Taking over the reins from a long-standing company chief is always a challenge for the incoming executive. Dominic Walsh compares what happened at YO! Sushi with the situation at Carluccio’s, while also pointing out that the odd bit of bad news from the industry is starting to turn into a trickle.

When a founder or long-serving chief executive steps back from the business with which they have become synonymous, it can be a tricky transition. The new incumbent will not want to ride roughshod over the culture and values their predecessor has spent so long developing and nurturing, yet they will want to put their own imprint on the business to which they have been handed the keys.

In the case of a more mature business, they will be under pressure to come up with ways of keeping the expansionary momentum going, either by developing a second format or brand or by going overseas.

Matching up to predecessors

Many will automatically think of YO! Sushi as a classic example of a new CEO being unable to match up to their predecessor. On the face of it, Vanessa Hall appeared an ideal person to grab the baton from Robin Rowland and take the business forward, both in the UK and overseas.

She had an excellent track record, notably at Mitchells & Butlers, while the continued involvement of Rowland as chairman meant she could take the brand to the next level while having the comfort blanket of her predecessor being still around to offer advice, wisdom and reassurance.

Of course, in Hall’s case, there was the added pressure of preparing YO! for its next exit process, to allow Quilvest Private Equity to cash in its chips at a good profit while providing Rowland with the handsome payday his efforts deserved. Except it didn’t quite work out that way. The sale process did not run to plan, the valuation came tumbling down and Rowland ended up retaking the reins from Hall, who exited stage left.

If he was to secure that payday, the veteran restaurateur was going to have to roll up his sleeves again – and that’s what he has done. As he revealed in a recent interview with MCA, he put creativity, innovation and leadership back at the top of the agenda – and addressed the issue of quality of the food.

In many ways, Rowland is behaving like a completely new CEO, doing the things Hall should have done, although much of what he has done is re-establish the foundations and go back to many of the basics that appeared to have been forgotten or lost during the previous couple of years.

Another business that has been through the succession process after a long period under an established CEO is Carluccio’s. In January 2015, Simon Kossoff handed the reins as CEO to ex-Gondola Group executive Neil Wickers and moved up to chairman.

The transition has, on the face of it, been more successful than the one at YO! Sushi. Wickers is still at the tiller, while last year Kossoff retired and handed the chairman’s baton to former De Vere and Gala Coral CEO Carl Leaver.

Carluccio’s remains a quality business, and one that is still expanding at home and in the Middle East. However, two of the avenues that should have enabled Wickers to really get Carluccio’s motoring – the rollout of the Via Carluccio’s grab-and-go concept and the conquering of the US – have both been scrapped after a decision that they weren’t going to be runners.

In some ways, you could say that Wickers has been brave and decisive in opting to kill off the babies that were to have been nurtured into core elements of the Carluccio’s growth story – particularly in the case of the US expansion, once touted as having the potential to grow to as many as 100 units. But whichever way you look at it, both setbacks are embarrassing and do nothing for Wicker’s credentials in the event that the chain’s Middle Eastern backers seek to cash in their investment.

Reasons for concern?

Some people keep telling me there’s no reason to get too concerned about the state of the industry, assuring me that trading remains steady if unspectacular, and that consumers are continuing to spend on affordable treats – and experiences – with cost pressures still just about manageable. The evidence would suggest otherwise.

Just as in previous recessions or economic downturns, the odd bit of bad news is now starting to turn into a trickle. For a while, The Restaurant Group was all on its own in hitting the buffers, though it was soon joined on the naughty step – and how! – by Ed’s Easy Diner.

More recently, Jamie’s Italian and Busaba Eathai have closed some underperforming units, Red’s True Barbecue and Burger & Lobster have had problems with banking covenants, while the likes of Tasty, Comptoir Goup and Revolution Bars have issued rather nasty profit warnings – two, in the case of the Comptoir Libanais operator.

With the well-regarded Handmade Burger Co having just fallen into the hands of administrators, who have closed nine of its 29 outlets, even the most optimistic observers are now keeping a wary eye out for the next bad news story as the industry wrestles with rising rates, utilities, wages and food costs while trying to coax money out of the pockets of Brexit-fearing consumers and teetotal youngsters. All in all, a rather unappetising prospect.

Dominic Walsh is a business reporter at The Times covering the leisure, tobacco and drinks industries