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Morning Briefing for pub, restaurant and food wervice operators

Thu 11th Apr 2013 - Pret A Manger, Robert Cain Brewery and White Brasserie

Story of the day:

Companies House files strike off notice against Robert Cain Brewery: Companies House has filed a notice to strike off Liverpool brewer Robert Cain. The notice comes after the company was three months late in filing its annual accounts. It’s the second such notice filed against the company in just over a year – a similar application was withdrawn in January 2012. Companies House is clamping down hard on the late filing of forms. If the form is filed three months late Companies House will issue a first gazette notice ‘GAZ1’ which is an application to strike the company off the register. The notice is regarded as a warning shot across the bow. When required information is provided to Companies House a second notice is filed to remove the striking off application - ‘DISS40’. The Robert Cain Brewery, headed by Ajmail and Sudarghara Dusanj, has not filed annual accounts since December 2010 when accounts for the period ended 30 October 2010 were submitted. The company filed notice to extend its financial year to 18 months, ended 30 March 2012, on 18 June last year. In 2011, Sudarghara Dusanj forecast the company would be in profit in 2012. He said: “We lost £1.8m in the first year of the company and £900,000 in the second year, but we’ll break even this year with a turnover of £34m. We’ll be back in profit next year.” In 2011, Robert Cain Brewery was admitted to membership of the Independent Family Brewers of Britain. The company originally applied to join in 2002 but was turned down after a new membership rule was created – a company had to be family run for ten years before it could apply to join.

Industry news:

Tesco step into franchise a “game-changer”: Tesco’s decision to offer its One Stop convenience store format as a franchise has been hailed as a game-changer. The supermarket is currently trialing its convenience store format at an unnamed location with other trials in the pipeline. One commentator told The Grocer: “It will be a game-changer for independents because of the buying advantage.”

Pub set to become the first self-sustaining site in London: A pub is to become the first in London to be self-sustainable, with all food grown on the premises or sourced locally – its menu will be designed by MasterChef winner Keri Moss. The Patch, formerly The Magnolia, in East Dulwich, will harness cutting-edge “urban farming” technology to help achieve its aims. Using vertical farming, techniques an outdoor area will be turned into a multi-layered garden planted with herbs, fruit and vegetables. The technology, supplied by US company Sun State Organics, uses 90% less energy and water by growing produce in a smaller, denser area. Parts of the buildings will be converted into a bakery and smokehouse, while meat, fish and other ingredients will come from within a 15-mile radius. The pub, which re-opens in June was once a popular music venue but closed in 2008.

Friends are the key influence in top-end eating out: A survey of 1,600 people by Hot Dinners has found more people are influenced by recommendations from friends when choosing where to eat than by the number of stars it has. 83% of people who responded to the survey said they are more likely to be influenced by friends and colleagues about where to eat, although 68% of people are still more likely to choose a restaurant with one or more Michelin stars. The average spend for a meal (without wine) is £20-£39 per head although 39% spend more than £40 per head. For those having the occasional blow out of over £200, the most popular restaurants are The Fat Duck, Le Manoir aux Quatre Saisons and Gordon Ramsey Restaurant at Royal Hospital Road.

Hospitality Guild launches web portal: The Hospitality Guild has launched a new web portal as the single channel for all information relating to skills and professional development within hospitality. The website contains a wealth of information for both individuals seeking a job or already working in hospitality, as well as for employers and training providers. UKSP, the award-winning careers website from People 1st, forms the backbone of the new Guild site and all 52,000 current UKSP registered users will be offered a year’s free membership to the Hospitality Guild when they transfer over to the Guild portal – www.hospitalityguild.co.uk – which will give them access to a range of additional benefits, discounts and information.

Technomic – Domino’s in the US swaps speed for quality message in marketing: Research house Technomic has argued that Domino’s in the US has changed its marketing message from an emphasis on speed to quality to fit with current consumers’ preferences. Technomic stated: “According to our 2012 Consumer Trend Report on the Future of Limited-Service Restaurants: Fast-Foods and Fast-Casual Restaurants, consumers say the availability of fresh, high-quality food is the most important attribute when deciding which fast-food restaurant to visit. For Domino’s, the challenge was shifting consumer perception from a budget-friendly product with speedy delivery to a more premium product, such as its pan pizza, prepared with quality ingredients by skillful employees.”

