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Morning Briefing for pub, restaurant and food wervice operators

Fri 4th Jan 2019 - Propel Friday News Briefing

Story of the Day:

Crussh converts Soho site to vegan pop-up as it explores viability of model: London-based healthy food and juice brand Crussh has turned its Soho site into a vegan store for the month. The outlet in Broadwick Street is serving an entire plant-based menu for the month, with more than 70 vegan recipes on offer. Crussh, which has 35 stores across London, said turning one store completely plant-based will allow it to see how consumers respond to a fully vegan site, and whether it may be a sustainable business model for the future. The pop-up brings nature inside with plants hanging from walls and ceilings throughout the store. The vegan store forms part of the brand’s "Powered by Plants" campaign, an initiative that see eight new vegan products launched across all Crussh's branches. Crussh's menu is already more than 45% plant-based – an increase from 22% in January 2017, currently selling more than 50 vegan products. Head of marketing Helen Harrison said: "We’re really excited to be turning our Soho store vegan for the month of January, it’s something we’ve talked about for a while and it felt like the right time to give it a go! And if people love it, there’s no reason why it couldn’t remain vegan permanently – it’s really up to our customers. One of the biggest trends we’ve seen this year is the growth in veganism and we know that moving to a more plant-based diet can have such a positive impact on both the health of individuals and the planet." Other operators have looked to take advantage of the growing vegan and vegetarian trend. This week, food-on-the-go retailer Greggs launched a vegan sausage roll while Pret A Manager now has four Veggie Pret sites, having initially launched the concept as a pop-up in Soho in June 2016.

Industry News:

Propel Multi Club Conference open for bookings, two free places for operators, Ted Kennedy to present: The first Propel Multi Club Conference of 2019 is open for bookings. The full-day event takes place on Thursday, 7 March at the Millennium Gloucester hotel in London. Ted Kennedy, owner of Pebble Hotels and veteran operator of pub assets, will set out ten key lessons learnt as an operator – and how these have been applied to making Alan Yau's Duck & Rice concept profitable. Multi-site operators of pubs, restaurants and foodservice outlets can book up to two free places by emailing Anne Steele at

Six-in-ten Brits support taxing unhealthy food and drink: Six-in-ten Brits support taxing unhealthy food and drink, according to a new study by Mintel. The research also found consumers want to be incentivised for leading a healthy lifestyle – 63% of adults would like brands to reward them, climbing to 76% of under-25s. Emma Clifford, associate director of food and drink at Mintel, said: “The UK is facing an obesity time bomb and consumers recognise decisive action is needed to combat this problem, even if it hits their pockets. More than six months after the soft drinks sugar tax was introduced and reports of a potential ‘pudding tax’ being considered, consumers are keen on the idea of taxing them in order to discourage unhealthy lifestyles. It is clear consumers really want help in cutting through all the noise around healthy lifestyles, with more guidance in making healthier choices as well as rewards for doing so.”

The Telegraph hires William Sitwell as its restaurant critic: The Telegraph has appointed William Sitwell as its new restaurant critic – and his first review is of a "plant-based" meal. Sitwell, who resigned as editor of Waitrose & Partners Food Magazine in October following comments about “killing vegans”, announced the new position on Twitter. He said he was “very happy to be joining the Telegraph as a restaurant critic, writer and commentator”. Sitwell also revealed in an exchange on Twitter his first contribution to the publication would be a review of a "plant-based" dining experience, set to be published in this weekend's Telegraph Magazine. 

