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Tue 2nd Nov 2021 - Propel Tuesday News Briefing

Story of the Day:

Mollie’s Motel & Diner secured new £10m facility to aid growth: Mollie’s Motel & Diner, the Soho House-developed concept, secured a £10m interest-free, loan facility earlier this summer, to support the company’s expansion plans and provide working capital for new site openings. The company’s latest accounts show the business, which is backed by entrepreneur David Elghanayan, the co-founder of London-based investment firm Nema Capital, and led by Darren Sweetland, former chief financial officer at Soho House, has so far drawn down £4.5m from the new facility. Earlier this summer the business launched its second site, at Bristol’s Cribbs Causeway. The concept was launched more than two years ago just off the A420 outside Oxford, with Soho House founder Nick Jones saying it hoped to open a further ten across the country. Sites in Manchester, as part of Allied London’s £1.2bn regeneration of the Old Granada Studios property, and near Brighton seafront have been mooted for a while. Since the lifting of restrictions in May, the group’s Oxfordshire site has seen record turnover and its most profitable period of trade since inception. The company also expects the Bristol site to be Ebitda positive by FY2022. It said the site in Manchester is currently under development and further locations “have already been earmarked as part of the immediate expansion plan”. Between November 2020 and May 2021, Elghanayan provided several shareholder loans totalling £1.9m to the brand’s parent company, which allowed it to provide working capital to the business during the periods of enforced closure. Part of the funds drawn down from the facility were used to repay the shareholder loan in full. The business invested £15m into the site in Cribbs Causeway, which comprises 123 bedrooms across three floors, an all-day 95-cover diner, as well as communal workspace. The business is backed by majority shareholder Javad Marandi, the entrepreneur and investor, who owns Soho Farmhouse, alongside co-shareholders Elghanayan and Sweetland. 

Industry News:

Three days to go before fourth edition of The New Openings Database released, to show details of 306 new sites, 15,000-word report included: The fourth edition of The New Openings Database, which is produced in association with StarStock, will show the details of 306 newly announced site openings and upcoming launches for Premium subscribers when it is published on Friday (5 November), at midday. The database shows the details of which company has opened a site or its plans to open one in the future. It will have details on what type of site it is and its location. There will also be a website link to the businesses so you can find out more about them. The database is published on a monthly basis. This fourth edition features several international growth brands making their UK debut, new and expanding luxury leisure concepts and regional brands in growth. For the first time this month Premium subscribers will also receive a 15,000-word report on the new additions to the database. Premium subscribers also receive access to two other databases. The latest Propel Multi-Site Database, which is produced in association with Virgate, was sent to Premium subscribers last Friday (29 October). The database contained 66 new companies, bringing the total number of businesses listed up to 2,152. The 446 sites run by those 66 new additions means the entire database of sites has reached 61,740 sites. Premium subscribers also received a 5,000-word report on the new businesses added. The go-to database provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. In a new feature this year, there is a synopsis of what the business does and significant news associated with it. Premium subscribers also receive the Turnover & Profits Blue Book, which is produced in association with Mapal Group. The Blue Book, which is also updated every month, provides an insight into UK operator turnover and profitability over five years, profit conversion and directors’ earnings. Subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews and now also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Propel insights editor Mark Wingett. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The regular single subscription rate of £395 plus VAT for operators and £495 plus VAT for suppliers remains the same. To subscribe, email
Prestige Purchasing’s free Christmas trading in a supply crisis webinar to be sent today: Foodservice and hospitality procurement consultancy Prestige Purchasing’s free-to-view Christmas trading in a supply crisis webinar will be sent to those operators that have registered today (Tuesday, 2 November), at 9am. The 60-minute seminar is aimed at giving operators “the best chance of mitigating the twin effects of inconsistent supply and rising prices this Christmas”. It will focus on the causes of the supply chain crisis and how long it will continue for, what can be done about product availability, how to keep a lid on price inflation and how to ensure longer-term stability. Speaking will be Prestige’s founder and chairman David Read, who has more than 40 years of sector experience, and chief executive Shaun Allen, who has an extensive knowledge of farm-to-fork supply. 
