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Morning Briefing Strap Line
Tue 3rd Jul 2012 - Thornbridge, Starbucks, Krispy Kreme

Story of the day:

Market Town Taverns boss calls for revival of “below cost selling” campaign: Market Town Taverns boss Ian Fozard has called for the resurrection of “below cost selling” proposals as a far more practical alternative to minimum pricing. Responding to an opinion piece in last Friday’s Propel Morning Briefing by Stonegate Pub Company chairman Ian Payne, Fozard said: “Banning below cost selling would achieve the aim of putting a floor under supermarket pricing and be much more easily legislated whilst heading off the price escalator fears that Ian Payne rightly raises. I do not agree, however, that “cost” should simply be duty plus VAT as was proposed by the government before they went for minimum pricing. Instead - and this would be so easy to monitor by Trading Standards - “cost” would simply be the price shown on the invoice (plus VAT), which would have to be produced by a supermarket if Trading Standards believed that abuse was occurring. It ought to be much easier to legislate - it would not be controversial so who could logically argue against it - and it would not fall foul of the competition laws.” Last Friday, Payne said that “the arguments against minimum pricing of alcohol are overwhelming”. He added: “The only way to prevent the government from wreaking further havoc in our industry is to mount a powerful and effective campaign against this initiative. If we miss the opportunity, we will surely regret it for years to come.” 

Industry news:

Sky to hold prices until 2013: Sky will freeze its UK pub and club TV subscription prices until at least June 2013, allowing licensees to benefit from certainty over their subscription charges. The move follows the introduction in January of additional food and location discounts, which have already benefited thousands of pubs across the country. New customers signing up to the top tier package - Sky Ultimate - will be able to enjoy half price viewing until the end of September 2012. Sky has also unveiled a partnership with Molson Coors to offer bars taking Molson Coors’ products a discount of up to 33 per cent off their monthly Sky Ultimate subscription. David Rey, managing director of Sky Business, said: ‘More than ever, we are focused on providing customers with tailored subscriptions, to help them to grow their businesses through the power of live sport. Beyond increasing the value of the Sky subscription through our investment on-screen, and in innovative new products and services, we can help our customers enjoy greater certainty over their entertainment expenditure by holding our prices for another year.” The move by Sky to hold prices will be welcomed by subscribers but there is concern that subscriptions will see a large jump next year after Sky and BT paid just over £3bn – a 70 per cent increase - for football rights starting in the 2013-14 season.

Around 40 MPs call for beer tax cut: Almost 40 MPs took part in a debate in the House of Commons during the early hours of Tuesday to call on the government to reduce the tax on beer sold in pubs. Adjournment debates are normally badly attended but 38 MPs - mostly Tories - stayed in the Commons until past midnight to back Gavin Williamson's call for ministers to freeze or reverse the beer duty escalator. The beer duty escalator means tax on beer currently rises at inflation plus two per cent. But Williamson, Conservative MP for south Staffordshire, said the tax was affecting British jobs. He said 86 per cent of beer sold in pubs was produced in the UK, while only 0.2 per cent of wine sold was produced in this country. Williamson said: “The simple reality is that beer duty is getting to the point where it is too high and it's pricing people out of the market.”

June beats rainfall record: June has been declared the wettest since records began, with double the average rain falling during the month, according to the Met Office. Figures show the UK received 145.3mm (5.7 inches) of rain during June, beating the previous record of 136.2mm (5.4 inches) seen in June 2007 - and more than double the average for June of 64.9mm (2.5 inches). It is the second month this year to see record amounts of rain - April became the wettest in records dating back more than a century to 1910.

Norwich claims cask ale crown: The city of Norwich has claimed the title of the UK city with most cask ale variety after a census by 30 Camra volunteers visited every pub in the city. Camra counterparts in York also performed a census on Saturday with Norwich winning with 254 real ales compared to 247 in York. Ian Stamp, pubs officer for the Norwich Camra branch, said: “We all know that Norwich is the UK Capital of Real Ale – we proved it last year, when we found 215 different beers on sale in the city, not quite reaching Sheffield’s total, but claiming the title on the basis that Sheffield is well over twice the size of Norwich.”

VAT on sports pitches is the latest VAT furore: A move to apply 20 per cent VAT to five-a-side football pitches is the latest VAT change to cause controversy. VAT at 20 per cent will apply to more than 150 sites across the country with all-weather pitches costing an average of £1 per player on sessions costing £5.

