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Fri 31st Jan 2020 - Propel Friday News Briefing

Story of the Day:

Roadchef eyes two new F&B brands for estate in 2020 as it looks to rival quality at airports and train stations: Roadchef chief executive Mark Fox has told Propel the company is set to add two brands this year to its offering to ensure the company’s motorway service areas (MSAs) are no longer seen as a poor relation to airports and railway stations. Fox said: “Roadchef has great operations but needs new concepts to continue the solid growth it has achieved during the past 15 years. When we talk to a brand, 90% are interested as we have the footfall. We’re hopeful we’ll land two more brands this year. We can tell them 1.5 million people will pass by their outlet. What we’re looking at is differentiating the offer such as bringing in exclusives with the likes of Leon. Two more trials will be fired up as we continue to innovate. We were the first to bring in branded coffee with Costa. It’s all about testing new ways to deliver customer wants rather than customer needs. We’re catching up with airports and rail. Costa and McDonald’s will continue to be the bedrock and we’ll add brands such as Leon. It was a cookie-cutter approach in the past but now we better understand the customer and look to tailor the offer site by site.” Regarding Roadchef’s only in-house brand, Fresh Food Café, Fox said: “We’ll play with it so it creates its own character.” Last year, 613 million vehicles drove past Roadchef’s sites with about 7% turning in. Conversion has been growing at 1% to 2%, as has the level of spend. Fox has managed to halve the number of people who stop at Roadchef but spend nothing – simply using the toilets – to 20%. Of the 80% of visitors who spend more than a penny, the food and beverage offer takes in 50% while retail accounts for the other half. Under Fox’s leadership, expectations are for growth of between 5% and 10% annually. Last year the growth rate hit 5.5% on both a revenue and Ebit basis. Fox said Antin Infrastructure Partners had invested between £75m and £100m in Roadchef’s 30 sites since it acquired the company for £153m in 2014. Our full interview with Mark Fox will appear in the next edition of Propel Quarterly magazine, which is due to be published in March. To order a free copy, email

Industry News:

Propel Multi Club Conference open for bookings, Tim Martin talks to Paul Charity, two free places for operators: The first Propel Multi Club Conference of 2020 is open for bookings. The full-day event takes place on Thursday, 5 March at the Millennium Gloucester hotel in London. Tim Martin, chairman and founder of JD Wetherspoon, will talk to Propel managing director Paul Charity about the realities of success in the pub trade and business. Multi-site operators of pubs, restaurants and foodservice outlets can book up to two free places by emailing Anne Steele at

Environment Bill ‘must not burden sector with additional costs’: UKHospitality chief executive Kate Nicholls has said the government’s new Environment Bill must not undermine work the sector is already carrying out or burden it with significant additional costs. She said: “Our sector has worked proactively to cut waste, promote recycling and tackle environmental issues – and will continue to do so. Voluntary measures have already worked to remove huge amounts of single-use plastic and we’re working on measures to reduce carbon emissions for our sector. Any new measures need to take into consideration possible cost increases, of which consumers will need to be made aware. Whatever the government proposes, it’s important such measures don’t undermine the work we’re already doing or, worse, pile on significant additional costs.” Ahead of the bill being published, business secretary Andrea Leadsom promised to build a “stronger, greener United Kingdom and back business to the hilt”.

Occupancy softens in London hotels: Hotels in London saw occupancy soften in the final quarter of 2019 to 84.8%, although room rates increased almost 2% to £159.53, according to new research. The UK Hotel Market Tracker, produced by HVS London, AlixPartners and STR, reported revpar growth in the capital of 0.9%, to £135.25. The UK’s regional hotels saw revpar fall in the quarter, down 2.7% to £50.73, and occupancy down marginally to 73.6%, while room rates fell 2.1% to £68.94. “Softening occupancy will be a concern in London, particularly given the high number of hotel projects in the pipeline, although the fact room rates have risen almost 2% is encouraging,” said HVS chairman Russell Kett. “Any improvement in yields will take longer to reach provincial hotels but they should start to see some change as we move through 2020. However, the active hotel pipeline, currently at 6% of supply outside London, will continue to prove challenging as it will in the capital.” With greater political certainty coming from the general election, transaction volumes in London saw an increase in the fourth quarter to £1.5bn, although transactions in the regions were down 38% to £2.2bn. Investors are expected to be cautiously optimistic about a resurgence in transaction activity. Kett added: “The recent UK election result and the ensuing Brexit decision is likely to make the UK more attractive to many investors. This is likely to have a more immediate impact on transaction yields in London during 2020, although any improvement may be tempered by the pipeline of luxury hotels in inner London.”

