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Wed 29th Jul 2020 - Update: TGI Fridays, Starbucks, Young’s, Rick Stein and Loungers
Electra – TGI Fridays exceeding expectations: Electra Private Equity has reported that TGI Fridays sites have exceeded expectations since re-opening. The company stated: “TGI Fridays now has 71 of its 85 stores fully open with a further nine being reopened within the next week. The remaining stores will reopen as location specific circumstances develop (e.g. at event driven destinations such as the London O2). Throughout the phased reopening to date the level of trading activity has exceeded our expectations. Whilst the future trading environment remains highly uncertain with many competitors yet to re-open, the year on year sales performance and weekly sales progression that we have seen since reopening, combined with the excess capacity that has come out of the market and the early reaction to the new initiatives being implemented by Fridays, give us grounds for optimism. Fridays’ chief executive, Robert Cook and his team are implementing a development strategy in response to a detailed review of customers’ aspirations which has an increased focus on consistent quality, provenance, simplification and point of relevance. The ‘click and collect’ channel successfully launched in May marked the first of a series of brand and channel developments that will be launched in the coming months. Fridays has acquired two new sites (Cobham and Lincoln) at attractive prices that will open in the fourth quarter and continues to explore other opportunities for measured expansion.”

Starbucks reports like-for-like sales down 40% in Third Quarter: Starbucks has reported global like-for-like store sales declined 40% in the 13 weeks ended 28 June. This was driven by a 51% decrease in comparable transactions, partially offset by a 23% increase in average ticket. US like-for-like store sales were down 40%, with comparable transactions down 52%, partially offset by a 25% increase in average ticket. Chief executive Kevin Johnson said: “Since the beginning of the covid-19 outbreak in January, we have taken a principled approach to navigate the crisis, true to our mission and values. Every step of the way, we have thoughtfully addressed the needs of Starbucks stakeholders and are particularly proud of the industry-leading investments we have made to support our partners while creating a safe, familiar and convenient experience for our customers. Starbucks partners have risen to the occasion, and our near-term focus is to recover sales safely and responsibly by offering our customers the comfort and care that differentiate the Starbucks Experience. We are pleased to share that the vast majority of Starbucks stores around the world have reopened and our global business is steadily recovering, demonstrating the relevance of the Starbucks brand and the trust we have built with our customers. As we continue to drive the recovery, we are also building resilience for the future by accelerating the transformation of our business in ways that will elevate the customer and partner experience and drive long-term growth. We firmly believe that we are well positioned to regain the positive business momentum we had before the pandemic began and look forward to reigniting our ‘Growth at Scale’ agenda.” Lost sales of approximately $3.1 billion relative to the company’s expectations before the outbreak included the effects of temporary store closures, modified operations, reduced hours and reduced customer traffic. The company added: “Today, approximately 97% of our global company-operated store portfolio is open, led by 96% in the US and 99% in China, as well as 99% in Japan and 97% in Canada. Currently, approximately 87% of our global licensed store portfolio is open, with remaining temporary closures predominantly in airport, college and university locations within the US and Canadian licensed store portfolios.”
Ex-Abokado managing director Alderin joins Young’s: Kara Alderin, who stepped down as managing director of London-based healthy eating chain Abokado earlier this month, has joined London pub retailer Young’s, Propel has learned. Alderin, who spent over two and a half years at Abokado, has joined Young’s as its new director of operations. She initially joined the 19-strong Abokado as operations director in early 2018 after almost nine years at Fuller’s. She was promoted into the newly created role of managing director in March 2019, taking overall responsibility for the day-to-day running of Abokado. She also took a position on the company’s board. Abokado said it currently had no plans to fill the managing director’s role. Young’s began the phased reopening of its managed house estate on 17 July. The Patrick Dardis-led business reopened six pubs – The Adam & Eve in Fitzrovia; The Red Barn in Lingfield; The Northcote near Clapham Junction; the Leather Bottle in Earlsfield; the Cutty Sark in Greenwich and the Clock House in East Dulwich. The company said a phased reopening would give the business a chance to trial its service cycle and fully-integrated “on tap” app. Young’s previously said it was eyeing reopening its pubs on Monday, 3 August although some larger pubs with gardens could open in mid-July. Late last month the company reported the completion of an equity issue raising gross proceeds of £88.4m.

Rick Stein restaurant in Marlborough saved from closure by landlord concessions: The restaurant operated by Rick Stein in Marlborough has been saved from closure after its unnamed landlord made rent concessions, The Times has reported. The venue, which has a turnover of £2m a year, was facing closure but its landlord wrote off rent arrears and cut the rent by more than a quarter. Chef director Jack Stein said that since re-opening, trading has been very strong with sales ahead of last year. He told The Times: “We can’t quite believe what we are seeing. It really shows the strength of the Rick Stein brand. If it continues, we’ll be able to claw back some of the lost revenue, though we can’t make up entirely for the loss of Easter and June.”

Loungers spends £500,000 on furniture storage operation: Loungers is spending £500,000 on storing excess furniture. The company, which operates 150 sites across the country, now has upwards of £1 million worth of furniture stored away in warehouses. “Obviously social distancing had a big impact on the layout of our sites,” founder Alex Reilley told i. “We took the decision early to change the spacing and start again with how our floor plans were designed. We’ve had to remove quite a lot of furniture. We started the process of clearing our spaces in June and it was a monumental logistical challenge.” Reilley told the publication he found a new warehouse in Bristol comprising 22,000 square feet. Loungers has spent £30,000 on a six-month lease, which may yet need to be extended. Costs might also rise, as there is currently no power at the unit, and the soft furniture in particularly might yet fall foul to the colder, damper winter months soon to arrive. Other warehouses in the North West have also been rented by the company, while two restaurants that haven’t reopened due to the coronavirus crisis have also been used for storage. Reilley added: “We are using about 50,000 square feet of space in total. £30,000 doesn’t sound like a huge amount but in total we’ve had to spend about £500,000 on the whole operation. We have about £1 million worth of furniture in storage. There was a lot of it as we have 150 sites. We wanted to take this approach to be ready. Early on, I saw this positively – I don’t want to cram tables and chairs in the corner of restaurants. I’ve visited other venues and seen this, and I think it looks half-hearted. I think we’ve managed to keep the mood good. We didn’t want perspex screens everywhere. Instead, I’ve commissioned a design company we work with to build specially made dividers to help maintain safety. If there’s an award for the best socially distanced restaurant, I hope to win it.”

Escape Hunt – demand is growing each week: Escape room operator Escape Hunt has reported it reopened eight of its venues in England on 11 July with its Edinburgh site opened on 16 July. It stated: “The sites are currently open only on Thursday to Sunday while momentum builds, and whilst it is too early to draw any conclusions on the time it will take to return to pre-covid levels of occupancy, the board is encouraged by the current level of demand, which is growing each week. A further update on current trading will be provided at the time of the release of the company’s unaudited interim results for the six months ended 30 June 2020 which are expected to be released in late September 2020.”

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