Sector like-for-likes up 13.5% in October compared with 2019 levels, London shows sign of recovery: Like-for-like sales were up 13.5% in October when compared with 2019 levels, according to the latest data from S4labour, the online labour-scheduling management system from Catton Hospitality. In particular, food-led sales performed well with a 17.8% increase in like-for-likes. Drink sales were also up by 9% – much higher than September’s drink like-for-likes. Non-London based sites saw their like-for-likes increase by 15.5%. London sites showed signs of recovery with their like-for-likes up too, but by a smaller 3.5%. S4labour chief product officer Richard Hartley said: “October’s high like-for-likes is excellent news for the sector, especially given the amount of headwinds (such as the increase in VAT and supply problems) that operators are facing. The autumn Budget also spelled some good news for the sector in the years ahead.”
Anne Ackord – VAT for sector should permanently be 5% but industry set for strong recovery in 2022: Anne Ackord, chief executive of Brighton Pier Group, has told Propel there should be a permanent reduction in VAT for the hospitality industry, to 5%, but believes the sector is set for a strong recovery in 2022. The VAT rate rose to 12.5% at the start of last month for hospitality and is set to return to its 20% rate at the start of April next year. But Ackord believes the rate should be permanently set at 5% – the level that was introduced in July 2020 before it was increased to 12.5% at the start of October. Speaking following the company’s full-year results, Ackord said: “I think there is going to be a strong recovery for the industry next year, but what would really help would be a permanent reduction in VAT. While the 12.5% level we have now is helpful, I think it should be lower still – at the 5% level it was previously. Seaside and small businesses in particular could really do with that as we go into the traditionally quieter months after Christmas. Costs are continuing to go up and have to be monitored closely. It’s not just wages that are playing a part in attracting staff, but also that work-life balance and we are seeing more people looking to part-time roles. We’ve also noticed staff want their training to be online so we’ve been working on making this more interactive and using games where possible and we’ll be rolling this out across the group.” Ackord said the company had seen strong trading across all divisions during the half-term period, particularly in the bars business, which had also benefited from Halloween. She added the group was focusing acquisition opportunities on the experiential side of the business having added the Lightwater Valley theme park in North Yorkshire to its portfolio in the summer. She said: “We’ve got the core estate we want in the bars division so we’re now looking to use our expertise of our team in those other areas, such as the adventure golf and theme parks, when it comes to further acquisitions.” Ackord added the group had seen an increase in spend per head and was seeing more sales of non-alcoholic drinks while the business was also seeing more Christmas bookings coming through. 
Hygiene more important to consumers post-covid, hospitality operators warned: Bars and restaurants that fail to maintain high food hygiene standards post-covid have been warned consumers are less likely to give them a second chance. This follows new research from Food Alert and KAM Media, which surveyed 500 UK adults, with almost two in three saying hospitality hygiene standards had become more important since the pandemic. More than half wanted venues to continue transparently displaying hygiene measures and 69% wanted to see hand sanitising stations become a permanent feature, while some 49% had a “one strike and you’re out” attitude to bad hygiene standards. Food Alert operations director Mike Williams said: “As we emerge from the pandemic, it’s clear that consumer hygiene awareness has heightened and shows no sign of waning. Those venues that can prove they operate the highest levels of hygiene and food safety will be the ones to win trust and build sustainable businesses going forward.”
Pub Governing Body reports ‘high’ levels of compliance despite pandemic challenges in latest audit: The Pub Governing Body has reported “high” levels of compliance in its fifth annual audit of companies operating up to 499 leased and tenanted pubs. The audit is based on codes of practice published by the Pub Governing Body and covers 1 August 2020 to 31 July 2021. The audit found full compliance regarding both business plans and the number of rent reviews settled within the audit period, apart from those that had to be delayed as a result of covid-19. Pub Governing Body chairman Sir Peter Luff said: “This has been a second very difficult year for all pubs – and we hope the easing of restrictions imposed due to the covid-19 pandemic will not be reversed – but we are very pleased to see that, despite these unprecedented challenges, a high level of compliance has been maintained. The industry can take pride in five years of sustained compliance, as the climate in which pubs operate returns to something closer to normality. However, there are two particular areas where we believe companies will need to be diligent if this record is to be continued into a sixth year – ensuring business development managers are properly trained and settling outstanding rent reviews at the earliest opportunity.”
