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Morning Briefing for pub, restaurant and food wervice operators

Thu 25th Jul 2013 - Brewdog, JDW, Shepherd Neame, Spirit and YO! Sushi

Story of the day:

Shepherd Neame joins UK craft ale export push with US distributor: Britain’s oldest brewer, Shepherd Neame, has joined the current craft ale export push with a new deal with Canada’s oldest independent brewery, Moosehead Breweries, to act as its distributor for the US and for Canada. The Kent brewery’s flagship beer, Spitfire Premium Kentish Ale, will be on sale across North America from September, with further products planned for 12 months’ time. The two businesses were introduced to each other by the Boston Beer Company, for whom Shepherd Neame brews Samuel Adams Boston Lager in the UK and Moosehead Breweries distribute in Canada. The synergies between the historic, multi-generational family brewers were clear from the outset and negotiations have resulted in five-year contracts being signed for each market. Shepherd Neame export manager Olly Scott said: “The US deal means Shepherd Neame beer will be available in the USA for the first time since 2001 and that’s very exciting for us. We know drinkers value greatly the heritage of our brewery and quality of our beers. Meanwhile, signing Moosehead Breweries as our new distributor for Canada will expand our distribution to new provinces.” The UK’s cask ale producers are seeing increasing success in the export market. Fuller’s sends one in five pints produced at its Chiswick brewery overseas while Brewdog exports to 38 different countries. David Croll, Brewdog’s Japanese importer, said: “Brewdog is blazing a trail in the Japanese craft beer market. From entering the market by selling to a couple of bars in Tokyo in 2008, Brewdog is now leading the way in a craft beer cultural phenomenon that is sweeping the nation with Punk IPA the most recognisable and iconic craft beer brand in Japan.” In a separate development, Shepherd Neame is expected to reveal today that it has signed a UK distribution deal with Kuehne + Nagel. As part of the deal, Shepherd Neame’s distribution staff will become employees of the logistics group.

Industry news:

Consumer confidence at highest level since 2010: A new report has found consumer confidence at its highest level since April 2010 amid signs that economic recovery is gathering pace. Analysts believe that gross domestic product grew by around 0.6% between April and June – the strongest growth since the Olympics boosted output last summer. Stephen Harmston, of YouGov, said: “British households are pulling out of a nosedive and consumers’ economic optimism is moving in the right direction.” The YouGov research found consumer confidence scoring at 104.6 – the highest in more than three years.

Restaurants seen as slowest places to process customers’ payments: Barely one customer in 16 thinks restaurants and cafes are “fast” at taking their payments, against one in three who rate supermarkets as “fast” payment processors, research has found. WorldPay, the payments processing company formerly owned by RBS, said its research found speed was the most important consideration for time poor consumers, with one in three often irritated by how long it takes to pay in shops and other outlets. While restaurants and cafes were seen as the slowest, with just 6% of those surveyed saying their payment systems were “fast”, even fast-food restaurants performed badly, with only 11 saying their payments, as opposed to their food service, was “fast”. The research found one in five consumers are concerned about the time it takes to print receipts, and even taking cash out of a wallet is “too time consuming” for 23%. The Omni-Payments research report found 30% of consumers would like to use PIN-based smartphones to pay their bills, 25% would like to use online wallets and 23% would like to be able to make SMS payments, while a further 12% would be interested in paying through social media.The full report, “Optimising your Omni-Payments: consumers, payments and the future”, will be released soon on

Nottingham plans to showcase pubs and restaurants in a Food and Drink Fortnight: Nottingham will hold a city-wide culinary celebration – Food & Drink Fortnight – between 3 and 17 August. The city claims more bars, pubs, cafes and restaurants per square mile than any other city in the UK. With prize draw incentives to encourage people to take advantage of more than one £10 menu deal, free city centre parking after 6pm, and special deals on public transport, event organisers, the Nottingham BID, are expecting visitor numbers to be high. Tom Waldron-Lynch is a director of the Nottingham BID and general manager of Chino Latino’s and the Park Plaza Hotel. He said: “The event is designed to showcase our wonderful food and drink offering, create a great experience in the city and give a boost to business at our pubs, clubs, bars, restaurants and other eateries.”

Hospitality Guild launches training kitemark system: The Hospitality Guild has launched a new kitemark system to help organisations promote their commitment to training and developing staff and to raise professional standards in the hospitality industry. The system has been developed in partnership with leading organisations in the industry and will be managed by the Hospitality Guild’s partner organisation, People 1st. Annette Allmark, head of professional standards at People 1st, said that the kitemark system has been established after research highlighted the need for an external endorsement of training programmes that offered staff members excellent training and development opportunities.

