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Fri 17th Aug 2018 - Propel Friday News Briefing

Story of the Day:

Brakspear to focus on opening bigger managed sites as Frogmill development gives company ‘new dimension’: Tom Davies, chief executive of Henley-based pub operator and brewer Brakspear, has told Propel the opening of its largest site to date – the Frogmill in Gloucestershire – will be the blueprint for its managed estate. Davies said the company was focused on trying to open bigger sites that were multifaceted as it grew the 12-strong division. The Frogmill in Shipton Oliffe, near Andoversford, opened last month following an extensive eight-month redevelopment of the 16th century inn. Comprising a 100-cover restaurant, bar, 28 boutique bedrooms and wedding and conference facilities for up to 150 guests, it is the biggest project in Brakspear’s 240-year history. Davies said: “The Frogmill has given us a new dimension to our business and that’s the line we’re looking at. We’ve taken a risk with it but it’s been trading its socks off. It’s a more multifaceted business. It’s a wedding venue, which is a new avenue for us and offers various income streams. This is something I’d like to see us doing more of. When we started the managed business we were looking at sites doing £1m net a year. That level for our managed houses is not really enough any more. We’re looking for businesses that can add £40,000 to £50,000 a week to our turnover.” Brakspear previously stated it was looking to build a 20-strong managed estate by 2020 but Davies said it might not reach that mark now. He added: “It could be a stretch given we’re looking for bigger properties. There’s nothing else in the pipeline as of today – over the next six months we’re concentrating on bedding in the new management team in the division following the restructure in the first quarter of the year. Staffing is also a big headache, not just for us but the whole industry, so having fewer sites where staff are more concentrated would help. We are a freehold business – I’m still not interested in leases. It’s about finding the right sites. I’m in no rush – the business has been around a long time and will continue to be in the future.” While the managed division has become a key focus for the company, Davies said the leased and tenanted estate was, and would remain, the core part of the business. He said: “We have about 125 leased and tenanted properties versus 12 managed. There’s a lot of noise around the managed estate because it’s newer but we’re continuing to invest in the tenanted and leased side – it’s of huge importance.” Davies said trading in 2018 was up on last year although the snow in March meant things started “pretty grim”. He added: “The World Cup was fantastic and the hot weather has also helped trading, although we have found food sales are coming under pressure as people enjoy barbecues at home. The drinks side of the business is certainly holding up well.”

Industry News:

Imbiba partner Darrel Connell to feature in latest video for Premium subscribers: Darrel Connell, partner at leading sector investor Imbiba, will feature in the latest 30-minute video for Propel Premium subscribers, which is sent out on Friday (16 August). Connell talks about the company’s £50m Growth Fund, spotting sector gaps, and Imbiba’s investment strategy – this week it invested £3.5m in London-based wine bar business Vagabond. Premium subscribers now receive weekly video recordings of key speakers from Propel events and conferences – they have included sector investor Luke Johnson, Ceviche founder Martin Morales, City Pub Company founder Clive Watson, brand strategist Ian Dunstall, Chozen Noodle chief executive Matthew Kirby, Coaching Inn Group founder Kevin Charity and consultant James Hacon. Propel Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out, access to our database of 1,100 multi-site companies, and discounts to attend Propel conferences and events. Propel managing director Paul Charity said: “We plan to compile an invaluable library of senior leaders and advisors offering insights and advice, a resource Premium readers can tap into.” An annual premium subscription costs £345 plus VAT for operators and £445 plus VAT for suppliers – plus £50 each for additional team members. Email anne.steele@propelinfo.com to sign up or call her on 01444 817691.

Operators invited to take part in haysmacintyre’s Hospitality Index in association with Propel, the biggest in sector: Operators are invited to take part in the fifth annual haysmacintyre UK Hospitality Index. The index, for multi-site pub, restaurant and foodservice operators, is the sector’s biggest benchmarking survey with more than 110 companies taking part last year. Covering trading, staffing, capital and funding, and property, the Index will deliver quality financial data and benchmarking intelligence to help hospitality businesses understand their sector’s key metrics and how they compare and can improve operations. To complete the survey and receive the final report, click here. The survey closes on Thursday, 30 August and information provided will be reproduced anonymously in this year’s Index, which will be launched at the Propel Multi Club Conference on Thursday, 1 November. Data and comments will not be attributed to respondents unless permitted.

