Hugh Knowles

Puttshack MD Hugh Knowles is keen to get back in the swing.

Having completed a £30m equity raise with lead investor Promethean Investment last June, followed five months later by its third UK site opening in London’s Bank, 2020 had all the promise of a stand-out year for the concept.

Its expansion was expected to push on at pace, with a £5m site set to open in Watford, followed by a US rollout in Atlanta, Chicago and Miami.

Needless to say things didn’t quite go to plan, and by virtue of the coronavirus crisis the business is currently operating in just two sites – Westfield London and Lakeside Essex – and, alongside the rest of the industry, bracing itself for Boris’ next surprise.

After five months of complete closure, two weeks of staff re-training and a significant amount of due diligence, Puttshack announced its partial reopening in August, and initially things were very positive, Knowles tells MCA.

Approaching relaunch with “trepidation and nervousness,” the pent-up consumer demand combined with the chancellor’s Eat Out to Help Out initiative saw trade soar over and above the business’ expectations, exceeding like-for-like’s on August 2019.

But as the restrictions started to pile up in September, whilst the venues have remained EBITDA positive, the challenges have continued to grow.

“Westfield London is faring headwinds with the rule of 6, the curfew and now tier 2, so we’ve been going backwards,” Knowles explains. “Where we were ahead of last year, we’re now about 40% back year-on-year.”

Currently operating one site in tier 1 and one in tier 2, the challenges facing businesses in the higher alert levels is plainly demonstrated in the “massive” difference in footfall between Puttshack’s two venues.

“It ranges from about 20% to 40% difference,” Knowles says. “We had that fundamental point in tier 2 that you’re not allowed to mix with anybody outside your household so immediately our market was pinched.”

So much so, that the business has temporarily lost two of its three core markets, which ordinarily span family, millennial and corporate.

With the corporate demographic “completely gone for the time being” and the millennial market severely reduced as a result of the mixing rule and curfew, the business is putting all its efforts into a very diminished consumer base.

“The family market has really come to the front for us and it’s something we’re pushing hard on,” Knowles says. “We’re targeting families and dates for couples that live together, and that’s pretty much it.

“But we’re delighted we can still facilitate and entertain those people within our venues. Puttshack provides some needed relief for people.”

Puttshack - Sapphire course

Unsurprisingly, with the reopening of its Bank site dependent on London exiting tier 2, the business has had to “press pause” on its other expansion plans.

That being said, Knowles stresses that the pause is only temporary, and there are still concrete plans in place to reignite its growth strategy going forward.

Construction has already started in Atlanta, and following some recapitalisation the group’s Watford site should open by the end of 2021.

“That’s our ambition,” he says. “We’re being careful and sensible, and we have a lot of landlord contributions out in America so we’re not burning our cash there which enables us to keep going.

“This is a pause, but we do have plans to re-establish our pipeline both here in the UK and in the US.

“We’re gathering our thoughts and then we’ll go again.”

But this opportunity for the business to “catch our breath” is not to be confused with a period of idleness, and the tech-heavy concept has been busy preparing itself for life beyond the crisis.

In the past few months, Puttshack accelerated the introduction of its mobile order app, launched an online booking system and is currently working on a gamification process, intended to integrate the physical mini golf gameplay into the digital experience.

“We were running at 100 miles an hour in a roll out across multiple countries, and this has just put that on pause so we’re able to come back and look at our core product,” Knowles says. “Our in-house developers have been busier than they’ve ever been, and there’s been a lot of things going on behind the scenes.”

And although times might be tough right now, he adds that though they may not be immediate, “there will be positives out of this.

“It’s exciting because a lot of innovation happens during these challenging periods,” he says. “This is my third recession in business, and we tend to become a lot more more efficient and a lot more profitable for them.

“That will definitely happen in every business that can survive. But if you stand still you go backwards. That’s our philosophy, and we plan to keep moving forward.”

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