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Morning Briefing for pub, restaurant and food wervice operators

Thu 19th Dec 2013 - Propel Thursday News Briefing

Story of the Day:

Chipotle applies knowledge to “fast casual” pizza start-up: Chipotle Mexican Grill, the most successful fast casual start-up of the last two decades, has been secretly helping develop a “fast casual” pizza concept called Pizzeria Locale that delivers a pizza in less than two minutes and applies Chipotle learnings to the pizza category. Pizzeria Locale, which was started in Denver, Colorado as a traditional pizzeria two years ago by restaurateurs Bobby Stuckey and Lachlan Mackinnon-Patterson, is now looking for outlets numbers two and three in Denver. The menu includes ten classic pizzas, four American classics, or customer-created combinations from an interactive service line. The pizzas are then fired in a high-temperature pizza oven that bakes them in less than two minutes. Individual 11-inch pizzas cost $6.50. Steve Ells, founder of Chipotle, said he had known Stuckey and Mackinnon-Patterson for years, and felt that the Pizzeria Locale concept was “the perfect opportunity to collaborate”. Ells said: “When I walked in, I thought, Oh my gosh, what if they did this in a Chipotle format?” Chipotle spent 18 months helping the pizzeria adapt to a faster format with a rotating oven and affordable ingredients. The new Pizzeria Locale launched in May. Ells added: “We realised we could change the ways people think about pizza. How we can serve the same ingredients at half the price.” Mackinnon-Patterson said: “Opening Pizzeria Locale using a model similar to Chipotle allows us to make extraordinary pizza, made with high-quality ingredients accessible to everyone. Through this partnership, we can continue to run Pizzeria Locale with the same energy and passion we’ve always had, but can also look to Chipotle to help with some of the challenges that can become distracting for a restaurateur.”

Industry News:

Vince Cable supports zero hours contracts: Business Secretary Vince Cable has given his backing to zero hours contracts because they offer “welcome flexibility” to some workers. However, Cable has launched a 12-week consultation that will consider banning companies from imposing “exclusivity contracts” that offer no guarantee of a job and stop staff working for another firm. He said: “Employers need flexible workforces and people should have the choice in how they work. But this shouldn’t be at the expense of fairness.”

SABMiller chairman Mackay dies: The chairman of SABMiller, Graham Mackay, died peacefully yesterday morning, with his family at his side. The board has appointed acting chairman John Manser as chairman with immediate effect, and has appointed Guy Elliott as senior independent director in succession to Manser. On behalf of the board of SABMiller, Manser said: “Our thoughts and prayers are with Graham’s wife and family. Graham was one of the most inspirational and successful leaders in international business by any measure. Everyone in the SABMiller family has been blessed by his vision, his loyalty, and his friendship during his 35 years with the group. He will be deeply missed. The board has every confidence that under Alan Clark’s leadership, we will continue to build on Graham’s legacy, and fulfil his vision to make SABMiller the most admired company in the global beer industry.” To allow for a period of familiarisation and handover, SABMiller said, Manser will defer his previously expected retirement date for approximately one year, to July 2015.

Activist investor presses the case for Darden Restaurants break-up: An activist hedge fund has launched a strong attack on the management at Darden, owner of the American restaurant chains Olive Garden and Red Lobster, as it pursues a campaign for the company to split. An investor group led by Barington Capital has published a critique of five years of what it calls value destruction, producing a litany of complaints, from failed acquisitions to poor menu choices.

Whole Food Market lifts US target from 1,000 sites to 1,200: Whole Food Market, the company with eight sites in the UK, has lifted its forecast for US store growth to 1,200 locations from 1,000. Co-chief executive John Mackey said: “The market continues to grow. We are thinking internally that we could do maybe 1,200 stores in the United States at this point just because the world is continuing to change.”

Restaurant gift voucher company hits £1m sales in first year: The Restaurant Choice Gift Voucher has marked its first year-end with sales in excess of £1m. Early customers include the likes of the Grass Roots Group which was one of the first agencies to offer Restaurant Choice to clients as part of its employee and customer loyalty programmes and as a way to say “thank you, have a meal on us”. Jenny Cuthbert, director of The Restaurant Choice, said: “Reaching the £1m mark within 12 months of launch illustrates just how popular dining experiences are. Our gift voucher can be spent in more than 1,000 restaurants across the UK including Nando’s, Jamie’s Italian, YO! Sushi, PizzaExpress and Café Rouge. Recipients love the choice – whether they want a ‘family’ experience; a romantic and sophisticated meal for two; or a great night out with friends, our gift voucher offers it all.”

