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Tue 21st Feb 2023 - Update: Zambrero secures investment for UK expansion push
Zambrero secures investment for UK expansion push: Zambrero, Australia’s largest Mexican quick-service franchise, has received £143m in equity financing to open more restaurants in Britain and Ireland. The Times writes that the Australian restaurant franchise that serves burritos, nachos and tacos, has opened about 20 sites in the British Isles in the past six years and will add a further 25 by the end of this year. It currently operates five sites in London and the south of England, but it plans to venture into other areas, including Manchester, as it competes with the likes of Tortilla, Chilango, Wahaca and Chipotle. Zambrero was founded in Canberra in 2005 by Sam Prince, a Scottish-born doctor, with the idea of using the profits to support humanitarian causes. The chain donates a meal to the developing world for every one bought through its Plate 4 Plate initiative. It has grown to become the biggest Mexican restaurant group in Australia and the eighth largest globally, with 250 sites in Australia, New Zealand, Britain, the Republic of Ireland and the US. The minority stake being taken by Metric Capital Partners, a European private capital manager, is understood to be worth about A$250m (£143m). It is the first external capital taken by Zambrero. Prince still owns over 70% of the business. He said: “We understand the retail world is difficult to operate in right now, but there is a lot of momentum that we’re building up across the UK and Ireland.” Prince said it was an exciting time for Mexican restaurants in the UK. “We’ve watched other parts of the world evolve its understanding of Mexican food from the very stodgy and grease-laden affair to something more fresh and healthy,” he said. “Mexican is a broad category and how you interpret that in the UK has sometimes been a little bit off the mark. The UK market is still going through its evolution, whereby Mexican food is considered something that can be healthy, and that is continuing to grow.” Prince said the plans were part of a wider expansion. “We want to deliver a billion meals by 2025, which means we have to continue to grow across regions like the UK and America,” he said. “We look at our burrito like an iPhone – there’s version eight and nine and so forth. Our view is to be incrementally better at scale.”

Propel Premium subscribers to receive three updated databases in a week: Propel Premium subscribers are to receive three updated databases in the space of a week. The next edition of the Propel Premium Database of Multi-Site Companies will be released on Monday, 27 February, at midday. The updated Propel Multi-Site Database, which is produced in association with Virgate, will feature 21 new multi-site companies, taking the total to 2,789. The comprehensive database is updated monthly and provides company names, the people in charge, how many sites each firm operates, its trading name and its registered name at Companies House if different. Meanwhile, the next edition of the Who’s Who of UK Food and Beverage will be sent to Premium subscribers next Tuesday (28 February). It is the first database where full profiles of 650 of the UK’s top food and beverage operators are available in one place. There are 46 updated entries, while 16 new companies have been added. The companies, listed in alphabetical order, will have their most recent results reported as well as broader information around Ebitda, plans and trading style available. The database merges Companies House information, interviews and other public information to provide an easy to reference and exhaustive guide to the sector. Premium subscribers will also receive the next edition of the New Openings Database on Friday, 3 March, at midday. It focuses on newly announced openings and upcoming launches in the sector and is updated every month. The next edition also includes a 5,000-word report on the new additions to the database. Premium subscribers also receive access to the Propel Turnover & Profits Blue Book and the UK Food and Beverage Franchisor Database. 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. Subscribers also receive access to Propel’s library of Friday Wrap interviews and now 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.

Small companies more optimistic as threat of UK recession fades: Bosses of small companies are increasingly upbeat about their prospects, according to a survey, adding to evidence that the outlook for the British economy may not be as bad as has been feared. The Times reports a poll of small and medium-sized firms commissioned by Barclays found that 41% were optimistic about their outlook, the highest level since the second quarter of last year. 55% were expecting to increase revenues this quarter compared with a year earlier, while a third were planning to hire more staff in the next 12 months. Barclays’ quarterly SME Barometer gives a glimpse of sentiment at smaller businesses across the country. Its latest poll canvassed 603 bosses between 20 January 20 and 1 February. It comes amid turbulence in the wider economy as the Bank of England scrambles to bring down inflation by rapidly lifting interest rates. Consumer price inflation hit a 41-year high of 11.1% in October, but by January had fallen for a third consecutive month to 10.1%. The Bank has responded to soaring prices by increasing its base rate from a record low of 0.1% in late 2021 to a 15-year high of 4% this month. The inflation jump and rising borrowing costs fuelled expectations that the economy would fall into recession this year. This month the Bank said it expected only a mild recession; it had warned previously that the UK faced its longest recession in a century. The Barclays survey found that energy costs were the top worry for smaller companies, with 73% reporting that they were concerned about prices and 54% saying they were looking at lowering their usage to try and cut their bills. Only 15% of respondents said they were pessimistic about their business prospects. Colin O’Flaherty, head of SME at Barclaycard Payments, said: “It’s encouraging to see more businesses reporting optimism about their prospects going forward and investing to future-proof their revenue streams.”

Four-day working week boosts revenue and makes staff happier: Allowing workers to drop to a four-day week with no loss of pay leads to happier staff and a boost in revenue for employers, a landmark British study has found. The Times reports employees in the trial reported lower levels of stress and burnout and took fewer sick days while employers saw improvements in both revenue and staff retention with no loss of productivity, according to the largest ever trial examining the effects of moving to a four-day working week. Across Britain, 61 companies and organisations moved their staff to a four-day week with no drop in salary over a six-month period starting in June last year. The results have now been published, showing that 56 of the 61 companies decided to stick with the four-day week arrangement after the end of the trial due to the benefits they saw, with 18 firms already having declared the move permanent. Researchers found that 71% of employees reported lower levels of burnout, with 39% saying they were less stressed compared with the start of the trial. There was a 65% reduction in sick days and a 57% drop in the number of staff leaving compared with the same six-month period in the previous year. Fears that moving to a four-day week would hit an organisation’s productivity or revenue proved unfounded. The organisations involved, which included online retailers, financial service providers, animation studios, restaurants, recruitment, hospitality and marketing firms, saw a 1.4% increase in revenues on average. The companies still saw “healthy growth during this period of working time reduction”. The 2,900 employees who took part in the study were asked about their experiences. Some 60% said a four-day week made it easier to combine their work with parental or other care responsibilities, while 62% said that it was easier to maintain a balance between their work and social lives. Brendan Burchell, at the University of Cambridge who led the research, said: “Before the trial, many questioned whether we would see an increase in productivity to offset the reduction in working time, but this is exactly what we found. Many employees were very keen to find efficiency gains themselves. Long meetings with too many people were cut short or ditched completely. Workers were much less inclined to kill time, and actively sought out technologies that improved their productivity.”

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