Customers want ‘more technology-led hospitality experiences’ and are ‘unsatisfied with current solutions’: Customers want more technology-led experiences when visiting hospitality venues, according to new research by mobile order and pay solution Wi5. Its Mobile Order & Pay 2020 report, which analyses customer opinions of the current state of mobile technology within hospitality, showed only 36% of under-45s were satisfied with current technology solutions. More than two-thirds (71%) of under-45s believe technology can improve the general dining experience, but 64% branded current technology options disappointing. Meanwhile, almost three-quarters (73%) of 18 to 34-year-olds said they usually chose to go somewhere else rather than wait in a long queue at a cafe or fast food restaurant. Almost three-fifths (58%) of under-45s would order more in a fast food or casual dining restaurant if it was easy to order on mobile. Meanwhile, 71% of all respondents who regularly use mobile ordering would be “very likely” to share a good dining experience with friends, compared with only 41% of those who don’t use it. Wi5 chief marketing and strategy officer Gavin Peters said: “2020 is set to be a breakthrough year in mobile order and pay in the hospitality sector. Our analysis shows customers are frustrated by long queues and delays and are increasingly looking to modern technology for the solution.”

Company News:

Gater to launch all-day dining concept Abatha Bistro & Bar: Coal Grill & Bar founder and former chief executive John Gater is set to return to the sector with new all-day restaurant and bar concept Abatha, Propel has learned. It’s understood Olefant Inns, which Gater is a director in, will open the first Abatha Bistro & Bar at the former Zizzi site in Victoria Road, Surbiton. The concept was previously linked to the former Giraffe site at The Oracle shopping centre in Reading. Gater also built the 16-strong Ma Potter’s chain, which he sold to Tragus for £14.15m in 2007. Later that year he founded Coal under the Charterhouse Leisure umbrella. By 2016 the nine-strong brand was backed by Beringea and Octopus Capital, with James Horler as chairman and considering its funding options. Gater left Coal at the end of 2017. By May 2018, Coal had been acquired by Sunshine Capital. It went through a restructure earlier this year that left the business with four sites – in Bristol, Exeter, Gloucester Quays and Basingstoke.

Wagamama introduces enhanced maternity and adoption policy: Wagamama has introduced an enhanced maternity and adoption policy that will make the company “one of the best in the industry when it comes to providing for colleagues who take time out to start or grow a family”. Under the new initiative, staff who have worked at The Restaurant Group-owned brand for at least 12 months will be entitled to 13 weeks full pay, 13 weeks half pay and a further 16 weeks of statutory maternity pay. The company already offers two weeks of paternity leave at full pay. In 2019, Wagamama’s gender pay gap results revealed a mean of minus 6.9% and a median of minus 17.7% in favour of women, which it said illustrated the business was already “well ahead in addressing the remuneration challenges women routinely face in working life”. The company said the latest move to enhance maternity and adoption benefits reflected a “commitment to ensuring women don’t have to choose between having a family and achieving their potential in work”. Wagamama chief executive Emma Woods said: “I am a mum of four so the impossible choice between family and work is one I’ve battled with throughout my career. I’m deeply proud we’re clearing away the obstacles preventing our female team members from realising their potential because our growth has been fuelled by their commitment. It’s only right we have their backs just as they’ve had, and continue to have, ours.”

