Propel Newsletter Archive Page

Urban Baristas to open first franchise site next month, set to double estate this year as it explores opportunities outside of London: Aussie-inspired coffee concept Urban Baristas has told Propel it will open its first franchise site next month as it looks set to double its estate this year. The business – which was founded in 2016 by Huw Wardrope and Jono Bowman and started out in a small kiosk in Bounds Green, north London – launched its franchise offer last month. At the time, the 12-strong business outlined plans to add 30 additional sites over the next three years. “We’re hoping to open our first franchise site in Tooting Bec station in the next few weeks,” Wardrope told Propel. “He’s an experienced franchisee with Anytime Fitness who has signed a multi-site deal and is looking for other sites. We’d been thinking about franchising for a while and we think it can take us outside of London, to market towns around the M25 – there are huge opportunities there. We’re looking to open ten franchise sites this year, including at least three by the end of the first quarter, and two or three company stores, as we get the franchise operations in place. We’ll also be opening our first out of London site this year, with the first currently in legals, which will be at the western end of the Elizabeth Line (which extends out to Berkshire). We want to be all round the UK but will close London first.” Wardrope said trading in 2023 has been tough and “especially concerning” for its City locations, but added coffee is “pretty recession proof”. “The strikes seem never-ending and are an administrative nightmare, but we’re positive about the City coming back,” he said. “We noticed a lot of workers at the end of 2023 returning full-time to the office.” Wardrope first came to the UK in 2006, a decade before founding Urban Baristas, and previously worked in finance before pivoting to coffee. “The UK at that time just didn’t seem to have many good coffee places like we were used to in Australia,” he added. The latest Urban Baristas site, which opened in London Dock last summer, included its first coffee lab, which will be used to train franchisees and teach home coffee enthusiasts.

Industry News:

Propel’s next Multi-Site Database to be released today with new seven category segmentation: The next Propel Multi-Site Database will be released today (Friday, 26 January) at midday to Premium members – and in a ground-breaking move sees companies now searchable in seven main segments. The database, produced in association with Virgate, provides details of more than 3,000 multi-site operators. But following feedback from subscribers, companies will now be searchable in seven main segments – allowing users to search quickly in key categories and allowing them to drill down into the details and updates for these specific areas. The biggest segment is casual dining, which consists of 900 companies and they make up 28% of the database. There are 758 companies in the pubs and bars segment (25% of the database total), 497 in café bakery (16% of total), 408 quick service restaurant companies (14%), 247 hotel business (8%), 187 experiential leisure operators (7%) and 50 fine dining companies (2%). The database is updated each month – this edition includes 20 new companies and brings the total to 3,047. Premium members also receive access to five other databases: the Turnover & Profits Blue Book, the New Openings Database, the UK Food and Beverage Franchisor Database, the UK Food and Beverage Franchisee Database and the Who’s Who of UK Food & Beverage. Propel is evolving its Premium subscription offer by launching Premium Club on Thursday, 1 February. All circa 4,000 existing subscribers automatically become members. The launch of Premium Club comes with even more benefits. All subscribers will be offered a 20% discount on tickets to four Propel paid-for events – The Excellence in Pub Retailing Conference (14 May), Social Media for Profit (18 July), the Talent and Training Conference (1 October) and Restaurant Marketer and Innovator (two days in January 2025). Operators will also be able to send up to four members of staff to each of our four Multi-Club Conferences for free. Premium Club members receive their daily Propel Info newsletter 11 hours earlier than standard subscribers, at 7pm the evening before. They also receive videos of presentations at eight Propel conference events two weeks after they are held. This represents around 100 videos of industry insight over the course of the year. Premium Club members will be sent a dedicated monthly newsletter that will highlight key updates in the sector and direct subscribers to all the vital content their membership offers. Premium Club members also receive exclusive opinion columns every Friday at 5pm, which include the thoughts of Propel group editor Mark Wingett and a host of industry leaders from across the sector. A Propel Premium subscription costs an annual sum of £495 plus VAT for operators and £595 plus VAT for suppliers. 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. Email kai.kirkman@propelinfo.com today to sign up.

