Propel Newsletter Archive Page (2023)

Story of the day:

Luminar chief executive – “Undercover Boss” appearance a major positive: Peter Marks, the chief executive of the UK’s largest nightclub company Luminar, has reported that his appearance earlier this year on ‘Undercover Boss’ has produced many positive outcomes for the company. Marks was filmed visiting various Luminar sites, including Oceania venues in Kingston and Swansea, where he met staff and customers incognito. The resulting film was a “warts and all” picture of life running nightclubs. Marks told Morning Briefing that the coverage provided a major boost to trade and staff morale. He said: “Trade has increased by 1,500 people-a-week in Swansea, and more in Kingston Hippodrome, which has become the most profitable it has been in the last four years. There was no material increase in business across the company as Luminar is not really a customer-facing brand, and the two other businesses that were featured had slightly different issues, with Kingston Oceana trading at capacity most of the time. Each of the ‘candidates’ featured in the show ended up inundated by their customers, many of which had photos taken with individuals concerned. In one instance, someone, tongue-in-cheek, opened a fan page on Facebook and he has 750 followers! Myself and the company were also inundated with complimentary emails and messages of support so it was great public relations. Even people I would not have expected to watch it did - such as head of leisure RBS, several friends in the City and many landlords. The staff loved it. Amazingly, I still get spotted by customers. So, it was positive all around and it would have cost goodness-knows-what to get that publicity. Much of the upside has not been financial but a surge in goodwill and belief in the company as to what we are trying to achieve.” Yesterday, Checkers Drive-in Restaurant chief executive Rick Silva reported that the company had received a five per cent sales boost from appearing on the US version of‘Undercover Boss’.

Did you know that Kentucky Fried Chicken and Starbucks have near identical turnover in the UK? The Propel Info Hospitality Sector Turnover and Profits Blue Book ranks the 200 leading pub, restaurant and foodservice companies in the UK by turnover and profit, provides a five-year overview of performance and lists directors’ salaries. To buy a copy e-mail Jo Charity or Sharon Dickinson on or

Industry news:

Wetherspoon’s Tim Martin praises Carlisle licensee: Wetherspoon founder Tim Martin has praised a Carlisle licensee for his clear articulation of the arguments for reducing VAT to five per cent in the hospitality industry. Alain Davis, of The Spinners Arms in Cummersdale, told his local newspaper that the industry is facing challenging times. He said: “Forty per cent of the cost of your pint goes to the government – around £1 a pint. The British pay the second highest duty level on alcohol in the European Union. VAT at the moment is 20 per cent but in France, the hospitality trade rate has been cut to 5.5 per cent to encourage growth. Apparently if Britain took this on board, it could create between 140,000 and 320,000 new jobs. Pubs also have to cope with the unfair competition from low cost alcohol sales from supermarkets. Supermarkets can afford to absorb the costs of selling alcohol and regularly use it as a loss leader to get people into their branches.” Martin said: “If only the trade organisations and pubcos could say just that - they are unable to articulate the twin simple messages. The obsession with the duty escalator is very bad: if they win we’re still stuck with the highest VAT and duty in Europe.”

Craft beer and cider boom in US market: A report by research company Technomic has found cider and craft beer were the best performers in the US market last year. Technomic reported: “Craft beer grew 11.2 per cent in volume to account for 5.5 per cent of total beer volume; the category benefitted from consumer interest in artisan and local products featuring unique styles and flavor profiles. Several craft brewers expanded production or distribution, while newcomers continued to enter the market. The number of craft brewers and microbreweries increased by nearly 200 facilities. Cider emerged as a bright spot. The smallest category within the beer industry tapped into many of the same consumer trends driving craft beer and posted the largest gain, 31.3 per cent.” The two largest US beer companies hold 75 per cent of the market: AB InBev has a 47.9 per cent market share while MillerCoors has a 29.3 per cent share of the beer market.

