Christian Rose, chief executive of the Sun European Partners-backed company formed to run 10 of the former Atmosphere Bars & Clubs venues, has told M&C Report that plans are still in place to launch a “radically different” version of the Chicago’s brand.
Rose, who was previously chief executive of Atmosphere, which was placed in administration with Deloitte in May, explained the “perfect storm” of factors that he said led to the firm’s collapse. He hopes to add new sites in the second year of the new company Chicago Leisure.
Prior to Atmosphere’s collapse, Rose told M&C Report that the company was looking to trial a new version of Chicago’s. He told M&C Report today that the plan remains to introduce an updated version with a “food, drinks and dance combination”, but also to “develop and enhance Chicago Rock’s late-night drinking and dancing proposition”.
He said a “radically different” version is expected to begin trading in the first quarter of the 2014 calendar year. In the meantime, the remaining sites will be updated.
“We desperately need to spend money on infrastructure,” Rose said. “We are working with designers at the moment to see how we can lift them, make them more contemporary to give them a sense of soul and purpose.” Investments will be funded by cash generation.
Rose said Chicago Leisure would “invest heavily in marketing and communications”. There would be “more relevant promotions” focused on entertainment rather than just drinks prices. “It can’t just be about price otherwise you are not differentiating yourself.”
He said a “myriad” of different ideas could work, pointing to areas such as live music and tribute acts, adding: “It isn’t just about serving cheap alcohol.”
Rose said there was a “perfect storm” of reasons that led to his decision to place Atmosphere into administration in May when it operated 24 sites.
“There are many factors: lack of investment in the estate, not having historically the right resources in the right functions. Without question, in some of the northern sites rents were very onerous, and the economic environment put pressure on the revenue line.
“We got to the May Bank Holiday, the company had had many, many months of extremely poor trading. It just wasn’t sustainable.”
On the prospect of expansion in the future, Rose said: “Certainly for the first year we are looking to keep the 10 sites, invest in those and drive good returns for them. Year two it’s about looking for new sites expansion opportunities but we need to demonstrate to everyone the success of the new concepts.
“I don’t have a plan that says we’ve got to get 20, 30. 40, 50 by a certain time. If we can deliver a winning formula they (Sun) will back you to the hilt.”
Rose said Sun is “very realistic” about the difficulties ahead. “They know this sector has challenges they know the business hasn’t been invested in,” he said.
“The most important thing is we now have a very strong business, a strong balance sheet. Revenues could be better but they are ok and there’s an awful lot more we can do. We’ve got to re-engage with the customer.”
Commercial director Tony Traynor left the business following Atmosphere’s collapse and Rose said his role would not be replaced. A smaller estate means fewer people are needed in operations roles, he explained. Colin Goodwin, general manager of Chicago’s in Chelmsford, has been promoted to area manager for the 10 units.
