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Wed 13th May 2020 - Propel Wednesday News Briefing

Story of the Day: 

Pret UK MD – ‘it is critical that businesses share what is and what isn’t working’: Clare Clough, UK managing director of Pret A Manger, has said it is critical for the sector that people share what is working and not working, and what they are learning, about reopening their sites. Pret this week reopened a further 71 shops, taking its total reopened to more than 100, having initially reopened ten sites in the capital. Speaking to Elliotts chief executive Ann Elliott as part of Propel’s “navigating the coronavirus” series, Clough said: “I feel similar to this, as how I felt with some of the allergy processes, the more consistent we can be for consumers the better it is for all of us as well. It will help consumers understand how to behave consistently in different outlets if we all use some of the same tools, communications and ways of supporting them.” Clough said one of the features of Pret has always been the “amazing communication we have between our teams in our shops and the teams in our support centre”. She said: “We have a really good muscle in Pret on listening to our teams and how they feel. So we were able to take the direct feedback from the people working in those (first) ten shops, as to what was working really well, what they found a bit more difficult and how their teams were feeling. I walked around to all of the ten sites and met all the teams in the first week of opening to hear directly from them where the pinch points were. We then worked as a team to adapt further. So, we had a little bit of feedback on how we could help teams to control the number of customers coming into the shop and how we should give a bit more signage to customers on how they should behave in the almost front of house environment. We have also had some learnings on what was needed back of house. That gave us the confidence to open the next 20 shops. We are going to keep taking it slowly – we have multiple phases in the reopening plan to make sure we take it step by step, and to make sure we keep learning.” Clough said one of the big challenges was seeing what operating in social distancing really looks like in the long term. She said: “At the moment it is comfortable with the level of trade to do social distancing in our kitchens and produce a limited range. But I worry a little bit about what will happen when more people start to come back to work and the customer base grows, demand grows, and how do we filter that in while not compromising the standards or the new ways of working we have put in place. It’s the moment of uncertainty in the coming months.” Clough will share more of her thoughts in the video, which will be released on Wednesday (13 May). Meanwhile, readers can support independent sector journalism and get their news 12 hours early (at 7pm each night) with a Propel Premium subscription. It costs £395 plus VAT per annum for operators and £495 plus VAT for suppliers. Email to sign up.

Industry News:

Sponsored message – Ritual launches free contactless ordering tool with automated marketing: With retail sales likely to be down 50% to 60% for the short to near term, restaurateurs must focus on capturing new customers and growing revenue from their existing customer base. Ritual has made its Whitelabel order ahead and instore service free for life to all food and beverage retailers that sign up to the service by June. The private equity-backed click-and-collect app has been helping restaurants and coffee shops tap into their customers’ co-worker network with its group ordering tool for the past five years. In response to challenges facing the industry with social distancing, Ritual will now offer a free solution for contactless order and pay in-store, while also helping to convert people who are browsing Instagram and websites into orders. The system can run automated promotions based on purchase pattern and frequency at the click of a button. Those who prefer to do things in-house can download customer contact details. The own-brand tool has no commission and no monthly fee for those who sign up for the service by the end of May. If you have information you would like to feature in a sponsored message, email

Trade bodies cautiously welcome CJRS extension but warn there must be added flexibility for sector: Sector trade bodies have cautiously welcomed the extension to the Coronavirus Job Retention Scheme but warned there must be increased flexibility for the industry. Chancellor Rishi Sunak has said the scheme will run until October and will continue to pay 80% of salary, up to £2,500. It will continue in its current guise – where the government covers the cost – until the end of July. From August to October the scheme “will continue for all sectors and regions of the UK, but with greater flexibility to support the transition back to work”, with employers expected to gradually cover more of the cost. UKHospitality chief executive Kate Nicholls said: “We will be actively engaging with government about how the scheme will operate beyond July. The full 80% (from government) may need to be extended past July for some businesses in sectors such as hospitality that will still operate at much reduced levels of trade, or not yet be able to open. Increased flexibility for hospitality will be equally vital. Hospitality businesses are not able to go from standstill to full capacity overnight.” British Beer & Pub Association chief executive Emma McClarkin added: “The increased flexibility allowing for part-time working beyond July is imperative and also welcomed. In the meantime, we continue to urge the government to bridge the significant gaps in the current financial support our sector faces as we ask them to help us get back on our feet while we reopen under social distancing conditions. This means removing the £51,000 rateable value cap on grant eligibility as well as extending grants, improving access to loans, and further support for brewers on beer duty.”

