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Morning Briefing for pub, restaurant and food wervice operators

Sun 29th Aug 2021 - Weekend leisure stories and restaurant reviews
Businesses ‘frustrated’ as government rejects plea to loosen visa rules for lorry drivers amid supply chain crisis: Business groups have been left ‘frustrated’ after the business secretary rejected requests to loosen Brexit immigration rules to ease the supply chain crisis, telling companies to hire UK-based workers instead. Businesses across multiple sectors are struggling to meet customer demand as a consequence of labour shortages, particularly in haulage where there is a shortfall of an estimated 100,000 HGV drivers. The industry says this is a consequence of Brexit and the coronavirus pandemic. EU drivers now require a visa to work in the UK, but are not included on the government’s shortage occupation list and do not qualify for their definition of skilled workers. Many returned home during the pandemic and have not returned, and covid also saw the suspension of driver testing, leaving a backlog of several thousand. Nando’s, McDonald’s, and KFC are among the companies that have reported product shortages as a consequence in recent weeks, while Tesco, Amazon, and John Lewis are offering four-figure joining bonuses to drivers. Logistics UK and the British Retail Consortium wrote to business secretary Kwasi Kwarteng last week, urging the government to help ease the immediate challenges by granting temporary visas to EU drivers. In a response, seen by Sky News, Mr Kwarteng says HGV drivers are not sufficiently skilled to meet visa requirements and companies should focus on training and recruiting British staff. “The government recognise that the UK labour market has changed dramatically due to the economic impacts and measures necessary to tackle covid-19, and I realise that by adding HGV drivers to the shortage occupation list, this could provide a short-term, temporary solution,” he said. “However, many UK-based workers now face an uncertain future and need to find new employment opportunities. I am sure you would agree on the importance of utilising the strength of our domestic workforce, and how our migration policies need to be considered alongside our strategies to ensure UK-based workers are better able to secure decent employment opportunities.” Logistics UK said the government’s position means driver shortages will continue well into 2022. (Sky News)

London restaurants still struggling to win diners back: The number of people dining out in London remains below pre-pandemic levels months after covid restrictions were lifted, with a lack of tourists still hurting the capital’s pubs and restaurants. As the bank holiday weekend arrives, seated diner numbers in London are about a tenth below 2019 levels – despite being almost a third higher elsewhere in the country, including in Manchester. Data from booking website OpenTable shows restaurants in London have had a tough pandemic, consistently enduring a recovery that was slower and weaker than the UK as a whole. In the week to 25 August, dining numbers in London were 8% below 2019 levels. By comparison, they were 40% higher across the country, and 38% higher in Manchester, the other UK city for which data is available. Tony Sophoclides from UKHospitality said London restaurants were suffering from a plunge in tourism numbers, and hesitancy to use public transport. He warned the problems are being felt more acutely in central areas of the city amid a slow return to office working and regular social activity. “Inner city pubs are clearly suffering at a greater rate,” he said. “But then again, in Zones three, four and five, where people are still working from home, those places are recovering more quickly.” After being forced to shut down through three lockdown periods during the pandemic, restaurants saw diners flood back during the spring as restrictions were lifted. But even then, the seven-day average for seated diner numbers in the capital only topped pre-pandemic levels for a few days in early June, before dropping back as the novelty of dining out wore off. Michael Kill, chief executive of the Night Time Industries Association, said hospitality businesses were trying to alleviate contagion risks. “The cities are always going to have a tougher time because of the volume and concentration of people, but we also are working harder than most to ensure that we’re creating a safe environment,” he said. Many London-based restaurants adapted in response to social distancing requirements during the pandemic, with al fresco dining arrangements proving particularly popular in Soho, the traditional entertainment district, amid a ban on traffic. The days of such arrangements appear numbered, however, with Westminster City Council warning businesses this week that traffic would be allowed to return to Soho from the start of October. (Sunday Telegraph)

