M&C Report’s Trade Tracker, which is supported by Torex, supplier of customer and business insight, takes a look at sector trading over the previous seven days. From a list of 40 businesses in the eating and drinking out sector, 10 give a snapshot of trading each week.
September is producing disappointing results for many operators, with most finding little growth after the holiday period. Poor and unpredictable weather patterns are creating similarly mixed and unpredictable sales, although there have been some winners. Here’s what 10 different companies told M&C Report:
Tossed
A good week for Tossed, with eight sites in key London locations and a ninth in Westfield Stratford City, Europe’s largest urban shopping centre, which opens its doors on 13 September. Double-digit growth was reported in some stores. This was despite the erratic weather, which can have dramatic results on the salad bar operator’s trade. “One day last week it was really sunny and it was a stonking day for us - in fact, the best day of the year - but the next day it was wet and takings dropped 30%,” said company chief Vincent McKevitt. Tossed will further benefit from having a second site in a shopping centre location, as well as prime high street locations. “Shopping centres are counter-cyclical: when the sun is shining the high street is busy, when it’s raining people go to the shopping centres. The ideal weather for us is sun all week and rain at the weekends!”
Pesto
Italian restaurant and bar operator Pesto saw trade down last week, 4% against the same period last year. Much of this deficit was attributed to Manchester and Liverpool city centres, where weekend evening trade has not fully recovered since the riots. “Our trade is usually pretty consistent on a Saturday, but since the riots it still hasn’t fully recovered, which is very odd.” Liverpool city centre was slightly down. Conversely, Pesto’s Trafford Centre site was trading well, up 5-6% like-for-like. Pesto has experienced delays in the opening of its biggest site on St Vincent Street, Glasgow, which is now scheduled to open next week.
Peach
Trading is flat for Peach, the Midlands-based pub operator with 14 sites from Leicester down to Cranleigh in Surrey. “July was amazing, August was tougher but we’re really not sure yet about September,” said co-founder Lee Cash. “It’s been a much cooler summer without those hot, lovely weekends, which is what you need when you have pubs with outside areas.” Cash added that he thought that the recession was beginning to bite, with people not going out spending now they’ve returned from holiday. “We started 10 years ago, and we had six years seeing trade go up, up, and up. The last four years have been different, with shock waves going through the market. But we’ve got a good business and we are still here. We’re been up all year and I’m sure it will return to the previous level.”
TGI Friday’s
Trade in September continues to be strong for TGI Friday’s. Overall like-for-likes are up 8%. “This is our third year of growth and it’s a fantastic place to be, especially as I know so many other businesses are struggling. We took the decision to get back to basics, offering good service, good quality and a great experience. It turned the business around and we’ve gone from strength-to-strength and the growth has been sustained,” said managing director Karen Forrester. “In times like this, when’s there’s not much to celebrate, when people do go out they want to be guaranteed a good time. It’s not just about food, if you want food you can get two meals for £10 from Marks & Spencer. It’s about getting a great experience.”
Le Bistro Pierre
Last week was mixed, but overall quite a tough week for Le Bistro Pierre, the nine-strong French restaurant operator with sites in the Midlands and the north. During the early part of the week trading was poor, but recovered to produce a strong weekend. Harrogate was a good example of this, with 118 covers on Sunday night due to a conference in town. CEO Robert Beacham said his gut feeling was that the recession was starting to hurt “a bit up north”: Nottingham and Derby, two sites that have been trading for 15-17 years, have experienced like-for-like growth every year, but this year trade slowed for the first time. “It was a hard week for Nottingham, we were 28 covers down. Luncheons were performing better than evenings.”
Kurnia
Like-for-likes were down 7% last week, which managing director Michael Kheng put down to a couple of very wet days. “A 7% drop is indicative of where we are in the marketplace,” said Kheng. The main factor for the dip, which had been experienced in July and August also, was the weather. “We have two outlets with big outside space and they are massively affected by the weather. The Cloud in Lincoln has a large roof top terrace overlooking the cathedral and castle, which doubles occupancy.” Kheng added that he was hoping September would improve. “Normally the six weeks to the autumn half-term school holidays are good for us, and we hope that when this hurricane goes we’ll have five weeks of good weather until half-term, which will give us the boost we need to take us up to Christmas.”
TLC Inns
Smaller village pubs are proving a massive success for TLC Inns. “I’ve just seen one stat for August which showed a 43% growth for the Henny Swan near Sudbury, Suffolk,” said founder Steve Haslam. In two of the company’s bigger sites, TLC reported like-for-like declines, at between 1% and 4%, however, one of these pubs still took in excess of £30,000 for the week and generally sales were buoyant. “Our half year figures are showing that we’re solid,” said Haslam, adding that good customer service was bringing customers back to the pubs time and again.
Orchid Group
“Tough and hard-going”, was the response from the Orchid Group, the 300-strong pub restaurant operator “The big thing for us is that you can’t tell day-to-day what sales will be. In the past our financial director could make a pretty accurate guess at our forecasts, but we’re experiencing huge swings,” said the commercial and people director Simon Dodd, adding that one day could be 8-9% down and the next 10% up. Like-for-likes are “in growth”, but it’s a tough market. “Last week was okay, but there wasn’t much sport and we have Sky in all our pubs which makes a big differences to Monday, mid-week and the weekend when games are on.” Dodd blamed the constant doom and gloom in the news. “It’s a self-fulfilling prophecy. If consumers are watching the news, it’s no wonder that they’re getting nervous. But then they must think ‘sod it’ and go out and spend a lot of money!”
Apostrophe
“Anaemic” is how Apostrophe managing director Amir Chen described the market at present. Last week, likes-for-likes were nominally up, at 0.6%, and while some stores were performing exceptionally well, others were down. “Every site has its own story and it’s hard to put a trend on it, “ said Chen, who added that the beginning of September had been mixed, with 1 September being “phenomenal”, the following weekend “really good” and the last weekend “not great”. Residential and shopping areas were performing the best. “Everywhere seems a bit tired with little growth. There’s a general malaise in the market,” Chen added.
3Sixty Restaurants
With sites in London, the Midlands and the north west, 3Sixty Restaurants saw mixed trading results for last week, but overall business was “soft”. Three sites in London were only just behind last year’s figure, two trading positively and one down by just 1%. In the Midlands, venues were trading up by 1% combined, but the north west continued to be difficult, down 6%. “People are eating out less and we are seeing Saturdays becoming softer. Six months to a year ago, the early part of the week was difficult, but in the last month we’re seeing the early part of the week picking up, but we’re losing out on Saturdays,” said CEO James Horler, who added that the economic downturn and job losses appeared to be taking their toll in the north west. “The EHO department in Lytham St Annes used to have 14 officers, now there’s only four. That’s just one department in one district in the north west,” he said. In Liverpool, sales were down 15% compared to last year, which was directly attributable to a fall in bookings at next door’s Philharmonic Hall. “Sixty per cent of our business comes from visitors to the Philharmonic,” said Horler, adding that there was a feeling that consumers were booking more traditional, popular shows and entertainment rather than the avant-garde performances put on by the Liverpool Philharmonic.
