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Morning Briefing for pub, restaurant and food wervice operators

Wed 18th Jan 2017 - Update: JD Wetherspoon and ETM Group trading, Bistrot Pierre loyalty app and rebrand, Deliveroo jobs
JD Wetherspoon reports like-for-likes increase 3.2%: JD Wetherspoon has reported like-for-like sales increased by 3.2% in the first 12 weeks of its second quarter to 15 January 2017, with total sales up 0.7% in the period. In the year to date (25 weeks to 15 January 2017), like-for-like sales increased by 3.4% and total sales rose by 1.6%. The company stated: We expect the operating margin (before any exceptional items) for the half year ending 22 January 2017 to be about 8.0%, 1.7% higher than the same period last year. The company has opened two new pubs since the start of the financial year and has sold 21. We intend to open ten to 15 pubs in the current financial year. We have now sold the majority of those pubs that had been put on the market in 2016, with a remaining small number which is either ‘under offer’ and going through the sales process or being marketed by our agents. The company remains in a sound financial position. Net debt at the end of this financial year is currently expected to be about £50m higher than the level at the last financial year end, partly as a result of the purchase of an increased number of freehold reversions. Chairman Tim Martin said: “In recent weeks, I have been asked frequently by the media to comment on the difference between the apocalyptic predictions by most economists for the economy and the actual outcome, following the referendum. The Bank of England’s chief economist Andy Haldane called these predictions a ‘Michael Fish’ moment for economists, but his comments demonstrate a deep misunderstanding of the situation. Michael Fish’s predictions were a misinterpretation of data on one evening, under great time pressure. In contrast, the majority of economists, economic institutions, politicians and intellectuals has consistently misunderstood the implications of the euro, its predecessor the exchange rate mechanism and the implications of leaving the EU, over a period of about 30 years. The underlying reason for their catastrophically poor judgement is a semi-religious belief in a new type of political and economic system, represented by the EU, which lacks both proper democratic institutions and the basic ingredient for a successful currency – a government. It also lacks any genuine commitment to free trade, other than to countries which are in, or on the borders of, the EU. Unless these lessons are learned and acknowledged by economists, their historic mistakes will be repeated. As regards the other frequently asked question about the government’s stance on dealing with the EU, the golden rule in any negotiations, ignored by David Cameron, is the willingness to walk away. Most people now understand that the mutual imposition of World Trade Organisation (WTO) tariffs would create a windfall for the UK, so a sensible basic mantra for the UK is ‘free trade or WTO rules – the EU can choose’. As previously indicated, the company anticipates significantly higher costs in the second half of the financial year. On an annualised basis, these are expected to rise by about 4% for wages, by £7m for business rates and by £2m for the Apprenticeship Levy, in addition to cost increases at around the level of inflation in other areas. As previously announced, the company intends to increase the level of capital investment in existing pubs from £34m in 2015/16 to about £60m in the current year. In view of these additional costs and our expectation that like-for-like sales will be lower in the next six months, the company remains cautious about the second half of the year. Nevertheless, as a result of modestly better-than-expected year-to-date sales, we currently anticipate a slightly improved trading outcome for the current financial year, compared with our expectations at the last update.”
Bistrot Pierre launches loyalty app and major rebrand: Bistrot Pierre, the restaurant group backed by private equity firm Livingbridge, has developed a bespoke loyalty scheme and launched a major rebrand. The company has introduced Mon Pierre Rewards, whereby customers collect points with purchases that are redeemed for rewards. The new loyalty programme can be accessed via a downloadable app or plastic card – the reward scheme offers eight points for every pound spent. Head of marketing Arpita Anstey said: “Bistrot Pierre has been offering great value French cuisine for more than 20 years. Mon Pierre Rewards will help us to learn more about the dining preferences of our customers. We have worked hard over the years to grow a loyal customer base across all of our bistrots and we would like to reward them for their continued support as well as those who visit less frequently. The scheme has been developed to benefit all spend at Bistrot Pierre, no matter how big or small and customers will earn points every time they visit.” Vicky Luke, digital marketing manager at Bistrot Pierre, added: “The app we have developed with Zonal is available to download from the Apple Store or Google Play. Our customers can check their points balance and redeem rewards such as complimentary drinks, starters, desserts and one and two course meals using the dedicated QR code in the app. They can also view our menus, book a table and leave feedback through the app. For customers who don’t have a smart phone we will have a plastic card alternative which will carry their QR code.” Co-founder Robert Beacham said: “We recognised that some of our customers do not want to carry loyalty cards, so combining loyalty with an app seemed an obvious solution. Our app has been built around the customer, it not only rewards them as they spend, but also makes it easy for them to interact with us on many levels. We believe Mon Pierre Rewards offers something to our customers that they can’t experience anywhere else.” The app coincides with a recent rebrand for the group that incorporates a refreshed logo and change of name. It has dropped the “Le” from Bistrot Pierre from the brand name and introduced contemporary branding with a modern feel. Arpita said: “As we are going through a period of significant growth, we recognised we needed to clearly define the brand proposition and personality of Bistrot Pierre, which is vital as we continue to grow in a competitive market. We worked with Blacksheep design agency on our rebrand who really understand the core of the Bistrot Pierre offer and have helped us refine our marketing communications as we continue to grow.” Bistrot Pierre was founded in 1994 by Beacham and childhood friend John Whitehead. It currently has 17 bistrots across the UK in Altrincham, Bath, Birmingham, Cardiff, Derby, Harrogate, Ilkley, Leicester, Leamington Spa, Newport, Nottingham, Sheffield, Stockton Heath, Stratford, Plymouth, Torquay and Weston-super-Mare.