Hickory’s reports Ebitda boost as full-year turnover hits £26m: American-style smokehouse and barbecue brand Hickory’s Smokehouse, which is backed by Piper, reported turnover increased 21.5% to £26m for the year ending 30 April 2019, compared with £21.4m the previous year. Group Ebitda before pre-opening and exceptional costs was up 31% to £2.1m, compared with £1.6m the year before. Pre-tax losses stood at £510,000, compared with a loss of £333,000 the previous year. Propel understands trading has continued strongly since April 2019 and the new sites are performing well. Earlier this month Hickory’s secured a £13m funding package from alternative lender ThinCats to accelerate its expansion plans. The company, which was founded by Neil McDonnell in Chester in 2010, opened two restaurants during the period, in Worcester and Gresty Green. It currently operates 11 sites in the north west and Midlands with the next site due to open in Wilmslow this spring after the company took the lease of the Boddington Arms, which was previously operated by Mitchells & Butlers. Hickory’s will also open its first new-build, in Staffordshire, this year. Managing director John Welsh said: “We’ve had another busy and productive year at Hickory’s and are very pleased this is reflected in the latest accounts. With our new funding package in place our hunt for new sites continues apace as we actively seek freehold and leasehold sites. We’ve been extremely encouraged by the response we’ve had from potential partners and look forward to bringing the Hickory’s experience to a number of new communities in the near future.”

All Bar One launches virtual delivery brand Halo Kitchen: All Bar One, owned by Mitchells & Butlers (M&B), has launched its first virtual delivery brand Halo Kitchen, Propel has learned. Available through Deliveroo and about one-third of All Bar One’s 57 sites, Halo Kitchen offers dishes from the brand’s Veganuary and wellness menus. The brand will also be used as an opportunity to trial new dishes. All Bar One operations director Alex Dawson told Propel: “This is an exciting time for All Bar One. We’ve been working with Deliveroo for some time but this opportunity is one we couldn’t ignore. We have seen changing trends in our business with guests expressing a desire for health and wellness products. We were lucky enough to launch Beyond Meat’s plant-based burger in October 2018 ahead of the ‘vegan pack’, which highlighted our intention to deliver high-street firsts. Halo Kitchen is another step in that journey.” In November, M&B chief executive Phil Urban said the company would look at making better use of delivery, with the potential for further virtual brands. Urban said the company had a lot of unused kitchen space at certain times of the day and was exploring how to exploit that opportunity. He said: “We already have three delivery-only brands operating out of a kitchen in London and will look at that opportunity further. Customers are more interested in what they’re eating than what kitchen it came out of.”

Cosmo returns to expansion trail as it secures three sites, seeks five more for 2020: All-you-can-eat brand Cosmo has returned to the expansion trail after securing three sites, while it is seeking a further five for 2020. Cosmo will open its 20th site, at Liverpool ONE, with one each in Glasgow and Dublin planned for later this year. The company has agreed a new 15-year lease for an 11,128 square foot restaurant at the Liverpool shopping centre, which will be the brand’s first site in the city. In Glasgow, Cosmo will open in the new St Enoch Centre leisure quarter alongside Vue cinema and other restaurants. This year will mark the brand’s first openings since 2017, when it launched in Hammerson’s Westquay development in Southampton. Cosmo, which was founded in 2003, is working with agent Savills as it embarks on its expansion plan. Savills leisure director Carlene Hughes said: “Consumer demand for Asian cuisine is at an all-time high so, in spite of the headwinds within the wider food and beverage sector, Cosmo has been able to stand out from the crowd.”

Rosa’s Thai to make Birmingham debut at Paradise development: TriSpan-backed Rosa’s Thai Café will add to its fledgling regional estate with an opening in Birmingham. The company will launch a site at the new Paradise development this year alongside Dishoom and Vinoteca. Propel understands healthy fast food brand Leon is also in talks to open at the development. Following launches in Liverpool and Leeds, Rosa’s will open its third regional site – at the former Handmade Burger Co site in Manchester’s Deansgate this spring. The company, which is led by Gavin Adair, opened its 18th site at the end of 2019 at the former Bill’s site in Northcote Road, Clapham. Saiphin and Alex Moore opened the first permanent Rosa’s Thai Cafe in London in 2008. It has grown to 15 venues in the capital. Thomas Rose, of P-Three, acts for Rosa’s.