Luke Johnson – circumstances for M&A should be more favourable this year, top-end businesses will prosper: Sector investor Luke Johnson has told Propel that after a generally difficult year for M&A in 2023, this year’s circumstances should be more favourable, with “falling inflation and lower interest rates in due course”. Johnson, who currently backs the likes of Gail’s, All Star Lanes and Lussmanns Restaurants, said: “Last year was generally difficult – tough trading conditions for consumer discretionary industries, and big differences in price expectations between buyers and sellers of businesses. This year will be a more active year for M&A overall. This year, circumstances should be more favourable, with falling inflation and lower interest rates in due course.” In terms of what parts of the industry will do well, Johnson said: “I think top-end businesses will prosper because wealthier segments in society are generally doing well. But many mid and lower end consumers are struggling with higher mortgage/rent costs and utility bills. Businesses serving those customers face more challenges.” In terms of investing in the sector, Johnson said that his investment vehicle, Risk Capital Partners, remained “open for business”. He added: “We are always interested in backing talented entrepreneurs and exciting opportunities at sensible valuations.”

Banning large glasses of wine is ‘codswallop’, says Fuller’s CEO: Banning large glasses of wine in pubs to encourage people to drink less is a “codswallop” idea, Simon Emeny, the chief executive of Fuller’s has said. Emeny said the suggestion that pubs should stop selling large measures of wine to “nudge” people into drinking less alcohol was misguided. He said: “We don’t go around people’s houses measuring the size of their glasses at home, so it’s completely bonkers.” It comes after University of Cambridge scientists conducted a trial in 20 venues across the UK where the largest measure of wine – typically 250ml – was removed from menus. Researchers found the change cut alcohol intake by just under 8% without hitting profits, likely because of higher margins on smaller servings. Academics have argued that a small reduction in how much people drink could have major health benefits and reduce alcohol-related harms, leading to suggestions that the Cambridge study should be replicated across the UK. However, Emeny said: “People go to a pub to have an experience and to socialise and entertain each other. The drink is actually quite secondary. We shouldn’t be telling people how to behave in terms of the size of measures they should be drinking. I think it’s just codswallop, because drinking in a pub is a regulated environment already. It’s a relatively expensive thing to do.”

Government-backed hospitality employment scheme begins in Wales: The Welsh skills and employment pathway for hospitality has begun, offering jobseekers career opportunities and a route back into work. The Cardiff pilot, run jointly by UKHospitality and training provider Cambrian Training, is backed by the Department for Work and Pensions and will provide tailored training to jobseekers, with a view to starting a career in hospitality. The UK’s largest brewpub group Brewhouse & Kitchen, Compass Cymru (which is part of the Compass Group UK & Ireland) and brewer and retailer Greene King are all supporting the pathway, taking place at the Principality Stadium, with a guaranteed job interview for all participants. Schemes have already taken place in London, Liverpool, Manchester and Coventry. Sandra Kelly, skills director at UKHospitality, said: “Our ambition with this scheme is to have it operating all across Britain. The pilot schemes in other cities in England have all been a great success so far, and I’m confident we’ll see the same in Cardiff.” Nick Mackenzie, chief executive of Greene King, said: “Through collaboration, we’re able to create a programme that gives candidates a greater insight into our exciting industry, and we look forward to creating opportunities for many to achieve a fulfilling career in hospitality.” Jody Bennett, people director at Brewhouse & Kitchen, added: “This pilot initiative is not just about jobs; it’s about unlocking the full potential of individuals and giving them the skills and confidence to join our great industry.”

Operators sought to help form first-ever hospitality strategy: Operators are being invited to come together to come up with ground-breaking initiatives to help shape the future of the industry through the first-ever hospitality strategy. The event will take place at Oxford Brookes University on Wednesday, 22 May. The Hospitality Sector Council – a partnership between industry leaders and the government – and its partners are covering the costs of the day, with the only expense for those attending being their travel. Places are limited, so if your application is unsuccessful this time, you will be considered for future innovation days. “We are looking for operators who are keen to explore creative ideas and solutions with others in the industry, academics and innovators,” a working group spokeswoman said. “Our focus is clear: to support each other in the brilliant world of hospitality by addressing the most significant challenges we face today. Our goal is simple: to co-create innovative ideas and solutions that will benefit all of us in the industry. This event presents a unique opportunity to network and, more importantly, to leave with actionable strategies to tackle our labour-related challenges.” To apply for a place, click here.

