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Thu 15th Sep 2022 - Propel Thursday News Briefing

Story of the Day:

Sector warns only ‘immediate and large-scale interventions can save huge parts of the industry’ despite government confirming business energy support from October: Businesses will receive money to help them with increases to their fuel bills from October, the government has announced – but sector bosses have warned only “immediate and large-scale interventions can save huge parts of the industry”. Downing Street made the commitment in response to a story by the FT that said business figures have been told the energy support scheme for companies may not be in operation until November. In response to the initial FT story, the government just said it was working to get the business support scheme up and running as soon as possible. But Downing Street has now said, even if it is not operational at the start of October, payments would be backdated to that point so businesses did not lose out. A spokesperson said: “We will confirm further details of the business support scheme next week. The scheme will support businesses with their October energy bills and that includes through backdating if necessary.” But Alex Reilley, co-founder and chairman of Loungers, tweeted: “After a summer of a zombie government and a marathon leadership contest, surely there is no need for a party conference? Thousands of businesses have an energy gun held to their head with many already closing for good. There is a massive economic crisis raging ¬– we need action!” Night Time Industries Association chief executive Michael Kill said: “Annual energy costs under pricing available now are simply untenable for small and medium-sized businesses (SMEs), in fact it was unaffordable six months ago! So it is long past time for government to act quickly, if we are to have any chance of saving jobs and protecting the future of the economy. Any further delay in the release of detailed support for businesses is unacceptable. Businesses are making irreversible decisions today, which are impacting thousands of people’s lives. We have now reached such a crisis point that only immediate and large-scale interventions can save huge parts of the sector, with substantial cuts to VAT, an extension of business rates relief and a meaningful energy price freeze for SME’s that is affordable.” Emma McClarkin, chief executive of the British Beer & Pub Association, added: “Pubs and brewers will not be able to wait days, let alone months to get clarity on their energy bills. Many are making decisions now as to whether they will have to close this winter. We need urgent clarity on whether this cap will deliver for businesses.”

Industry News:

John Gaunt & Partners’ Tim Shield to speak at final Propel Multi-Club Conference of 2022, three free places per company for operators: Tim Shield, partner at John Gaunt & Partners, will be among the speakers at the final Propel Multi-Club Conference of 2022, which takes place on Thursday, 10 November, at the Millennium Gloucester Hotel in London, and is open for bookings. The all-day conference will focus on “new ways of working”. Shield examines all the key legal developments that impacted multi-site operators in 2022, and also looks at what’s coming down the track over the next 12 months. Operators can book up to three free places per company by emailing

Propel Turnover & Profits Blue Book shows hotels and holiday parks generating greatest profit as a percentage of turnover: The next edition of the Propel Turnover & Profits Blue Book shows six of the top ten companies generating the greatest profit as a percentage of turnover are either hotels or holiday parks. Premium subscribers will receive the latest edition of the Blue Book, which is produced in association with Mapal Group, on Friday (16 September), at midday. Another 22 companies have been added, while accounts have been updated for 42 businesses. The Blue Book shows the effects of the pandemic, with total losses of £5.4bn being reported by 326 companies. However, a further 293 sector companies are still reporting total profits of £1.5bn. The 619 UK pub, restaurant, cafe and hotel operators featured have a collective turnover of £31.3bn. The Blue Book, which is updated every month, provides an insight into UK operator turnover and profitability over five years, profit conversion and directors’ earnings. Premium subscribers also receive the Multi-Site Operators Database, produced in association with Virgate, and the New Openings Database, which are also updated each month. Premium subscribers also have access to the UK Food and Beverage Franchisor Database, which will be updated every two months. Subscribers will also be given exclusive access to the recording of the Propel Multi-Club summer conference. The videos will be sent next Friday (23 September), at 9am. 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 to upgrade your subscription. Subscribers also receive access to Propel’s library of lockdown videos and Friday Wrap interviews, and 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; plus regular video content and exclusive columns from Propel group editor Mark Wingett.