Job of the day: COREcruitment is working with a visitor attraction business in North Yorkshire as it looks to hire a retail and catering operations manager. The catering offers currently include fast food outlets, pizza restaurant and takeaways, cafes and ice cream outlets. There are two main retail shops selling a variety of souvenirs, gifts and confectionery. A COREcruitment spokesman said: “The business has plans to expand this portfolio this winter and is looking for a proactive and people-focused operations manager to support this journey. The ideal operations manager will have experience in expanding and improving catering offers, new openings and product development. They will support the senior manager in goals to drive revenue, footfall and customer experience and will be a key part of the senior team.” Anyone interested can email with a copy of their CV. 

Company News:

Wingstop UK appoints Chris Sherriff as COO: Lemon Pepper Holdings, which is rolling out US chicken brand Wingstop across the UK, has appointed Chris Sherriff, formerly of Ben & Jerry’s and Yum! Restaurants, as its new chief operating officer, Propel has learned. Sherriff joins the company after almost six years at Ben & Jerry’s, including most recently as head of retail – Europe and Asia. Wingstop recently opened its eighth restaurant in the UK, in Bristol’s Cabot Circus scheme. The company also operates six delivery kitchen sites. It will open a site in the Edinburgh St James Quarter scheme, in the unit previously earmarked for @Pizza, and on the former Bella Italia site in Manchester’s Piccadilly Gardens, later this year. Wingstop is also set to open a site in Wood Green, north London, in Capital & Regional’s The Mall scheme. Last weekend marked three years since the brand launched its first site in Europe, in London’s Shaftesbury Avenue. It has “strong ambitions” to double the size of its UK estate in 2022. In May, Wingstop, which has more than 1,500 locations worldwide, announced a minority investment in Lemon Pepper Holdings. Wingstop said the investment followed strong performance in the UK and underscored the brand’s confidence in the market as a key growth lever for global expansion.
Cubitt House reports ‘significant and sustained’ increase in trading since ‘Freedom Day’: London gastropub operator Cubitt House has seen a “significant and sustained” increase in trading since the lifting of restrictions on “Freedom Day” in July. The company also said with more of its customers returning to the office, it expects to return to historic trading levels in early 2022. Cubitt House added it is continuing to work with its banking partner, Barclays, on its longer-term financing options having managed during the pandemic to negotiate various extensions to its overdraft facility. The business secured a maximum extension of £500,000, providing a total of £1m of overdraft facilities to the group. It comes as Cubitt House reported turnover fell to £5.1m for the year ending 31 December 2020, compared with £11.3m the year before as a result of the various lockdowns. Ebitda before pre-opening costs was minus £1.1m, compared with a profit of £805,000 the previous year. Pre-tax losses increased to £2.3m from £311,000 the year before. The directors did not recommend the payment of a dividend. During 2020 the business completed a number of projects including introducing order and pay, simplifying the menu and making improvements to its outside trading areas. In their report accompanying the accounts, the directors stated: “While the results of the period to December 2020 are not those that we were hoping to present we are still proud of what we have delivered in the period, and believe we are well placed as the effects of the pandemic recede and the world returns to relative normality.” Last week Cubitt House reported chef Ben Tish had joined as chef director, as the group looks to continue its London expansion. His priority will be to ensure each of Cubitt House’s current portfolio of six pubs has a distinctive menu and will oversee their development alongside Richard Sandiford, previously of Hawksmoor and The Double Red Duke, who will focus his attention on new openings. Lucky Onion group founders and Country Creatures owners Sam and Georgie Pearman have also joined the board. Sam will focus on the operational side of the business while Georgie will take charge of the redevelopment of the existing portfolio and new sites. The new ventures include turning the former Pomona’s site in Notting Hill into The Princess Royal and launching The Barley Mow in Mayfair, both next year.
