted seeking full permission for the revamp of the Grade-II listed brewery building as well as outline permission for further development. The historic brewery building was described by planning officers as “one of the finest examples of a purpose-built brewery in Britain”. A report prepared ahead of the meeting said Henry Boot “will potentially” partner the applicants. Sudarghara Dusanj said he was in early talks with Henry Boot over a joint venture which would see the group bring funding as well as construction expertise. A council document prepared before the planning meeting on November 19 shows the Dusanjs, applying as Brewery Village Ltd, have been let off £800,000 in section 106 payments. The contributions, which legally oblige developers to pay for infrastructure works and public realm improvements, should have been £1.2m, but have been reduced to £400,000 after Brewery Village said the sum threatened the viability of the scheme.

St Austell multi-site operator wins Pub of the Year award – for the third time: John Milan and Steve Bellman, who operate five St Austell pubs, have won the title of Pub of the Year in the Cornwall Tourism Awards for their The Pandora Inn at Restronguet, near Falmouth. It is the third year running that the Pandora has won the award, winning it in 2010, 2012 and now 2013. The ‘missing’ year was when the pub was almost destroyed by fire, making the three wins even more significant for Milan and Bellman. Milan said: “The team at the Pandora Inn, led by managers Catherine and Lester Croft and chef Tom Milby, all work incredibly hard to maintain the high standards for food and service that we have set ourselves. To win for a third time is amazing. They absolutely deserve it, and we’re very proud.”

Luke Johnson – PizzaExpress is the perfect business: Sector investor Luke Johnson has described PizzaExpress as the perfect business. He said: “If you want a perfect business, PizzaExpress is pretty close. If the ingredients for a margarita cost 50p, I’d be surprised – but it sells for £7.25. You don’t need large kitchen facilities for pizza.” Add in pizza’s broad appeal, from children to couples, and it produces a very strong business model, he added.
Yummy Pub Company opens cake and cocktail bar: Yummy Pub Company, the four-strong operator led by Tim Foster and Anthony Pender, has opened a basement cocktail and cocktail bar at its Somers Town Coffee House in North London after a £100,000 joint investment with landlord Charles Wells. The basement venue is licensed until 3am. The move to expand the Somers Town site downstairs comes as Yummy copes with demand. It is rumoured to be selling more cask ale at the Somers Town than Fuller’s nearby Parcel Yard site in Kings Cross, which is selling 1,000 barrels a year.

Costa Coffee to enter Moroccan market: Costa Coffee has entered into a franchise agreement with Fawaz A Alhokair & Co with the aim of opening the first Costa Coffee store in Casablanca in early 2014. Andy Marshall, managing director of Costa Coffee International Franchise, said: “Costa is a truly global brand that is enjoyed by customers all over the world. It’s great news that we’re extending our reach into Morocco, which is an exciting market where there is already an established coffee culture. We believe it is the right time for Costa to offer our unique Mocha Italia blend and quality handcrafted coffee to coffee lovers in Morocco, and we envisage a significant store opening programme over the coming years.”

Mayfair nightclub faces closure over licensing conditions: A £2m nightclub in Mayfair, the Aura Club, in St James Street, faces closure after 20 tough licensing conditions its owner claims will make it unviable. Westminster City Council has said the club has become a focus of “crime and disorder” and a “particular cause of drunkenness” is that spirits are left on the table so clients can “drink direct from the bottle”. Councillors said customers would in future have to drink from plastic cups. It also banned music being played after 3am and ordered that the venue’s doors be shut to punters at midnight. Club owner Alberto Barbieri said the conditions risked the closure of the club, wasting a £2m investment.
Pentahotel opens in Warrington with Pentalounge: A 102-bedroom Pentahotel has opened in Warrington, Lancashire, the company’s second UK opening . It is targeting five sites initially. The company says the hotel’s “chilled beats, colourful lighting and exquisite design by Italian star architect Mattheo Thun is more reminiscent of a cool club than a hotel lobby”. Its “Pentalounge” is a “restaurant, bar, chill-out area and meeting point all in one”.

Harry Ramsden’s to open at Welcome Break: The fish and chip shop chain Harry Ramsden’s is to open at two Welcome Break sites. The first open on Wednesday 11 December at Welcome Break Woodall, located on the M1 near Sheffield, between junctions 30 and 31. A second Harry Ramsden’s restaurant will also open at Welcome Break’s Oxford Services, at Junction 8a on the M40, early in 2014. The opening of the two outlets will create up to 20 new full and part time jobs. Both restaurants will open at 6am daily. Chief executive Joe Teixeira said: “Welcome Break presents an exciting opportunity for us, as it is our firm intention to make Harry Ramsden’s more accessible to the myriad of fans it has built up over 85 years. We view the opening of these two new outlets as the next step in making that ambition a reality. I believe these new restaurants, situated within great facilities which attract millions of visitors each year, will be welcomed by existing customers, as well as affording us the opportunity to introduce the brand to a new generation.” Harry Ramsden’s currently operates 26 outlets across the country. Its strategy will see an increase in the number of company-owned outlets, while interest in the company’s new franchising model is expected to result in up to 250 franchised outlets opening within the next five years.