Jay Rayner – technology taking away the personal touch at restaurants, venues setting table time limits will lose out: Restaurant critic Jay Rayner has argued technology is taking away the personal touch and warned venues that set table time limits would lose out. He wrote in the Guardian: “Partly it’s the increasingly brutal economics of the restaurant business. To make a profit, they have to turn tables and they want to make doing so easier. But I think a major part has been played by technology – which is, to say, online booking systems. Obviously yay technology! We all love being able to plan our evening via a few clicks but it does make it easier to add small print online making outrageous demands few reasonable people could ever bring themselves to mention if they were talking to them over the phone. The most outrageous example is the £5 charge for a window seat at the Marco Pierre White Steakhouse in Birmingham. I adore Birmingham but I’m not paying a fiver to look at it. It’s just not very hospitable, which is a crying shame for the hospitality business. Plus, it can work both ways. I also suspect one reason there’s been a rise in no shows is that people are feeling less beholden to a booking because they did it online rather than by talking to a human being. That’s not to excuse the behaviour; it’s just an unintended consequence. It’s something I fully intend to discuss with my friends in detail the next time I go out for dinner – if they allow me enough time.”

BigDish buys restaurant discovery business: BigDish, the UK-quoted foodservice tech company that operates a yield management platform for restaurants, has bought Looloo, a web and app-based restaurant and travel discovery business focused on the Philippines. BigDish chief executive Joost Boer said: “Looloo is one of the Philippines’ leading platforms in the restaurant and travel discovery space. Founded in 2012, it contains information, recommendations and reviews on restaurants, hotels and travel in the region. It has more than 28,000 restaurants recorded, a monthly average of up to 500,000 unique visits, about 200,000 app installs and more than 320,000 reviews. Across its social media platforms, Looloo has more than 370,000 Facebook and tens of thousands of Instagram and Twitter followers, which have been grown organically.” BigDish directors said they saw great opportunity in Looloo’s platform and large user base, which generates revenue through paid-for content with low overheads and was approaching break-even with strong growth potential. They said: “There are a number of potential synergies between a discovery platform such as Looloo and the BigDish yield management platform we will be exploring in the coming months.” The company stated: “The initial stage of Looloo’s incorporation into BigDish will be to commence marketing the company to Looloo’s current user base via content and email marketing, with a view to organically driving restaurant bookings in the Philippines through the BigDish platform. Additionally, the BigDish logo and a link to the website will be added to every webpage of the Looloo website, which has thousands of web pages within the month, and is expected to increase the company’s brand image in the Philippines. Further consideration to enhance the synergies between the Looloo and BigDish platforms continue to be explored, with the prospect of integrating BigDish reservation functions into Looloo’s website and app in due course.”

Calls for tighter licensing laws at airports as disruptive passenger incidents continue to climb: Airlines UK, the trade body for UK-registered airlines, has said licensing laws at airports need “tightening up”, with airside terminals subject to the same licensing controls as landside. There have already been more than 200 reports from UK airlines in 2018 of incidents involving disruptive passengers, licensing solicitor John Gaunt & Partners told Propel. The latest UK Civil Aviation Authority (CAA) figures mirror previous years, which have seen more than 400 incidents reported for the past two full years, many involving acts of violent and intimidating behaviour. The number of reports has risen from 98 in 2013 to 417 in 2017. So far there have been 202 reports in 2018, with a total of 1,472 in the past five-and-a-half years. The CAA is calling on airlines and enforcement agencies to “make better use of laws that are already in place” and called for “more travellers to be prosecuted for violent and drunken behaviour”.