Company news:

Mark Derry – building a pub estate will be our focus for the next three years: Mark Derry, who runs Brasserie Blanc operator Brasserie Bar Co, has told Propel that building a pub estate will be the focus of the company for the next three years as it plans to expand to 20 sites in affluent suburbs from its current two. The company opened two Enterprise Inns tied pubs, in Weybridge and Teddington, under the White Brasserie banner, in late 2010. Both pubs take £30,000 per week net “comfortably” and are currently enjoying 11% like-for-like sales growth. Brasserie Bar Co currently has its third pub site in legals. Derry told Propel: “We took the two Enterprise tied sites because they were in exactly the right locations. We are keen to take free-of-tie leases going forward. We’re generating cash and not particularly levered. We’ll be looking to do a couple of sites this year, but we’re taking a little bit of a breather (at this precise moment) after opening 11 sites in the past 12 months.” Derry said the company would consider free-of-tie tenanted pub company leases. “We are very used to paying market rents.” The White Brasserie offer at the two existing pubs is based on offering Brasserie Blanc-style food with a larger drinks element. “Good food is good food and we cook everything from fresh - our customers have their expectations exceeded,” said Derry.

Jonathan Kaye – Chimichanga will account for almost half of new openings: Prezzo chief executive Jonathan Kaye has told Propel that the company’s Chimichanga brand, with 28 sites, will account for just under 50% of the 25 new openings planned this year. The brand has proven itself in smaller market town locations such as Bury St Edmunds in the past year, where it opened in a former La Tasca at the end of 2012 – Bury also has a Prezzo. He said: “Prezzo does better in Bury than Chimichanga but it probably twice the size.” More generally, Kaye said confidence in Chimichanga in now so high that it is often the company’s first choice brand when a site is located. Chimichanga is taking slightly more cash per unit than the 180-strong Prezzo brand, but reflective of a smaller base and more confidence in taking on larger units at this stage of the company’s development, Kaye reported. He told Propel that the Prezzo brand is still years away from running out of opening opportunities. “We’re still opening in towns I’d hardly heard of,” he said. At the last company results six months ago, Kaye mentioned that one new location had proven so lucrative that the company was seeking a site for Chimichanga – yesterday he told Propel that the location was the New Brighton leisure development near Liverpool. “The Prezzo (opening) was wonderful and Chimichanga has been slightly more wonderful.” Kaye reported competition for sites from the ‘leading restaurant groups that are expanding quite aggressively’, with London locations ‘becoming more expensive recently’. But the two brands’ flexibility meant that the company is able to consider a wide variety of locations – leisure parks, city centres, market towns and London. “We look at property on a case-by-case basis - in London, you might have to invest more, but earn more.” Kaye said the company, with 211 sites, has no tail-end. “We have a handful of sites that might be cash neutral where we are taking action but we have no tail.”

Mitchells & Butlers converting Windsor Castle, Kensington to premium Castle format: Managed operator Mitchells & Butlers (M&B) is converting a fourth pub, The Windsor Castle pub in Kensington to its new Castle Premium enhanced offer. The pub will re-open on 3 May. The first three sites within the Castle Premium brand segment are all within London – they are The White Horse in Parsons Green, The Engineer in Primrose Hill, a franchise pub converted to managed last year, and The Spaniards Inn on Hampstead Heath. The Premium Castle pubs serve only food prepared fresh on the premises and make their own ice cream – prices range up to £55 for a 28-day winged rib of beef for two to share. Pubs offer beer and food matching events and full table service. They offer 18 speciality beers, real ales and ciders on tap including British cask ales, lagers, pale ales and stout sitting alongside beers from around the world. The Windsor Castle’s website states: “We will be opening with some great new seasonal dishes that our friends at The Engineer in Primrose Hill are helping us pull together, matching with our new range of beers by the beer sommelier from The White Horse, Parsons Green.”

New Pub Company renames Colliers Wood pub: New Pub Company, headed by Peter Linacre, has re-opened its Colliers Tup in Colliers Wood, one of seven Star Pubs and Bars sites it runs, as The Charles Holden. It is described as “a traditional English pub offering the best of British food, brilliant ales and wines, in a relaxed environment for all the family and the whole of the local community”. Charles Holden was the architect who brought the Tube to Colliers Wood in 1926. Linacre told Propel: “The demographic in Colliers Wood has changed and we’ve turned the pub into a lovely food-led community pub. We’re all getting a bit older and we’ve changed the offer to meet what customer want. It’s already trading really well. We’re holding a ‘Big Hello’ event this weekend to let lots more people know it’s changed.”