Coldplay perform at pub Christmas party: Coldplay performed at the Ring O Bells pub Christmas party in Compton Martin, Somerset on Monday night. Coldplay were joined by Lewis Watson, Royal Blood, Conor Maynard, Chas ‘n’ Dave and Becky Hill, much to the surprise of the village. The gig, organised by Miles Leonard, a local resident and chairman of Coldplay’s record company, Warner Bros/Parlophone, was a staff Christmas party.

Price rises may have prompted fall in US craft beer sales: Price rises in craft beers at American bars and restaurants may have led to the reported sharp decline in volumes this autumn. A report by the American research firm Restaurant Sciences said that like-for-like craft beer sales at restaurants and bars fell an average of 6% during September, October, and November. While craft beer sales for the period were down 4% at casual dining restaurants, bars, and nightclubs, sales at family dining establishments were down 13%. Restaurant Sciences’ chief executive, Chuck Ellis, said: “Consumers may be balking at price increases in the 3% to 7% range this autumn across restaurants, bars, and nightclubs.”

Company News:

Costa Coffee to launch sleeker Marlow machine in offices, universities and hospitals: Costa Coffee intends to drive its Costa Express business with a new, smaller and more attractive coffee machine called “Marlow”, to grab the attention of coffee lovers in locations such as offices, universities and hospitals. The company has a target of 6,000 machines in the UK by 2018. Jim Slater, managing director of Costa Enterprises, told an investor conference that the current machine “is fantastic in the forecourt arena. It’s big, it’s red, it’s conspicuous, it generates impulse purchase at petrol stations, but it’s just a bit too big, red and conspicuous for an office.” According to the research group Allegra Strategies, consumers are drinking twice as many cups of coffee in the workplace as in coffee shops, while Costa has put the UK market at around 20,000 possible machines. The new machine, costing £13,000, broadly in line with its predecessor, can produce 240 different drinks (versus 32 currently) and has a sleeker design, courtesy of Italian design specialist Pininfarina, famous for designing cars such as the Ferrari Berlinetta. The machine’s control screen was developed by gaming specialist Atomhawk, which helped create Pottermore, the interactive site for Harry Potter fans, while customers will also smell coffee and hear coffee shop sounds mixed by eMixpro, a firm more used to working with the likes of U2 and Katy Perry. Costa already has nearly 30 of the new machines on trial in Britain, France, Denmark and the UAE as it tries to grow its international business as well.

Wetherspoon to open motorway pub next month: JD Wetherspoon will open its first motorway service station pub at the M40 Beaconsfield services on Tuesday 21 January. The pub will be called The Hope and Champion and bar staff will be paid the company’s Band Seven exceptional rate of £6.70 an hour plus up to 19% bonus.

Founder of first tandoori house in Surrey closes his last restaurant: The owner of a mini-empire of Indian outlets in Surrey which began with the county’s first tandoori outlet in 1967 is closing the last of his restaurants on Christmas eve after 46 years in the business. Mohammed Fazlul Haque, 72, from Ashtead, said it has been a difficult decision but he wanted to focus on other projects and spend time with his grandchildren. He opened his first restaurant, the Curry House, in Epsom in 1967 after spotting there were no tandoori restaurants in Surrey, despite the growing popularity of Indian cooking in the UK. He opened a second branch in Ewell in 1975, and then the Ashtead Curry House in 1980. Only the Ashtead outlet survives. Celebrities who have eaten in Mr Haque’s restaurants include the newsreader Sir Trevor McDonald, the actor Oliver Reed, the television presenter and singer Des O’Connor and the drug dealer turned author Howard Marks.

Greene King wins planning consent for second Cloverleaf in Scotland: Greene King has obtained planning consent for its second Cloverleaf restaurant in Scotland. The application for a restaurant on the Dunsinane Industrial Estate in Dundee, which will create 59 jobs, was approved by a majority of three, despite being originally recommended for refusal. The proposed restaurant and bar, which will have 372 covers, will also include three specially constructed staff flats, which “encourage pride in the business”. The proposal, which is subject to conditions, had been scheduled for refusal as it contravenes two planning policies. However, the strength of the company’s previous work and the opportunity for job creation, both in the restaurant itself and during its construction, eventually won the day. The company’s first Scottish site, Linwood Farm, opened at Phoenix Park, Linwood, Renfrewshire in October. The brand is also called Farmhouse inn by Greene King.