UK high-street footfall starts to pick up: UK high-street footfall is starting to pick up but is still down circa 75% compared with the February average, according to the latest data from Wi-Fi solutions provider Wireless Social. The analysis, which took an aggregated look at footfall in more than 800 venues nationally and focused mainly on major cities, showed footfall in London has again slightly picked up, but is still down about 70% compared with the average in February. Of the other cities analysed, footfall in Birmingham, Bristol, Edinburgh and Leeds is creeping up but remains down by about 80% compared with the average in February, while Cardiff, Glasgow Liverpool, Manchester, Newcastle and York are still down almost 90%. Wireless Social said with people in England now being encouraged to return to work if they are unable to do so from home, the next few weeks ought to offer some real insight on changing behaviour.
Wireless Social is a Propel BeatTheVirus campaign member

Online eating and drinking spend increases 24.6% in April but overall consumer spend falls 36.5%, Brits show growing desire to buy local after lock-down: Online spend for eating and drinking – including takeaways – grew 24.6% in April compared with the previous year but overall consumer spend fell 36.5%, according to the latest Barclaycard data. The impact of the lock-down and social distancing measures meant spending on non-essentials fell 47.7% with spending in restaurants, bars and pubs contracting by 96.9% as only takeaway and delivery operations were allowed. Specialist food and drink stores – including off-licences – saw spending up 37.7% in the month. This was helped by Brits continuing to support local businesses, and more than half (57%) said the current environment has made them realise how much they value these stores. As a result, UK adults are planning to spend more in local retailers including butchers (27%), cafes and restaurants (26%) and farmer’s markets (23%) when restrictions are lifted. Spending on essential items fell 7.5%, which Barclaycard said was largely due to a 58.9% reduction in fuel spend. Supermarkets, meanwhile, continued to see a boost in sales – climbing 14.3% as Brits made larger shops and prepared more meals at home. Consumer confidence in the UK economy overall has dropped to its lowest for at least six years – just 20% of adults feel positive, representing a 5% decrease from March. Confidence in job security also declined to 42% – its lowest level for 17 months. However, Brits continue to be resolute about their own financial situation, with 70% remaining positive about their household finances. Barclaycard said this could be attributed to the fact almost nine in ten UK adults (88%) have saved money on everyday expenses since the lock-down began. 

100,000 businesses urge government to raise grant threshold: The #RaiseTheBar campaign has written on behalf of 100,000 businesses across England and Wales to chancellor Rishi Sunak and business secretary Alok Sharma outlining concerns for their future in light of the coronavirus recovery strategy. The campaign is calling on the government to increase the rateable value threshold from £51,000 to £150,000 for the retail, hospitality and leisure grant and provide a vital lifeline of financial support to aid their survival. The letter said with tens of thousands of businesses already closed for more than 50 days, with a potential move to exploring reopening tabled for 4 July, companies across the retail, hospitality and leisure sectors are “currently in limbo”, unable to access the government grant due to the arbitrary business rates threshold currently in place. The letter said: “Announcements in the past 48 hours by government have done little by way of reassurance, and instead thrown up more questions than it has answers to how these businesses, the cornerstones of our local economies, can be resilient in the absence of financial support. The campaign recognises the need for investment into the country’s infrastructure, as demonstrated by the £2bn package for cycling, however it is these very businesses in need of financial support that will be instrumental to kick-starting the economy in the near future.” The campaign said there were 54,638 businesses across England and Wales “currently teetering on the edge of collapse” because they are unable to access grants, with some 19,000 located in London. 