Sector companies to shut for Queen’s funeral: McDonald's is to shut all its restaurants in the UK on Monday (19 September) from midnight until 5pm to allow staff to “pay their respects” to Queen Elizabeth II. Her majesty's state funeral is taking place at Westminster Abbey, after the four-day period of her lying in state at Westminster Hall comes to an end. McDonald’s said in a statement posted on Twitter: “In honour of Her Majesty Queen Elizabeth II and to enable everyone at McDonald's to pay their respects, our restaurants across the UK will be closed from midnight until 5pm on Monday, 19 September.” Caribbean restaurant brand Turtle Bay also said its restaurants will not open until 5pm on Monday while Scottish brewer and retailer BrewDog said its UK bars will be closed until 2pm. However, the company will open its central London sites to allow people to use its toilets and baby changing facilities free of charge. The company’s hotels will remain open for guests only. Food-to-go operator Greggs said its stores will be closed on Monday, although a small number of its sites, operated by its franchise partners, may remain open. All-day dining casual cafe brand Boston Tea Party said it would also be closing its venues. Meanwhile, Center Parcs faced further backlash after it revealed its facilities would be closed for guests staying at its resorts while also warning new arrivals not to arrive on the day of the Queen's state funeral. The company had been inundated with complaints after it said its five sites would close from 10am on Monday “as a mark of respect”, leaving guests scrambling as they struggled to find alternative accommodation. The company was forced into a U-turn after being contacted by thousands of furious families whose holiday plans were left in tatters by Center Parc's plan to turf them out. Parks will be now remain open for those who planned to stay there on Monday, though the villages will still be closed and there will be limited activities. Swimming pools, sports activities, restaurants are all expected to be shut. And although guests who arrive before the state funeral will now be allowed to stay on the resort, Center Parcs has advised those hoping to arrive on Monday they should not travel and said it will be offering discounts.

More than eight in ten operators struggling to build teams to drive growth: More than eight in ten operators have said they are struggling to build a team with the right capabilities to drive growth now and in the near future, according to new research. A survey conducted by Hospitality Mavericks, in partnership with workforce management specialist Bizimply, showed just 33% of operators have implemented a clear people strategy in their organisation. While this is an improvement on the 28% in the 2021 survey, it still leaves two-thirds of operators without a formal and documented people strategy. Only 40% of respondents feel they've invested enough in technology, compared with 55% last year. Meanwhile, 83.4% recognise that improving operational complexity using digital tools is the area with the biggest potential to improve performance. The report, The Six Tenets of Agile Hospitality – 6 Tenets Every Leader Needs to Survive and Thrive in the New Era of Hospitality, builds on a study undertaken a year ago in the immediate aftermath of the pandemic. The white paper reports on the survey of senior operators and leaders representing hundreds of outlets employing thousands of staff in the UK, Europe, and the USA.

Job of the day: COREcruitment is working with a company operating an array of premium restaurants and bars that is looking for a strong general manager to lead a venue in Manchester. A COREcruitment spokesman said: “The business is ideally searching for someone with a proven track record of attracting new customers and delivering consistently good guest experiences; who is comfortable with P&L, including financial sales budgets and stock control; and works to actively promote inclusive work environments.” The salary is up to £50,000 per annum. For more information, email 

Company News:

Coco di Mama to begin regional expansion, secures debut train station site: Jim Attwood, managing director of Coco di Mama, the Azzurri Group-owned business, has said the Italian food-to-go brand is to begin its regional expansion later this year, and has also secured its first train station-based site. Coco di Mama currently operates 15 bricks-and-mortar sites in London and in circa 140 locations nationwide as delivery kitchens out of Zizzi and ASK sites. Speaking at the Lunch! trade show, Attwood said the business had taken learnings from its delivery kitchen roll out. He said: “What we learned is whereas before the affluent office worker was our lifeblood, we now know the brand resonates with different types of consumers, students in particular. Rather than focus on opening stores in London, we are going to start our regional expansion later in the year. And likewise in travel as well, where there are busy travel hubs to go into. The delivery kitchen roll out will help us decide where we go on our regional expansion. When we look at a town, I know instantly what my top line delivery revenue number is before we even start and that is trading with a small subsection of the brand’s range.” Propel understands Coco di Mama is in talks on a site in Reading. Earlier this year, the business opened its first roadside services site, at Roadchef’s flagship Norton Canes service area on the M6. Attwood said the business is set to work with Network Rail on opening its first site in a train station in London’s Liverpool Street station. In terms of top line sales, he said in London it is “still really hard”. He added: “We are still figuring out the routines of those that are coming into the capital on Tuesdays, Wednesdays and Thursdays. To be fair on those midweek days there is an up-trade there and it is actually quite exciting. Mondays are beginning to grow and Fridays, which used to be our biggest day, are at half of what it once was. I think of hospitality as 21 trading sessions across the week, in food-to-go we were only trading in ten pre-covid – breakfast and lunch Monday to Friday. Now we are at an average of three and a half days a week, so it is very hard to get the level of revenue you need with the fixed costs you currently have.”

Parogon Group to expand under new hybrid model, acquires tenth site: Staffordshire operator Parogon Group will carry out its expansion plans under a new hybrid model, and has acquired the first site to start rolling it out. All of the group’s nine sites so far operate under distinct brands, but managing director Richard Colclough said maintaining such a model does not sit easily with the company’s plans to double its estate size by 2025. Instead, its latest site, in Congleton, will become its second The Orange Tree, copying the format of its bar and grill of the same name in Newcastle-under-Lyme. “All our brands are different and bespoke, and coming up with individual sites is pretty exhausting when you want to expand quickly,” Colclough told the Propel Multi-Club Conference. “Each of the brands has a different identify – a certain commonality with menus, but ultimately, they’re all different. We can’t keep doing that, so to accelerate our expansion plans we’re going to come up with a hybrid model, where we do retain some of the similarities from the different sites. We’ve just acquired our tenth site, in Congleton, and to fit in with our ambition to scale and expand Parogon, this will be our second Orange Tree site, albeit updated from the original. It allows us to take some of that design element and offer and not reinvent the wheel – the distance between them is enough to do that.” As part of its growth plans, Parogon launched a £5,000 finders’ fee in April, payable to anyone who finds them a suitable venue that in turn becomes a new site. “It has been a great way to raise our profile with customers in areas we weren’t previously known in,” said Colclough. “I have to say most suggestions were along the lines of come and run my local, but it was a great bit of PR. A chunk of our success is down to acquiring sites that have impact, ideally landmark or well known, and have the physical scale to operate our business model, with 200-plus covers. With the infrastructure and head office support in place now to add up to three sites per year for the next three years, the future looks bright, provided the electricity bills stay down and we can keep the lights on! We can add another nine with the structure we have in place.” Colclough added Parogon, which turns over “in the region of £25m a year”, is also adding rooms to our portfolio and has been granted planning permission for 13 boutique rooms at The Red House in Lilleshall.

Rileys reports sales up 48% on 2019 levels, ‘perfectly positioned’ to make acquisitions: Sports bar operator Rileys has reported sales in the first six months of 2022 are up 48% on 2019 levels. The company has completed a series of refurbishments, which have been a key part of the sales success, the 13-strong group said, delivering 62% like-for-like growth on 2019. Chief executive Craig Mayes said: “We are delighted with our half-year numbers and we have seen Rileys outperform the Coffer Peach Industry tracker in every month since we reopened and this is down to the relentless focus of our club teams on exceeding our customer expectations. We are delivering record customer feedback scores and that was celebrated recently when we closed the business for a day to celebrate with our team.” Finance director Tom McMahon added: “Our bullish approach to investing well over £1.5m in our clubs during a pandemic has paid dividends and our strong trading in the first six months leaves us perfectly positioned to complete further refurbishments and acquisitions before Christmas.” Rileys, which is owned by Weight Partners Capital, shows live sport on HD screens around the club, as well as offering a dedicated sports zone serving food with a large cinema-style HD projector. Competitive sport also happens within the clubs by hosting local and national pool, snooker and darts competitions including the Professional Darts Corporation qualifiers.