Secret DJ app launched for pubs and bars: A new app is giving pub and bar customers the chance to choose the music that is played at their local bar or pub. The Secret DJ app provides more than 1,000 tracks with users able to select what gets played on the venue’s sound system with a few virtual key presses. The more customers visit a venue and use the app, the more priority their chosen track will be given. The app has been developed by a collective of DJs, musicians and developers called C-burn. The app has links to both Amazon and iTunes, enabling users to purchase any tracks they like the sound of. A social stream provides live updates of where other Secret DJ users are located in terms of venues, as well as details of the names of tracks playing where they are. The Secret DJ app is available from the Apple App Store and Google.

WSTA chief executive argues “minimum pricing needs to be challenged”: Miles Beale, chief executive of the Wine and Spirit Trade Association, has stated that minimum unit pricing is top of the list of challenges for the trade because it is a “pretty aggressive change in tactics” from the government. He described minimum pricing as the potential “thin end of the wedge”. Beale said the trade should take encouragement from Bulgaria, Spain, Portugal and Italy all having lodged complaints. He added: “The outcome of minimum pricing will dictate the pace of further government reforms.”

Internet killing pubs says Adnams: Suffolk brewer/retailer Adnams has blamed the internet as one of the reasons why people don’t go to the pub. Chairman Jonathan Adnams said: “I think we have to recognise that the world is changing, people are doing other things with their leisure time. They are not going to go down to the pub quite as much as they used to because they are at home on the internet.” In an interview in The Daily Mail, Adnams said: “When I was a boy, what did you do in a place like Southwold in the evening? Went down the pub. There was nothing else to do. We didn’t have internet at home where we could sit and network with friends.”

Company news:

Stonegate Pub Company reports 35 per cent return on investments: Stonegate Pub Company, the 550-strong managed operator led by Ian Payne that operates 333 former wet-led Mitchells & Butlers pubs and the former Town & City Pub Company estate, has reported turnover of £264.6m in the 58 weeks ended on 25 September 2011. Chairman Ian Payne told Morning Briefing that the figures do not include a full year’s trading for Town & City. The company’s current 53-week financial year finishes this Sunday. Payne said: “I can assure you we are in profit and sales growth this year.” Stonegate reported that its first year’s trading was “very strong” with like-for-like sales and profit well ahead of market performance. A Companies House report stated: “The performance of the group led to significant investment in the sites. The returns from these investments are considered by the directors to be industry leading at 35 per cent.” The company lost £24.4m after acquisition, start-up, restructuring and integration costs, as well as interest costs on original loans provided by its parent company, all impacted on consolidated profit and lost. The company noted: “The interest expense of £23.4m will be significantly lower in future years due to the restructuring of debt in June 2011. The loss was in line with management expectations in the first year of operation whilst forward projections indicate profits even after interest and taxation.” The company is financed by a £285m loan.

Tavistock Leisure buys Lambton Worm with plans to “invest heavily”: Innovative north east leisure operator Tavistock Leisure has bought The Lambton Worm pub in Chester-le-Street for an undisclosed price. The property was sold on behalf of one of the company’s national corporate clients and its marketing generated good interest and several offers. The pub closed down at the turn of the year due to declining trade. There are 14 basic but functional letting rooms on the first floor. Christie + Co associate director Mark Worley said: “Tavistock Leisure intends to invest heavily in the site and reopen The Lambton Worm as a quality food-led pub. The company has previously purchased five pubs through Christie + Co. All of them were either closed or poorly trading licensed businesses but each one is now a successful, high quality food-led establishment. In each case, the investment and refurbishments have also helped to improve the image of the area. This is yet another example of a struggling licensed operation being purchased for ongoing use, and it is very encouraging news for both pubs and the licensed sector generally.”

Ministry of Sound executive consulting on £1.5m bar, restaurant and nightclub: Ministry of Sound operation director Tony Rigg is consulting on a unique £1.5m “new generation” bar, restaurant and nightclub in Leamington Spa. New set-up Warneford Bars plans to convert the former KoKo premises in Warwick Street into a new concept with Altoria as its holding name. Spread over four floors, it will have a ‘boutique’ VIP lounge with table service, a semi-glazed roof terrace called the Observatory, a club room Uba, in which DJs use the latest technology to mix the soundtrack to the evening. Operations director Zolly Branch, who has worked for Novus and Luminar, said: “I walked round (Leamington) and nobody seemed to be having that celebratory drink from 5pm to 11pm.” Branch said the venue is aimed at is looking to attracting people in the over-25 age bracket, young professionals who are currently going to Coventry or Birmingham. Rigg said: “I want to create the greatest venue Leamington has seen or is ever likely to see.”