Company News:

Whitbread completes £3.9bn Costa sale to Coca-Cola, reaches agreement to release coffee chain from pension fund obligations: Whitbread has announced it has completed the sale of Costa to Coca-Cola for £3.9bn and reached agreement to release the coffee chain from its pension fund obligations. Whitbread stated: "The sale proceeds have been received in cash. As previously announced on 21 December 2018, Whitbread intends to start a share buyback programme, which is likely to commence following the release of Whitbread's third-quarter trading update on 17 January. Whitbread has also reached an agreement with the trustee of Whitbread's defined benefit pension scheme, the Whitbread Group Pension Fund. The agreement will release Costa from its obligations to the pension fund and will involve a one-off contribution to the pension fund of up to £380m, which will significantly de-risk the pension fund's investment strategy. This one-off contribution will replace the previously agreed deficit recovery plan, which would have required Whitbread to make total payments of £326m to the pension fund over the next four years."

Artisan making continued losses since 2014 while lift issues exasperate 'challenging' trading at Manchester House, administrators report reveals: Artisan, the restaurant and bar in Manchester's Spinningfields that was put into administration by Living Ventures in October, had been making continuous losses since 2014, a new report has revealed. A statement of administrator's proposal filed at Companies House by joint administrators Philip Duffy, Sarah Bell and Karen Mairs, of Duff & Phelps, said the layout of the venue had contributed to the trading difficulties. The report said: "The smaller bar and cafe downstairs had the benefit of more passing trade. However, as the entrance to the restaurant led directly upstairs it was difficult to promote as it seemed most passing trade was not aware of the restaurant and the 12,000 square foot space was proving difficult to fill. Upon review of the accounts it was clear Artisan was making continuous losses since 2014." The report also revealed sister venue Manchester House Bar and Restaurant was also placed into administration by Living Ventures despite making a profit of £274,438 in its most recent financial year. It "struggled to maintain adequate sales, particularly during the week" following the departure of Michelin-starred chef Aiden Byrne in January last year to head the kitchen at D&D London’s rooftop restaurant and bar 20 Stories. The report also revealed Manchester House was "significantly disadvantaged" by the refurbishment of the lifts in the building from April. Attempts to negotiate a rent reduction or break in the rent for the period of the work, which was still ongoing when Manchester House was placed into administration, was rejected by the landlord. The restaurant was located on the second floor, with the bar area on the 12th floor. The report stated: "The works being undertaken resulted in only one lift being in operation for the entire 12 floors of the building, which also includes a number of offices. The amount of people using the one lift in operation resulted in customers of Manchester House waiting for long periods of time to gain access. This caused frustration leading to complaints, bad reviews and cancellations as customers would go to nearby competitors rather than wait for lifts or walk up the stairs. The work also coincided with a mid-year trading period that has traditionally been challenging for Manchester House." Byrne and a team of private investors have since bought the lease and the venue reopened as MCR in December. The report showed a total consideration of £50,000 was paid. Meanwhile, a buyer is still being sought for Artisan, which was opened in June 2013. Artisan has two secured creditors – Cork Street Properties and Spinningfields Investments. The former is owed £123,532 while the latter has had its debt satisfied in full, although the charge is yet to be satisfied at Companies House. Manchester House has no secured creditors. The report also showed trade and expense creditors are owed £1,146,150 and £1,479,091 by Artisan and Manchester House respectively. It is anticipated there will be insufficient funds to allow a distribution.

Carluccio's appoints Hilary Ansell as marketing director, James Backhouse moves to new Fresca project role: Carluccio’s, the Italian all-day restaurant group owned by Dubai-based investment group Landmark, has appointed Hilary Ansell as its new marketing director. Ansell, who starts her new role next month, replaces James Backhouse, who has moved into a new role as project director, overseeing a number of strategic Fresca projects requiring senior level leadership. Ansell joins from the Gordon Ramsay Group, where she was director of sales and marketing. Prior to that, she was director of marketing and food development at the Casual Dining Group where she led the rebranding of Bella Italia. Ansell has also held senior positions within The Restaurant Group and Compass. Ansell is the latest appointment to the senior team at Carluccio’s following the arrival of Graham Ford, who recently joined as commercial director from Bill's. Carluccio’s chief executive Mark Jones said: “I am delighted to secure someone of Hilary’s experience and talent to help us in our business transformation. She has a wealth of highly relevant marketing experience that will greatly aid us as we implement our £10m ‘Fresca’ refresh programme.” Ansell added: “With a full programme of refurbishment and new guest experiences planned for 2019, it’s an exciting time to be joining. I look forward to developing the brand’s marketing strategy in line with the new-style Carluccio’s.” 