Company News:

We Do Play’s new London site exceeds expectations with 40,000 guests in first four weeks, signs Sweden deal: We Do Play, the team behind Flip Out and Putt Putt Noodle, has told Propel its new London site had exceeded expectations, welcoming 40,000 guests in its first four weeks. The business opened its latest Flip Out at the end of December, where it shares a space in Canary Wharf’s Cabot Square with go-karting concept Capital Karts. We Do Play has also signed a deal to take its trampolining concept to Sweden for the first time. Richard Beese, owner of We Do Play, said: “The success of Flip Out Canary Wharf showcases the flexibility of the brand’s offerings for landlords, contributing to the ongoing transformation of the high street. Notably, trade at Flip Out Canary Wharf has exceeded expectations in the first four weeks of operation, welcoming more than 40,000 guests. Furthermore, We Do Play has signed a significant European deal in Sweden, confirming plans to build a Flip Out adventure park in the Westfield shopping centre in Täby Centrum, Stockholm, set to open in the autumn of 2024. This development further solidifies Flip Out’s position as the world’s number one adventure park brand.” It comes after We Do Play earlier this month appointed Michael Toon, former financial director at fast-growing quick-service restaurant (QSR) brand Chopstix and Comptoir Libanais and Shawa operator Comptoir Group, as its new chief financial officer. Toon joined from Comptoir Group, where he spent three and a half years, following two and a half years with Chopstix and 17 years at Casual Dining Group, where his roles included finance director of its Cafe Rouge, Belgo and airport businesses. At Comptoir, he played a pivotal role in the group’s strongest Ebitda performance in the last two years of published accounts, and at Chopstix, he helped implement substantial system and procedural changes as the company expanded to become the largest Asian QSR operator in the UK. Beese added: “With the next three years poised to be transformational, appointing an experienced chief financial officer was crucial to our overarching strategy. Michael’s extensive experience with founders, private equity and shareholders in a publicly listed business, coupled with his profound understanding of the hospitality industry, makes him an excellent addition to the We Do Play team.”

Future of North Brewing Co secured with sale to Kirkstall Brewery founder Steve Holt: The future of Leeds brewer and retailer North Brewing Co has been secured following a sale of the business out of administration to Steve Holt, founder of fellow Leeds brewer Kirkstall Brewery. Howard Smith and Rick Harrison, of Interpath Advisory, were appointed joint administrators of North Brewing Company, North Brewing Leisure and North Brewing Management on 25 January 2024. Immediately following their appointment, the joint administrators sold the businesses and its assets to Vertical Drinks and Kirkstall Brewery (as part of one transaction). The transaction safeguards the future of the North Brewing Co brewery in Leeds, as well as the North taproom bars in Leeds and Manchester. A total of 78 members of staff have transferred to the purchaser as part of the deal. North Brewing Co will continue to be an independent brewery operating from its Springwell site and will be run by the existing management team led by John Gyngell and Christian Townsley. Gyngell said: “We are pleased to have found a solution for our team and the legacy of the North brand.” The new company will be known as Vertical Drinks trading as North. The transaction does not include the North taproom in Birmingham, which will close resulting in 15 redundancies. Holt said: “We’ve been friends and industry colleagues for almost 30 years, North is an iconic beer brand that had to continue. Together, we’ll make sure that North will continue to make some of the best beer in the country.” Based in Leeds, the group traded under the “North Brewing” brand and supplied several supermarkets and casual dining chains nationally, as well as exporting to 27 countries worldwide. Having been hit hard by the impact of covid-19, the company had also faced rising costs, which had an impact on cash flow. The directors sought to explore a number of options, including a sale of the business. When it became clear a solvent solution could not be found, they took steps to file for the appointment of administrators.