Douglas Jack – Domino’s in a strong position but shares have had a strong run: Numis Securities analyst Douglas Jack, who is house broker for Domino’s UK, has downgraded Domino’s share a notch from Buy to Add after a strong run. He said: “Domino’s is in a strong position to generate attractive growth over the long-term with: market dominance in the UK; highly profitable franchisees; and a strong expansion pipeline (paid for by franchisees) in the UK and Europe to drive up system sales over a relatively fixed cost base. Following a strong run in the shares, we are moving our recommendation to Add, from Buy.”

Premier Inn expands in south west and Wales: Premier Inn, the UK’s largest hotel chain, has secured six new hotel and restaurant sites and has started work on another nine – adding 1,140 new bedrooms to its expanding estate in the south west of England and south Wales. The new hotels and restaurants are part of the company’s UK-wide expansion programme and will create more than 750 new jobs across the region. Whitbread, Premier Inn’s parent company, is aiming to increase the 49,000 bedrooms across the UK today to 65,000 by 2016. The six new sites are Bideford (70 bedrooms creating approximately 65 jobs), Exeter, Honiton Road (102 bedrooms and 65 jobs), Exeter, Southernhay (120 bedrooms and 55 jobs), Falmouth (74 bedrooms and 45 jobs), Newport (60 bedrooms and 45 jobs), and Tenby (61 bedrooms and 45 jobs). In addition, the nine sites where construction work has already started are Barry Island (80 bedrooms and 65 jobs), Bath (107 bedrooms and 50 jobs) Bicester (80 bedrooms and 65 jobs), Dorchester (74 bedrooms and 45 jobs), Glastonbury (60 bedrooms and 65 jobs), Trowbridge (80 bedrooms and 45 jobs), Weston-super-Mare (112 bedrooms and 65 jobs) and Weymouth (60 bedrooms and 65 jobs).

KFC to targeting women with first social media campaign: KFC is to target female customers in the UK with a viral ad featuring comedian Jenny Bede. The tongue-in-cheek clip considers the justifications women might use for eating unhealthy food, such as “It doesn’t count if it’s from someone else’s plate”. Viewers will be encouraged to share their “It doesn’t count if…” stories on Facebook, Twitter and Instagram. Twitter users can also follow KFC’s @Doesnt-CountIf feed. Jennelle Tilling, UK and Ireland vice-president for marketing at KFC, said: “Our first major social campaign provides us with a light-hearted mechanic to engage directly with young adult females, and gives us a chance to change their perception of KFC.”

New York phenomenon Eately chalks up $85m of sales: Restaurant emporium Eately’s flagship New York site, which has seven restaurants over 58,000 square foot of space, is set to have chalked up $85m of sale in its second year, up $10m on the first year. The $85m of sales works out at $1,700 per square foot per year – high grossing Cheesecake Factory sites chalk up around $10m of sales a year or $1,000 a square foot in sales. Eately in New York had seven million visitors in its second year and on Saturdays serves 25,000 customers. There are a total of 19 Eatalys in Italy, Japan and New York – with another one planned for Chicago.

Former M&B executive adds weather forecasting to labour system: Former Mitchells & Butlers executive Alastair Scott has developed a weather forecasting function to a labour scheduling his consultancy firm Catton Consulting has developed for the market, S4. A spokesman said: “The system now shows an updated weather forecast for your postcode for the next ten days. This will help all those sites who are affected by weather produce even better sales forecasts, and therefore even better service and greater operational efficiency.”

Wildwood set for Newmarket: Wildwood, the restaurant brand operated by Tasty, has won planning consent to open in Newmarket - it opened a site in nearby Ely six months ago. It will turn premier Newmarket High Street fashion store Anne Furbank into a restaurant set over three floors. Clare McDonald, of architecture and retail design firm, Browns, said it was the intention of the London-based company to highlight and expose the historical features of the building. Tasty operates 15 Wildwoods.