London’s hotels bounce back in June: Hotels in London bounced back year-on-year last month, with total revenues per available room (trevpar) returning to the figures of June 2011 after a slump last year caused in part by government warnings about the possibility of heavy congestion in the capital during the Olympic Games. Occupancy, at 88.9%, was back to the levels of June 2011 and average room rate was up 3.9% year-on-year to £163.29, giving a rise in revpar of 12.3%. In addition, food sales rose per room by 7.5%, beverage sales were up 9.6% and meeting room rental was up 15%, lifting calendar-year-to-date trevpar from £147.51 in May to £155.67 in June. A fall in payroll levels and lower travel agent commission payments, plus profit growth for the month in London full-service hotels’ food and beverage departments of 18.8% meant gross operating profit per available room rose 12.5% in June compared to June 2012, and 2% compared to June 2011.

Company news:

Tim Martin – ‘legal action subject to a hiatus as we leaf through Van de Berg files’: JD Wetherspoon founder Tim Martin has told Propel that the company’s eight year legal action against individuals involved in the Van de Berg property fraud is now subject to a hiatus as the company mulls further action. Martin said the company was “considering its position” as it continues “to leaf through the Van de Berg files”. Meanwhile, Martin said the company is expecting “inflation in the coming year across most products we buy in”. Added Martin: “You still need 3% like-for-like sales growth to match last year’s profit – it’s a hell of a thing to get.” He reported that the company is now selling 750,000 cups of coffee and tea a week with breakfast also an established and important part of the business. “Breakfast and our coffee trade are both doing very well – they are established parts of the business although I doubt we’re yet making too much money from breakfast.” Wetherspoon disposed of three pubs during the year – an airport site closed down, a venue in Liverpool “didn’t work out for us” and a small leasehold site in Southfield, London, which the company had run for 20 years, was sold to Tesco. Numis Securities leisure analyst Douglas Jack said: “Between 2007-12, total sales rose 35% (£308m) to £1.197bn, yet profit after tax fell over this period largely due to higher taxation/regulation eroding margins. With the beer duty escalator now stopped and machine income (which generates over a third of profit before tax) due to receive a stakes and prizes boost, there is now a good opportunity for the company to hold/increase margins (each 10bps change = a 1.7% change in profit before tax).”

Kained Holdings opens fourth pub – second Spirit leased site: Kained Holdings, the Scottish operator headed by Graham Suttle, has opened its third site – the Little Urban Achievers Club in Glasgow. The venue is his second Spirit leased pub. Kained Holdings also operates Finnieston Bar and Restaurant in Glasgow and Lebowskis in Edinburgh and Glasgow’s West End.

Spirit unveils philosophy behind ‘premium’ Chef & Brewer: Spirit’s first premium evolution of Chef & Brewer – called ‘New World’ internally – with open at The Bear Inn in Berkswell, Coventry. The company is currently recruiting for staff at the site. It states: “We are currently developing a new premium food pub that will offer outstanding food, drink and service, in an independent and stylish pub environment. Located in affluent areas, our pubs will attract a discerning guest that has high expectations. They will put as much emphasis on the atmosphere and service as they do on the quality of the food and drink and we will deliver all four elements in total synergy, with passion and flair. These pubs will look and feel like independent pubs, offering a social haven for every occasion. They will be run by a confident, engaging and friendly team who have a passion for great fresh food and drink. The food offer will be fresh and seasonal, and will not only attract people for special occasions but also tempt in for an evening of great food and drink.”

Michael McGuigan’s Shilling Group buys seventh site, a coaching inn: Michael McGuigan’s Shilling Group has bought The Borders Hotel, an 18th Century coaching inn in the conservation village of Kirk Yetholm in the Scottish Borders. This inn has been owned by Margaret and Philip Blackburn who decided to sell after building up the business. Michael McGuigan Shilling Group currently operates Bar Kohl and The Golden Rule among a group of six sites in and around Edinburgh. This is their first venture in the Borders. Ken Sims, of agent Christie + Co in Edinburgh, said: “The sale of The Border Hotel shows again the demand for quality businesses in the hospitality sector. While many businesses have suffered as a result of the recession, businesses such as The Border Hotel, where the owners have continued to invest in the property as well as the business, are showing consistently strong profits. These businesses are attractive to funders which is a major advantage in the current climate.”

Two New York restaurants to drop Gordon Ramsay name: The two restaurants in New York’s London NYC Hotel that carry Gordon Ramsay’s name are reportedly scheduled to close between the first and third week in September. Owner Blackstone’s LXR Luxury Resorts & Hotels is allegedly seeking a new operator, and meanwhile, management has given notice to approximately 65 employees. Both restaurants opened in 2006. Ramsay is rumoured to be planning more New York projects, including a local branch of Gordon Ramsay Steak, not to mention a possible collaboration with recent retiree David Beckham.