Arkell's reports continued sales growth in new financial year, full-year revenue up 7.3%: Swindon-headquartered brewer and retailer Arkell’s Brewery has reported continued sales growth in its new financial year as it saw a boost in full-year revenue. Turnover was up 7.3% to £23,138,303 for the year ending 31 March 2018, compared with £21,571,698 the year before. Pre-tax profit rose to £3,296,577, compared with £3,252,871 the previous year. Profit before property disposals grew to £3,124,013, compared with £2,306,294 the year before, according to accounts filed at Companies House. A dividend of £598,000 was paid, compared with a dividend of £572,000 the previous year. It sold one site and a plot of land adjoining one of its pubs. During the period the company bought its first pub with rooms – The Priory Inn in the Cotswolds – while it started work on its first new-build pub in 15 years, at Crest Nicholson’s Tadpole Garden Village development in north Swindon, just before Christmas. In his report accompanying the accounts, chairman James Arkell said: "Turnover for the year increased by 7.3% and this result was significantly influenced by the investment made in 2017, which included buying two pubs and carrying out substantial refurbishments on four pubs in our existing estate. The combination of the World Cup and excellent weather has generated continued sales growth in the early months of this financial year."

Meatailer returns to profit following increase in turnover: MeatLiquor operator Meatailer, led by Scott Collins, has reported a return to profit following a boost in turnover. The company saw turnover increase to £14,725,000 for the year ending 24 June 2018, compared with £13,395,000 the previous year. Adjusted Ebitda was up to £933,000, compared with £703,000 the year before. It reported a pre-tax profit of £33,000, compared with a loss of £753,000 the previous year, according to accounts filed at Companies House. In his report accompanying the accounts, Collins said: "During the year, the group opened one restaurant (2017: two restaurants and one delivery kitchen) and closed one restaurant and one delivery kitchen (2017: zero). This took the total number of restaurants operated by the group as at 24 June 2018 to 11 (2017: 11 and one delivery kitchen). In November 2017, the group converted the ChickenLiquor restaurant in Brixton to MeatLiquor, which has been trading well. During the year, the group invested in a central kitchen. The group will continue to improve trading and profitability of the existing group of restaurants and look for opportunities to open further restaurants across the UK. Since the year end the company has opened a new restaurant in SW11 in London. This takes the total number of restaurants operated by the group to 12." As previously reported, the company will close its flagship restaurant, MeatLiquor W1, in February when the lease comes to an end with the building is earmarked for redevelopment. A number of potential locations nearby have been identified and negotiations are currently taking place to find a new home for the restaurant.

City District Group reports turnover boost: City District Group, which operates the five-strong Brazilian rodizio restaurant brand Fazenda, has reported turnover grew to £12,968,245 for the year ending 31 March 2018, compared with £11,454,122 the year before. The company saw pre-tax profit fall to £730,450, compared with £1,141,999 the previous year, according to accounts filed at Companies House. Gross margin was down slightly to 67%, compared with 68% the year before. During the period the company closed its experimental restaurant Bossa, which opened in Leeds in 2016 and was aimed at the lower end of the casual dining market. It also operates Picanha in Chester. In November, the company opened a Fazenda site in Birmingham. In their report accompanying the accounts, the directors stated: " Despite the challenging market conditions, the board are pleased with the performance following the year end and the successful opening of the Birmingham restaurant is encouraging and confirming the board's belief in the differentiation and attraction of the offering. The board is pursuing opportunities for further expansion if appropriate sites become available." 