Hove pub to launch fringe theatre: The Iron Duke pub in Hove is to launch a new fringe venue at the start of October. The 50-seat proscenium arch-style theatre space is being built in the function room at the pub. It will host plays, comedy, cabaret and music from local and touring acts, with two to three performances per week. Producer Mill Goble, who has managed shows at Brighton Fringe, Edinburgh Festival Fringe and the Terror 2011 season at London’s Soho Theatre, is in charge of the new theatre. She said that she would offer tailor-made packages for shows with negotiable box office splits and the option of press and marketing services for an extra charge. The space will also be available for rehearsals and Goble plans to include a weekly drop-in improvisation class as well as a ten-week course on performing Shakespeare in the New Year.

Domino’s trials pan pizzas made from fresh dough: Domino’s Pizza is entering the US pan pizza market by using fresh, handmade dough, not the frozen dough used by other operators. The firm’s president and chief executive officer Patrick Doyle said:“ There is a standard out there for pan pizza that we realised could be better. The reason most people buy a pan pizza is for the crust, and that key component should be fresh, never frozen.” Pan pizzas account for one in five pizzas sold in the US. Analyst Stephen Anderson said: “With pan pizza accounting for more than $7 billion in annual sales, this is a market segment in which Domino’s needs to participate in our view. Pizza Hut is far and away the market share leader in pan pizza, as we estimate it garners at least 30 per cent of all pan pizza sales nationwide, while Papa John’s does not offer pan pizza. Given the product credibility Domino’s has garnered in the past three years, most notably with the re-launch of its flagship hand-tossed pizza in December 2009, we anticipate a similar success with its new pan pizza.”

London restaurant investment sold: A freehold restaurant and bar on Battersea’s Lavender Hill, tenanted by the Ashtar Lebanese restaurant, has been bought off an asking price of £750,000 by a pub investment company. “A new 20-year lease was granted on the property in March this year, so the incoming owners will not be rolling their sleeves up and getting stuck in to the business,” says Panayiotis Themistocli of licensed leisure specialists AG&G, who handled the sale. “With a rental income of around £45,000 a year, I don’t think they will be too disappointed to be taking a hands-off approach.”

Wahaca opens new site – with a twist: Mexican chain Wahaca has opened its eighth site in Charlotte Street, Fitzrovia, with a dedicated takeaway counter that offers torta (sandwiches). Crusty white rolls are stuffed with warm black bean frijoles, sour cream, salsa, avocado and your choice of cinnamon and chilli spiked pork pibil, tender strips of steak, chicken, chorizo or roast tomatoes and feta. The restaurant also has a Mezcal bar spanning the first floor of the restaurant, with 26 different 100 per cent agave Mezcals on pour. A number of the Mezcals, such as Los Danzantes and Alipus, are currently only available at the restaurant.

Starbucks opens third community store in the US: Starbucks has opened its third profit sharing community store. The Houston opening will contribute funds based on the performance of the Gulfgate Center Mall to The Association for the Advancement of Mexican Americans (AAMA). The new store has undergone an extensive remodel so that the store now reflects the unique nature of the relationship through an outdoor mural and indoor artwork that aims to promote community interaction in a creative and aspirational setting.

Agent Davis Coffer Lyon appointed to enhance food and beverage offer at The Gate: Agent Davis Coffer Lyons has been appointed by the Crown Estate to work on developing the variety of cuisines available at The Gate leisure scheme in Newcastle – the Crown Estate bought it for £60m. The Gate comprises of 18 units and spans 210,000 square foot, anchored by an Empire cinema and occupiers include; Nandos, The Restaurant Group, Pizza Hut and J D Wetherspoon. Alice Keown, associate director at Davis Coffer Lyons, said: “The Gate is a fantastic project and although it is fully let to some very well-established food and beverage operators, we intend to work with The Crown Estate to enhance the variety and choice of cuisine available, as well as increase the number of customers engaging in multiple leisure activities on their visit. Our focus will be on food and beverage operators which offer excellent quality and keeping in mind the strong family feel of the scheme.”

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