PizzaExpress stresses local links in refurbishments: PizzaExpress is stressing local community links in its current refurbishments. The refurbished West Wickham outlet in Bromley, South East London has paid tribute to the prolific Beckenham film producer Betty Box. The store’s makeover has been inspired by her work, using curved text, fret-cut screens and pendants, in references to her style. Hanging on the walls of the restaurant are two rare photographs of Box on set with the stars from her films. The refurbished Cheltenham site restaurant has design inspired by composer Gustav Holst, who was educated at Cheltenham Grammar School, now known as Pate’s Grammar School. Each area of the restaurant contains paintings of planets as well as Cheltenham landmarks. PizzaExpress said: “We are proud of our policy to have decor that celebrates local places or individuals. It’s not just the bog standard design, it’s paying something back to the community. It’s becoming a terrific talking point for the people who have visited.”

BBPA declares surplus: The British Beer and Pub Association (BBPA) has declared a surplus in the year to 30 September. The trade body reported revenue of £2.19m, down 3% on 2012’s £2.26m, with a surplus of £278,000, a turnaround from a deficit in 2012 of £17,700. There was an operating loss of £491,000 and £146,000 of reorganisation costs but income from investments and other sources of income created the surplus. The BBPA has reserves of £8.07m

Hotcha adds ninth site: Hotcha, the UK’s only Chinese takeaway chain, has opened a ninth site, this time in-store in Yate Shopping Centre, Gloucestershire. James Liang, founder of Hotcha, which is based in the South-West of England, said: “The opening of the Yate branch marks the end of an outstanding year for the company. I am confident it will be as successful as the others stores have been, and will be a real springboard into a successful and ambitious new year for Hotcha.” Hotcha has a central kitchen in Ashton Vale, Bristol, and positions itself as the “healthy” alternative to the standard Chinese takeaway meal.

Warrens Bakery unveils new brand identity: Warrens Bakery, which calls itself the “oldest Cornish pasty maker in the world” and which has 50 sites in Cornwall and Devon, has unveiled a brand identity at its store in Paignton. Mark Sullivan, Warrens Bakery’s chairman, said: “Paignton has always been a very important location for us – it’s very much a year-round local bakery as well as a seasonal business – and it made sense to roll out our new look here. This ‘new’ image is a classic look, focusing on the history of the company in the West Country as well as Paignton itself. We’ve already seen a significant increase in sales compared to last year and many people who may have walked by before are now coming in and trying our range of new products.”

Pay drops in 2013 for Enterprise executive directors: The earnings of executive directors at Enterprise Inns fell in 2013. Chief executive Ted Tuppen earned £1.024m including pension and benefits, down 1.16% compared to £1.159m in 2012. His base salary stayed the same at £640,000 but his actual bonus dropped to £192,000 from £329,000 the year before. Chief operating officer Simon Townsend earned £620,000 including pensions and benefits, down from £695,000 the year before. His base salary stayed the same at £384,000 but his bonus was reduced to £111,000 from £186,000 the year prior. Finance director Neil Smith saw his earnings drop to £581,000 from £651,000 the year before. His base salary rose by £5,000 to £355,000 but his bonus dipped to £110,000 from £187,000. The company’s annual report indicates that the new chief executive, Simon Townsend, can earn as much as £1.751m in 2014, and finance director Neil Smith can earn £1.433m in fixed pay, annual bonus and long-term incentives if they hit the top end of performance targets. In 2014 the number of executive directors on the board will drop from three to two. Susan Murray, chairman of the Enterprise remuneration committee, said: “On 18 November 2013, Ted Tuppen gave 12 months’ notice to the board of his intention to retire. Since a successor has been appointed, the board has decided that he will retire as chief executive officer on 6 February 2014 after the AGM on that day, allowing Simon Townsend to take over the role from that date. Ted will continue as an employee until at least 19 May 2014, or later at the request of the board, and will be engaged in, among other things, the orderly handover to the newly appointed chief executive and matters arising in relation to the government consultation into pub companies. He will be paid salary, benefits and pension in lieu of notice for any period after he leaves employment until 18 November 2014. He will be eligible for a pro–rata bonus for the period from 1 October 2013 up until the date he leaves the company and this will be based on personal objectives and EPS, subject to achieving the threshold EPS target set in the bonus plan for 2014.”