Budweiser brewer Anheuser-Busch to licence its brand for a restaurant: The giant US brewer Anheuser-Busch is to licence its name for a restaurant for the first time. The restaurant will be sited in the proposed Ballpark Village development next to Busch Stadium in St Louis, Missouri, the brewer’s home city. The licensing agreement is with the St Louis Cardinals and development company Cordish Companies and will create a 25,000 square foot restaurant with German-inspired cuisine and more than 100 global beers on tap.

Wendy to focus on beverage, bread and bun innovation: Wendy’s, which has 6,500 sites in the US, will focus on innovation in beverage, bread and buns to drive sales in the latter part of 2012. Chief marketing officer Craig Bahner said future products for Wendy’s would have to be “compelling, distinctive and ownable.” New products to be introduced revolved around innovative applications of bread and buns, fresh lemonades and its Redhead Roaster coffee program. Bahner added: “We know that beverages drive visits outside of the main mealtime occasions. We’re lagging in incidence on teas, coffees, specialty and frozen coffees, but we have a strength on lemonade.”

Starbucks expands alcohol concept “Starbucks Evenings” beyond the US north-west: Starbucks will open its first Starbucks Evenings site outside of the seven in the northwest this Friday in Chicago. Venues offer beer and wine, priced at between $7 and $15 and up to $50 per bottle, and offer food from a small plates menu that includes warm rosemary cashews, bacon-wrapped dates and flatbreads. Rachel Antalek, director of new concept development at Starbucks, said: “We're constantly innovating and trying new things, and this is something our customers have asked us for that, in a lot of ways, links back to European coffeehouse heritage.” Customers order at the counter but there’s also limited table service whereby customers are asked whether they’d like anything else after they’ve ordered. The first seven sites offering wine and beer have seen double digit same store sales growth after 4pm. Starbucks thinks the concept will be suited to cities and airport locations.

Company news:

Thornbridge Brewery signs up for first Punch lease: The award-winning Thornbridge Brewery has signed up for its first Punch Taverns pub. It’s to operate The Cross Scythes, Derbyshire Lane, Sheffield on a ten-year, free-of-tie lease – Punch will make an investment of £200,000 at the site to make it a “destination pub for the local community”. Simon Webster, Thornbridge’s chief operating officer, said: “The deal was completed in a very positive way with both sides keen to make the best of a site that has underperformed for some years. The opening of The Cross Scythes will complete a very busy two-year period for us in taking on new pubs and bars across our brewery heartland and providing excellent outlets for our beers.” Richard Woodward, senior regional operations manager of Punch Taverns said: “We were aware of Thornbridge’s growing reputation as, not only a quality brewer, but also as a pub operator. Our joint investment is considerable but backs our belief that good pubs, run in a professional way, can prove to be successful. We look forward to working with Thornbridge on The Cross Scythes and ahead to possible further agreements”. The Cross Scythes, which will be Thornbridge’s twelfth pub, will reopen after an extensive refurbishment on 2 August.

Pod buys Café Mana: Pod, the healthy eating chain founded in 2005 by Tim Hall which prices main course meals at £5, has acquired the three sites run by Café Mana to expand its estate to 23 sites. Pod is planning three new further openings in London – it is opening sites in Gracechurch Street, Lombard Street and Leather Lane. It has recently opened sites in Queen Victoria Street, Monument and Great Eastern Street. Every Pod is built from sustainable or recycled materials.

Brewer and pub retailer Wye Valley in £2m expansion: Wye Valley, the brewer and retailer founded by Peter Amor in 1985, is to invest £2m in expanding its brewing capacity in Stoke Lay near Hereford. The brewery, which is run by Peter’s son Vernon, has seen double-digit growth in volumes for more than five years. The investment will see the installation of a new brewhouse. Wye Valley opened its fifth pub last month (9 June), The Pelican Inn in Gloucester. Vernon Amor said at the time: “We are passionate about pubs, we believe they play an important role in our communities as they are the outlet for our national drink, cask-conditioned beer.”

New Moon Pub Company unveils second site: New Moon Pub Company, led by David Mooney and former Living Ventures executive Paul Newman, will open The Old Sessions House in Knutsford as its second pub. The pair opened The Lord Binning in Kelsall at the start of 2012. Newman said: “Knutsford is a thriving town, where quality is recognised and expected. We’re excited to bring our new brand of dining experience to the area and we know it will meet the strict criteria for excellence demanded by local diners.”

