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Morning Briefing for pub, restaurant and food wervice operators

Tue 20th Mar 2012 - Marston’s, Peach and Novus

Story of the day:

Operators report mixed results with Groupon: A small survey of operators who have used Groupon has found a range of results. Paul Salisbury, who runs Lovely Pubs, has undertaken two offers with Groupon, one each for his Stratford site The Baraset Barn and the Farm in Lichfield. “We sold 2,000 vouchers in 45 minutes for The Baraset Barn – some people were buying ten and giving them away as presents. The average spend-per-head was £17 to £18. “We negotiated a 60/40 revenue split with Groupon in our favour – it is possible if Groupon wants you. The secret is to be in control – the offer was available at limited times and customers had to book online. “It created a lot of e-mail traffic with 50 to 60 a day and we had to assign someone to dealing with it. “But overall I found it very good and it created a meaningful database which we used to promote another pub, the Orange Tree.” Ross Sanders, whose Urban and Country Leisure (UCL) business runs two Lazy Cow hotels and six pubs, found Groupon a good way of achieving high occupancy rates at the Lazy Cow in Warwick, which opened in October 2010 – but found Groupon badly affected his margin on food and beverage sales. “When you open a new hotel, achieving 95 per cent occupancy could take a year and involve, perhaps, a £50,000 marketing spend. “We were at 98 per cent occupancy within two months of opening and have never dropped below that.” On food and beverage, Sanders said Groupon had brought a lot of “bargain-hunters” who could not be up-sold – nor returned to the venue. With a half-price discount and 50 per cent of revenues going to Groupon, Sanders reports UCL was earning £2.50 for a £10 meal. He also said that Groupon payment terms mean that UCL isn’t paid for three months after a meal is served. He recommended KGB deals, a smaller discount broker that pays much more quickly that Groupon. Dan Shotton, boss of Redcomb Pubs, said the company avoided Groupon. “It’s too scattergun. If you get into the discounting culture, customers start to expect it. We prefer to use short, sharp bursts of discounting on a tactical basis.” 

Industry news:

£20bn in discounted loans available: Four UK banks are to offer small businesses £20bn in discounted loans underwritten by the Treasury. Small businesses taking out a loan will receive a one per cent discount to the normal interest rate.

Minimum wage freeze for under 21s: The minimum wage is to be frozen for under-21s. From 1 October the minimum wage for workers aged 21 and over will rise by 11p from £6.08 to £6.19. For those aged 16 and 17, the hourly rate will be frozen at £3.68 and frozen at £4.98 for those aged 18 to 20.

Hi-Spirits launches first draught vodka, Vodka One: A company has launched the industry’s first draught vodka, Vodka One. The draught Vodka One font means staff can serve super-cold premium vodka much quicker than is the case at the moment. Vodka One has been successfully trialed in a number of high street venues in the past five months. It’s been shown to increase vodka sales and reduce product waste to zero. The Vodka One font delivers a certified weights and measures 25ml or 35ml shot in one second. It also has built-in stock control software that allows licensees to easily cross-reference with EPOS and manual stock takes. The new product has been launched by Hi-Spirits, the company behind spirit brands such as Buffalo Trace and Antica Sambuca.

New York restaurant reduces “no shows” by charging: New York eatery Eleven Madison started charging anyone who didn’t show up or cancelled a reservation 48 hours beforehand $75 a head, the Wall Street Journal has reported. Owner Will Guidara says the restaurant was losing eight to ten people per night. Since the policy has been in place, the restaurant claims it is only having to charge a couple of cards a week.
Panmure Gordon analyst re-iterates minimum pricing concerns: Simon French, the highly rated Panmure Gordon analyst, has repeated his concerns about the setting of a minimum price for alcohol. French said: “We think alcohol duty will increase 5.9 per cent (two per cent above January RPI of 3.9 per cent), although The Times on Saturday suggested it could be 7.2 per cent. This will bring duty on a pint of 4.2 per cent abv beer to circa 48-50p. “We think plans for minimum pricing will not be included in the Budget but instead presented a few days later. “A minimum price of 40-50p per unit of alcohol appears to be the most likely outcome. This leaves us uncomfortable that the industry becomes a price-taker from government rather than a price-setter.”

Newport goes polycarbonate: Pubs, bars and nightclubs in Newport have gone glass-free at weekends after 10pm and for all sporting events. The majority of venues in Newport went glass-free after the provision of £5,000-worth of polycarbonate glasses by the Safer Newport Partnership in 2010. A Revolution vodka bar did not take up the offer because it was using toughened glass. It has since moved to polycarbonates and will also use polycarbonate ashtrays.

Surprise jump in US full-service restaurant sales: The New York Times has reported a surprise jump of 8.7 per cent in sales at full-service restaurant in the 12 months to the end of January this year. It’s the fastest pace of growth since the late 1990s – and much higher than sales growth at limited-service restaurants. The New York Times states: “Since those numbers became available 20 years ago, the difference (in sales growth between the two segments) has been a reliable indicator of how the economy is going.”

