Sessions is focused on building a platform for brand growth, while launching food halls where necessary to gain a foothold in the market, CEO Dan Warne tells MCA.
The operator of Shelter Hall in Brighton and Neighbourhood in Islington has a third venue due to open in Manchester – but sees its food hall business as secondary to its purpose to scale concepts.
“We don’t see ourselves as a hospitality business, more as a tech business,” Warne says. “We have a way of scaling concepts no one else has.
“We may roll out additional sites when we feel we want a foothold in a new market. But scaling by rolling out brick-by-brick is not what we do.”
Sessions is best described as a food licensing business that helps brands scale rapidly.
While Shelter Hall has been “hugely valuable” due to its location and the sales it generates, finding the sites and resources for food halls is a long process, Warne adds.
“Our belief is that the restaurant industry is too static relative to pace of consumer change. While most other industries have been able to benefit from the scale that tech offers, restaurants haven’t.
“You can distribute things overnight via the Internet, but can’t do that with a restaurant brand.”
According to Warne, Sessions does business by sourcing chefs and founders, identifying cuisine types and creating brands with them, and finally launching the brand within a test environment or ‘launchpad’ – one of its food halls, which serves as the beginning of brand development.
The brand is then licensed to a third party operator, typically a pub with a kitchen. Pubs don’t always have a food offer that “gets people excited,” Warne says, allowing them to leverage the brand and drive sales.
However, that can be any operator with a kitchen, he emphasises. With the supply chain managed by Sessions, any prospective operator can “polish it off.”
This brand distribution is much like traditional franchising, albeit without the need of a new bricks-and-mortar location.
“We’re doing our best to make this model more of the norm for how restaurant brands sale,” Warne adds. “We believe that if you want to achieve the level of disruptive change other industries have experienced, there needs to be a different way in how restaurants derive value for the brand itself.”
Warne points to the success of Patty Guy, a burger concept with more than 100 points of sale.
“Traditional hospitality doesn’t allow that kind of scale quickly.”
Sessions works with either early stage brands or offers a stepping stone for international brands to test the waters in the UK.
It recently worked with chef Ivan Orkin to launch Ivan Ramen at Shelter Hall and also launched New York-based Baohaus at Neighbourhood.
“Our ePos has c£50m in annual sales going through the platform,” Warne says. “It doesn’t only generate sales but also gives us data around what’s selling and where.
“A lot of the time what’s sold isn’t our product, but we can see potential trends.”
In addition to the data-driven approach, Sessions also has a brand scout, with both working together to identify new opportunities for investment.
“Where we’re looking to invest is predominantly the sweet spot of concepts that may have landed, but haven’t reached material scale.”
Its success with Little Bao Boy and Baohaus is because bao, whilst not a new trend, has yet to be mass distributed outside major cities.
“It’s not so obscure people won’t get it, but it’s interesting enough to not just be another burger or pizza concept. People are comfortable enough that it’ll sell to the mass market fairly well.”
Little Bao Boy has reached more than 50 points of distribution in the past 18 months. It is fully owned by founder James Ooi but has been supported by Sessions in its growth and licensing journey.
“The founders themselves have the personality and credentials,” Warne says. “We leverage that through our distribution network. Both sides win.
“We have seen our model grow exponentially post-pandemic.”
While Sessions works with satellite kitchen network Foodstars, he adds that dark kitchens have “really struggled” since the pandemic, with low occupancy.
“On the surface, the economics look good – but the reality is you’ll lose money every week if you can’t get those sales.”
However, he believes delivery will see growth recover despite a decline in volumes, which he attributes to the pandemic comparative.
“People think in a binary fashion about dine-in vs delivery. Even if you’re growing at 6-7% year-on-year, the cumulative effect of that is enormous.”
Sessions is now working with US-based chef Andy Ricker to bring over a Thai concept to the UK, with a menu and launch plan in the process.
Other partnerships are also in the process, with details to come soon.
Sessions has yet to feel the pinch when it comes to tightened consumer spend, according to Warne, who calls its food halls “premium QSR.”
“The price point and flexibility of our sites allows something for everyone, as opposed to a single-site concept at a higher price point.”
