Whitbread CEO Dominic Paul has said the 126 restaurants it plans to exit are generally smaller sites, that are harder to run efficiently.
Speaking on a press call after the announcement of its ‘accelerating growth plan’, Paul declined to share numbers on which brands, which include Beefeater and Brewer’s Fayre, would be impacted.
The group has launched a consultation over the proposals, which involves informing the 1,500 staff whose roles will be impacted on a site-by-site basis.
Whitbread is retaining 196 of its branded restaurants, while converting a further 112 into hotel rooms for its core Premier Inn hotel business.
Paul said: “Generally the lower performing branded restaurants are because they’re slightly smaller sites next to slightly smaller hotels.
“The branded restaurants that are performing better are generally larger branded restaurants next to the larger hotels.
“So it’s not quite as simple as about the restaurant format, it’s generally also linked to the hotel that they’re next to.”
Paul said branded restaurants has been a “more challenging environment” than hotels, which are performing well for Whitbread.
He pushed back against a question over whether there was a problem with the food offering at the restaurant estate, which also includes Bar + Block Steakhouse, Cookhouse & Pub, Thyme Bar & Grill and Table Table.
“It’s not so much about the food that’s offered. In our integrated restaurants we’ve got really attractive menus. The guest scores are incredibly high in those integrated restaurants.
“It’s generally more because we’ve got the option to turn these branded restaurants into room extensions, which ultimately is a much more profitable way for us to go.”
Paul said a variety of brands would be retain as part of the plan.
“We’ve looked at this through the lens of how do we optimise each individual site. It’s not actually done from a brand point of view.
“So actually through this programme, in our retained 196 branded restaurants, we will have a variety of the brands, same brands that we’ve got today will be in that retained group. So actually we will continue with the brands that we’ve got in the branded restaurant estate.”
Precise locations of restaurants affected have not been disclosed, while the affected teams are informed.
“Because we’re a public company, we have to do it all at the same time, and that consultation process starts today and will last for a couple of months.
“It’s really important to us that the teams hear from us in the right way today. So we haven’t shared site by site detail.
“The way we’ve done our analysis is we’ve looked at it from a site by site basis, as particularly where the hotels need the extra rooms. And that’s really been the driver of the decision here as to which of the hotels where we build extensions, and that then impacts the branded restaurant.
“We’re having those conversations with the impacted team members face to face today and over the next few days. But in the retained business we will continue with the array of brands that we’ve got today.
Paul said the retained restaurants would continue to offer value for money.
“When you look at the guest feedback in our branded restaurants, the guests like the menu. We’ve got a really strong value play in those restaurants. The guests like the value for money. So we will continue with that approach.”