Brewdog withdraws ‘offensive’ language from website (only for now): Scottish brewer Brewdog has denied it has removed ‘offensive’ language from its website because the Advertising Standards Authority ruled against – and it is threatening to repost. The company previously described itself as a “post Punk apocalyptic mother f*****” brewer, which has now been removed. James Watt, co-founder of Brewdog, said: “We believe in freedom of speech and artistic expression. We don’t believe in mindless censorship. We removed the statement from the site because we needed to make room to talk about our Equity for Punks offer. We’ll be putting it back up once the share offer is over. We have thousands of craft beer fans who have invested in what we do and how we do it – they are the people we listen to – not the killjoy, self-important pen pushers at the ASA in their Burton suits.” The Advertising Standards Authority (ASA) ruled that the use of “mother f*****” is “highly offensive” and “gratuitous”, despite the inclusion of an asterisk to obscure part of it. The ASA said the webpage must not appear again in its current form, adding: “We told Brewdog to take care to avoid causing serious offence in the future.”

YO! Sushi approach to social media a combination of information gathering and direct intervention: YO! Sushi maintains a mix of information gathering and direct intervention in its social listening operations, senior marketing manager My Ly has told a Marketing live conference. The company asks consumers to name dishes they want the brand to keep when refreshing the menu. Marketers also look out for people asking for a Yo! Sushi restaurant in their local area. “Fans let us know which areas they want us to open in and these recommendations are passed on to our head of property to be considered for future openings,” said Ly. As an example of the brand joining a conversation, Ly described how one Twitter user wrote that she was unsure of whether to eat at YO! Sushi or Wagamama that evening. Impressing the tweeter by responding immediately, YO! Sushi helped her make the decision in its favour.

Luminar to rebrand all Oceana sites as Pryzm: The UK’s largest nightclub operator, the Luminar Group, has revealed a new brand identity for its ten Oceana nightclubs. Bristol Oceana, which is undergoing a £1 million investment, will be the first site to adopt the Pryzm branding when it re-opens at the beginning of September. The remaining clubs will rebrand as they undergo major refurbishments. Luminar chief executive Peter Marks said: “The Pryzm name reflects the multi-characteristics of the new format that features three distinct clubs, an exclusive VIP area plus a chic and stylish bar called Myu all under one roof. Oceana has been a successful brand for 11 years, but fashions and trends evolve and the time has come to create a new, high quality clubbing experience and we need a name that reflects those changes. When we unveil Pryzm Bristol in September for the first time, customers will be really impressed with the cutting-edge design, layout, technology and entertainment that the club will be providing. We are confident that Pryzm will appeal to a wider audience looking for a great night out.”

Yoghurt pop-up appears at Heathrow: A pop-up yoghurt brand Frae has opened in Heathrow’s in Terminal 5. Frae yoghurt is created on a dairy farm in North Wales – it currently operates six other stores across London in sought after locations, such as on the King’s Road and their newest store in One New Change, St Paul’s. Founders Donald Murray and Martyn Pollock stumbled upon frozen yogurt in New York whilst craving a healthy, refreshing snack and immediately saw the potential of this product in the UK. The word ‘Frae’ itself means “from” in old Scots, is firstly a subtle, playful reference to the origin of the founders but more specifically a direct, serious reference to the impeccable sourcing of the dairy ingredients used in the product. TRG Concessions managing director Nick Ayerst said: “We are delighted to work with such an inspiring brand as Frae, due to their natural and fresh ethos that runs throughout everything they do. They are a company with a refreshingly healthy conscience which we felt suited Heathrow’s commitment to delivering the best to their customers perfectly.”

Iberico to expand into Derby: Spanish-themed restaurant Iberico, which has an existing site in Nottingham, is to expand into Derby with a September opening in the city’s Cathedral Quarter. Owner Dan Lindsay, who also runs Nottingham’s World Service restaurant, said: “We have found the perfect location in Derby for a fine-dining restaurant. We are looking forward to creating a diverse menu with a broadly Spanish theme.” Alec Hamlin, Blueprint development manager, added: “I’m delighted to see Iberico move to Derby. Their decision to locate in the Cathedral Quarter is a real vote of confidence and will add to the area’s reputation for quality food.”

Mitchells & Butlers to open co-located Toby Carvery and Harvester in Suffolk new town: Mitchells & Butlers is to open a co-located Toby Carvery and Harvester at Ravenswood new town, just off junction 57 of the A14 near Ipswich. The area will see 1,200 new homes. The site will also see a new-build Marston’s pub and a Hungry Horse.