Non-alcoholic beer saves Fuller’s from January blues: Fuller’s, the premium pubs and hotels business, has said an increased range of non-alcoholic drinks protected it from the usual January drop in sales, despite an uptick in the number of people going teetotal for the month. Chief executive Simon Emeny told City AM: “We have traded really well in January. We have seen more people do Dry January and still seen people come out. The range of non and low-alcohol choices in our pubs is really good. In the past, January was a nightmare.” Meanwhile Emeny is looking forward to a surge in sales as the Six Nations rugby tournament kicks off on Saturday (1 February). He added: “It is so exciting. It feels like the beginning of spring.” Emeny was talking after Fuller’s reported like-for-like sales in its managed division were up 4.3% for the six weeks encompassing Christmas and New Year. For the 42 weeks to 18 January 2020, like-for-like sales in managed pubs and hotels rose 2.5%. However, tenanted like-for-like profits were down 3% in the period.

Whistle Punks targets City site: Axe-throwing operator Whistle Punks has lined up an opening in the City of London, Propel has learned. The four-strong company, which is backed by Edition Capital, is believed to be in talks to take space at 1 Finsbury Avenue for what would be its debut central London site. The company opened its latest site in November at the former Panache nightclub in All Saints Street, Bristol. Jools Whitehorn and John Nimmons launched Whistle Punks in 2016. Its other sites are in Birmingham, Manchester and London’s Vauxhall. Last year the company secured £1.5m of new investment from Edition Capital that will enable the business to expand across the UK as the popularity of alternative sports and experiential leisure continues to rise. It also appointed former Carluccio’s operations director Chris Poole as head of operations late last year.

Cocotte secures fourth London site, in Queen’s Park: Healthy rotisserie chicken concept Cocotte has secured a fourth site in London, Propel has learned. The company, which will open a third site in Parson’s Green in March, has secured the former Kitchen 79 site in Salusbury Road, Queen’s Park, for an opening this year. The group’s 50-cover restaurant in Parson’s Green will open in New Kings Road offering a new breakfast menu featuring organic coffee and a fresh juice bar. Additions to the main menu will include cheese and charcuterie boards, with all dishes available to eat in or take away. Cocotte focuses on free-range chicken marinated in herbs and spices for 24 hours before being cooked on a rotisserie spit. Chef Romain Bourrillon, who has worked in a number of Michelin-starred restaurants, launched Cocotte in Notting Hill in April 2016, opening a second site, in Shoreditch, two years later. Cocotte also operates delivery-only kitchens in Battersea and Islington. Jake Bernstone, of Stonebrook London, acted on behalf of the vendor on the Queen’s Park deal. Marc Rogers, of MKR Property, acted for Cocotte.

Bakkavor shutters last sector site: Bakkavor, the international manufacturer of fresh prepared foods, has closed its remaining site in the sector, competitive socialising concept Rebound in Wandsworth, Propel has learned. The site was previously operated under Bakkavor’s Pizza Storm brand before converting to the bar concept in early 2019. Earlier this month Propel revealed Bakkavor had closed both remaining Pizza Storm sites, in Nottingham and Newcastle. The company entered the restaurant sector in 2015 by launching two concepts – Inferno Pizza and Ashby’s. The idea was both would highlight Bakkavor’s range of products in a restaurant environment while exploring new routes to market for the business. The value-led Ashby’s, which launched in Lowestoft High Street in early 2015, didn’t last out the year. Inferno, following a name change to Pizza Storm, grew to a three-strong entity.