Company News:

Urban Pubs and Bars secures 14th site, closes in on second Well Street pizza venue: London-based Urban Pubs and Bars, the company founded by Nick Pring and Malcolm Heap after they sold their previous business Realpubs to Greene King, has secured its 14th site, giving the company the same number of sites the pair ran when Realpubs was sold. Pring told Propel: “We are turning over a lot more money than Realpubs was at the same size – and we have hardly any bank debt. We have been seeing high double-digit like-for-like sales for quite some time.” The company has exchanged contracts on The Opera Tavern in Covent Garden, a Shaftesbury leasehold site formerly run by four-strong Salt Yard Group. Pring said: “All the Salt Yard Group venues are great – we eat in them regularly. We have a lot of admiration for what they are doing. This is a great opportunity for us to get into central London, an area we’re not really in at the moment.” Urban Pubs and Bars is understood to have a number of other sites in legals and has grown its head office team to cope with a pipeline of new sites. The company is also close to securing a second site for its pizza concept, Well Street Pizza, which launched three years ago in Hackney. Pring said: “The site has got stronger and stronger over the three years – we saw 35% growth last year. Our pizza is really good – and quality food prevails. Delivery accounts for half the sales at the site.” A recent TripAdvisor review of the venue stated: “I love pizza and this place does some of the best in London. Simple pizzas, well made and delish. Great wine list, warm friendly service. Genuinely, what’s not to like?”

Ei Group hits 250-pub milestone for Beacon managed tenancy model: Ei Group’s leased and tenanted division Ei Publican Partnerships has opened the 250th pub under its Beacon managed tenancy model. The Black Horse in Monkseaton, run by Danny Cox and Phil Campo, has been trading well since opening and has already secured a nomination for the Ei Awards of Excellence. Beacon director Mark Brooke said: “We will take momentum from this as we target further growth over the coming years. The Beacon model gives publicans regular contact, support and access to the decades of knowledge our business has amounted. Combined with passion and enthusiasm, it’s proved time and again to be a recipe for success.” Ei Publican Partnerships regional manager Marcus Parton added: “The Beacon model gives publicans the support needed to create community-focused pubs that deliver exceptional experiences and memories. Danny and Phil have fast become excellent operators, going above and beyond by running events, engaging with regulars and keeping a keen attention to detail. I look forward to working with them and watching them thrive.” Campo said: “The Beacon model has been pivotal in providing us with the support, knowledge and operational knowhow we need to drive the business forward. Trading is going extremely well and we are exploring opportunities to extend our lease at the site and renovate an upstairs function room while looking at taking on further sites under the model.”

Cosmo Group founder to launch grab-and-go concept Pizza Sqr in the Midlands on Saturday: Cosmo Group founder Tom Chan is to launch grab-and-go concept Pizza Sqr at Intu Merry Hill shopping centre in the Midlands on Saturday (18 August). The 800 square foot site will offer square pizza slices alongside handmade sandwiches, soup, pastries and authentic Italian coffee. The menu, available to eat in or take away, will see a rotation of recipes with more than 20 pizzas available daily, while the opening has created 50 jobs. Pizza Sqr operations manager Davide Cason said: “We believe everyone deserves a taste of what’s good in life and we have spent more than 18 months researching, training and sourcing our ingredients to offer a unique and authentic concept. We have based our menu on traditional recipes from Rome, combining the freshest ingredients and seasonal toppings to offer real Italian pizza. We can’t wait for the people of Dudley to try it.” Intu plans to build a 180,000 square foot leisure extension at Merry Hill, which will introduce more restaurants and a cinema. Intu regional managing director Nick Round said: “We are investing millions to transform Intu Merry Hill. Exciting new dining concepts such as Pizza Sqr are a key focus of our plans to update the centre’s leisure offer.” The company has said it harbours ambitious expansion plans to open 100 stores in the next five years.