Amber Taverns sets sights on south Wales and south west England expansion: Community pub operator Amber Taverns has targeted south Wales and south west England for its next phase of expansion. The business, which operates more than 160 pubs in the Midlands, Wales, north of England and Scotland, has opened three sites in the UK this year, all of which have been retail conversions. They are the Jack Jigger, which came to Walsall in May; the Three Brass Monkeys, which launched in Bridlington in September and the Brier Rose, which opened in Brierley Hill last month. The company, which is being advised by Savills, is now on the hunt for freehold or long leasehold high street locations in new areas outside its traditional heartlands. Stuart Stares, associate director in Savills’ licensed leisure team, said: “With the economy opening up, we’ve seen pubs and restaurants benefit from the positive and energetic response from consumers. The sector is expected to continue to perform resiliently, and as such we have seen active interest from investors, both new and established. Amber Taverns is an experienced pub operator with an established portfolio, many of which have been converted from alternative uses, and now seeks to expand.”
Amber Taverns features in Propel’s Turnover & Profits Blue Book, which is updated monthly for Premium subscribers. Amber Taverns has turned over an average of £71.9m in the past five years. The Blue Book, which is produced in association with Mapal Group, provides a five-year overview of turnover and profit, ranks 427 companies according to turnover, pre-tax profit and profit conversion. It also provides details of directors’ earnings and highest paid directors. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The regular single subscription rate of £395 plus VAT for operators and £495 plus VAT for suppliers remains the same. Email to sign up.
BrewDog plans to double up in Bristol, eyes further Red’s franchise site: Scottish brewer and bar operator BrewDog is to double its presence in Bristol, with plans to open a new bar in the city’s harbourside. Propel understands BrewDog plans to open a site in Millennium Promenade, which will join its existing Bristol-based bar in Baldwin Street. The business also has sites lined up in the BH2 centre in Bournemouth and in the Brewery Quarter, Cheltenham. Meanwhile, Propel understands BrewDog is looking to extend its franchise agreement with smokehouse brand Red’s True Barbecue to a further site, in Hull. It is believed to be in early discussions on a site in the city’s Princes Quay. BrewDog currently operates four sites with Red’s, including sites in Headingley and Huddersfield. Last month BrewDog reported it had seen strong trading in its UK bars, particularly in the regions since reopening with its London sites starting to recover. The company, which operates 105 bars globally, also said trading is ahead of expectations in its recently opened UK sites. Last week Propel revealed BrewDog is to open its biggest site to date, complete with bars, brewery, workspaces, bowling alley and coffee shop, in London’s Waterloo. 
Ex-The Naked Deli chief executive to launch new kebab concept: Craig Bell, the former chief executive of Newcastle-based The Naked Deli, is to launch a new quick service restaurant kebab concept called Sqew, Propel has learned. Bell, who stepped down as chief executive of The Naked Deli earlier this year, will launch the new concept later this week with co-founder Mitch Renshaw, in Duncan Street, Leeds. Bell, who was previously finance director of Red’s True Barbecue, told Propel the business was set to launch at the start of 2020 before the pandemic put things on hold. Bell said the business would spend the next six months to a year building up its following in Leeds, but would look at expansion opportunities in places such as Manchester, Newcastle and Sheffield going forward.
Le Bab set to open in Brixton: Modern kebab concept Le Bab, founded by Stephen Tozer, Manu Canales and Ed Brune, is to open a new site in London’s Brixton, Propel understands. Le Bab is believed to have started building the new site in Coldharbour Lane. Earlier this year, the business opened its third Le Bab site, in Old Street, Shoreditch. Tozer and Brunet launched Le Bab in Soho’s Kingly Court in 2016. They opened a second London restaurant, in Covent Garden, two years later, under the Maison Bab name. The business also operates a collaborative venue with German Kraft Beer in the Dalston Locke hotel. Nick Garston, of the Found Agency, acts on behalf of Le Bab.