Lucky Voice reports record-breaking festive season: Lucky Voice, the social entertainment brand, has reported a record-breaking performance across its estate in December 2023, marking its best Christmas ever. In the four-week period leading up to Christmas, Lucky Voice said it achieved sales growth of 48% compared with 2022. Its performance was 11% up in terms of like-for-like revenue across the estate. The company said Ebitda for the month of December exceeded its previous best month by 49.3%, with strong performance across its estate which includes venues in Soho, Islington, Holborn, Brighton and Liverpool Street. It said the week commencing 11 December saw four of its sites recording their best ever sales weeks. Charlie Elek, managing director at Lucky Voice, said: “After three years of disrupted Christmases due to covid, there was a huge sense of anticipation for December 2023. While unaffected by the pandemic, the period wasn’t without its own headwinds – with consumers closely monitoring their spending amid the rise in cost of living and the sector as a whole monitoring for potential train strikes. Our team pulled together to navigate these challenges and the results speak for themselves. To us, this performance establishes the continued strength of our business model in delivering our mission to combine karaoke with great service, technology and food and drink.” The group’s sixth site – Lucky Voice Waterloo – is due to open this spring, occupying a 3,200 square-foot unit in The Sidings scheme, and is its first London site south of the Thames.

Peppermint to operate dining and events space at Queen Elizabeth Olympic Park: Bars and event solutions business, Peppermint, has been appointed as the new operator for dining and events space at Queen Elizabeth Olympic Park in London. Working in partnership with the London Legacy Development Corporation (LLDC), Peppermint will be investing in the existing space within the Podium footprint to create a unique offering for the area. The transformation will boast a rooftop garden with panoramic views over east London, a 300-cover café/restaurant and hospitality space across two floors, and a dedicated street food area. Guests can expect outdoor screenings, DJs, markets and seasonal events throughout the year. Peppermint will reposition the Podium’s building and its separate areas to come under one umbrella brand to become Riverside East. The seven-year lease, with the option to extend, will cover the operation of the Podium building and external spaces situated by the ArcelorMittal Orbit and Slide on the Park. Peppermint will start a matchday offer from February but will fully launch the new destination from this spring. The company said it will roll out new ideas through the tenancy. Matt Simkin, head of venues and partnerships at Peppermint, said: “We are thrilled to be part of this transformative project that will not only bring life and energy to this exceptional space, but promises to be a hub that caters to the diverse needs of the local community.” Thomas Rose, co-founder of P-Three, which advised LLDC, added: “Totalling more than 41,352 square foot, it is one of the most significant food and leisure venues in London and represents the first stage of the new food and beverage story at the Queen Elizabeth Olympic Park, with the new riverside restaurant quarter at EastBank due to open later in 2024.”

Various Eateries lines up Richmond opening for Noci concept: Various Eateries, the Coppa Club operator, has lined up an opening in Richmond for Noci, as it targets Greater London boroughs for the pasta concept’s expansion. Propel understands that Various Eateries has lined up a site in Hill Rise for Noci, which currently operates restaurants in Islington, Battersea and Shoreditch. Various Eateries is understood to be working with property advisor Teague & Capital to secure sites in the capital, with Greenwich, Wimbledon, Notting Hill and Waterloo on its target list. Last month, Various Eateries raised £10m with the aim of rolling out ten new Noci and three new Coppa Club sites over the next 18 months. The company said: “The directors believe Noci’s flexible format can work from both large and small sites; although the concept has been designed specifically to deliver profitability in circa 3,000 square-foot spaces, which the directors understand have become challenging for incumbent operators. Market research has led the directors to believe there are more than 100 suitable sites in the UK, while the immediate rollout will be largely focused on the Greater London boroughs.”

Luxury hotel operator expects growth to continue into 2024 as development works are finalised, sees turnover increase but losses grow: Maybourne Hotel Group, the Qatar owned British luxury hotel operator of venues including Claridge’s, the Berkeley and the Comnaught, has said it expects growth to continue into 2024 as development works are finalised. It comes after the business reported a rise in turnover in the year ending 31 December 2022, from £12,918,000 in 2021 to £20,722,000. Its pre-tax loss widened from £5,707,000 to £6,121,000. No dividends were paid (2021: nil). Director Fady Bakhos said the groups for which it provides hotel management services “experienced a steady level of recovery from February 2022, with performance exceeding pre-pandemic levels in some months” and the hotels recording record monthly KPIs. He added: “Growth is expected to continue into 2024 strengthened by the finalisation of the development works in the portfolios.” The company said it losses are predominantly due to interest incurred on its related party loan from the Selene group. At the balance sheet date [7 December 2023], the company had net current liabilities of £255.7m (2021: £184.8m) and net liabilities of £19.1m (2021: £12.8m). Exceptional items of £3,465,031 (2021: £3,427,000) relate to sums recharged by the Coroin group in respect of a pension shortfall. Additional monthly contributions are expected to finish by the end of March 2025.

