Up to date on rent payments, a brand-new opening, and like for like’s ahead of last year - looking at Giggling Squid, the word ‘crisis’ doesn’t spring to mind.

Of course, that isn’t to say the past few months haven’t been challenging for the 37-strong restaurant brand, who like the rest of the industry was forced to shutter its entire estate in March and seek survival in the now all-too-familiar government support schemes.

After just over a month of complete closure, the business began reopening sites for delivery in May, followed by a full dine-in reopening – bar one restaurant in Leicester – on 4 July.

“We opened the second we were able to,” founder and CEO Andy Laurillard tells MCA. “The operations team made an amazing job of getting the business open and selling takeaway like it was going out of fashion, and as a result we were able to take full advantage of Eat Out to Help Out and the VAT reduction.”

Having “never seen anything like” August trade levels, demand since the government’s discount scheme has inevitably dipped, but with sales boosted by elevated delivery and takeaway revenues and therefore ahead of 2019 on a like for like basis, the business has been able to press on with its growth plans.

On Monday (28 September), it opened an all-new restaurant in Cambridge, its largest site to date, and despite having to opt for a soft-launch, the restaurant is on track for a solid first month.

“It’s fully booked for three weeks. It’s the number one site in the group,” Laurillard says. “We couldn’t do the normal ‘full monty’ marketing because we couldn’t do a proper opening, so we’ve been really staggered by the interest.”

And given the brand’s not only strong but overtly successful few months, the ongoing pressures facing many across the sector aren’t so much of a concern for Laurillard.

The business is without any supplier or rental overhang, other than payback agreements for Q2 which are to be extended over the next few years, he tells MCA.

“Within those schedules, and the ones where we didn’t agree anything, we’re up to date and have payed-up on everything.

“We’re quite well financed anyway so we had no justification whatsoever for not paying rents, because we were doing fine.

“There’s no creditor pressure building on us. There are no deadlines. There’s no cliff-edge.”

That being said, with rumours of local and even national lockdowns circulating, the chain won’t be applying a business as usual strategy to the coming months.

With another new site ready for development in Harborne, Laurillard says there are no plans to start working on it “until we know the trajectory of the various lockdowns that are inevitably coming.”

Financially, the business could “live with a full lockdown for about three years,” he explains, but is nonetheless preparing for the uncertainty of a stop/start government order.

“In our financial plan we’re modelling for six two-week circuit breakers over the next nine months,” he says. “We’re sitting on enough cash to get through some quite harsh lockdown measures, but we don’t want to spend that on opening loads of new sites and then not be able to pay the rent.”

“We’re expecting to have to duck and dive like everyone else.”

However, whilst Giggling Squid might not be looking to pounce on the surge of new land opportunities, in the short and medium term Laurillard predicts that the market transformation is set to be huge.

The volatile rent environment and unpredictable consumer demand will continue to see “large, over-indebted, under-capitalised businesses that have been passed from one private equity firm to the other over the years wiped out,” he says. “Their administration processes and CVAs will make all sorts of sites available, which means a lot of small restaurant groups and independents can go in and take those opportunities up.

“Think of this as the asteroid that hit the dinosaurs. It’s wiped out the dinosaurs and let a whole new class of creatures evolve into something quite exciting.”

And it isn’t just an opportunity for smaller groups, he’s keen to add, “but it could be positive for the remanence of the larger brands as well.”

“They’re free of the debt and free of the burden of unprofitable sites. They’ll be smaller, with more capital, and the ability to reinvent themselves.

“It’s painful at the moment but in three to five years’ time there will be a lot more vibrance, not just from independents but in larger operators too.”