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Morning Briefing for pub, restaurant and food wervice operators

Fri 20th Oct 2023 - Pret to accelerate US expansion under new JV
Pret to accelerate US expansion under new JV: Pret A Manger has announced a new joint venture (JV) partnership with existing franchisee, Dallas International, accelerating the company’s ambitious plans in the United States. The brand’s expansion will be through a combination of new equity shops and additional franchise agreements with plans to triple the size of the 58-strong US business in the next five years. As part of this new partnership, Dallas will have operational control of about 50 Pret shops located in New York, Pennsylvania, and Washington DC, and exclusive rights to open new shops in these markets. Dallas intends to refurbish a number of shops, and work with Pret to develop and introduce new shop formats, including drive-thrus. Dallas will also open more than ten new Pret shops on the east coast by 2026. This JV builds on the existing relationship between Pret and Dallas, which includes separate franchise partnership agreements for Dallas to build and operate a range of Pret shops, including in the UK and more than 40 in southern California. Dallas, which has more than 40 years’ experience developing and running food and beverage locations in the United States and Europe, has eight Pret shops in the UK with another six opening in early 2024, one in New York’s Hudson Yards, and plans to open four shops in California in the first half of 2024. Following completion, which is intended to be in February 2024, Dallas will operate more than 60 shops across both counties, and more than 100 by 2026. Pret chief executive Pano Christou said: “We have huge ambitions for Pret to become a more globally recognised brand that is working in partnership with our franchisees to unlock significant growth in new markets. This approach has driven significant growth in Europe and Asia and enabled Pret to track ahead of its mid-term global growth target to double the size of the business by 2026. We look forward to replicating these results in the United States, building upon our already successful partnership with Dallas as we jointly pursue our next phase of growth.” Shane Thakrar, president and chief executive of Dallas, added: “We believe in Pret and are proud to be a strong partner to a marquee brand that is known and loved wherever it operates. This new company further demonstrates our confidence in the brand, concept, and growth potential. We look forward to taking operational control of these prime locations and territories and further investing in new shop formats, operational excellence, and team members. Each market included in the deal has tremendous growth potential that will build on our already strong footprint in the UK and new operations in California, all underpinned by our strong partner, team and customer ethos.” Jorrie Bruffett, Pret US president, said: “Our vision, both within and beyond our involvement in this new joint venture, is to bring our freshly made food and organic coffee to more people at scale, faster than ever before. The United States stands out as a significant growth market for Pret, with opportunities to trial new locations and shop formats, bringing our high-quality service and differentiated grab-and-go concept to more places.” Pret said the new arrangement comes at a time of growing momentum and consumer demand for the brand. The company has seen sustained growth in Canada, recent US shops sales are up 10%, and the recent launch of its Club Pret programme has been “a huge success alongside Pret pick-up”. Pret’s remaining shops in the United States and Canada will continue to be a mix of equity-owned and other franchise agreed shops and, in the future, may extend further to new states under separate operated franchise partnerships, with Pret A Manger USA retaining ownership of the Pret brand, marketing, food and logistics. Pret is also set to reopen its Chicago market in the coming days and is looking into further growth and franchise opportunities in Texas, Florida and Washington state. Pret operates more than 600 shops with 9,900 team members in 15 international markets. Pret features in the Propel Turnover & Profits Blue Book. Its turnover of £790.1m for the year ending 31 December 2022 is the 17th highest in the database. The Blue Book ranks companies by turnover, profit and profit conversion, listing directors’ earnings for the past five years. Companies can now have an unlimited number of people receive access to Propel Premium for a year for £995 plus VAT – whether they are an operator or a supplier. The single subscription rate is £495 plus VAT for operators and £595 plus VAT for suppliers. Email to upgrade your subscription.

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