ETM Group reports December like-for-likes up 6%: ETM Group, the 13-strong gastro-pub operator led by brothers Ed and Tom Martin, has reported December like-for-likes sales were up 6% on the previous year as it saw a 23% growth in sales during the month. The company said the openings of Burdock in October and Aviary in December had exceeded forecasts with ETM Group experiencing its most successful New Year’s Eve on record at Aviary. Ed Martin said: “We are extremely pleased with the group’s performance – despite tough trading conditions we have delivered positive like-for-like growth. Much of the success of December can be attributed to our dedicated sales team who played a vital role over the festive period and the collaborative relationship we enjoy as food and beverage partner to Montcalm Luxury Hotels, where four of our venues sit across two properties – Aviary and Burdock at Royal London House and the Jugged Hare and Chiswell Street Dining Rooms at The Brewery London City. We have just opened our restaurant, pub and sports lounge, Greenwood, at Victoria’s new Nova development and recently strengthened our management team, both of which will further drive the group’s performance.”
Deliveroo to create 300 new technology jobs: Deliveroo is planning to create 300 technology jobs at its new London headquarters, trebling its current engineering headcount. The company plans to hire the software and hardware engineers at its office in Canon Street this summer to work on technology such as the Deliveroo app and logistics systems. Deliveroo, which operates in 12 countries and employs more than 1,000 people full time, said it would hire experts in behavioural economics, machine learning and data analysis. The new recruits will join a 125-employee strong team that has built the tech to date and is headed by former executives from Facebook, Twitter, Netflix and Groupon. The announcement comes after a period of dramatic growth for the company in which its orders grew 650% in 2016. Deliveroo works with more than 8,000 local restaurants in the UK and 20,000 around the world, according to its latest figures. Its services are available in 75 cities across the country where thousands of delivery people are employed. Founder and chief executive Will Shu said: “London is where I founded this company and it’s from our headquarters here that we export our British-born technology around the world. When so many success stories in the on-demand economy have been grown from America, I am particularly proud to be doing this here in Britain.” Deliveroo is seen as one of Britain’s most promising technology start-ups and is one of a handful of “unicorns” to be valued at more than $1bn (£810m).

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