Former Delisserie sites snapped up by expanding American-style operators: Two former sites of Delisserie, the New York deli and grill concept, have been snapped up by a pair of American-style operators. North London eatery Hudsons American Brasserie and Pinner-based dessert parlour Indulge Dessert Lounge have secured the properties through agents CDG Leisure. CDG worked with insolvency agents Williams and Partners to secure a 2,830 square foot unit at the former Delisserie restaurant in Shenley Road, Borehamwood, for Hudsons and a 1,700 square foot unit in Buckingham Parade, Stanmore, for Indulge. Hudsons is the brainchild of former Delisserie director Martin Ment. Established in 2015, Hudsons offers American-inspired cuisine and has venues in Mill Hill and Whetstone. Indulge Dessert Lounge offers waffles, crepes and pancakes made to order, alongside 25 varieties of ice cream and sorbet. This is the concept’s second site. Emma Cousins, of CDG Leisure, who brokered the deals on behalf of Mark Reynolds, of Valentine & Co, and Adam Harris, of Mazars, the joint liquidators of Delisserie, said: “This is a great outcome for Delisserie and a testament to the strength of the two brands.” Lewis Craig acted as joint agent. CDG Leisure has now secured concepts for four Delisserie restaurants since its instruction on the business earlier in the year. Vegan restaurant group The Gate has taken the restaurant in St John’s Wood for its fourth venue, while all-day bistro Bob’s Café, a concept by Laurel Canyon Ventures, opened its third site at the former Delisserie in Mill Hill in April.

Greene King saves 600,000 pints of water a day through water retail switch: Brewer and retailer Greene King is saving more than 600,000 pints of water a day since obtaining its self-supply licence. The company, which operates more than 3,000 venues, was the first non-household water customer to apply to provide its own services. The switch to self-supply, in partnership with water management company Waterscan, has enabled Greene King to save the equivalent of 676,313 pints per day, Edie reports. The move is part of a raft of sustainable initiatives Greene King is undertaking – last year the company diverted 98% of waste from landfill across its operations, a 3% year-on-year increase, which included almost 11,000 tonnes of food waste sent to anaerobic digestion facilities and recycling more than three million litres of waste cooking oil from its kitchens. Elsewhere, the company removed 100,000 boxes from its annual packaging requirements by working with suppliers and distributors to introduce reusable containers for meat deliveries.

Young’s launches new-build pub restaurant The Naturalist in north London: London pub retailer Young’s has launched new-build pub restaurant The Naturalist in north London. The venue has opened at new Berkeley development Woodberry Down, near Finsbury Park. The Naturalist is set on the banks of one of the development’s two reservoirs and features outdoor seating, seasonal dishes and a bar serving local craft beer, wine and bespoke cocktails. The Naturalist offers a number of menus throughout the day. As well as fresh pastries, smoothies and hot drinks, dishes on the breakfast and brunch menus include The Naturalist fry up and Suffolk chicken and ham hock with house pickles. Sharing plates include vegetarian option The Woodberry Down (vegetable crudité with squash and white bean dip, black olive pesto, aubergine dip, rapeseed oil and seeded crackers). Main dishes include beetroot and feta barley cakes and 28 day-aged sirloin steak, while there are seasonal fish dishes and a Sunday roast menu. The Woodberry Down development also features cafes and restaurants such as Zer Café & Juice Bar, Italian restaurant Bon Italy and Simply Organique, a health food store and coffee shop. It is set to eventually feature 5,500 homes, three public parks, a community centre, library, schools and a children’s centre.

Signature Pub Group reveals plans for £2m bar restaurant in Edinburgh: Edinburgh-based Signature Pub Group has revealed plans for a new bar restaurant in the city. The company, which has invested £10m in new venues in the past year, proposes to refurbish a former Bank of Scotland branch at Holy Corner into the new venue, creating 50 jobs. It will invest £2m to restore the 19th century building, which has lain derelict for two years. Director Nic Wood told the Edinburgh News: “I have seen the Morningside and Bruntsfield area develop over recent years and I know Signature can provide the very best facilities for local residents. We’re delighted to be able to bring this new bar and kitchen to create a community feel for everyone to enjoy. This £10m investment across the business shows our commitment to the Scottish economy and the communities our venues serve, and we would like to extend this to Morningside.” Another project to renovate the former Robertson Memorial Mission Church in Grassmarket into a bar, restaurant, micro-brewery and rooftop terrace could be complete by the end of the year. Earlier this year, the company acquired the Auld Hundred in Rose Street and Boozy Cow bars in Edinburgh, Dundee, Stirling and Aberdeen from Speratus Group.