Cyrus Todiwala leaves Leicester venture: Cyrus Todiwala has left Tandem – his first restaurant outside London. The venue at Highcross Leicester shopping centre was launched as a joint project between the chef and Leicester-based Raphael Hospitality. The Tandem team said the restaurant, which opened in October, would offer a diverse menu different to other Indian restaurants, pulling on Goan and Portuguese influences. However, Todiwala told Leicestershire Live he had left after becoming “disillusioned and disappointed”. He said: “Tandem, which I envisaged to be a shining star in the Midlands, sadly left me disillusioned and disappointed at the direction it was taking and, for me, the only sensible way, regardless of the loss, was to exit. I am sorry to let the people of Leicester down and feel sad this decision had to be made so early in the restaurant’s life.” Todiwala has three restaurants in London – Café Spice Namasté, which is the longest-running Bib Gourmand restaurant in the Michelin Guide; Mr Todiwala’s Kitchen at Lincoln Plaza London in Canary Wharf and Mr Todiwala’s Kitchen at Hilton London Heathrow Airport.

NZR Group to double up Chotto Matte in London via Black Roe conversion: NZR Group, the Kurt Zdesar-led business, is to double up its Chotto Matte brand in London. Chotto Matte, which also operates in the US and Canada, said it would open the company-owned site in Mayfair later this year. The strategy to expand Chotto Matte led NZR’s decision to convert its Black Roe restaurant in Mill Street. Managing director Paul Sarlas said: “Chotto Matte has been incredibly successful in Soho and we’re poised to open the second London site, in Mayfair. We’ll maintain our cool Tokyo vibe while enhancing the offering with a more plush design. Our commitment to quality will continue.”

Benugo founder launches co-working hospitality concept: Benugo founder Hugo Warner has launched a co-working hospitality concept. Warner has opened The Fisheries in Hackney, east London. The building comprises 32 flats above a workspace. There are also two communal kitchens, podcast and photo studios, and a multi-functional events space, The Green Room, which features a fully equipped kitchen to host supper clubs and masterclasses. Warner, whose previous projects include as a chef under Henry Harris at Harvey Nichols, aims to incorporate hospitality into the co-working environment. He told BDaily: “Great hospitality means taking care of people. I think you have to be involved in every part of the experience to deliver this, from the overall design to the finer details of lighting and soft furnishings. Community is at the core of The Fisheries and by creating these water-cooler moments strategically located around the space linking one area to another, we have tried to create valuable opportunities for our members to interact.” Warner founded Benugo with brother Ben in 1998 before leaving the business in 2010, three years after it was acquired by present owner Westbury Street Holdings.

MasterChef winner Steven Edwards to double up for London debut: MasterChef: The Professionals winner Steven Edwards, who operates Etch restaurant in Hove, is to make his debut in London. Edwards will take over Bingham Riverhouse in Richmond to reopen it in March offering a seasonal British menu. The chef will continue to operate Etch alongside his new venture, Steven Edwards At Bingham Riverhouse. Whereas Etch only offers a tasting menu, the riverside venue in Petersham Road will feature an a la carte menu with dishes such as guinea hen with cauliflower cheese and nasturtium. However, the venue will offer a weekly Sunday Experience five-course tasting menu, including salt-baked pork rump with pickled pumpkin. Edwards said: “I am so proud of what we’ve achieved in Hove and, with so much more to come there, this feels like the right way to continue to grow our portfolio.” Bingham Riverhouse manager Erick Kervaon added: “Since our days together at South Lodge more than ten years ago, we’ve tried to find ways to work together. His dish innovation and eye-popping presentation is inspiring and we see a great fit with this and the next chapter of Bingham Riverhouse.” Edwards won MasterChef: The Professionals in 2013, launching Etch in the Sussex seaside resort in March 2017.

Fusion pizza concept East West to launch in Tufnell Park next month: Fusion pizza concept East West is to launch in Tufnell Park, north London, next month. East West will open at the former Stingray site in Fortress Road on Wednesday, 12 February combining southern Italian-style pizza with the home-cooked recipes and flavours of northern India. The 48-cover restaurant will open near Tufnell Park station featuring terracotta and turquoise seating, exposed brickwork and navy blue tiles. The concept is the brainchild of Devinder Singh, whose pizzas will include butter chicken, masala jackfruit and saag paneer. Fusion sides will include paneer bruschetta with roasted masala tomatoes, and arancini variations such as tandoori chicken. Desserts will stick to the Indian theme but drinks will follow the fusion route with options such as chai martini. Singh said: “East West is about reimagining age-old north Indian recipes passed down through generations and found on dinner tables across the region and bringing them together with the western pizza culture. I have always been a huge admirer of how Italians from the southern regions, Puglia in particular, make their pizza. The light and gentle base provides the perfect stage for punchy Indian flavours.”

