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Tue 7th Jun 2022 - Update: Starbucks CEO, cost-of-living crunch, household savings, Inn Collection opening
Starbucks’ Schultz to remain interim CEO until March: Starbucks has said that Howard Schultz will remain the coffee chain’s interim chief executive until the end of March, as it looks for a permanent successor. Schultz returned to lead Starbucks for a third time earlier this year, taking over from Kevin Johnson at a crucial time for the company as it deals with rising unionisation of its US workforce. Starbucks is considering only external candidates for its next chief executive, the Wall Street Journal reported. Schultz cited a need to add fresh talent and skills to its senior leadership ranks. The new chief executive is expected to be named in the autumn, the company said, with Schultz retaining his seat on the Starbucks board after a formal handover takes place during the first quarter of next year. This timeframe would provide the company with “the ideal runway for a seamless transition and continuity of leadership through the 2022 holiday season”, Starbucks said. On his return in April, Schultz announced the immediate suspension of the company’s share buyback programme in order to invest more in wages and modernising its stores, with $1bn earmarked for spending during this financial year. Last month the coffee chain declared its intention to exit the Russian market, bringing to an end its 15-year presence.

Propel Premium subscribers to receive seven exclusive videos: Propel Premium subscribers are to be given exclusive access to seven videos where sector leaders and entrepreneurs offer their insights as they develop their businesses in a post-covid world. The videos, which will be sent to subscribers on Friday (10 June), at 9am will include Paul Campbell, sector investor and non-executive director at Hawksmoor, Vinoteca, Hickory’s, Blacklock, Tortilla and The Alchemist, who explains what he now looks for when investing in the sector post-pandemic, the key traits he looks for in management teams and what the next 12 months holds for the industry. Colin Hill, chief executive of Nando’s UK, discusses how sustainability is the cornerstone of the group’s future development, and the challenges and opportunities around becoming carbon-neutral in the sector, and what the industry needs to do next. James Shapland, co-founder of Coffee#1, the Caffe Nero-owned brand, and new venture Coffi Lab, talks about the development of his new business, why he has returned to the coffee sector and discussed how he believes the sector will develop in a post-covid world. Jyotin Sethi, co-founder of JKS Restaurants, talks about the company’s move into pubs, food halls and pop-ups, and why they are all providing fresh ideas and inspiration for the growing business. Jonny Boud, founder of Kitchen Ventures, talks about the creation of the cloud kitchen and virtual dining start-up, its expansion and how it picks and develops the brands it works with. Tom Snellock, founder of Clays, discusses the development, launch and expansion of his indoor virtual clay pigeon shooting experience. The videos will also include a panel session on solving the staffing, recruitment and retention crisis hosted by Mark Stretton with James Hacon, global chief marketing officer at Mapal Group; Sol Schlagman, co-founder of Stint; Roland Horne, founder of WatchHouse; Kate Daines, chief people officer at PizzaExpress; and Brian Trollop, managing director at Dishoom. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £895 plus VAT – whether they are an operator or a supplier. The single subscription rate is £445 plus VAT for operators and £545 plus VAT for suppliers. Email jo.charity@propelinfo.com to upgrade your subscription. Premium subscribers also receive access to three databases that are updated monthly – The New Openings Database produced in association with StarStock, the Propel Multi-Site Database produced in association with Virgate, and the Turnover & Profits Blue Book, which is produced in association with Mapal Group. Premium subscribers also have exclusive access to the UK Food and Beverage Franchisor Database, which is an exhaustive guide to the companies offering a food and beverage franchise in the UK and will be updated every two months. Subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews and also have access to a curated video library of the sector’s finest leaders and entrepreneurs, offering their insights on running outstanding businesses in the sector. Premium subscribers also receive their morning newsletter 11 hours early, at 7pm the evening before our 6am send-out; regular video content and regular exclusive columns from Propel group editor Mark Wingett.