Wingstop confirms plans for Clapham site: Lemon Pepper Holdings, the company behind the rollout of Wingstop in the UK, has confirmed it will open a site in London’s Clapham, this March, As revealed by Propel in November, the 39-strong business will open on the former Bodeans site at 169 Clapham High Street. Earlier this week, Propel revealed Lemon Pepper Holdings had secured a site in Leeds’ Boar Lane, and earlier this month, also revealed it was set to take sites in Watford’s Market Street and the Lakeside shopping scheme in Essex. Wingstop will also open its largest UK site yet, at Westfield Stratford City in London, in the first quarter, while further openings for this year are lined up in Hounslow, Wood Green, Croydon Leisure Park and the Merry Hill shopping centre. Paul Tallentyre, of DCL, represented Bodeans for the sale of the Clapham site lease at a premium.

English Lakes Hotels reports operating profit in current financial year ‘running ahead of budget’: English Lakes Hotels has said operating profit in its current financial year is “running ahead of budget”. It comes as the company reported a drop in turnover and profit in the year to 31 March 2023 following the sale of one of its sites. During the prior year, it sold the Waterhead Hotel in Ambleside to the Inn Collection Group for £5.6m, making a £1.3m profit in disposal, as previously reported. English Lakes Hotels’ turnover was down slightly to £13,367,738 from £13,690,440 in 2022, with the latter figure including £7,937 from discontinued operations. The 2023 figure included £10,000,078 from hotel and leisure (2022: £10,800,287) and £3,367,660 from water sports and other activities (2022: £3,690,440). Its pre-tax profit dropped to £1,864,798 from £5,684,484, with the latter figure including £1,309,598 from discontinued operations. The company received no government grants compared with £295,469 in 2022. Dividends of £357,673 were paid (2022: £379,155). Director Matthew Wilkinson said: “The company saw a more typical year of trading following the welcome increase experienced during the previous financial year. Despite this, the year-on-year sales were down by just 2.4%. Gross profit was impacted further due to direct cost pressures and reduced by 14.2% on last year. Cost of sales were similarly impacted due to high inflation and were increased year-on-year by 14.6%. Overall, the company was able to return a healthy profit before tax of £1.9m. Operating profit at the halfway point of the current year is running ahead of budget.” The sale of the Waterhead Hotel left the business operating the Low Wood Bay and The Wild Boar hotels in Windermere and Lancaster House hotel in Lancaster.

Chef behind Six by Nico business suing building owner for more than £4.4m: Chef Nico Simeone, who is behind the Six by Nico business, is suing a building owner for more than £4.4m after he was forced to shut his restaurant in Liverpool when flooding left it “malodorous and unhygienic” with rotting floors. The Mail reports that Simeone told London’s High Court he had no choice but to close his Liverpool venue in 2022. Lawyers for his company said water began pouring into the restaurant due to badly sealed walls, filling a storage room, rotting the restaurant floor and causing mould. It is now suing the freeholder of the building, Highneal, to cover losses, pay for a refurbishment and relaunch the restaurant. But the freeholder of the building, which is close to Liverpool Waterfront, denies fault – claiming the restaurant’s heavy-duty industrial dishwasher was the source of the leak. Simeone’s firm had bought the lease to the restaurant the previous year, according to documents filed at the High Court. Simeone carried out a major refurbishment of the premises but claims to have suffered repeated leaks since moving in. His company’s barrister, Hugh Jackson, said in court that water had penetrated both the ground floor and the basement. Although a complaint was made with Highneal, the problem was not solved and it continued to be hit by “water ingress”, the lawsuit claimed. A “substantial flood” then happened in December 2021, causing damage to stock and equipment and leaving the basement unusable, the barrister added. Jackson said: “By around January 2022, the basement rooms had become so damp, mouldy and unhygienic that the claimant had to instruct its staff to cease to use them.” However, for the freeholder, barrister Elizabeth Fitzgerald argued it “undertook significant investigations” to determine the cause of the flooding and insisted the restaurant was to blame. She accused Six by Nico of failing to pay about £60,000 in rent and thus forfeiting the lease. The case is at an early stage and has not yet come before a judge in court.