Coffi Lab plans for estate to reach double figures by next spring: Coffi Lab, the dog-friendly coffee shop brand launched last year by Coffee#1 founder James Shapland, is planning to reach ten sites by the second quarter of 2023. Earlier this year, the business opened its sixth site, and third in Cardiff, in the suburb of Rhiwbina. Shapland told Propel the site has become the fledgling group’s most successful so far. It now plans a further opening in Cardiff, at 32-34 Station Road in Llanishen, before the end of the year. Shapland said: “We hope to have a further three or four sites over the line by the second quarter of next year, which will take us into double figures and we will look to push on from there. Looking at the current state of the market, there is sadly going to be further closures across our sector and retail over the coming months, but this should allow us further opportunities for expansion next year.” Shapland returned to the coffee sector last year having previously founded Coffee#1 in 2000 and sold it 11 years later, having grown it to 15 sites in Wales and the south west. Last year, Shapland told Propel he plans to open 50 Coffi Lab sites over the next five years but insists growth won’t be at the expense of the original concept. He said: “We’re initially focused on neighbourhoods and towns I have traded in before with Coffee#1, and who knows where it will go from there. I think there’s a place for Coffi Lab in every leafy neighbourhood in the UK.”

McDonald’s franchisee sees profits more than double, sales up almost 55%: McLean Restaurants, operator of 21 McDonald’s sites, saw its profits more than double during the year ending 31 December 2021, with sales up almost 55%. Pre-tax profit increased from £3,716,990 in 2020 to £9,396,363 (2019: £2,627,231). Turnover also rose from £63,236,534 in 2020 to £97,872,588 (2019: £64,467,160). The company received £1,175,794 in governments grants in 2021, compared with £4,578,049 in 2020. A statement accompanying the accounts said: “The director is pleased to report the profitability of the business. The company has positive cash flows and the balance sheet shows net assets of £9,053,301, an increase of £4,897,758 on 2020. Gross profit margin increased by 3.78% from 39.27% in 2020 to 43.05%. The company will continue its strategy of refurbishing its stores in line with the McDonald’s national reimaging strategy and will continue to push delivery and digital offerings. The director is confident the company will continue to grow due to the strength of the brand and success of delivery and digital services.”

Stonegate Group launches new development programme to find future leaders: Stonegate Group has launched a new development programme across its management team named “Future Leaders”. The programme sees delegates from across the company work their way through a six-session programme lasting ten months. Each workshop “challenges and enhances the leadership thinking of each individual” and will see a number of key figures from across Stonegate lead sessions, including from five of the company’s board members. Stonegate said the programme has been designed for high potential leaders from within the business. It has three objectives in mind – to provide an internally delivered programme that enables delegates to interact with the operations board while building their own personal brand, to retain and promote to the leadership team from within Stonegate and to continuously build on the performance of its high potential individuals while challenging their thinking processes. Tim Painter, HR director of Stonegate, said: “We are on a mission to raise the bar on the British pub, by being the best for our people as they sit at the heart of our business. Our Future Leaders programme equips our rising stars with the tools and behaviours that they need to have a long and successful career with us.” The first cohort consists of 32 delegates, split between head office and operations roles. Throughout the ten-month programme, delegates will be given a variety of ways to learn including videos, group discussions, role play, case studies, team activities and personal reflection reviews.

Band of Burgers secures fifth London site: Band of Burgers, the London concept, has secured its fifth site in the capital, in Fulham. The business, which is led by founder Zeeshan Amin, will open in Lillie Road next month. Launched in Camden in 2015, the concept also operates sites in Brick Lane, Southgate and Walthamstow. Thandwie Shephard, of CDG Leisure, acted on the Fulham deal.