Nando’s now carbon neutral across its scope one, two and three emissions: Nando’s has announced it has become carbon neutral across its scope one, two and three emissions, as part of its roadmap to becoming net zero by 2030. Colin Hill, chief executive of Nando’s UK & Ireland, said: “In May we announced Nando’s UK & Ireland would be taking bold steps in the fight against climate change. As of today, I can confirm we are carbon neutral across our scope one, two and three emissions, the first step on the way to our ultimate goal of becoming net zero by 2030. An important first not only for the brand but our industry as well. We have made a good start on the journey to cut our own emissions and are also taking responsibility for those that can’t be avoided, through carbon offsets that finance climate and development projects elsewhere – in this case, our homeland of South Africa and surrounding countries that provide vital ingredients for our world-famous peri-peri. Becoming carbon neutral is only a small part of the journey we are on to reach our existing science based target, which will see Nando’s reduce the carbon footprint of the average meal by almost 50% by 2030. This is on top of the 40% reduction we’ve achieved since 2015. We are proud of this progress but we are under no illusion the job is anywhere near done and as world leaders, activists and sustainability experts converge on Glasgow for COP26, we’ve never felt more sure of our commitment.”
Chestnut Group adds to East Anglia portfolio with 15th acquisition, plans further growth: East Anglian-based pub and restaurant company The Chestnut Group has continued its expansion across the region by taking on The Feathers in Holt. The pub, which was built on the site of an old cattle market in 1650, has 16 bedrooms with capacity for growth, alongside a restaurant and bar. The addition of The Feathers follows the acquisition of The Maltings in Weybourne earlier this year and takes the group’s estate to 15 pubs. Chestnut founder and managing director Philip Turner said: “It continues to be a year of growth, and with Norfolk remaining a great staycation destination and fast developing into a preferred post-covid relocation hotspot, The Feathers is the perfect addition to the Chestnut collection. We have ambitious growth plans for the area, which is reflected in our latest acquisitions. Chestnut is looking to consolidate its position in a market of £3.5bn tourism spend and be well positioned for the changing dynamic of office/home working habits.” Earlier this year the group announced it had raised £7m from a range of private investors to support the acquisition of new hospitality sites around East Anglia and support a comprehensive upgrade programme. Turner also announced the group’s pubs would all close on Christmas Day and Boxing Day to give their teams time off, despite a predicted £250,000 in lost revenue.
Baz & Fred continues Cotswolds expansion with third site: Pizza specialist Baz & Fred, which operates two pizzerias in London, has expanded its Cotswold portfolio with a new deli and coffee shop. The Twig, so-called as it’s an offshoot of nearby Cirencester pub The Stump, serves pastries, sourdough toasties, cakes, foccia sandwiches and coffee from Oxfordshire-based roasters Ue Coffee. Having opened in the site of a former village store that has lay empty for some years, The Twig also sells a selection of local produce such as honey, oil, cured meat, wine and beer. Baz & Fred also operate another Cotswolds pub, The New Inn, in Coln St Aldwyns. The duo behind the company, Harry Henriques and Fred Hicks, started making pizzas in 2012 and opened their first restaurant in Southwark’s Flat Iron Square, followed by a second site near Brixton railway station early last year.