No bonuses for Marston’s executive directors: Marston’s three executive directors, chief executive Ralph Findlay, finance director Andrew Andrea and the head of inns and taverns, Peter Dalzell, failed to earn bonuses in 2013, the annual report reveals. Findlay’s earnings dropped to £636,000 from £815,000 in 2012, when he earned a £192,000 bonus. Andrea earned £386,000, down from £482,000 in 2012, when he earned a £120,000 bonus. Dalzell’s earnings rose to £590,000 from £450,000 the year before because of a pension-related benefit of £301,000.

Ex-Red Hot Buffet manager opens international cuisine rival: The general manager of the Manchester branch of Red Hot World Buffet since it opened in 2011 has now started his own “international cuisine” restaurant in nearby Oldham. Sandeep Manhas opened the 60-cover Neighbour’s Chef in a former pub on Ripponden Road, after an investment of £50,000, and plans to roll out more. The restaurant’s à la carte menu features dishes from India, China, Thailand, Italy, Great Britain and the United States. Manhas, who spent five years working at Red Hot World Buffet’s outlets in Nottingham and Milton Keynes before being appointed general manager of the Manchester branch, said: “I felt that Oldham was the ideal choice as it has such a great community feel, hence our choice of name, and it’s a fantastic place to do business. There are no other restaurants serving this type of food in the area, meaning that we can offer the people of Oldham a unique dining experience where they can taste a host of culinary treats from around the world, all in one sitting. I think that it’s very important to bring something different to Greater Manchester that isn’t necessarily a high street brand, a place with delicious food that feels homely and welcoming and that people regard as a social hub.” Talking about his expansion plans, involving opening more restaurants around Greater Manchester, Manhas said: “I’m truly excited to see what the future holds for us. We’ve had great feedback from our customers so far. They have praised the high quality of the food and the restaurant’s relaxed atmosphere.”

Brunning & Price opens fourth pub of 2014: Brunning & Price, The Restaurant Group’s gastro-pub division, has opened its fourth site of 2014, the Grade II-listed Worsley Old Hall, in Worsley, near Salford, Greater Manchester, which has undergone a five month refurbishment. Landlord David Green said: “It is a truly extraordinary building with some six wings which have been added over the centuries. Many later additions have covered up interesting original features, but we have stripped these away to reveal more of the historic character of the hall”.

Cafe-bar opens flagship branch in Media City: Pokusevski’s Deli and Cafe, based in Heaton Moor, Stockport, has opened a flagship branch in Media City, Manchester. The cafe-bar chain, which also runs a concession at Northern Lawn Tennis Club in Didsbury, has taken a 25-year lease on a 1,300 sq ft property. Founder Zoran Pokusevski said: “For the last ten years we have steadily grown our business and our brand in Heaton Moor and South Manchester. Now it is time to expand into new areas. MediaCityUK is a really exciting place to be opening for business. The new space is bigger than anything we’ve operated before, but I am confident that our philosophy and approach will attract customers just as it has done before.” Mark Robinson, property executive for MediaCityUK, said: “We are now home to over 8,000 people, so we’re always looking to attract businesses that can bring an added dimension to our ever-evolving city. Pokusevski’s is a brand with a great track record that offers something a little bit different, and we are delighted they‘ve chosen MediaCityUK.” Pokusevski’s was advised on the lease by Jean Walker, SME business services partner at SAS Daniels. Pokusevski, a former chemical engineer, launched the business in 2003.

Condou plans cocktail bar and restaurant: Pierre Condou, the man behind some of the best-known restaurants, bars and clubs in London, including Paramount in Centre Point and Century in Shaftesbury Avenue, is planning to open a cocktail bar and restaurant with a “low-down and dirty vibe” in the capital’s West End next year. It will be an all-day drinking and dining venue with a likely 30 to 40 covers inside and a further 100 covers outdoors in a large courtyard. The venue is due to open in the spring, but the name, the exact location and cuisine remain a secret at this stage.

Wendy’s bills drive-through customers using electronic toll-collecting system: Five Wendy’s restaurants in New York are taking money from drive-through customers via the electronic tag system normally used by drivers for paying tolls on highways and bridges and in tunnels. Customers sign up with a company called iDriveThru and link their credit, debit or prepaid card to their electronic toll tag, called an E-ZPass. When going through the drive-through, the tag’s data is read by sensors, and customers are greeted by a personalised message on the video above the drive-through’s intercom. Payment is taken automatically and frequent customers can earn reward points for every dollar spent. An electronic receipt is automatically sent to the customer’s smartphone, which reduces the chances of fraud through theft of the E-ZPass device. E-ZPass has about 25 million registered users.