Pub Invest Group boss gets green light for Liverpool hotel plans: Jamie Motlagh, managing director of Pub Invest Group – which operates more than 35 brands in the north west including Soho, Moloko and Cheers Big Ears – has been given planning permission to open a hotel in Liverpool city centre. Motlagh also heads up bar and leisure operator JSM Company Group, which had applied to open a hotel in a former NatWest bank at 20-34 Castle Street. The city council has now approved the scheme, which will feature 92 bedrooms in the grade II-listed building, which opened in 1902 and is set over four storeys. It comes just weeks after Pub Invest Group launched a recruitment drive for hundreds of new staff, ranging from general managers and chefs to office staff, after experiencing a “very busy” summer.

Yorkshire independent coffee shop doubles up and eyes further expansion: Yorkshire independent coffee shop, The Clubhouse, has expanded into Leeds for its second site and is eyeing further expansion. Founder Kane Pulford-Roberts has signed a long-term lease for 8a St Paul’s Street, part of the recently refurbished One East Parade development. It follows the opening of the first The Clubhouse, in Skipton, in July 2018. Pulford-Roberts said: “We created The Clubhouse as a haven for coffee lovers and as a community focal point. The on-site micro roastery really brings out the best flavours from the coffee beans and fills the shop with rich aromas. This has been a real hit in Skipton, and we’re really looking forward to creating the same in Leeds. We are now looking for more sites in the city.” As well as offering eat-in and takeaway services, the new store will also offer coffee beans and other related merchandise.

Australian fitness franchise set to make UK debut, in Leicester: Australian fitness franchise Body Fit Training (BFT) is set to make its UK debut, in Leicester. BFT, which has more than 300 franchise sites around the globe, is set to open at 127 Granby Street on Saturday, 24 September. Founded in 2017 by Princess Diana’s personal trainer, Cameron Falloon, BFT specialises in strength, cardio and conditioning classes across 13 different workout programmes, each designed to reduce fat and create lean muscle. BFT, which has more than 200 studios in Australia alone, has been operating under a franchise model since 2018. It operates as master franchisor in Australia, New Zealand and Singapore, while US-based Xponential Fitness is growing the brand in the US and Canada. The Leicester gym, which BFT claims is the first of its kind in the UK, is being launched by Brian Saund and James Kotak. “We’re excited to be launching the UK’s first BFT here in Leicester,” said Saund. “This style of training offers something different to your regular gym or personal trainer sessions. We use science and technology to drive positive outcomes at all fitness levels. We first became aware of BFT during a trip to Australia and were blown away by its innovative training methods, which not only produced incredible results, but did so while staying fun and motivational. At BFT, we are all about creating a great community that pushes each other to be better every day.”

Sector security staffing company makes acquisition: Professional Security – which operates nationwide across hospitality, leisure, retail and the public sectors – has acquired Phoenix Security. This now gives the business a combined workforce of more than 10,000 front-line personnel. The acquisition will see Professional Security, which was established in 2005, integrate the full Phoenix operations team into its four regional operational teams that cover the length and breadth of the UK. Phoenix founder and managing director Steve Howe will remain in the business as business director of Professional Security. Phoenix was established in May 2000 and its portfolio of sector clients includes McDonalds, KFC, Stonegate Group, Revolution Bars Group, Turtle Bay, Lane7, Roxy Leisure and Mojo Bars. Jason Thorndycraft, chief operating officer at Professional Security, said: “We feel the security sector needs to re-regulate post covid and this acquisition gives us the opportunity to make positive change.”

Mr Ji’s confirms October opening for Camden site: Taiwanese-inspired chicken concept Mr Ji has confirmed it will open its second site, in Camden, next month. Propel revealed in March the concept, which launched in London’s Soho at the end of 2019, will open in The Parkway. The business, which previously operated a pop-up in Camden, has now confirmed an opening date of Tuesday, 18 October. Mr Ji is the brainchild of restaurateur Samuel Haim, who also founded Camden-based fish and chip restaurant Hook and was inspired by his visits to the Taiwanese capital Taipei. Mr Ji will replace the closed Hook site in Camden.