Asda tycoons to open 300 stores in petrol stations: The billionaire Issa brothers are planning to open more than 300 Asda convenience stores across their EG Group forecourts empire as the supermarket’s new owners begin to make their mark. Mohsin and Zuber Issa are pressing ahead with the plan after a trial of five “Asda on the Move” stores on EG’s 400 UK forecourts. They will open the new stores, over the next few years, at about 300 petrol stations. The brothers acquired Asda last year with the private equity firm TDR Capital in a £6.8 billion deal that was mostly financed with asset sales and £3.7 billion of debt. A competition inquiry, resolved in June, delayed the new owners’ ability to make operational changes. After failing to build meaningful convenience store businesses, Asda and Morrisons have found themselves at the centre of takeover deals partly predicated on having convenience store chains on petrol forecourts. The board of Morrisons this month recommended a £7 billion offer from Clayton, Dubilier & Rice (CD&R) to its shareholders. Provided its bid is not trumped by its rival private equity firm Fortress, and shareholders vote in favour, CD&R intends to open a chain of Morrisons convenience stores on the forecourts of its petrol station business Motor Fuel Group. The US private equity giant Apollo has also been running the rule over Sainsbury’s. By combining food retail and petrol, the Issas and CD&R hope to boost overall grocery sales and generate savings on fuel purchases and costs. The Issas have snapped up the fast-food chain Leon and attempted to take control of coffee brand Caffè Nero in a battle that bubbled over into a High Court hearing last month. EG Group already runs franchises for KFC and Starbucks in the UK. Asda’s new owners are also understood to be weighing a plan to open supermarkets of between 30,000 and 40,000 sq ft in locations including high streets and out-of-town retail parks. “The fact Asda has not had a convenience retail offer, when convenience and discount retail are the only two growing categories ... that kind of tells you how asleep at the switch [Asda’s previous owner] Walmart was,” said an industry source. Asda and EG declined to comment. (Sunday Times)

A McCrisis for consumers: McDonald’s sent its customers into a froth last week with the news that it had run out of milkshakes, keeping the summer issue of product shortages firmly on the agenda. Earlier this month, Nando’s was forced to close up to 50 restaurants after running short of chicken, while the British Meat Processors Association warned that the industry might not be ready to serve up the nation’s pigs in blankets for Christmas. High-street staple Greggs also admitted that some items on its menu were temporarily unavailable. Milk and bread deliveries to supermarkets have come under particular strain but the disruption is not limited to perishable goods, with the CBI reporting last week that companies were struggling with the worst stock levels on record. A separate survey of hospitality businesses found that 94% had issues with their stock, and two thirds were reducing product lines as a result. The end result for consumers is likely to be less choice in shops – and higher prices. (Sunday Times)

Just Eat hits a pothole in New York: New York’s city council has voted to permanently cap the commission rates that food delivery services can charge, prompting a sharp fall yesterday in the share price of Just Eat Takeaway, the London-listed owner of Grubhub. The legislation to license food-delivery apps including Grubhub, DoorDash and Uber Eats provoked a swift response from the companies, which called the price controls unfair and vowed to fight them. Grubhub said: “This permanent price control is flagrantly unconstitutional and will hurt local restaurants, delivery workers and diners across NYC. We will vigorously fight this illegal action.” DoorDash said that caps on commission charges were “unnecessary and unconstitutional” and it added that New York’s restaurants “need choice more than ever, and this dangerous government overreach will severely limit the options small businesses rely on every day to succeed”. Bill de Blasio, New York City’s mayor, has 30 days to sign the legislation, which would go into effect 120 days after becoming law. The bills limit the amount that companies can charge restaurants to use their platforms to 15% of food orders for delivery services and 5% for advertising and other non-delivery services. Restaurants have complained that commissions from delivery companies as high as 30% are draining their finances, so the city enacted temporary caps on those fees during the pandemic when so many restaurants were forced to close or rely on delivery and takeaway. The new legislation requires the companies to obtain operating licences, which are valid for two years. Uber did not immediately provide a comment. Dan Ives, an analyst at Wedbush Securities, an investment firm, said that New York’s permanent cap would mean a “10% headwind” for the growth of all players in the market. (The Times)

