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Morning Briefing for pub, restaurant and food wervice operators

Fri 11th Sep 2020 - Update: Stonegate, consumer confidence, Pizza Hut Restaurants, Nando’s and Zizzi
Stonegate announces up to 300 head office redundancies: Stonegate Pub Company has announced up to 300 head office redundancies are to be made with the integration of Ei Group into the business “now well under way”. Stonegate stated: “From January 2021, it is proposed the enlarged Stonegate business will be headquartered in Solihull at Ei Group’s former head office. Stonegate’s head office lease in Luton expires at the end of 2020. However, as part of the proposal, the group will maintain a presence in the town with a satellite hub above one of its pubs there. As previously announced, it was anticipated there would be an inevitable degree of duplication in combining the two businesses, resulting in a reduction in headcount in corporate and support functions, which formed part of delivering the synergy targets anticipated at the time of the acquisition. The group, which employs more than 15,145 staff nationwide, has announced the start of a collective consultation process on proposals that may result in no more than 300 roles being made redundant across the support teams in the legacy Stonegate and Ei Group businesses. This proposal reflects the aim to reduce central costs where possible, as well as to continue to protect the group’s liquidity headroom as the hospitality sector rebuilds trading momentum post-covid over the months ahead.” Stonegate said 95% of its 4,730 pubs now open. As previously revealed by Propel, Bermondsey Pub Company’s 65 pubs are also being incorporated into Stonegate’s managed estate and will be converted into one of Stonegate’s existing pub formats. Four operational directors have left as a result, including Henry Fairbanks. Following the acquisition of Ei Group in March for £1.27bn, Stonegate Pub Company is the largest pub company in the UK.  

More than half of consumers cancel eating and drinking-out plans as ‘rule of six’ hits confidence: The ban in England on meetings of more than six people from Monday (14 September) has left almost a third (31%) of consumers feeling less confident about visiting pubs, bars and restaurants, according to a snap poll by CGA. Just 4% said the new measures had lifted their confidence while well in excess of half (59%) of consumers who were intending to go out had cancelled plans or would not be making new ones in the future. About one in seven (15%) of all consumers said they would alter their plans to observe the new regulations, while one in ten (10%) intends to go ahead with their visits regardless. Two in five (43%) thought the new restrictions were the right course of action, while a quarter (23%) thought they were too drastic. Slightly more (29%) thought the government is still not doing enough to control the pandemic. As expected, older consumers were less confident about visiting than young adults. “This research really highlights the fragility of consumer confidence at the moment,” said Hannah Payne, consumer research manager at CGA. “The new restrictions are a warning – if it were needed – the road back to normality in the out-of-home sector is going to be very bumpy.” Speaking at CGA’s Redefining The Out-Of-Home Experience webinar on Thursday (10 September), Loungers chairman Alex Reilley said. “There’s an argument we were getting a bit too relaxed as a country – clearly we’ve got to be very careful, and the sector needs to play its part.”

Pizza Hut Restaurants reveals locations of planned 29 closures as part of CVA: Pizza Hut Restaurants, the UK dine-in franchise business of the global Pizza Hut brand, has revealed the 29 restaurants it plans to close as part of its proposed company voluntary arrangement. The company is set to undergo the restructuring, with the loss of about 450 jobs, as “sales are not expected to fully bounce back until well into 2021”, despite a quick and safe reopening of sites. The restaurants earmarked for closure: are Basingstoke Retail Park; Brighton (city centre); Bury St Edmunds; Cambridge, Regent Street; Cardiff, Culverhouse Cross; Chelmsford, Moulsham Street; Croydon, North End; Cumbernauld; Dunstable; Glasgow, Great Western Retail Park; Grantham; Gravesend; Huddersfield, John William Street; Leicester, Haymarket; London, Leyton Mill; London, Stratford; Maidenhead; Maidstone; Newcastle-under-Lyme; Oxford; Plymouth Royal Parade; Salisbury; Scarborough; Sheffield, High Street; Sheffield, Penistone Road; Stafford; Thornton Cleveleys; Weston-Super-Mare; and Worcester.