McDonald’s franchisee to close Dewsbury town centre site: McDonald’s franchisee Pritpal Singh is to close his site in Dewsbury town centre in Yorkshire after 26 years in the town. It will shut on November 30. Andrew Hutchinson, vice-chairman of Dewsbury Chamber of Trade and deputy chairman of Dewsbury Town Team, said: “I am genuinely at a loss to explain this. You never hear of a McDonald’s closing down and it always seems busy when you pass by. It’s just depressing really.” Singh, who owns a large number of McDonald’s restaurants across Yorkshire including Huddersfield, said: “I can assure you this decision was not taken lightly. However, it has become apparent in recent years that trading patterns in Dewsbury have changed.”

Prezzo and Frankie & Benny’s line up for Newquay’s old bus station: Prezzo and The Restaurant Group’s Frankie & Benny’s brand are lined up to open in Newquay’s old bus station development in Cornwall next summer. Landowner Monmouth Properties was granted full planning permission in August to construct three eateries at the old bus station site on East Street. The identity of the third chain is yet to be announced, although Nando’s has previously been linked to the development. Prezzo said it was “in solicitors’ hands” to take unit 1 at the site and, if agreed, the aim would be to open around summer 2014, though timing is not definite. The restaurant would cater for 80 diners, employ approximately 20 staff and would represent a £500,000 investment in the town, it said. Chief executive Jonathan Kaye said: “We are keen to open a Prezzo Italian restaurant in Newquay and believe that it would prove popular with people of all ages and be an asset to the town’s social scene.”

Antic London backer looks to invest up to £30m in pub sector: Downing, the investment trust that has built a 29-strong freehold London pub portfolio with Antic London and has a number of other pub investments, is looking to invest up to £30m in the pub sector in the next 12 to 24 months. Steve Kenee of Downing said: “Downing is looking to build long-term partnerships with high quality operators with whom we can make serial investments.” In a recent Propel Friday opinion article, he said: “Entry prices prior to the start of the credit crunch only made financial sense if they were funded by an unsustainable combination of rising markets and cheap bank debt. Without significant underlying capital appreciation, if you’re paying 12-14x Ebitda for a business, you’re simply not making a good return. However, once the banks retrenched, prices started to fall and they are now at much more sensible and attractive levels. Stockbrokers will be the first to tell you that no one gets rich by investing at the top of the market: the same is true of our industry.”

Whitbread in £9.5m investment in Exeter: Whitbread will open a new Brewers Fayre pub restaurant and Premier Inn hotel in Exeter next Monday (18 November), injecting a total investment of more than £9.5 million into the local economy. The restaurant will offer a “pub classic” menu and the adjoining Premier Inn will feature 102 bedrooms. The development creates 75 jobs.

Intertain to make £500,000 investment in Lincoln site: Intertain is investing £500,000 in its Walkabout bar on Lincoln High Street with a re-opening scheduled for next Thursday (21 November). Once completed, the venue will boast new additions such as the “Reef Bar”, where split screens will project under-sea footage and beach action. The new layout will have two VIP pool table areas in the “sporting and chill-out zone” upstairs. In addition, new seating areas will aim to create an “al fresco” atmosphere. The new menu will offer snacks, main meals and party platters with a 50% discount on “Aussie food and drink” between 5pm and 7pm, Monday to Friday.

Nando’s links crisps product with live music: Nando’s is launching an on-pack promotion with its new Peri Peri Groove Cut Potato Chips, offering fans the chance to win gig tickets every day for 12 weeks. The latest promotion aims to support the launch of the new-look range and help drive sales in the lead up to Christmas. The range of crisps under licence from Nando’s is produced by All About Food. James Beaumont, marketing manager at All About Food, said: “Given the product name and the popularity of music with this target audience, it’s a well-suited partnership.”