Company news:

Marston’s to re-open failed hotel: Brewer and retailer Marston’s is set to re-open the landmark 70-bedroom Wynnstay Hotel in Wrexham, part of Stephanie Booth’s seven-strong Llangollen Hotel Group that fell into administration last year. The Wyynstay closed last July and Marston’s plans to re-open the site on the weekend of 21 April after a refurbishment. Llangollen Hotel Group operated four freehold sites – The Bodidris Hall in Llandegla, Wrexham, The Wild Pheasant, The Chainbridge and The Bryn Howel, in Llangollen, Denbighshire. The Wynnstay was a leasehold site that reverted to Marston’s.

Hall & Woodhouse plans new two-storey pub restaurant at Portishead marina: Dorset brewer and retailer Hall & Woodhouse is to build a pub restaurant in a new marina project in Portishead, Somerset. The venue will be built to maximise the view of the marina. It will have a pub and bar area on the ground floor with an open plan restaurant and kitchen across the first floor.

Robinson’s tenant goes multi-site: Robinson tenant Darren Sayle is taking on his second site with the brewer and retailer. The Red Lion in Pickmere will see a substantial investment from the company and Sayle, who also runs the White Lion in Alvanley. 

Peach’s Richard Onslow receives positive review from the Daily Mail: The Daily Mail’s anonymous hotel inspector has praised the Richard Onslow in Cranleigh, Surrey which re-opened last year after a major refurbishment of the bedrooms. The newspaper’s “An Inspector Calls” column stated: “We have steak: it’s a joy. The Richard Onslow is run by John Taylor, who used to work for Richard Branson on Neckar Island. He has energy. We like the way when you order tea or coffee, the sugar arrives in a Golden Syrup tin with a little bowl of Smarties next to it.”

Greene King picks up fish and chip award: Greene King’s Old English Inns brand has picked up the coveted award of best food service outlet serving fish and chips at the National Fish and Chip awards. Group managing director Jonathan Webster said: “Fish and chips are as much a British institution as real ale and pubs.”

Orchid staff discount card produces £175,000 of revenue: Managed pub Company Orchid launched a 25 per cent discount staff card in January that has generated an average spend-per-head of £15 so far among the company’s staff. The “O Card” has been used by more than 50 per cent of staff. Four team members have spent more than £1,000 each since the card's launch in January. The personalised cards were sent to 4,000 staff and have produced 11,000 individual transactions. Orchid’s Free House Dining segment has been the most popular place for staff to use their O Cards, with £83,000 of the total sales in these family value pubs and restaurants. “The figures really do speak for themselves,” says Orchid’s commercial director Simon Dodd.

Fuller’s keen to re-name Reigate acquisition: Fuller’s has told a meeting in Reigate that it is keen to re-name The Market Hotel, which it bought last month, to “distance it from its poor public perception”. Operations manager Andrew Durn said the venue, which has been dubbed “the worst pub in East Surrey”, hadn’t always been called the Market Hotel. Of a new name, he said: “Top of our list at the moment is Market Stores.” Fuller’s plans to invest in the pub, with the development of a breakfast offer. The building was previously owned by Reigate & Banstead Borough Council and leased to Market Taverns, who opted not to extend its lease.

Gary Rhodes re-names planned £1.5m Plymouth restaurant: Celebrity chef Gary Rhodes has re-named his forthcoming restaurant in Plymouth’s Hoe area. The chef was planning to call the venue, due to open in the Dome, Rhodes West but will now call it Rhodes @ The Dome. A spokesperson said: “ Rhodes West was the initial idea, but it didn’t fit in with the vision we had for the Dome. “We wanted to identify it strongly as Plymouth rather than West Country.”

Barnard Castle restaurateurs to focus on pub: Restaurateurs Andrew and Mandy Rowbotham have closed their Barnard Castle restaurant to focus on their pub. The pair have been running the Riverside restaurant for the last five years. Last year, they refurbished the Rose & Crown in Mickleton and re-opened it as the Crown. Said Andrew: “We’ve had great support from our customers and we’ve built up an amazing reputation, which really allowed us to start up The Crown. “But The Riverside was only ever rented premises and the lease is due to expire at the end of this year.” 

New Swindon nightclub plans rooftop smoking terrace: An application to open a new nightclub in Swindon, Tiger Bills, includes a plan to allow smokers to use a roof terrace until 2am. The venue, which has applied for a 6am licence, will include a VIP mezzanine and a garden area. A previous nightclub at the location had a 6am licence but only permitted smoking on the terrace until 11pm.

JD Wetherspoon to open second site in Newquay: Managed chain Wetherspoon is set to open a second site in Newquay. The company has submitted an application to take over the Red Square building and re-name the site The Cribber. The company is seeking a licence to open from 9am to 4am, Sunday to Saturday.

Novus targets 100 sites: Novus Leisure chief executive Steve Richard has told Pub & Bar magazine he’d like to be operating 100 bars. He told the magazine: “Our growth plan is about doing more of the same. The plan is to finish London. I’m not in Canary Wharf, I’m not in Oxford Street. I’m not in Shoreditch: there’s so much more to go at in London.”

McDonald’s backs down of 24-hour opening plan: McDonald’s has revised a plan to open a 24-hour restaurant in the car park of The White Bear pub in Tingley, Leeds after 960 objections. The company has submitted fresh plans that limit opening although it now wants to demolish the pub to create more parking spaces.

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