Nando’s doubles delivery estate as it enters into exclusive new partnership with Deliveroo: Nando’s has announced it has entered into an exclusive new partnership with Deliveroo, which will allow consumers to order delivery from 360 of its restaurants in more than 50 cities across the UK and Ireland. The two companies have also launched a “brought to you by Deliveroo” service that enables people to order via the Nando’s website and the Deliveroo app. Deliveroo said the new relationship was the first of its kind for the delivery company in the UK. It said the partnership would allow Nando’s to create a multichannel proposition of delivery, click and collect and dine in, “deepening the customer relationship and increasing lifetime value”. It said: “The partnership also doubles Nando’s delivery estate, which currently stands at 180 restaurants. Nando’s UK and Ireland chief executive Colin Hill said: “We are passionate about making Nando’s a truly multichannel business and are excited to launch our new delivery service with Deliveroo as a major step in that direction. By combining our unique expertise with Deliveroo we believe we are in the best place to operate an industry-leading digital-first product that will help our fans satisfy their Nando’s cravings in whichever way suits them – delivery, collect or, when we’re fully back open, dine in.” Stephen Goldstein, executive vice-president – restaurants at Deliveroo said: “We are extremely proud that, at this critical moment in Nando’s growth trajectory and development of its multichannel digital customer vision, Nando’s has trusted us as their exclusive delivery partner across the country.” 

Zizzi to launch first grocery range: Zizzi, the Azzurri Group-owned brand, is partnering with Sainsbury’s on the launch of its first grocery range. Sainsbury’s will begin selling three frozen Zizza pizzas that are all based on one of the restaurant’s most popular menu offerings, the hand-stretched Rustica pizza. Due to launch on 13 September, the selection will include Piccante Pepperoni, Margherita Classic and Vegan Jackfruit Pepperoni pizzas. The products will all be made from “premium restaurant-quality ingredients to evoke the Zizzi restaurant experience at home”. The partnership is part of the supermarket’s Future Brands initiative and marks the start of Zizzi’s plans to make retail an important part of its business following the covid-19 pandemic. Harry Heeley, managing director at Zizzi, said: “We are delighted our Rustica pizzas will be available exclusively at Sainsbury’s. This is an important step for us, as a business, as we grow beyond restaurants, and what better way to start than with a true Zizzi favourite? This iconic Zizzi dish is always a popular choice with our customers and we are proud that we have been able to bring the best of our menu to retail.” In 2017, Zizzi trialled a pizza counter concession with Sainsbury’s at its Balham store.

Fledgling Scottish hospitality group demands immediate closure of sites that flout coronavirus regulations: Newly formed Scottish Hospitality Group (SHG) has called on the government to immediately shut down licensed premises that flout social distancing regulations. SHG, which comprises some of the country’s largest and best-known restaurant and bar businesses, says the move will save Scotland’s hospitality industry. SHG spokesman and hotelier Stephen Montgomery, who runs two hotels in Dumfries and Galloway, said: “We have been forced to act because our industry is facing an existential crisis. The vast majority of bars and restaurants in Scotland have been adhering religiously to every regulation that has been introduced because we realise the very future of our industry is at stake. The Scottish government simply must not take a blanket approach if a few rogue licensees fail to do the right thing. All members of the SHG are united in calling on the Scottish government to immediately shut down the operators of bars and restaurants that don’t adhere to the very highest standards of social distancing, PPE and other essential hygiene measures. Targeting the few bars and restaurants that are breaking the rules is the proper and proportionate way to proceed, particularly in light of the revised Scottish government guidance limiting gatherings to six people from two households. Responsible bar and restaurant owners across Scotland are also essential to the effective use of the test-and-trace system. If you shut down restaurants and bars, you are massively increasing the risk of more house parties and irresponsible gatherings, where test and trace is almost impossible.” SHG members include The DRG Group, Buzzworks Holdings, Signature Pubs, Montpeliers, Manorview Group, Lisini Pub Co, Caledonia Inns, G1 Group, Siberia Bar & Hotel, Mor-Rioghain Group, and Caledonian Heritable. It also stated its businesses have a combined turnover of over £275m and employ close to 6,000 staff members.

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