Starbucks UK boss to be asked about jobs for UK citizens: The boss of Starbucks will be quizzed tomorrow on why young Londoners are failing to get jobs in the capital’s coffee shops. Kris Engskov, managing director of Starbucks UK, will be one of a number of UK employers who will be asked why migrant workers appear to be hired for some jobs instead of young people raised in the capital. The hearing at City Hall on Wednesday is being organised by the Mayor’s Education Inquiry. Boris Johnson said: “It is critical that we understand why young Londoners are not getting the jobs or taking advantage of the opportunities being created in the capital.”

Jamie Oliver opens Gatwick mega-site: Celebrity chef Jamie Oliver opened his first airport restaurant at London Gatwick’s North Terminal yesterday. It includes a bespoke ‘grab and graze’ Jamie’s Italian Bakery – a first for Oliver – providing passengers with food to take onto the plane or eat on the go. The new restaurant area also includes a Union Jacks Bar serving an all-British menu. The Union Jacks site at Gatwick – the first stand-alone Union Jacks Bar to launch in the UK – has a bar on the balcony of the North Terminal, serving a British menu, with small plates such as scotch eggs and dishes accompanied by homemade pickles. The bar also has an 'open' beer cellar, offering an all British wine list and a large number of UK sourced/produced beers. The very first Jamie’s Italian Bakery has a wide choice of freshly baked items from homemade pizzas, focaccias and filled sandwiches to cookies and brownies as well as freshly prepared salads, fruit and yoghurts. It will also sell its own bread – baked on-site over night by professional bakers – and a selection of homemade jams for breakfast menus.

Palmers of Bridport re-opens award-winning pub: The New Inn in Cerne Abbas has re-opened after an eight month refurbishment funded by Dorset brewer and retailer Palmers of Bridport. The pub, which won Dorset Dining Pub of the Year in the Good Pub Guide 2012, now has 13 letting bedrooms, up from six, and extended eating and dining areas. Landlord Jeremy Lee, who also judged the National Landlord of the Year for the Good Pub Guide, is a former Michelin inspector. He said: “We have turned a tired old 16th century coaching inn into a 21st century pub.”

Ilkley Brewery wins top prize in UK business competition: Ilkley Brewery has beaten 3,100 other businesses to win top prize in the Local Business Accelerators competition run by 500 local newspapers. Ilkley Brewery will receive a year of business mentoring from Dragons’ Den star Deborah Meaden. The three-year-old company will also receive a free advertising campaign from a top London agency. The judging panel, led by Meaden, highlighted the company’s “great growth story”, success in generating local employment and strong ties to the spa town’s community.

Krispy Kreme launches Facebook promotion: Donut company Krispy Kreme has launched a Facebook promotion that gives customers free donuts. The promotion, called Summer Road trip, requires customers to “like” its page to discover locations around the UK where free donuts are available. The Facebook page provides details of where customers can find a Krispy Kreme lorry giving out the free 12-packs of donuts – it’s at Bluewater shopping centre from midday tomorrow (Wednesday).

Hotelier plans £7.5m spa: Hotelier Nigel Carpenter plans to turn the Old County Hall in Truro, Cornwall's historic former council headquarters, into a £7.5m spa, subject to planning consent. Carpenter owns St Michael's Hotel & Spa in Falmouth – The Truro Spa Hotel would open in 2014 if planning is granted.

On-trade wine specialist Enotria gets a new investor: On-trade wine specialist Enotria has secured a major new investor in the form of BlueGem Capital Partners. ISIS Equity Partners have sold its shares in the company and BlueGem becomes the majority shareholder in Enotria, with senior management remaining as shareholders. The terms of the deal are not being disclosed. BlueGem invested in mid-market companies based in Europe, with particular focus on the UK and Italy. Their portfolio of companies includes Liberty, the well-known central London department store. Chief executive, Alison Levett said: “I am thrilled to have secured private equity backing from BlueGem as it demonstrates confidence in both our track record and for management’s plans for the future.”

Fleurets markets freehold occupied by Mitchells & Butlers: Property transfer agent Fleurets has been instructed to market the freehold of The Lamb & Flag in Lincoln, a site occupied by Mitchells & Butlers on a ten year lease. The guide price is £1.55m, producing an initial yield of 7.32 per cent.

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