Sam’s Kitchen closes final site in Frome as firm nears liquidation: Restaurant, bakery and wine bar concept Sam’s Kitchen has closed its remaining site, in Frome, Somerset, as the company prepares to go into liquidation. Sam Wylde opened the Frome venue in late 2016, featuring a restaurant and bakery on the ground floor and a wine bar upstairs. Insolvency specialist David Rubin and Partners said the venue had “shut for good”, while its holding company would be “liquidated next week”. Charlotte Jobling, of David Rubin and Partners, told Somerset Live: “They tried to make a go of it in Frome but unfortunately there wasn’t the level of footfall or the turnover to keep it going. About 30 people have lost their jobs as a result. After we assessed the position, we took the view the company could no longer continue trading.” Wylde opened the debut Sam’s Kitchen in Bath in 2001 but closed the site in July last year citing “cost increases and trade decline”. A venue in Holt, Bradford-on-Avon, also closed.

Chipotle illness that hit 647 customers traced to ‘unsafe’ food temperatures, staff to undergo nationwide retraining: Health officials have identified the cause of a foodborne illness outbreak stemming from a Chipotle restaurant in Powell, Ohio, which sickened at least 647 people. Customers who became ill after eating at the restaurant tested positive for clostridium perfringens, a foodborne disease that occurs when food is left at an unsafe temperature. In response, Chipotle chief executive Brian Niccol said employees nationwide would be retrained on food safety. He told Business Insider: “Chipotle field leadership will be retraining all restaurant employees nationwide, beginning next week, on food safety and wellness protocols.” A specific food has yet to be identified as the source of the illness. Chipotle temporarily closed the restaurant in Powell on 30 July after receiving reports of customer illness. Health officials found lettuce was not properly cooled and beans were not held at a warm enough temperature. The violations came after Chipotle spent millions of dollars on measures to improve food safety after an E. coli outbreak affected restaurants in 14 states three years ago.

Rita’s re-emerges to run Redchurch Brewery restaurant space: Late-night, American-influenced restaurant Rita’s, which closed its site in Hackney, east London, has taken over the new kitchen at Redchurch Brewery. Rita’s founders Gabriel Pryce and Missy Flynn will operate the open kitchen, which overlooks the 24-capacity dining area recently added to the brewery in Poyser Street, Cambridge Heath. Dishes will include Thai spiced sardine crostini, Swaledale lamb with roast tomato and jalapeno ranch greens, and Rita’s renowned green chilli mac ‘n’ cheese. The menu will change regularly and feature beer-influenced dishes alongside cocktails and wine. Pryce told Hot Dinners: “I have learned a great deal since closing Rita’s in Mare Street. I have had the opportunity to work with some amazing chefs in London and abroad, cooking at The Marksman, Brawn and Brat, and stages at Estela and Lilia in New York. While that has helped push my cooking, it has also reminded me something is missing. I miss my restaurant and food. Rita’s held a special spot and I don’t think anything has filled that gap.” After closing the original Rita’s, Flynn and Pryce launched Italian-Argentine canteen concept Quilombero in East India Dock, which has since closed.