TCG unveils plan to drive coffee sales: The managed pub and bar group TCG is looking to boost its hot drinks sales with the launch of three new seasonal specials later this month and the roll-out of barista training to its pub and bar teams, with the help of its coffee partner Cafeology. The new drinks, two flavoured coffees and one hot chocolate, will be available in 40 TCG sites. The drinks, created exclusively for TCG by Cafeology, are Black Forest Mocha (espresso coffee blended with hot chocolate and a shot of cherry syrup); Hazelnut Latte (latte coffee with a shot of hazelnut syrup); and Henry’s Hot Chocolate Orange (hot chocolate with a shot of blood orange syrup, topped with whipped cream and fresh chocolate and orange shavings). At the same time, TCG is boosting the coffee skills of its pub and bar teams with a barista training programme. Staff attend an intensive day of training at Cafeology’s roastery, receiving lessons in coffee product knowledge as well as hands-on instruction in how to recalibrate coffee grinds, make and present the different styles of coffee, as well as having the opportunity to roast their own beans. These “coffee champions” are then charged with delivering training to their colleagues back in their own pub or bar and helping to train teams in other nearby sites. Chief operating officer Nigel Wright said: “The out-of-home coffee market is growing fast, but is also very competitive. We want to make the hot drinks in our pubs and bars as good as or better than the offer in specialist coffee bars and the combination of trained baristas and appealing new seasonal hot drinks will help us achieve that goal.”
Burger and Lobster takes £150,000-a-year Fitzrovia site: Shelley Sandzer, the property agent has secured the sixth site for Burger and Lobster, in Fitzrovia, central London. The site, at 6 Little Portland Street, was previously the ORA restaurant. Burger and Lobster has taken a new lease at £155,000 a year on the 3,500 sq ft restaurant, which is expected to open in February 2014. The group currently has sites in Mayfair, Soho, Farringdon, the City and at Harvey Nichols in Kensington. Nick Weir, at Shelley Sandzer, said: “Burger and Lobster has been one of the capital’s big successes of recent years. It quickly established a great reputation and big following and each venue has traded extremely well. This latest location in Fitzrovia is well-placed to attract a strong following and we expect it to be busy from the start.” Burger and Lobster opened its first restaurant in Clarges Street in Mayfair last year. It has a no reservations policy, which has regularly seen people queuing for over an hour at each of its restaurants. It serves burgers, lobsters and lobster rolls, with a variety of cocktails and a good wine list.
Dish boss hails Business Enterprise Fund for backing restaurant’s expansion: Eddy Nuttall, who owns Dish, the dining room and cocktail bar that moved into the premises in Boar Lane, Leeds formerly occupied by Anthony’s in the summer, has praised the Business Enterprise Fund for enabling his expansion. The Anthony’s empire, run by chef Anthony Flinn, collapsed in June, and Nuttall immediately moved to secure its Boar Lane premises. It was, he said, “such a sought-after location it was attracting a huge amount of interest and I knew I had to move quickly to access the funding to secure a deposit. When the banks turned me away in 2012, BEF offered its support and Dish was launched last October. In ten months we became so successful and so busy that we had to move into new premises to cope with demand. I turned to BEF again and they quickly provided the funds that facilitated the deposit I needed on the new property.” Nuttall has kept the original Dish restaurant in Millennium Square, which is now Harry’s Bar and Brasserie. If it had been down to the banks, Dish wouldn’t have got off the ground. Less than 12 months on, we’ve expanded and the organisation that believed in us and made it happen was BEF.” The Business Expansion Fund, based in Bradford, is financed by the European Union, and set up to lend money to small business who cannot get finance from banks. Its director, Stephen Waud, said Dish was a prime example of the sort of business needing help. He said: “In less than 12 months of opening the restaurant doors, Eddy demonstrated incredible tenacity and business acumen that meant his business naturally grew. BEF gave him the initial support to get Dish off the ground and we were delighted to help facilitate his expansion through the loan to move into new premises.”
Domino’s relaunches app for android: Domino’s UK has relaunched its Android app with an array of new features and functionality, to try to ensure ordering for Android users is as quick, easy and user-friendly as possible. It replaces the existing Domino’s Android app to ensure that Android users are able to access the new improved mobile ordering that iOS and Windows Domino’s customers have enjoyed over the past year. The app combines the best UI experience from other Domino’s mobile platforms with the Android platform and Domino’s brand guidelines, making it very easy, the company says, for Android users to navigate through the app. Developed by Future Platforms, the new Android app, designed for Jelly Bean and above, has been built using Kirin, a bespoke cross-platform development framework, developed in-house by Future Platforms. The same platform was used to build the relaunched Domino’s iOS (iPhone and iPad) and Windows Phone apps, which were introduced earlier this year. 
Flinn returns to Leeds in Tetley brewery bar/restaurant venture: Leeds’ best-known chef, Anthony Flinn, is helping set up a bar and restaurant venture based at the 1930s former Tetley Brewery headquarters in the city that is set to open later this month. The venture, called Bar & Kitchen, is part of the plan by Project Space Leeds to develop a modern art gallery in the former Tetley Brewery buildings, to be called The Tetley. Bar & Kitchen will see diners eating in the formal rooms once used by generations of Tetley’s directors, including the boardroom, which retains much of its original furniture, while paintings of former chairmen still hang on the oak-panelled walls. Profits from Bar & Kitchen will be invested back into The Tetley to support the artistic and educational programmes to be based at the building. Flinn, whose four restaurant and bar outlets in Leeds closed in June, is acting as a specialist adviser to The Tetley through his new venture Darkside Consultants. The ground floor Bar & Kitchen will seat 87 in the bar area and 65 in the dining room, which is located close to the newly created galleries and exhibition displays. Pippa Hale, at director at The Tetley, said: “When The Tetley opens, we hope that everyone who comes will be as inspired and nourished by their experience of the Bar & Kitchen, as they will by the contemporary art exhibitions and installations. We have spent many months researching and planning for what we want to be a relaxed kind of place where everyone will be welcome and we are looking forward to the public of Leeds enjoying for the first time this wonderful building which has been given a very special new lease of life.” Bar & Kitchen at The Tetley opens on November 29.
Gourmet Burger Kitchen reports turnover increase: Gourmet Burger Kitchen, the better burger offer owned by Nando’s has reported a 4.1% rise in turnover to £40.7m in the year to 24 February. The company achieved a 57.5% increase in profit before restaurant opening costs, cost of fundamental reorganisation and interest of £1.62m. Gourmet Burger Kitchen, reported a profit on ordinary activities of £160,000, a turnaround from a loss of £685,000 the year before. It opened two new restaurants taking the total to 57. Gourmet Burger Kitchen booked an impairment charge of £468,000. Net debt stands at £18m.
Wetherspoon buys Crowborough site: JD Wetherspoon has bought The Crowborough Cross, a substantial public house owned by Punch Taverns in Crowborough, East Sussex (population: 20,000) that has been closed for sometime. Nick Earee, from the Brighton office of property agent Fleurets, which handled the sale, acting on behalf of Punch Taverns, said: “After a local and nationwide marketing campaign and over 20 viewings, the property then went to ‘best and final’ offers. Terms were then agreed with JD Wetherspoon.” Eddie Gershon, a spokesman at Wetherspoon, said: “We are delighted to have exchanged contracts to purchase the Crowborough Cross. We have been keen to open a pub in the town for a number of years and are pleased that this has now happened. There is no on-site or opening dates at present as the property will be substantially refurbished, which will be subject to securing planning and licensing consents.”