Heineken to invest £1m in data-driven marketing campaigns after Star Pubs & Bars pilot leads to increased footfall and spend: Heineken is to invest £1m in data-driven marketing campaigns after a pilot in its Star Pubs & Bars estate led to increased footfall and spend. The pilot resulted in more than 125,000 pints sold, equating to £370,000 in additional sales in the test pubs. By promoting the availability of pints of Amstel, Foster’s and Strongbow on social media, digital and outdoor advertising, Heineken was able to direct more consumers into Star Pubs & Bars outlets. Three different levels of data-driven marketing were used as part of the trial. These ranged from age, gender and broader location targeting, to postcode-based and amending copy lines based on the closest pub. The most success came from the broader location targeting and Heineken said it plans to build on these learnings and continue to execute footfall-driving initiatives in 2019. Star Pubs & Bars managing director Lawson Mountstevens said: "Encouraging more consumers into our customers’ outlets, with prompts across social media and digital has proved hugely successful and is part of our strategy of 'Growing Together', supporting both ours and our customers’ businesses. The results of this pilot campaign has been incredibly positive and as a result we will be looking to roll out more campaigns, with more of our customers in the year ahead.”

Founders of Istanbul-based Yeni Lokanta to launch Soho restaurant: The founders of Istanbul-based restaurant Yeni Lokanta are heading to London. Cem Bilge and Civan Er are launching Yeni in Beak Street, Soho, on Monday, 21 January. They opened Yeni Lokanta in 2013 where Er’s menu infuses "modern sensibility with ingredients and dishes that could only come together in Istanbul", from the koftes and street food stalls of the city’s markets, to traditional meyhanes where seasonal fish and vegetables are served alongside wine and raki. Yeni will bring the original restaurant’s signature style to London. Dishes will include traditional Antep sausages with borlotti bean puree; and line-caught bass with raki and feta. Larger plates of Yeni’s oven-roasted ribs with isot pepper on sourdough with cracked wheat, sour cherries and sumac molasses and octopus with "salty fingers" will be prepared on the charcoal josper grill. Civan said: "For me, it’s exciting and humbling to be able to bring Yeni to the city where my professional journey began. Yeni looks forward to inviting London to feast on our take on Istanbul’s style."

Emilia’s Crafted Pasta to open second site, in Aldgate: London-based pasta restaurant concept Emilia’s Crafted Pasta is to open its second site, in Aldgate next month. Founder Andrew Macleod is adding to his portfolio having launched the concept in St Katharine Docks in November 2016. The new site in Alie Street will offer seven pasta dishes that Macleod has fine-tuned to pay homage to the original dishes from various regions in Italy. A bigger kitchen will allow for a revolving specials board. A short wine list will be made up of predominantly Italian vintages while there will also be a selection of Italian cocktails, craft beer and coffee. The venue will have 55 covers as well as an open kitchen and manned pasta counter at the window of the restaurant, giving 360-degree views of the handcrafted pasta being made. There will be a further 24 seats outside.

El Gato Negro operator to open new Middle Eastern concept: The operator of Manchester tapas restaurant El Gato Negro have revealed plans for a new Middle Eastern concept nearby. Mill Hill Developments has taken out a lease on the former Panama Hatty's unit in Brown Street, in the basement of the grade II-listed former Reform Club building at the top of King Street. It will open a new, as-yet unnamed, restaurant "designed and run on a similar basis [to El Gato Negro] but with an eastern Mediterranean style cuisine", documents lodged with the city council's planning department reveal. El Gato Negro chef patron and creative director Simon Shaw told the Manchester Evening News: "We're pleased to announce we will be opening our long-awaited third restaurant in Brown Street, this summer. Drawing heavily on my travels through the Middle East, diners can expect authentic flavours inspired by the various regions." El Gato Negro has a Portuguese sister restaurant, Canto in Ancoats.