Family-owned New York Italian-focused restaurant opens in London’s Soho: A New York Italian-focused restaurant has opened in London’s Soho. Grasso is the brainchild of the McCaffrey family and has launched in the former Wagamama premises in Dean Street. The family came from Syracuse in Sicily before moving to London and New York in the 1950s. Dishes include meatballs, which are a third-generation recipe, served with spaghetti al pomodoro. The menu also includes chicken Parm, a big Caesar salad and a vodka sauce pizza. The space spans two floors with private dining rooms, a DJ booth and two bars that offer drinks such as a Cherry Coke Long Island iced tea. Seanie McCaffrey told Hot Dinners: “Soho has such a rich history, with Italian communities settling in the area more than 100 years ago. So it feels fitting to follow in their footsteps, and to open an independent restaurant with a family feel.” Richard Negus, of AG&G, acted on the deal.

Greggs scraps plans for 24-hour opening in Kent: Food-to-go operator Greggs has scrapped plans for a 24-hour licence at one of its Kent branches after fears it could lead to anti-social behaviour. The company submitted an application to provide a round-the-clock service at its Canterbury city centre site last summer but has snow ditched the bid, reports the BBC. Greggs did not comment on why it had withdrawn the application for its site in St George’s Street, which already has a 24-hour McDonald’s next door. Canterbury city councillor Pip Hazelton opposed the application, saying: “My concern is up the top end of St George’s Street, there’s been a history of anti-social behaviour. The litter, the noise, even relatively small groups of people hanging about – that can be intimidating for other people.” Police did not object to the plans as long as the shop functioned only as a takeaway during late-night hours and had two security guards working from 11am-5pm. A Greggs spokesperson said: “We continue to look at opportunities to extend the opening hours of our shops.” The company previously attempted to get a licence for its Leicester Square branch to operate 24 hours, but was blocked by Westminster City Council. Its Lord Street store in Liverpool has been open 24 hours a day, five days a week, since September 2023, and Greggs also has round-the-clock sites open at Newcastle, Manchester, Leeds Bradford, Birmingham, Glasgow and Gatwick airports.

Freehold investment of PF Chang’s sole UK site placed on market: The freehold investment of the property housing US brand PF Chang’s sole UK site has been placed on the market, with offers sought in excess of £7.2m, Propel has learned. Coffer Corporate Leisure is instructed to offer for sale 10-11 Great Newport Street, a freehold restaurant investment in the heart of London’s West End. The upper parts of the property are arranged as 14 luxury residential apartments. The restaurant comprises 4,696 square feet of accommodation and trades under the American-Asian premium dining brand, which operates more than 300 sites worldwide. Offers sought in excess of £7.2m reflects a net initial yield of 5.38% and a capital value of £1,533 per square foot. The restaurant is let to Zaf Holdings, trading as PF Chang’s, on a 15-year lease from 4 July 2017. Last April, Propel revealed Zaf Holdings had acquired the master franchise rights for PF Chang’s in the UK, with plans to expand the brand UK-wide. The company is a Pizza Hut Delivery franchisee with more than 30 stores throughout the UK.

Plans for new £250m Southampton leisure development ‘stall’: Plans for a multimillion-pound portside leisure development on the site of a former cinema complex in Southampton have “stalled”. Work was due to begin early in 2023 on a £250m project including a cinema, a casino, 650 homes and two hotels after developer Sovereign Centros won planning approval to develop the former Leisure World site. However, Associated British Ports (ABP) said the site had now been “closed for some time” and that “plans for the site to be redeveloped have stalled”, reports the BBC. He added that ABP is working with Southampton City Council and other stakeholders on a long-term solution. Built in stages, the new development was expected to take up to eight years to finish. Leisure World first opened in 1997 and was home to an Odeon cinema, a casino, restaurants and various night-time establishments. Odeon has previously said it had been negotiating with the developers and landlord regarding opening at the new site.

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