CAMRA launches survey to determine consumers’ attitudes towards pub-going when lock-down lifts: The Campaign for Real Ale (CAMRA) has launched a survey to determine consumers’ attitudes towards pub-going once lock-down lifts. The survey, which has already been taken by 13,000 people, is designed to determine the ongoing issues that may face the industry post-lockdown and identify government measures required to support the sector over the coming months, particularly if limits are imposed on the number of customers allowed on the premises at any given time. The survey looks at how many people will be willing to go to pubs that have social distancing measures in place, which aspect of going to the pub they’ve missed the most during lock-down and whether they want to see locally-produced and independent real ales and ciders available in pubs when they reopen. CAMRA national chairman Nik Antona said: “This will help us to better represent beer and cider drinkers and pub-goers interests when detailed plans are being drawn up to reopen pubs and allow us to ensure pubs and their staff get the support they need to stay afloat in the months ahead.” The survey is available on CAMRA’s website until Monday (18 May). 

Sacha Lord – hospitality ‘continuously left on the sidelines’: Sacha Lord, Greater Manchester's night-time economy adviser and Warehouse Project co-founder, has expressed his disappointment over the hospitality industry being “continuously left on the sidelines” as the country looks towards easing lock-down restrictions. Responding to the government's 50-page guidance on the issue, Lord said: “It was meant to kick-start the sector, enable it to start planning for the future and help gain a small sense of normality amid the chaos and confusion. However, there is nothing in this document that we didn't already know, or that hasn't been included in other previous guidance, and I'm disappointed to say the least. As a sector, I feel those working in hospitality have been continuously left on the sidelines to second guess the next steps. It is an incredibly difficult time for the UK, and the health and safety of all must come first, but we need some clarity.” Lord said there was “no information or support given as to how businesses can prepare” for a possible reopening in July. He added: “It's a very frustrating time, to put it mildly, and I know there are hundreds of operators across Greater Manchester who are losing hope.”

Italy to speed up restaurant and bar reopenings: The Italian government has agreed to demands from the country’s regions for an acceleration of phase two of the coronavirus emergency. As a result, regional governments will be able to give the go-ahead for bars, restaurants, hairdressers, barbers and beauty parlours to open from Monday (18 May) when Italy's other shops are set to reopen too, reports The Local. According to the government's previous plan, these businesses were not to be allowed to open until 1 June. Each of Italy's 20 regions has its own government, and has the power to adapt national lock-down rules within their own territory. The central government, however, will be able to intervene if there is a new upswing in coronavirus cases.

Takeaway restaurants see increase in food waste during lock-down but consumers becoming more savvy: Takeaway restaurants have seen an increase in food waste during lock-down from an average of £111 to £148 per week –a £16.7m rise for the sector as a whole, according to new research. But the findings by Just Eat, the online market place for food delivery, and the Sustainable Restaurant Association (SRA), show UK households have started to become more conscious about how they order and eat takeaways, helping save an average of £3.2m a week. It comes after data in December from Just Eat revealed in restaurants the most common reason for food being thrown away was overproduction of meals (46%). Cooked meals were the most thrown away food type (50%), ahead of unused fresh ingredients (43%). In response Just Eat is using guidance from the SRA and WRAP to give its restaurant partners insights and data to help them better anticipate lock-down fluctuations. To encourage consumers to build on the positive habits they’ve adopted in recent months, Just Eat and the SRA are offering new recipes for dishes consumers can cook at home to use up the most commonly wasted takeaway food items and tips on how to safely store and use up the leftovers from their favourite food. 

Bloomberg – Uber makes takeover approach to Grubhub: Uber, the owner of UberEats, has made an offer to acquire food-delivery company Grubhub, Bloomberg News reports. The companies are in talks about a deal and could reach an agreement as soon as this month. Chicago-based Grubhub is valued at circa $4.5bn, while Uber has a market capitalisation of about $55bn. Grubhub saw its shares jump 25% on the news of the approach. A deal, which would see the merger of two of the largest food delivery companies in the world, would enable Uber to expand the operations of meal delivery through UberEats. Uber reportedly previously held merger talks with Grubhub rival DoorDash.