McMullen welcomes seven to 25-year club: McMullen, the family brewer based in Hertford, has welcomed seven new members to its 25 Year Club, bringing the total experience of all the club’s members to 1,141 years. There are now 38 members in the 25 Year Club, which honours all McMullen employees who have dedicated 25 years of service or more to the brewery. The longest serving employee is family member John McMullen, who has worked for the brewery for 60 years, and currently serves as a non-executive director. The seven new members who became part of the club this month are Lew Miller (IT manager), Joceline Mills (tenancy administrator), Simon Kimpton (drayman), David Williamson (drayman), Samantha Barlett (secretary to surveyors), and Peter Shadbolt and Andrew Newbury (property director). New members are traditionally presented with a watch or item of jewellery to mark their contribution to the company. Fergus McMullen, production and sales director at McMullen, said: “We are very proud to have such long-serving members of staff, who are truly dedicated to McMullen. We don’t view ourselves as a company, but rather as an extended family, with each member bringing a wealth of experience and passion to their individual roles.”

Global Star reports small profit increase: The Birmingham-based wholesaler and pub operator Global Star has reported a small increase in profit. Turnover fell 8%to £9.11m in the year to 28 February from £11.1m the year before. Pre-tax profit rose to £164,000 from £143,000 the year before. An interim dividend of £90,000 was paid.

Middlesbrough nightclub comes on the market: Spensleys Emporium in Middlesbrough, a landmark North East bar and night club, has come to the market with agent Christie + Co at an asking price of £500,000. The overall capacity of the property is for 450 customers arranged over three floors and three separate trading areas. Mark Worley, an associate director at Christie + Co, said: “This large Grade II Listed town centre building has been privately owned by the same family for many years and generates a significant turnover which has been maintained throughout the economic downturn.” 

Kensington Place turns private dining room into pop-up restaurant: The Notting Hill brasserie Kensington Place, owned by D&D London, is turning its private dining room into a pop-up “fast fish food” restaurant called FISHBone in February. The restaurant said on its website that FISHBone “will be a unique fish and seafood spin on ‘gourmet fast-food’, a small and intimate pop up space that will combine English eccentricity and a retro diner feel.” The menu will offer a range of “fast-fish” dishes created by head chef Dan Loftin, including “scallopdog” with brown shrimp and cucumber vierge; yellowfin tuna burger with sesame, soy and radish; pulled skate with beurre noisette and capers; salmon doner with pitta, cucumber and yoghurt; “prawnish pasties”; and crab bahjis. Diners will apparently sit at a communal table for 36 and food will be served on trays. The “pared-back” drinks list will include English white wine sangria, hot and cold sake; and a “small selection of British beers and spirits”. FISHBone will be open Tuesdays to Saturdays.

Robinson’s tenants sign up for apprenticeship scheme: Robinson’s brewery in Stockport has signed up 20 tenants eager to have training for their staff to its Apprenticeship PLUS programme in the first 50 days of the scheme. In total the company has signed up 50 applicants to the scheme, which has been developed with other Greater Manchester regional brewers, restaurant and pub operators to deal with worries about the current Apprenticeship scheme by adding additional qualifications in customer service and wine knowledge, as well as giving every apprentice their APLH (personal licence). Beverley Ashton, Robinson’s consultant training and development manager, said: “We’re off to an incredible start. In just under two months we have filled almost half of our expected 130 places and the exceptional demand for the programme continues to grow.” Robinson’s director of marketing, David Bremner, said: “What makes me really pleased about this is that we are engaging tenanted pubs initially and gaining success. With a managed business, arguably, it would be easier to hit numbers quickly as there can be more of a ‘tell’ approach. But we have worked with about 20 tenants so far who see the benefit of having funded training for aspiring members of staff through which they also achieve the mandatory training in health and safety and food hygiene.” Robinson’s has initially launched five different apprenticeships for bar and kitchen staff, supervisors and managers, and it sees this as the start of a programme which would allow people who want a career in hospitality to progress onto higher-level apprenticeships, ultimately leading to degree equivalent qualifications. Bremner said: “I’ve admired what the legal profession has done in Greater Manchester, giving promising A-level students an alternative to being £50,000 in debt by the end of university by taking them through a similar programme and paying them instead, with the added benefit of higher staff retention.” The programme, funded through the Greater Manchester Chamber of Commerce Employer Ownership of Skills Pilot (EOS), is open to any pub, bar, hotel or restaurant in the North West of England, not just Robinson’s. Hospitality employers in the region who have a member of staff of any age, working an average of 30 hours a week or more who might be interested should e-mail

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