Costa launches two new milk options: Costa Coffee, which has been acquired by Coca-Cola from Whitbread for £3.9bn, has launched two new milk options – lactofree and almond – in response to increased consumer demand for vegan and "free-from" products. It means Costa Coffee now offers seven milk variants in its portfolio. To mark the new drink options, Costa Coffee has launched a limited-edition hot drink for January – the vanilla latte. Costa Coffee innovations director Russell Braterman said: “We know our customers want more choice when it comes to coffee customisation and have witnessed a growing demand for ‘free-from’ and vegan options. Given the popularity of the coconut alternative drink, which we introduced last year, our lactofree and almond options are the next logical step."

Stem + Glory to make London debut this month for third site: Cambridge-based vegan restaurant Stem + Glory will open its third site this month as it makes its London debut. Founder Louise Palmer-Masterton will open the restaurant on Monday, 14 January at the Bart’s Square development in Bartholomew’s Close, central London. She said the venue would take the brand to the “next level”, serving a new menu of breakfast, brunch, fast eat in and takeaway lunch, and a new vegan evening dining concept. Palmer-Masterton added: “The backdrop to our success has been the rapid and exponential shift in attitudes towards plant-based cuisine. London has become a European hub for plant-based dining, and we are looking forward to being a part of this exciting movement in the capital.” Stem + Glory raised more than £630,000 on crowdfunding platform Crowdcube last year to open the restaurant. Palmer-Masterton launched the concept in Cambridge in October 2016 before adding a second site in the city in November 2017. 

Greene King to invest £500,000 in Belhaven Brewery visitor centre as part of 300th anniversary celebrations: Belhaven Brewery, which is owned by Greene King, is investing £500,000 in a new visitor centre to mark its 300th anniversary. The new centre, which will open in the summer, is part of a year-long programme of celebrations to mark the milestone. They include a weekend music festival at the brewery this summer and 300 days of celebrations across Belhaven and Greene King pubs. Founded in 1719 by John Johnstone, Belhaven Brewery has been brewing from its brewery in Dunbar since. It took its name Belhaven, which means "beautiful bay", from its coastal location in East Lothian. Managing director Matt Starbuck said: “John Johnstone would no doubt be delighted to see his beloved brewery today, not only the oldest working brewery in Scotland and the home of Scottish brewing but a thriving innovative business and a great Scottish success story abroad. We are continuing to invest in Belhaven with a new visitor centre opening this year bringing tourism to Dunbar.”

Australasia aparthotel brand to make UK debut with Liverpool site, plans up to ten venues by 2023: Quest Apartment Hotels, the largest aparthotel brand in Australasia, is to make its UK debut, in Liverpool – and has set its sights on further expansion in Britain. The £10m Quest Liverpool City Centre will feature a 100-bedroom serviced aparthotel in a former office block in Church Street, next to the Liverpool ONE retail complex. It will be the group’s first property outside of Australasia and will also feature a conference room and gym. By 2023, Quest aims to open between eight to ten aparthotels in the UK and is looking at Birmingham, Bristol, Leeds, Manchester, Edinburgh, Glasgow, Belfast and commercial areas of London within the M25. The group’s UK team is headed by director of UK development Andrew Weisz. Quest founder and chairman Paul Constantinou said the deal marked the realisation of a long-held dream. He told Insider Media: “For decades, we have honed the brand and the franchise business model to appeal to Australasian business travellers. This marks the beginning of an expansion of the business across international markets outside Australasia.” 

Nigeria-based hotel operator acquires first UK site, in Morecambe: Nigeria-based The Statement Hotel has acquired its first UK site. The company has bought The Clarendon Hotel in Morecambe, Lancashire, for an undisclosed amount off a guide price of £725,000 through agents Fleurets. The property, which is on the seafront, has 29 en-suite bedrooms. The Statement Hotel director Nonso Ochinanwata said: “We are delighted to have acquired The Clarendon in Morecambe. Marking our first UK hotel, The Statement Hotel has further intentions of building a broader investment portfolio in the UK market. We targeted Morecambe as a location for various reasons, however, the proposals for the new Eden project, a venue intended to draw 500,000 to a million visitors every year, was a key factor. Now the transaction has completed we will be focusing our attention on transforming The Clarendon into a destination hotel with world-class standards.” The Statement Hotel has an existing hotel and property portfolio in Nigeria.