Job of the day: COREcruitment’s executive recruitment team is looking for an operations director with experience in the grocery, delivery and food product sector. The individual will ideally have dynamic experience that includes growing concepts or startups as well as extensive account management understanding and a strong knowledge of online food retailing. COREcruitment is short-listing for an end of year hire. The salary is between £100,000 and £150,000. Anyone interested can send their CV or profile to 
COREcruitment is a Propel BeatTheVirus campaign member

Company News:

McDonald’s to reopen 30 drive-thrus next week with plans to have all operational by early June: McDonald’s is to reopen 30 of its UK and Ireland drive-thru sites next week as it steps up plans to bring its estate back into operation. The company will begin reopening sites on Wednesday (13 May) with 15 outlets in London and the Home Counties offering delivery only. There will be a £25 cap on orders as the business adjusts to smaller teams and social distancing in its kitchens. Now McDonald’s has announced plans to reopen a further 30 pilot restaurants, offering service through the drive-thru lane from Wednesday, 20 May. These will also have a £25 cap on spend. Moving in step with government guidelines, it plans to reopen all drive-thrus by early June. UK and Ireland chief executive Paul Pomroy said: “Over the past two months we have worked tirelessly to overhaul our operational procedures to enable our teams to return to work safely. When a drive-thru does reopen, it will be different. Our service will not be as quick as you might be used to, as we adjust to smaller teams and social distancing in our kitchens. We expect there will be some queues for some of our busier sites and our restaurants will look different, with Perspex screens at our drive-thru windows and employees wearing protective equipment. As we get accustomed to the new processes and procedures, we will look to reopen more restaurants, for longer hours and reintroduce more menu items. But only when I am confident we can do so while maintaining the new procedures we have introduced for the protection of our people. Learning from our initial phases, we will start to return to towns and cities across the UK and Ireland.”

Nando’s reopens a further 32 sites for delivery only: Nando’s has reopened a further 32 sites across the UK for delivery only, Propel has learned. Last month the company reopened seven of its kitchens to help feed NHS workers, and subsequently opened them for delivery to the wider public. It has reopened a further 32 sites over the past two weeks as part of its controlled reopening strategy. It is thought the company hasn’t publicised the latest reopenings after the huge response it received regarding the initial reopened sites. It is understood the brand wanted to give these restaurants a “bit of breathing space to get up and running if possible”. A spokesman told Propel: “Safety of our team, drivers and customers is obviously the main concern and we are trying to avoid huge demand.” The initial reopened sites were offering a limited menu including dishes such as its chicken burgers, butterfly chicken and the beanie burger. 

Goodbody – TRG to have a more focused business arising from coronavirus crisis: Goodbody leisure analyst Paul Ruddy has argued The Restaurant Group (TRG) will have a more focused business arising from the coronavirus crisis. He said: “TRG faced a number of well documented challenges before the advent of the crisis. These included the oversupply of branded restaurant chains in the UK, cost inflation, high rents and struggling legacy brands. The closure of the sector for a quarter is another considerable hurdle. The question for investors is whether the group can exist in its current guise? TRG will be a different group at the other side of this pandemic. Firstly, Chiquito and Food & Fuel have been put into administration and we expect a high portion of the legacy units to remain closed. It will be a smaller group, more focused on growth brands, with the potential for higher margins in a normalised environment. On a wider sector basis there will be a significant supply reduction given many of the chains in the UK were struggling with leverage and profitability prior to lock-down and future potential social distancing restrictions. Absent of a vaccine, lower footfall should be expected, owing to a combination of weaker macro and health concerns, into 2021. We now expect revenue to decline by 50% in FY20 in line with company guidance and Ebitda to be below the guided range. There remains risk to this year’s forecast as we are still unaware of the level of social distancing restrictions that will be put in place post reopening. We expect Wagamama sales and margins to return to 2019 levels in 2022 but revenues elsewhere will be lower owing to site closures. We value TRG on a sum-of-the-parts and price-to-earnings ratio basis that yields a 95p target price and we retain our ‘Buy’ recommendation.”