Cost of living crunch hits UK consumers hard: British consumers cut back sharply on spending last month in almost all areas apart from holidays as the rising cost of living hit budgets hard, according to industry data. Households adopted a more frugal approach in May with inflation running at its fastest annual pace in 40 years, stoked by a 54% jump in the cost of average gas and electricity bills a month earlier. The FT reports retail sales fell at an annual rate of 1.1% in May, a sharper contraction than the 0.3% fall in the previous month and the worst since January last year, according to figures compiled by advisory firm KPMG and the British Retail Consortium trade association. BRC chief executive Helen Dickinson said sales continued to see declines “as the cost-of-living crunch squeezed consumer demand”. She noted that higher-value items, such as furniture and electronics, had taken the biggest hit as shoppers reconsidered major purchases during this difficult time. The BRC warned that sales figures were not adjusted for inflation, meaning that the drop in sales “masked a much larger drop in volumes once inflation is accounted for”. Separate data from the BRC also suggested that the platinum jubilee bank holiday weekend could provide a boost to spending in early June, with UK footfall for the whole of last week up by 17% compared with the average for May.

Households hoard £7,000 covid savings as prices spiral: Families have saved almost £7,000 since covid struck, mostly because of lockdowns when they were unable to spend money in pubs, restaurants, “non-essential” shops, travel and holidays. But they are unwilling to spend heavily now to make up for lost time, instead being battered by inflation and rising bills which are pushing consumers to cut back and shop more carefully. The Telegraph reports households put away £195.9bn between the start of 2020 and the end of 2021, according to the Office for National Statistics. Before the pandemic, typically families saved around 6pc of their income. At the peak of the first lockdown in 2020, they put aside almost one-quarter of their incomes, as earnings were supported by schemes such as furlough, while spending opportunities diminished radically. Of this cash, which amounts to an average of almost £7,000 per household, the ONS estimates that three-quarters, or £140bn, was “forced” saving as lockdown rules made it difficult to spend the money. This amounts to around 10% of the nation’s disposable income, which had raised hopes that shoppers would return enthusiastically to high streets now the pandemic has faded. But despite this cash mountain, households are proving reluctant to spend in the face of a cost-of-living crisis. Retail sales in the three months to April were down 0.3% on the previous three months, according to the ONS, continuing a downward trend which began in late 2021 after a brief frenzy when the shops and hospitality industry reopened following the long lockdown. Meanwhile household bills are taking up a growing share of spending, with the energy price cap rising by more than 50% in April and expected to go up by another 40% in October.

Inn Collection Group reopens former police station as pub with rooms: The Inn Collection Group has reopened a former North Yorkshire police station as a new pub-with-rooms venue after a multi-million-pound investment. The company bought the former Northallerton Police Station in 2020 and have developed it into a new food-driven pub with 30 bedrooms in the popular North Yorkshire market town. The 18-month project included the remodelling of the building’s former custody suite – complete with five cells – into bedrooms with original features including the front entrance and main staircase being retained. The internal spaces of the Grade II listed building have been repurposed into a bar and dining area with 200-covers, in keeping with The Inn Collection Group’s food-driven pubs with rooms concept. Managing director of The Inn Collection Group Sean Donkin said: “This has been a particularly exciting project for us. We are delighted with the transformation and to have expanded our Yorkshire customer base with the opening of this superb new site. We have pulled out all the stops to do justice to the building and its fascinating past while giving the building a brand, new purpose as an inn. Northallerton is a cracking market town with bags of character and The Northallerton Inn is at the heart of it. We are very happy to be trading and being part of the community here, with a new venue that local people and visitors can enjoy, providing year-round food, drink and accommodation services.” Prior to The Inn Collection Group’s purchase of the 18,500 square foot site, the Georgian building had been a police station for 30 years and was previously a Local Authority office and public library. Outside Northallerton, the 31-strong The Inn Collection Group’s trading Yorkshire venues include The King’s Head Inn at Newton-under-Roseberry, The Black Swan at Helmsley, The Stables at Whitby and The Dean Court in York. It also owns The St George in Harrogate, The Ripon Spa Hotel in Ripon and The Dower House in Knaresborough which are currently being refurbished.

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