Australian fitness franchise F45 takes London portfolio to 25 with Vauxhall site: Australian fitness franchise F45 has secured a new site in London, in Vauxhall. The deal, through agents Savills, takes the total number of F45 studios open or due to launch this year in the capital to 25. F45 has agreed a new ten-year lease for a 3,608 square foot unit in Vauxhall Arches, owned by Network Rail, in Goding Street. F45 was established in Bondi in 2013 and has since opened more than 1,200 venues across the Asia-Pacific region, the Middle East, North America and Europe. Its 100,000 members take part in team-based fitness workouts, with technology a key element of F45’s business model. The company continues to seek single level units of between 2,000 square foot and 3,300 square foot in high footfall locations close to retail and residential areas or transport hubs in Greater London and large UK cities, with Savills recently securing two sites in Bristol and Bath. Luke Armstrong, global franchise director at F45, said: “We are pleased to be continuing our expansion in London where, like in all major cities, people are time-poor but still want to have a great workout with support and encouragement from a fitness professional. This is F45’s point of difference.”

Dalata completes £91m acquisition of Aldgate hotel: Irish hotel operator Dalata has completed the acquisition of a site in Aldgate, London, for a total consideration of £91m. The company announced in August its intention to buy the entire issued share capital of Hintergard from Aldgate Hotel Holdco, an investment vehicle of an international private equity real estate investor. Hintergard owns the 300-year leasehold interest of the hotel. The hotel, which will be branded Clayton Hotel Aldgate London, is expected to open at the end of this month. It will have 212 bedrooms, with a restaurant, bar and access to a fitness centre.

Manchester Gin to open city centre distillery with bar and restaurant: Gin brand Manchester Gin has secured six grade II-listed railway arches in Manchester city centre with plans to open a distillery, bar and restaurant. The site lies beneath Manchester Central Convention Complex in Watson Street. Three of the six arches will have floor-to-ceiling windows, allowing passers-by to see gin being distilled. The venue will also host tutorials, talks and masterclasses. Manchester Gin hopes to upgrade to a 1,000-litre still in the 5,300 square foot space, a giant leap from the brand’s beginnings in a dining room with a 60-litre still. Manchester-based Up North Architects will design the space, while the project will create at least 30 jobs. Manchester Gin co-founder Seb Heeley told Manchester Evening News: “The arches under Manchester Central will be the perfect mix of the old industrial heritage of Manchester with a contemporary look synonymous with our brand.” Shaun Hinds, chief executive of Manchester Central, which was converted from the former railway station, said: “Since joining the business 18 months ago, I’ve been looking for the right opportunity to activate our arches and reinvigorate this part of the venue. In getting to know Seb and Jen from Manchester Gin, I have been impressed with their vision for their business, which in many ways matches the ambition of Manchester Central and the city as a whole.” Manchester Gin distillery is due to open in the summer.

Pipers Crisps wins ‘best savoury snack’ for seventh year running: Pipers Crisps, stocked by a range of sector operators, has been voted Britain’s best brand of savoury snack for the seventh year running. The Lincolnshire-based premium crisp-maker, which is to be acquired by PepsiCo, subject to Competition and Markets Authority approval, topped the poll in an annual survey of speciality food products on sale in UK delicatessens, farm shops and food halls. Marketing manager Katy Hamblin said: “For us, it’s an important accolade to win because it’s voted for by the retailers themselves; our own customers. It shows we’re not only doing the right things, but we’re also doing them right. We provide a consistently high-quality product, exceptional customer service and great distribution – these benefits are clearly valued by our loyal independent retailers and their customers.”

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