Wasabi to reopen Ealing site as part of phased return to trading: Wasabi, the sushi and bento chain led by Henry Birts and backed by Capdesia, will open its Ealing store for takeaway and delivery only on Wednesday (13 May) as part of a phased programme of reopening over the coming weeks as the UK's lock-down gradually eases. The company said the site will initially open between 11am and 8pm but with new social distancing guidelines in place to ensure the safety of customers and staff. It will also offer 50% discount to NHS workers – this is in addition to the 17,000 free meals given to front line staff by Wasabi since the beginning of lock-down in March. Delivery will be available through Just Eat, Deliveroo and UberEats. Birts said: "We're following the government guidelines very carefully and will only reopen parts of our business when and where we believe it is safe for us to do so. If Ealing goes well, we will put in place a managed reopening programme over the coming weeks, but with customer and staff safety our primary concern. We will initially offer a reduced and simplified menu but will of course offer all our most popular dishes such as katsu curry, K-wings and best-selling sushi sets. I'm very proud of how our teams have coped through these challenging times, particularly with our support for NHS and front line workers, and pleased to be able to start slowly welcoming our people back to work where we can.”

Deep Blue to reopen six sites this week, brings forward plans to bring seaside outlets back into operation: Deep Blue Restaurants, owner of the Deep Blue and Harry Ramsden brands, is to reopen a further six sites this week following the relaunch of its site in Bedhampton, Hampshire, for a “controlled experiment”. The company has introduced a phased approach to reopening, which focuses on prioritising stores that are able to offer delivery – and is also bringing forward plans to reopen seaside outlets. Deep Blue will reopen its eponymous sites in Oxted, Newmarket, Reading, Southsea (Eastney Road), Thornbury and Woburn Sands on Wednesday (13 May) for collection and delivery of online orders. Chief executive and founder James Low said: “The Bedhampton reopening was a great success, with the customers and team members adapting to the new social distancing measures extremely well. We have outlined a plan to have all locations open for collection and delivery by mid-June, but this remains fluid as the situation continues to evolve. We welcome the prime minister’s announcement, informing people they can spend more time outside. As a result, we will be bringing forward the reopening of all our seaside locations, including South Parade Pier (Southsea), Bournemouth, Brighton, Eastbourne and Blackpool. After being stuck inside for so long, fish and chips on the beach with the family is bound to be a particularly attractive prospect!”

JKS reopens a number of sites across its brands for delivery: JKS Restaurants, led by Karam, Jyotin and Sunaina Sethi, is reopening a number of sites across several of its brands for delivery, while also debuting some in delivery kitchens across London. Gymkhana, Brigadiers (City) and the Michelin-starred Trishna are all reopening to offer delivery, whilst Hoppers is reopening its King's Cross and Soho sites for delivery only, plus a delivery-only unit in east London. The company’s Iranian-influenced Berenjak concept will branch out into delivery kitchens, taking space in Deliveroo Editions sites in Battersea, Swiss Cottage and Whitechapel. At the same time, its delivery brand Motu Indian Kitchen will expand from its current five sites to more locations and wider delivery radiuses, including initially Crouch End.

Escape Hunt launches play-at-home games to soften blow from coronavirus lock-down: Escape room operator Escape Hunt said it has launched a number of “play at home” games to enhance its brand exposure amid lock-down measures caused by the coronavirus pandemic. Updating on the period following the end of its financial year on 31 December 2019, the company said it had also introduced “significant cost reductions” to place its business into hibernation during the pandemic, while the opening of two new sites had been deferred until the lock-down was relaxed. Despite the disruption, the company said its pipeline for new sites “remains attractive” and while being unable to provide financial guidance it was “confident we will emerge from the pandemic intact and ready to build on the base we have successfully established so far”. Escape Hunt also said it is “actively exploring options to access further capital” to finance its strategy for 2020 and provide additional working capital for the short and medium term. It comes as the company reported full-year revenue rose 128% to £4.9m while adjusted Ebitda losses narrowed to £1.7m from £3.1m in 2018. Escape Hunt also reported trading until the end of February was “strong” with revenues and owner-operated site performance “comfortably ahead” of expectations. 