Paddy & Scott’s opens largest site to date, in Ipswich: Independent Suffolk coffee shop operator and wholesaler Paddy & Scott’s has opened its largest site to date, in Ipswich. The 73-cover cafe with terrace is in the University of Suffolk building at Neptune Quay, overlooking the waterfront. Paddy & Scott’s will use the site as a concept cafe to test new ideas. Director Zoe Hill said: “This is our first branded fuelling station in the town so it’s an amazing opportunity to connect with our Suffolk supporters and offer a new experience.” Paddy & Scott’s was appointed to take over the food and beverage operation for the University of Suffolk in August. Scott Russell launched the Paddy & Scott’s business from the boot of his car in 2007. It now operates cafes across East Anglia and has more than 150 branded concessions in the UK. The company also has its own coffee farm in Kenya.

Searcys reports revenue up 17.5% in 2019: Searcys has reported revenue increased 17.5% in 2019 from the previous year, with like-for-likes contributing 6.7% of growth. The company hosted more than 15,000 commercial events and 380,000 guests during the period. In turn, this led to an employee increase of 14%, including apprenticeships, while the company invested in training by launching Searcys’ School of Service. Contract wins during the year included The Honourable Artillery Company in the City of London and The Alnwick Garden in Northumberland. Searcys plans a series of innovations to enhance its events and dining experiences this year, including its own range of ice cream, a bakery range and seasonal zero-waste menus. Managing director Matt Thomas said: “We are looking to continue our work into the next decade with an increased drive for sustainability across all venues while celebrating the best of seasonal British produce and English sparkling wine.”

Loungers opens largest Cosy Club to date, in Nottingham: Cafe bar brand Loungers has opened a Cosy Club in Nottingham – the brand’s largest to date. The company has turned the former Victoria Club casino into a 21,000 square foot Cosy Club set over three floors. Amber Wood, managing director for the Cosy Club brand, said: “We look forward to bringing some delicious food and quirky style to Nottingham. It’s a great city and we’re confident the locals will love it.” Loungers operates circa 160 sites under the Lounges and Cosy Club brands.

Alchemist finance director on Northern Power Women list: Vic Stewart, finance director of premium bar and restaurant group The Alchemist, has been named on the Northern Power Women (NPW) 2020 list. Stewart, who joined The Alchemist in April 2017, has helped the business more than double through an expansion programme targeting large cities in the UK. The NPW said: “Vic champions the development of women within and outside The Alchemist through mentoring and regularly speaking at a range of engagements targeting women at different stages of their careers. She is passionate about promoting the feasibility of combining flexible or part-time work with a successful career. Recently Vic launched the 6% Club, a network of ladies committed to drive diversity in the north west deal-making community. Only 6% of senior investment professionals in UK private equity firms are female. The senior ladies in the 6% Club aim to change that by giving their time and expertise to create a well-networked talent pool of potential female leaders within the industry.”

Greene King rolls out disability signage: Brewer and retailer Greene King is to roll out new signs outside all accessible toilets in its estate to remind customers “not every disability is visible”. The move follows consultation with charities Crohn’s & Colitis UK and SeeAbility. From next month, Greene King will begin the roll-out to 1,700 Greene King pubs, offices and distribution centres. Chief executive Nick Mackenzie said: “We know many of our customers have disabilities that aren’t always visible and we want them to feel comfortable using the disabled toilets. We also hope that by working with Crohn’s & Colitis UK and SeeAbility, these signs will stop the stigma and discrimination of people with hidden health conditions.”

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