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Fri 4th Dec 2020 - Update: Barburrito, Tim Martin and Confidence Survey
Barburrito protects 14 sites with fresh investment: Barburrito chairman Graham Turner has led a new investment in the business, alongside other private investors, backing the existing management team of Morgan Davies, founder and chief executive and Steve Herring, finance director. Previous investor Business Growth Fund has exited the business. The deal protects 14 stores and over 270 jobs via a corporate restructure, which has been led by restructuring specialists RSM. Three stores are to close – Aberdeen Union Square, Edinburgh Lothian Road, Manchester Deansgate. The Edinburgh and Manchester teams have transferred to other stores in the same city. Morgan Davies, said: “I am delighted that we have secured the future of Barburrito, just ahead of our 15th birthday. The last few months have been extremely challenging for the whole sector. The high street is changing fast and my heart goes out to all those affected. Despite this, we have done really well in the stores that have remained open and, in particular, we have demonstrated the success of our delivery offering. In common with many in our sector, the closures and liabilities accrued during lockdown have resulted in us having to restructure the business. However, with the new investment, support of our landlords and the hard work of our fantastic teams, Barburrito is now well positioned to succeed in this new landscape.” Graham Turner added: “Morgan and the team have developed a great business which was poised for fast growth just before the pandemic hit. They have navigated through the lockdowns and reopenings and have seen good traction with the delivery offering of the business, which has grown significantly. This transaction has enabled the business to secure the vast majority of jobs and restructure its balance sheet so that it can take advantage of future opportunities both in terms of new sites and delivery offerings.” Barburrito, which Davies and Paul Kilpatrick founded in Manchester’s Piccadilly Gardens in 2005, had been backed by the BGF since 2012, when as a then six-strong business it secured £3.25m of funding to expand.

JDW’s Tim Martin criticises devastating effect of lockdown on hospitality: Wetherspoon founder Tim Martin has renewed his criticism of the devastating effect of lockdown on the sector. He said: “The reckless and draconian anti-pub regulations continue to impact the hospitality industry with devastating effect. Wales today (Friday December 4) enters its fourth set of new regulations in the last few weeks. One set of regulations applied before the recent ‘firebreak’. A second set applied during the firebreak itself. A third set has applied in the brief period since the firebreak ended (which is different from pre-firebreak regulations). The fourth applies today, closing pubs at 6pm and banning the sale of alcoholic drinks, among other changes. In England, the situation is similar, with nearly half of Wetherspoon pubs closed and the rest, apart from 13 in tier one areas, trading as restaurants. In England, as in Wales, regulations have changed at random, almost on a weekly basis. The disturbing evidence from the ‘frontline’ is that the constant changes are putting enormous and unfair pressure on pub managers and staff – these are the people who have to implement the rules and explain them to customers. Many report that sensible explanations are impossible, because the rules are so contradictory and absurd, especially in view of expenditure of tens of millions of pounds on covid-19 safety measures by the industry. Two statistics stand out. One is that lockdowns simply don’t work, as most medics and scientists know. For example, Peru locked down in military style, but has had a higher mortality rate than Brazil, which didn’t lock down. Sweden hasn’t locked down and has a lower mortality rate than England, which has locked down twice. The second astonishing statistic is that the overall mortality rate in the UK this year, from all causes, is no higher than four years of the last 20, yet we did not lock down then, nor was it ever proposed. The world’s foremost expert in these areas of analysis is often regarded as John Ioannidis of Stanford University, who has calculated that the risk of covid-19, for those under 70, is half that of flu. Yet the country is destined for many more months of lockdowns, quasi-lockdowns and regulations, causing havoc and misery, until the government persuades the majority of people to accept a vaccine.”

Latest Business Confidence Survey reveals the scale of the challenges facing operators in the run-up to Christmas: The covid-19 pandemic has wrecked confidence across hospitality, with fewer than one in five (18%) leaders now optimistic about the market’s prospects for the next 12 months, the new Business Confidence Survey from CGA and Fourth reveals. The figure is 42 percentage points down on the pre-pandemic level of 60% in the February edition of the survey. Extended restrictions on trading and socialising over the autumn have led more than a quarter (27%) of multi-site business leaders to predict their groups will be unviable within the first six months of 2021 if current levels of support continue. Single-site businesses are at even greater risk of failure, the survey shows. However, twice as many leaders (35%) say they are optimistic about their own business’ prospects over the next year – a substantial increase from the last edition of the Business Confidence Survey. There are also signs of cautious ambition, with more than two in five (44%) leaders intending to open new sites in 2021. CGA’s research, supplemented by a poll of members of UKHospitality, the British Beer and Pub Association and the British Institute of Innkeeping, shows the particularly damaging impact of England’s tiered system of restrictions. Nine in 10 (88%) leaders say pubs, bars and restaurants will be unviable or loss-making in tier two regions of England, where well over half (59%) of licensed premises are located. CGA’s research and insight director Charlie Mitchell said: “As we near the end of hospitality’s toughest year in memory, the bleak picture of the sector will come as little surprise. Suffocating restrictions across Britain will devastate trading in what should be businesses’ busiest time of the year. Leaders’ optimism is at least rising from the rock bottom level of our last survey, and news of a vaccine is a reason for cautious hope of recovery in 2021. However, this week’s tier two restrictions in England and strict new limits in Wales could be fatal for smaller business in particular, making the case for more relaxed trading conditions and better government support even more urgent.” Sebastien Sepierre, Fourth’s managing director – EMEA, added: “Hospitality has always been a resourceful, optimistic and innovative sector, something we’re immensely proud to be a part of. Despite these strong characteristics, the results clearly paint a stark picture for leaders’ optimism levels across the sector, as businesses look to negotiate the ever-moving goalposts of government restrictions, during what is traditionally the busiest period of the year. With cautious optimism on the horizon, in the form of a vaccine, there still remain many challenges in the year ahead, such as the availability of goods and labour, after we exit the EU Customs Union. We will continue to work tirelessly with businesses to help them harness the power of technology and data to tackle what lies ahead.”

Wahaca launches an augmented reality menu: Mexican restaurant company Wahaca, which last month completed a CVA process, has launched a new augmented reality (AR) menu to showcase its dishes and create an “interactive customer experience”. The Web AR effect enables customers to interact with the menu – the first of its kind in the UK – by scanning a QR code which has been printed on more than 60,000 physical Wahaca menus with their smartphone. The experience will project AR information on top of existing physical menus which will not only allow customers to navigate the menu but also access pictures of dishes, descriptions, and even additional information such as ingredients, allergens and sustainability practices. Those who use it will find themselves being greeted by an animated 3D model of Wahaca co-founder Thomasina Miers, who will instruct them through the AR experience. The AR experience will also be linked to a digital payment system to enable contact-free payments directly from the customers table, enhancing customer experience while keeping customers and staff safe. Wahaca co-founder Mark Selby added: “At Wahaca we have always sought to inspire our guests, both in the restaurant with our food and service and in the wider world. We’re very excited about collaborating with Poplar Studio as this AR experience brings our menu to life to visually inspire our customers about our food, ingredients and sustainability.”

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