Second Greene King Partners pub for Teesside-based bar and restaurant group: The Teesside-based Marshall Robertson Group, led by Sally Marshall, has taken on its second site with Greene King Pub Partners. It has reopened the Union Arms, in Yarm, Stockton-on-Tees, under a new name, Marshall’s, following a £116,000 refurbishment. This follows the reopening in April of The Ship in Redmarshall, also in Stockton-on-Tees, after a £190,000 investment that included a large extension and new kitchen. New food and drink menus have been launched at both sites, including cocktails created by Sally’s son, Toby, featuring popping candy and other sweets. Among the food offerings are the Parmo – breaded chicken or pork with bechamel sauce and a variety of toppings from around the world. Sally said: “Greene King Pub Partners has supported us through both investments, and even as experienced operators, the advice was invaluable to relaunching the sites.” Sarah Barron, Greene King Pub Partners business development manager, added: “To say Sally has made a mark on both businesses is an understatement. Her standards and values in her business run right through both pubs. Having an experienced operator like her who knows what makes a good business great is fantastic.” The Marshall Robertson Group, which also boasts Middlesbrough restaurant Prickly Bear Bistro in its portfolio, was formed four years ago after Sally had spent several years supporting Toby in his Asian street food project. Greene King Pub Partners operate 995 pubs across the UK through a range of agreements, from tied tenancies and leases to turnover agreements and franchise concepts.
SpiceBox doubles up with Leytonstone launch: SpiceBox, the London-based vegan curry house concept, has doubled up. Founder Grace Regan has opened the new restaurant in Leytonstone. Taking over what was previously Vietnamese restaurant District Mot, the new SpiceBox is significantly bigger than its Walthamstow sibling, with up to 90 covers. The Leytonstone outlet has an expanded dinner menu, revamped weekend brunch and offers coffee, wine on tap and cocktails. As well as new dishes such as Mushroom Madras – roasted portobello mushrooms in a creamy, spicy tomato sauce, the restaurant also offers favourites such as Jackfruit Jalfrezi and Shroom Keema – a rich mince of chopped mushrooms, walnuts, soya and peas. Its Tiffin Club, which allows guests to get their takeaways in a reusable metal tiffin time and time again, is also running along with its in-house deliveries via electric bike. Regan published her first cookbook in April this year while SpiceBox has also launched a retail range of sauces and condiments. Regan launched the Walthamstow restaurant in January 2019.
Nico Simeone cancer charity-supporting Glasgow restaurant to open this month: Scottish-Italian chef Nico Simeone, who is behind the Six by Nico brand, will open his new philanthropic restaurant in Glasgow on Tuesday, 16 November. Beat 6, which will open in Whitehill Street in Dennistoun, will send all profits to the Beatson Cancer Charity, which supports the Beatson West of Scotland Cancer Centre. Simeone’s wife, Valentina, was diagnosed with Non-Hodgkin’s Lymphoma in May 2015 at the age of 25 and was treated at the Beatson. The 34-cover restaurant will offer a constantly rotating tasting menu that celebrates some of the most popular dishes created in the Six by Nico kitchens since its first restaurant opened in Glasgow in 2017. Simeone has opened eighth Six by Nico restaurants to date with a ninth set to open in Dublin shortly. A six-course tasting menu costing £32 will include Six by Nico classic deep fried Mars Bar with Irn Bru sorbet and chocolate soil, plus a vegetarian alternative for each course.
Brixton restaurant Three Little Birds relaunches with new name and direction, sister site closes: April Jackson, founder of Three Little Birds, will relaunch the Brixton-based Jamaican restaurant as Wood & Water next month. Situated at the Coldharbour Lane site of its previous incarnation, the venue is going in a new culinary direction, serving modern British food with a Jamaican twist. The announcement comes only a month after Jackson permanently closed her other Three Little Birds site, in Battersea Rise, due to staff shortages. The former Miss Jamaica Universe and The Apprentice contestant has teamed up with Lee Tan, both her business partner and real-life partner, for the venture. Having recently celebrated the birth of twin girls, the couple set their sights on a project combining their love of Jamaican flavours with innovative techniques and a contemporary style. While the menu will come from Jackson, operations manager Tan will draw on more than 20 years’ experience in the hospitality industry to create a new cocktail menu to complement the dishes. There will be a cocktail lounge at the front and a dining area towards the rear. Jackson said: “After a hard year, it is time to go back to the reason I started six years ago, which was to share my love for Jamaica through delicious food, rum cocktails and warm hospitality. Brixton is still changing, and we are eager to change with it. I am excited to serve small plates that have familiar ingredients alongside some less familiar Jamaican elements, in a newly renovated space with an interesting collection of rum and an energy.”

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