Take a slice of Franco Manca’s recovery: Franco Manca’s owner, Fulham Shore, is coming out of the pandemic with one thing on its mind: expansion. The AIM-quoted company has a hit list of 150 sites where it thinks it can plant a pizza restaurant or its other brand, Mediterranean dining spot The Real Greek. Investors have reason to be optimistic. Franco Manca’s restaurants are trading above 2019 levels, while takeaway and delivery orders have held up after lockdown. If the buzz continues, Fulham Shore may soon be updating the market with good news on trading. Watch this space. The business is led by executive chairman David Page, who ran PizzaExpress in the 1980s and 1990s with the entrepreneurs Luke Johnson and Hugh Osmond. Its history as a quoted company has had its ups and downs. The shares rose from 2p to 22p shortly after Fulham Shore joined the AIM market in 2014. After crashing back to 4.75p during the first lockdown, they have recovered strongly, closing on Friday at 17.7p and giving it a value of £109.4 million. It now has 76 restaurants. Like all restaurant groups, Fulham Shore was hit hard by covid. Sales in the year to March fell 41.3% to £40.3 million, despite a shift to takeaway and delivery via partnerships with Deliveroo and Uber Eats. It also made a pre-tax loss of £7.5 million, against an £800,000 profit a year earlier. But the company plans to make the most of cheaper property coming out of the pandemic, with rent deals cutting its opening costs by about £100,000. Further growth could come overseas. Fulham Shore has hired a team to run its international franchising operations, and early discussions are afoot for expansion into Greece. There are also opportunities for it to snap up younger brands to add to the business. Longer term, it will probably look to sell its brands to a larger rival. Despite the optimism, there are reasons to be cautious. Franco Manca needs to look over its shoulder at the growth of rivals Pizza Pilgrims and Pizza Punks. And Fulham Shore has a low free float of just under 30%. Page, 69, owns 13.5%, while Nabil Mankarious, the founder of The Real Greek, owns 18.9%. That said, with international growth on the horizon, and soaring summer sales, Fulham Shore is one to buy. (Sunday Times)

Cafes and gyms can revive our worn-out high streets: James Timpson writing in The Sunday Times says: “Over the years, I’ve watched new kids on the block roll out different concepts, often paying crazy rents that set the going rate for the rest of us to live with. Do you remember the niche formats Tie Rack and Sock Shop, or shops with water tanks in the window providing fish pedicures? They may be long gone, but new retailers are still popping up – including one format I never could have predicted, covid-testing stores. Don’t think of the high street as a row of shops. Think of it as a series of buildings that can be repurposed to provide whatever’s needed. This could be housing, gyms or libraries – they don’t have to be retailers. While many experts predicted that covid and online retailing would sign the death warrant for high streets, bizarrely they may have helped solve two big problems: excessive rents and excess shops. With a portfolio of more than 2,000 properties, I can see what has happened to rents across the UK in real time. For many years, it felt like we were on the losing side versus landlords as rents kept climbing. Now, when renewing a lease, we get rents at levels about 30% lower than before covid. This makes high streets more viable for established retailers and start-ups alike. To back this up, some councils are making bold moves to reduce the number of shops and create spaces that are more relevant to how people live. There is government support for redevelopment, through the Towns Fund and the Future High Streets Fund, so the tone is set and the economics are looking better. But change depends on inspirational leaders who understand their communities. We haven’t opened a new high-street shop for six years; instead, we’ve been growing our out-of-town portfolio. But this trend could be set to flip, particularly if developers create new fresh-food markets, service arcades and craft hubs. People will return to town centres that take a risk and reinvent themselves. They may not all be shoppers – some could be there to have a meal, or visit the library or a medical centre, train at a gym or watch a film at the independent cinema. Online shopping will remain popular, but covid has taught us the importance of personal contact; every town needs a social hub. So high streets aren’t dead – they’re just changing faster than ever.” (Sunday Times)

Celebrity chef Nick Nairn’s restaurant burns down in 90 seconds of devastation as customers flee ‘explosion’: An off-duty firefighter and a cop helped guide dozens of diners from celebrity chef Nick Nairn’s restaurant during a horror blaze. The telly cook, 62, told how the heroes helped guide panicked punters outside after the kitchen went up in just 90 seconds when a piece of equipment malfunctioned at the bistro in Bridge of Allan, Stirlingshire. His chefs tried to dampen the flames with a fire blanket and tackled it with extinguishers – but they were forced to flee when the canisters ran out and the appliance ‘exploded’. Nairn said: “We had a full house. It happened right in the middle of service. Luckily an off-duty cop and off-duty firefighter were dining with us. They assisted with the evacuation. Everybody is okay – that’s the main thing. It took hold in 90 seconds. It’s scary how quickly it happened. It’s a bitter pill to swallow after the last 18 months. We have to ask ourselves what’s next, we’ve already been flooded.” Customers and staff were forced to escape after the fire broke out around 8.17pm. Six fire engines raced to the scene as emergency crews descended on the street. Two people were treated for smoke inhalation. More than 30 firefighters battled the blaze at the chef’s flagship restaurant. Nairn – the youngest Scottish chef to win a Michelin Star – was working at another branch but rushed to the restaurant when he was told about the blaze. (The Sun)