Argentinian pastries concept launches in London: De Nadas, a new pastry-based Argentinian concept from chef Nico Buyo and former Kerrang! magazine editor Ñako Martinez, has launched in London. It is the capital’s first restaurant specialising in baked hand-shaped empanadas – traditional half-moon shaped pastries featuring 15 different meat, vegetarian and plant-based fillings. Located at 61 Golborne Road, it aims to “bring a touch of Buenos Aires to London”. Fillings include ham and cheese, chorizo, spicy lamb, blue cheese and pear, and butternut squash and kale. Bought individually or in boxes of six, nine, 12 or more, the empanadas are available to eat in or take out. Lunch boxes feature from 11am-3pm Monday to Friday, and include up to three empanadas with salad. The venue also offers artisanal coffee and a deli stocking Argentinian produce, plus a wine room that hosts private events.

Boparan Restaurant Group to open third Restaurant Hub in partnership with Sainsbury’s with Wolverhampton launch: Boparan Restaurant Group (BRG) – the owner and operator of brands including Gourmet Burger Kitchen, Carluccio’s, Giraffe and Ed’s Easy Diner – is opening a third site for its The Restaurant Hub concept in partnership with Sainsbury’s. The hub will be at the Sainsbury's St Marks superstore in Wolverhampton and have capacity for up to 130 diners as well as takeaway or delivery options. The first Restaurant Hub under the partnership launched last year, on a trial basis, at the Sainsbury’s superstore in Selly Oak, Birmingham. A second site has opened at the Sainsbury’s in Sydenham, south London – the first of at least 30 planned to open this year, followed by up to 250 over the next three years. Signage can be seen around the St Marks supermarket as it prepares for the opening later this month, reports the Express & Star. The official opening date is yet to be confirmed. Satnam Leihal, chief executive of Boparan Restaurant Group, said: “The Restaurant Hub allows customers to enjoy multiple brands by placing one order with one payment, which can all be enjoyed on site, or all delivered in one bag with just one delivery charge. This gives customers choice that never existed before and we’re delighted to be the first in the market to land this experience with such incredible brands. We now look forward to rolling out our innovative Restaurant Hub concept across the country.”

Historic North Wales hotel set to reopen under new owner: A historic country house hotel in North Wales that ceased trading just before the pandemic is set to reopen following its acquisition by an investor. Northop Hall Country House Hotel, previously known as The Chequers, was built in 1872 and is located in the village of Northop Hall, Flintshire. It comprises 37 bedrooms, three meeting rooms, a restaurant and bar for 90 covers, a function and banqueting suite for 150 covers, plus an additional three-bedroom owners' cottage. Having ceased operations early in 2020, it has now been sold by joint liquidators, Quantuma Advisory, for £850,000. New owner Na'ím Anís Paymán, founder of Paymán Investments, plans to operate the hotel as a wedding and events venue following a refurbishment, ahead of reopening later this year. He said: “As an impact investment company, we seek to acquire assets that besides making for a successful business, can also be revitalised into becoming a hub for the local community. We very much feel this acquisition will not only make for a very successful hotel, corporate events and wedding venue given its fantastic location, but it also has the potential to bring employment and funds to the local area. The hotel and conference centre will trade under our group brand, Paymán Club. Having got married myself just a fortnight ago, my wife, Sara, and I have decided to set up a sister brand, Paymán Weddings, which will advertise a number of our wedding venues across the UK, with Northop Hall Country House Hotel being one of the many beautiful venues in our collection.”

US chef to make Thai-American pop-up concept permanent: US chef Kris Yenbamroong, best known for LA restaurants Night + Market and Night + Market Song, is set to give his Thai-American pop-up, Chet, its brick and mortar debut. Yenbamroong earlier this year opened Chet as a pop-up at the Hoxton Hotel in Holborn. With Hoxton opening a Shepherd’s Bush hotel later this year, Chet will take up a permanent spot in the new venue. The hotel, which opens in Shepherds Bush Green in mid-December, will have 237 bedrooms, reports Hot Dinners. There will also be a large open lobby with a central wraparound bar and terrace too.

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