Pret A Manger wins US sustainability nomination: Pret A Manger’s sustainability program has earned the brand a spot as a finalist in the National Restaurant Association’s Operator Innovations Awards in the US. An independent panel of foodservice operators from the across the industry has selected the finalists for the awards. Three finalists in each of five categories will be brought to Chicago for the 2013 National Restaurant Association Restaurant, Hotel-Motel Show in May. The company is one three finalists in the sustainability category. The nomination reads: “Pret worked closely with third-party experts to research and develop a comprehensive sustainability program which it openly shares with the industry. The program features four-stream front-of-the-house recycling, plus additional recycling, waste diversion and composting process for back of the house – the resulting program diverts 55% of waste from landfills, and results in 40% of excess food being donated to the homeless.” It will discover whether it has won at a gala dinner on 18 May.

Greene King cohort of BDMs graduate from Birmingham City University: A team of 12 from Greene King has achieved top business qualifications thanks to an intensive development programme. The group, including nine Business Development Managers (BDMs) from Greene King’s tenanted and leased division, studied for a post-graduate degree in Multi-Unit Leadership and Strategy at Birmingham City University (BCU) and recently graduated. Managing director for Greene King Pub Partners Simon Longbottom said: “This is part of a big investment in our team and this graduation is the first of many, as others are already on their way to achieving this important qualification. It is not about boosting the credentials of the team, but equipping them with the right tools and skills to offer the very best support possible to our licensees.” The course was split into four main parts, covering strategy, leadership, finance and operations, carefully constructed by BCU for Greene King to cover the key requirements of the BDM role.

Wayne Brown – Prezzo is a ‘strong buy’: Cannacord Genuity analyst Wayne Brown has issued a strong Buy recommendation on Prezzo shares after yesterday’s results. He said: ‘Prezzo (full year results) are 5% ahead of expectations resulting in similar upgrades to forecasts. Revenues are in line with expectations rising 17% to £144.5m. The combination of lower promotional activity, targeted marketing and benefits from the centralised IT and reservation systems has resulted in a better margin performance than what we were expecting. As such EBITDA is up 16% to £25.5m (CG estimate: £24.8m) resulting in EBITDA margins of 17.6%, down only 30bps from 2011. Profit before tax is 5% ahead of expectations coming in at £18.3m versus our forecast of £17.4m. The group is highly cash generative and despite opening 31 new restaurants in the period (up from 24 last year) the group has ended the year with £4.4m cash on hand. We view these results as very strong and should result in consensus forecasts as well as confidence rising.”

Marks & Spencer opens first café: Marks & Spencer has opened its first standalone café at its headquarters in London’s Paddington. The 70-seat Merchant Square café will serve both M&S employees as well as the general public. It has an open food counter with a marble slab table with cakes and patisseries. The menu offers hot breakfast rolls, muffins, cakes and in-house baked pastries. It aims to feature showcases M&S food hall ingredients, including hot and cold sandwiches, freshly-made meals, soups and salads. Jason Danciger, head of hospitality for M&S added: “Our cafés are achieving industry leading growth.”

Greene King plans Cloverleaf site in Dundee: Suffolk-based brewer and retailer Greene King is planning a new-build Cloverleaf restaurant in Dundee – the brand now has 16 sites but does not operate in Scotland yet. Greene King operates eight sites in the city. A Greene King spokesman said: “We are looking to build the restaurant on King’s Cross Road, a brownfield site. This will create approximately 65 local full-time and part-time jobs.”

Punch Taverns to invest £200,000 in Peak District pub to enhance food offer: Punch Taverns is to invest £200,000 in The Rising Sun, situated at Rise End, Peak District with new licensees Stephen Merrick and Laura Clarke. Said Stephen: “We will be introducing locally-sourced home-made food and a good selection of drinks, including cask ale. We will be offering the community something different and a range of facilities to suit, all along with a great customer experience.” The pub is expected to re-open in early May.