Jay Rayner reviews The GPO, Liverpool: The app wants to be reassuring. Yes, of course I can have half a fried chicken with hot sauce on a thick slice of bread with pickles. As long as I am in Sheffield. I’m not in Sheffield. I’m in Liverpool, in a booth within the polished redevelopment of what was once the city’s General Post Office building. It is baffling. The app is meant to be the best way to unlock the offering at this food hall with its many outlets and gracious table service. Now it has taken me all the way through the process before telling me I am 78 miles away from my order. This is a profound tragedy, albeit only within the narrow parameters set by a restaurant critic’s nightmarish entitlement. The GPO Food Hall in Liverpool is a great idea. Unfortunately, a great idea is not always the same as a great night out. At least not yet. There is the potential for one here; it just needs some fine tuning, and maybe one of those stern meetings at the app developers’ office to which no one brings Danish pastries because that would undermine the seriousness of the message. The GPO Food Hall offering has been put together by the Milestone Group, which cut its teeth with the Cutlery Works in its home town of Sheffield. In Liverpool, alongside Jailbird fried chicken, it currently includes the restlessly pan-Asian Konjö, the Middle Eastern MorMor, Patty B’s Burgers, Chit ’n’ Chaat (kind of) representing the Indian subcontinent, Torito Tacos and Ice Desserts, for those who never really liked their pancreas anyway. There are also a couple of bars and a coffee place. For the most part this is flavour-bomb food, designed to slap you in the face and slap you again and again. None of it is subtle or carefully crafted. What we get are a set of sturdy, reasonably priced dishes, better versions of which can be found elsewhere, but not all in one place like this. Very few cost more than £10. Of the outlets we tried, the best by far was the Middle Eastern MorMor. Granted, you’ll not find harissa spice-dusted Padrón peppers anywhere on the road between Alexandria and Amman, but they were vibrant and punchy. (The Observer)

Tom Parker Bowles reviews Defune and Sumi, London: You’ll find no frills or flourishes at Defune, no muzak, swagger or over-exuberant interior design. Because this discreet-to the-point-of-secretive Marylebone Japanese restaurant is single-minded in its dedication to flawless sushi and sashimi. Oh, and the occasional hand roll, too. They do have a menu with other things. I know that because it sits, untouched and unopened, every time I visit. It may well be very good, although I wouldn’t know. Because at Defune, you head straight for a seat at the sushi bar. Where you put your lunch in the hands of the great Sammy, provider of blessed relief from the tyranny of choice. You start with sashimi, usually tuna, flawlessly cut, deliriously rich. Then yellowtail, firm and handsome. And scallops, of course, as sweet as you’ll ever taste, alabaster discs of quivering delight. Those who are that way inclined can order natto, fermented soybeans, mildly stinky and gloriously sticky, the very essence of umami, with a few chewy curls of squid. Nigiri next, placed on the wooden counter and eaten by hand, the rice just warm and gently vinegared, each grain individually discernible, somewhere at that magic point between soft and firm. A luscious prawn, or more tuna, is draped atop, brushed with a whisper of tamari sauce. It takes years of experience to make simplicity taste this good. Finally, tempura maki roll, a delicate cone of nori seaweed filled with more of that rice, and the hot crunch of tempura-coated shrimp. Like everything else, it has a clean, Zen-like purity. In fact, the only jolt here is the price. Perfection does not come cheap. Sumi, across town in Notting Hill, has another great sushi master at its helm, Endo Kazutoshi of Rotunda fame. Again, this is many miles removed from YO! with a smartly clad team toiling away in an open kitchen. There’s lots of natural light, and blonde wood, and music too, something that would be frowned upon at Defune. Mushroom miso soup has splendid forest-floor depth. A sprightly seaweed salad is slick with creamy sesame dressing, and has a sharp yuzu tang. Sashimi – yellowtail, tuna and scallop – is beautifully cut and sourced, some of the best in London. Nigiri is also very good indeed, the fish and rice both immaculate. Though Sumi is not yet quite up there with Defune. But then nothing really is. (Mail on Sunday)

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