No Saints to re-open Oceana site as Faces: No Saints, the nightclub company headed by Stephen Thomas, is to re-open the former Oceana nightclub in Wolverhampton as Faces. The former Oceana building is being given a £750,000 revamp – the name has been selected after residents were asked to make suggestions.

Battersea restaurant is sold: Ransome’s Dock in Battersea has been sold by agent Davis Coffer Lyons (DCL) to Tbl7 for £110,000. Located just off Battersea Bridge Road, the 2,000 sq ft restaurant is surrounded by some other popular south-of-the-river venues including Bunga Bunga and the Doodle Bar. Ransome’s Dock was first opened in 1992 by Martin and Vanessa Lam and is commonly referred to as the blueprint for the neighbourhood restaurant. Although the restaurant continued to trade successfully the pair decided to close after 21 years to allow them some time off. The restaurant will close in August (2013) before reopening under a different name later this year. Josh Leon, associate director at DCL, said: “Ransome’s Dock is in a lovely location which has recently seen more demand from restaurateurs and bar operators since the surrounding area has become an ‘overspill’ for those who would have previously lived and gone out in Chelsea.”

Enterprise Inns adds two to commercial team: Enterprise Inns has created two new roles within the commercial team. James Armitage joins Enterprise as head of marketing from Brakes Group, and Andy Parker has been appointed retail operations manager for the Beacon estate. Armitage will be responsible for all aspects of the marketing mix including the development of the Enterprise brand, publican recruitment and supporting business development through innovative marketing campaigns for our publicans. Parker joined Enterprise in 2011 as a regional manager in North Wales. In his new role, he will lead the on-going development of Beacon helping to improve the retail offer and services provided to our Beacon pubs. Commercial director Ed Cottrell said: “James provides us with significant experience in building brands, B2B communication and retail marketing, as well as expertise in food development, sales and marketing in the retail leisure sector. I am confident Andy will lead and inspire our Beacon Operations team empowering those who are new to the industry to become excellent publicans. I wish both James and Andy every success for the future.”

Wendy’s to sell company-owned stores: Wendy’s has announced that it is to sell around 425 of its more than 1,420 company-operated restaurants to franchise operators. The fast-food chain said it wanted to concentrate its store ownership geographically and cut back the proportion of outlets it operates from 22%, or more than one in five, to 15%. The announcement came as Wendy’s unveiled second-quarter figures showing a profit of $12.2 million, a turnaround from a loss of $5.5 million in the same quarter in 2012, as revenue for the quarter rose 0.7% to $650.5 million. Margins at company-operated restaurants rose by almost a fifth to 16.7% from 14.1%, while same-store sales were up 0.4% at company-owned North American restaurants and 0.3% at North American franchise restaurants. Wendy’s has been attempting to differentiate itself from “traditional” fast food outlets, with the launch of premium burgers and salads, which also have higher profit margins. However, it said earlier that this year it plans to focus more on low-priced menu items to compete with rivals such as McDonald’s, which has been promoting its Dollar Menu, in the fight for more cost-conscious customers.

Zuma founders look to launch fast food concept: The Waney family, which founded Zuma, Roka and Le Petite Maison, is looking to launch a new fast food concept, Stixx Yakitori. The agent David Rawlinson has been retained to find sites – the company is looking for 1,500 square foot sites in the City of London, Kings Cross, Soho, Covent Garden and Canary Wharf. High footfall areas are being sought with a dense office population with close proximity to train stations.

Well-known Glasgow restaurant goes into administration: One of Glasgow’s best-known restaurants has gone into administration with the loss of 21 jobs. Brian Milne and Eileen Blackburn, partners at accountancy firm French Duncan, have been appointed joint administrators of Sanstef Limited, which traded as Paperinos @78. Administrators blamed “depressed market conditions” for the collapse of the business at 78 St Vincent Street, which was opened in 2009 by the Sanstef directors, brothers Stefano and Sandro Giovanazzi. Brian Milne said: “It is clear that, despite the directors’ best efforts, the restaurant has struggled in recent months due to depressed market conditions and intense competition in the local area.” The sister restaurant in Byres Road – which launched Scotland’s first Prosecco bar last year – is unaffected by the administration.

Domino’s Pizza reports 78th consecutive quarter of international like-for-like growth: Domino’s Pizza has reported double-digit growth in net income and revenue for its June 16-ended second quarter, driven by a like-for-like sales growth of 6.7% in the United States and its 78th consecutive quarter of comparable-sales growth in its international division. The company also opened nine net new stores domestically to go along with 101 net new units in its international system of more than 70 foreign markets.

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