Heineken crowdsources for ideas to make its beer more appealing in nightclubs: Heineken is crowdsourcing for creative ideas from the design community to make its beer more appealing in nightclubs, Marketing Week has reported. Designers and technology companies have been challenged to come up with ideas on the glasses Heineken should be served in, the look of the bottles and the design of bar pumps. Heineken is hoping the activity will lead to both men and women feeling more comfortable about drinking beer instead of spirits on a night out, the magazine reported. The brewer is also asking designers to submit samples of their work to Tumblr to source ideas on building a concept lounge bar. The pop-up space will then be showcased at Milan Design Week in April 2014.

Whitbread celebrates first birthday of innovation hub: Whitbread is celebrating the first birthday of its designated Brewers Fayre innovation hub, The Hive in Widnes. Buffet Place’s research and development team trial new dishes and technology at the site, with those proving popular incorporated into Brewers Fayre restaurant menus across the nation. Among the ideas trialed at the site in the last year are: whole fresh gammons, rotisserie chicken with a choice of flavoured glazes and freshly made pizza. Successes include ‘Pie Night’ and ‘Pub Classics’, which have both become theme nights at other Brewers Fayres.

Browns to mark 40th birthday with a book: Mitchells & Butlers Browns brand is to mark its 40th birthday with the publication of an anniversary book detailing the brand and its evolution from its beginnings in Brighton right through to the present day told through anecdotes from staff and guests. This will be supported with a series of celebratory 40th anniversary book tour events at various locations throughout the UK including Brighton, London, Cambridge, Leeds, Cardiff and Glasgow. In addition, 40th birthday parties will be held at various sites across the country. Simon King, retail director at Browns, said: “Browns is a staple part of British culture, and is proud to have been serving freshly prepared classic dishes to the nation for 40 years. From its birth in Brighton in 1973 it has grown to be one of the UK’s leading bar and brasseries with a dedication to quality. The ethos of the brand has remained the same throughout and still stays true to its original mantra – a great example of proper food served by a team of people who are highly skilled and attentive to each guest that walks through our doors. Each restaurant has been selected for its individuality and character and has its own story to tell – whether that be a historical or listed building right through to the cutting edge design of some of our sites.”

JD Wetherspoon abandons plan for its biggest hotel, with 52 bedrooms, in Ilfracombe and opts for futuristic £4m pub design: JD Wetherspoon has abandoned a plan to build a pub with 52 bedrooms on the site of the former Collingwood Hotel in Ilfracombe, Devon (population: 10,840) – deciding to build its most futuristic pub ever instead. It has submitted a plan for a £4m pub with an iconic curved design, a glass dome and roof terrace. The building will use an unusual mixture of glass, copper, aluminium and stone. Of the plan, the company stated: “The site needs a building that will rejuvenate the area. A Victorian style was considered but it was felt this style of modern pastiche would not sit well against the original Victorian buildings and that a more modern approach was needed. This style, whilst reflecting the seaside heritage also, fits with a modern construction of clean lines, bold geometry and minimal ornament.” Inside the pub will feature several bespoke fire places, one large bar and sculptures and artwork from local artists. A supporting statement with the new application says: “This scheme does not propose hotel accommodation. The client believes creating an attractive building will bring more tourists to the area which will encourage people to use the surrounding hotels and accommodation facilities therefore enhancing the sustainability of this part of Ilfracombe.” Ilfracombe town and district councillor Philip Webb said: “This is great news for Ilfracombe as we will soon be getting a top quality facility for locals and tourists. This is a big investment in our town and will create much-needed jobs, boost the economy and smarten up the seafront. Myself and others have been working with Wetherspoon since the beginning of the year to bring this good news to the town.” JD Wetherspoon has planned to invest around £4m building its biggest hotel in Ilfracombe. The company has already demolished the derelict Collingwood Hotel in preparation for the scheme. The company originally gained permission in 2008 to redevelop the prominent Victorian era Collingwood but it decided too much money would be needed to make it sound again - an a brand-new hotel would cost much more than the original £4m. A spokesman for Wetherspoon told Propel: “It’s a very, very prominent site but the costs were completely over-the-top for building a hotel. The proposed pub will have two beer gardens – one at the normal level and one on a terrace with views out to sea.” JD Wetherspoon founder Tim Martin told Propel: “Salvador Dali, Picasso and JD Wetherspoon – we are all out of the same mould really.”

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