Carlsberg reports UK volumes fall 5% in first half but premium brands see double-digit growth: Carlsberg has reported total volumes declined 5% in the UK in the first half of the year as its mainstream brand lost market share but its premium brands showed double-digit growth. The company reported total volume growth of 3.4% during the period. Volumes of the Carlsberg brand grew 4%, with “good” growth in several markets including China, India, Malaysia, Russia, Poland and Denmark, partly offset by a decline in the UK. The company’s other premium brands all had strong volume growth – Tuborg (8%), Grimbergen (11%), and 1664 Blanc (55%). Carlsberg saw craft and speciality volume growth of 26% in Western Europe, with alcohol-free brews growing 26% in the region. The company stated: “Based on the strong first-half performance, the upgrade of the expected Funding The Journey benefits and a good start to the third quarter, we adjust our earnings expectations upwards to high single-digit percentage organic growth in operating profit (previously mid single-digit). Chief executive Cees ’t Hart said: “We delivered strong results for the first six months of 2018 with healthy top-line growth, margin improvements across the regions, strong cash flow and continued debt reduction. We’re pleased to be able to adjust our earnings outlook upwards. This is a proof point our SAIL’22 investments support our ambition of sustainable top-line growth.”

BrewDog offers investors chance to have craft beer bar built in their home: Scottish brewer and retailer BrewDog has offered anyone who invests more than £50,000 in its Equity for Punks V crowdfunding campaign the chance to have a craft beer bar built in their home. The bar would be designed in BrewDog’s signature industrial style complete with three-tap bar, a fully stocked fridge and a keg of Punk IPA. Earlier this month, BrewDog passed the £20m mark in Equity for Punks V. The company set out in October 2017 to raise £10m in an initial 90-day period and has now secured £20,484,660 from 40,139 investors. The campaign was due to finish in January but was extended until Monday, 15 October or until the maximum potential raise of £50m is reached. With 2.8% equity in the business made available at £23.75 per share, it means BrewDog values its business at £1.8bn. Co-founder James Watt said: “Through Equity for Punks we can offer money-can’t-buy benefits our community will love, and this one is the most exciting yet.”

Thwaites starts production at new £12m brewery: North west brewer and retailer Daniel Thwaites has started producing the first 6,000 pints of ale at its new £12m brewery at Sykes Holt in Ribble Valley, Lancashire. The first barrels of Thwaites Best Cask will be delivered to pubs in the next fortnight. Brewing at the site started a month ahead of plan after travellers ended production at Thwaites’ historic Blackburn home after ransacking the site in May. The company was forced to pour 1,700 pints of ale down the drain after 100 travellers caused an estimated £100,000 damage. Thwaites director of pubs and brewing Andrew Buchanan told the Lancashire Telegraph: “Our new brewery looks fantastic and brewing there is a milestone in our history. Our brewers are happy to get back to brewing great beer and we all look forward to the future in our new home.” Ribble Valley Council leader Ken Hind added: “This is terrific news. It is the start of a new era for the borough and for Thwaites. This will bring jobs and prosperity to the Ribble Valley.” Thwaites’ head office, stables and shire horses will relocate from the 211-year-old Star Brewery in Blackburn town centre next month.

Marston’s appoints ‘home-grown’ head brewers: Marston’s has appointed head brewers at its Oxfordshire and Hampshire breweries, with both rising through the ranks. Following the retirement of Jeff Drew, Maurice Walton has taken over as head brewer at Ringwood Brewery, while Jon Tillson is the new head brewer at Wychwood Brewery in Witney. Walton joined Ringwood Brewery in 2004, while Tillson began at Wychwood on a two-week work experience from school in 1992. Marston’s director of brewing Emma Gilleland said: “It always gives me enormous pleasure to recruit from within the business so the team can see real career progression without leaving the company. I wish Maurice and Jon all the best in their new roles.” Marston’s operates six breweries.

Cineworld adds immersive experience as it boosts technology offering: Cineworld has confirmed plans to introduce new technology at its White Rose cinema in Leeds. ScreenX uses a multi-projection system to expand the screen to side walls, creating a 270-degree viewing experience. Cineworld Leeds will be the third in the UK to install the technology, which was developed and launched in South Korea three years ago. The side walls in a ScreenX-equipped auditorium are covered with fabric to ensure the brightness and colour closely match the central screen. It’s not the first time Cineworld has sought to take a lead on high-tech customer experiences. In 2015, it became the first operator in the UK to offer immersive sensory experience 4DX. Cineworld Leeds general manager Steve Petersen told BDaily: “We are driven by innovation and this fully immersive experience will transform the way our customers experience film.”

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