Combined cafe and bike shop opens in York: Your Bike Shed, a combined cafe and bike shop, has now held its official opening in Micklegate, York. The operation, founded by Martin Harman, 40, describes itself as “an exciting new place where cycling and café culture meet in one relaxed and friendly environment. It’s about being able to get your bike fixed or serviced, pick up a spare part or simply hang out with like-minded people and share your experiences in a bike-friendly setting. It’s also about providing a fantastic cup of coffee, together with tasty and nutritious food sourced locally wherever possible.” The Bicycle Shed Cafe sells breakfasts, snacks, sandwiches, jacket potatoes and soups. 
Douglas Jack – we’d be adding Fuller’s shares: Numis Securities analyst Douglas Jack has issued an “Add” recommendation on Fullers shares, with a price target of 950p, ahead of its results next Friday (22 November). He said: “We are forecasting H1 profit before tax of £18.0m (H1 2013: £17.1m), driven by a material increase in managed like-for-like sales. We upgraded forecasts in July and believe the risk to forecasts remains on the upside. About half of Fuller’s pubs are in London, with the other half in southern England. The London market is very strong, aided by inbound tourist expenditure in London being up 12.4% between January and June. In such a healthy market, demand is gravitating to differentiated, premium products, which is where Fuller’s is both positioned and extending its range. With net debt down 4% (or £5.4m) in Q1 alone (net debt/Ebitda is 2.5x), it is clear that Fuller’s has the cash flow, balance sheet, brand quality and operational track record to enhance earnings through being more expansive. Low gearing, combined with the highest asset quality and the best operational track record in the sub-sector, justifies Fuller’s premium rating, in our view.”
Douglas Jack – Enterprise Inns set for flat 2014 without LFL net income growth: Numis Securities leisure analyst Douglas Jack has issued an “Add” recommendation on Enterprise Inns with a target price of 170p for its shares but warned that price growth is linked to like-for-like net income growth. He said: “After two years in which the shares have risen 390% and earnings have fallen 20%, commentators may start valuing Enterprise on NAV [net asset value] relative to the UK property sector (despite the differences in political risk, regulation and licensing constraints). In reality, if LFL net income growth does not materialise, the shares are likely to have a flat year in 2014E, in our view”.

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