McMullen commercial director retires: Steven Gill has retired from his role of commercial director of Hertfordshire brewer and retailer McMullen after 30 years, Propel has learned. Gill’s responsibilities will be split across two positions in future. Kat Morgan, formerly of Bourne Leisure, will take the position of commercial finance manager, and Emma Taylor, previously of Tesco, will become group buyer, from June. McMullen joint managing director Heydon Mizon said: “Steven’s candour, analytical rigour and good humour will be much missed. He has been instrumental in supporting McMullen’s growth and leaves with the gratitude of family shareholders and the board alike. We wish Steven a long, happy and healthy retirement, and we will reconvene his retirement celebrations when circumstances allow.”

Ambrette owner plans ‘dark kitchen’ project as part of plans to re-engineer business: Dev Biswal, chef-owner of the Ambrette Anglo-Indian restaurants in Margate and Canterbury, has announced plans to re-engineer his business. Biswal said he was bringing forward a number of initiatives he had been “contemplating for some time” to survive the lock-down and anticipated changes to customer dining habits when the economy reopens, He had already introduced a contactless takeaway and delivery service, with a new menu designed to survive transportation and is now focusing on developing a new “dark kitchen”, located on an industrial estate in Kent, to provide deliveries of “fresh, healthy, gourmet meals from several of the world’s great cuisines”. Biswal is also planning a recipe and ingredient subscription service, delivering produce from local Kent suppliers, plus exotic herbs and spices. His regular cookery courses will switch to live password-encrypted virtual classes. He added: “Looking at the research into modern dining trends, and the evidence from America, all the growth is in the home delivery market – those businesses who fail to read the signs will struggle to survive.”

Leon expands grocery range: Natural fast food brand Leon is extending its grocery range available through Sainsbury’s. Leon’s waffle fries alongside three vegan sauces – LOVe burger sauce, iconic Korean chilli mayo, and harissa and sundried aioli – will be available from Friday (15 May). Chief commercial officer Charlotte Di Cello said: “We know how much our customers love our baked waffle fries and vegan sauces, so we’re excited to be expanding our grocery range to help more people enjoy naturally fast food at home.”

Maison Bab’s restaurant co-operative delivers more than 9,000 meals to NHS: The London Restaurant Co-operative, the not-for-profit social kitchen was launched by Maison Bab and Le Bab co-founders Stephen Tozer and Ed Brunet, has delivered more than 9,000 meals to the NHS. The scheme was intended as a “high quality, low cost, ready meal delivery service”, designed to offer some extra financial relief to chefs and waiters who’d lost their jobs due to the coronavirus crisis, and also as means of providing free meals for NHS workers and the homeless. To date, the scheme has delivered more than 200 meals a day to NHS staff across London and also to The Connection at St Martin’s Field Homeless Shelter. Tozer said: “We hope to continue to be able to support those in the hospitality industry who are in need of help, and to keep feeding people who need feeding. Sadly, the damage of this crisis has now spread way beyond the NHS, and we're just here to do our bit in supporting anyone we can.”

Deliveroo launches new initiative to raise funds for NHS workers and expands voucher scheme: Deliveroo has introduced a new initiative in-app as part of its campaign to raise funds for the NHS and support health care workers and vulnerable groups. To make it easier for customers to donate and get more free meals to the NHS, Deliveroo is enabling customers to round up their bill to the nearest pound at check-out on the app. Rolling out this week, customers will be able to either round up their bill or will be given a choice of amounts they can add to their bill. All funds will go towards the cost of delivering meals to the NHS or new vouchers for NHS workers. To date, Deliveroo customers alone have raised more than £500,000, which has seen 250,000 free meals delivered to NHS hospitals and vulnerable communities across the UK. To mark the birth of the founder of modern nursing Florence Nightingale and the tireless, life-threatening work of health care staff, Deliveroo has also made another 30,000 £20 vouchers available to NHS workers on top of the £50,000 already issued.

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