Red’s True Barbecue, the Scott Munro and James Douglas-led group, is set to test its concept over a number of different locations over the next few years as it looks to build as much collateral in the business as possible.
This spread of sizes and locations is partly down to availability of sites, but also because the pair want to show prospective buyers further down the line that the Red’s brand can work in a number of operations. The pair have to provide an exit to their investors, many of whom are friends and family, in three and a half years’ time, and are conscious that any business decisions they make today reflect this.
Munro told M&C’s sister title Restaurant: “We want to prove we have a concept that can run over a number of different platforms. We can show potential buyers that it works in shopping centres, suburban areas, city centres and, possibly, even overseas. We are trying to build as much collateral in the business as possible, to push the value up and turn it into a really desirable business.
Red’s aims to open four sites a year for the next three and a half years. More are likely to open in London, with the Midlands and Scotland also on its radar.
Douglas said: “The first 10 sites will have various sizes. We are experimenting as we go. If you go to a commercial agent and say you’d like a site between 4,500 and 5,000sq ft in a prime location in the UK you will be at the end of a very long list of people looking for similar sites. How you get around that is to open restaurants of different sizes.”
Its upcoming sixth site in Liverpool site will be attached to Liverpool One, but not actually in the shopping centre. “We’re often a minute or two walk from prime locations. What we save on location we spend on fit out,” said Douglas.
In May, the company secured £5m of new investment from a group of leading industry players and retail entrepreneurs as it looks to accelerate its growth plans.
The equity investment deal for the then four-strong brand featured a consortium comprising industry veteran and former chief executive and chairman at Wagamama Ian Neill; Jamie Barber, the founder of Cabana; Stephen Wall, the co-founder of Pho; Brandon Stephens, the founder of Tortilla; Maurice Abboudi, the founder of K10; Dom Lake, the founder of Canteen; and retail entrepreneurs Aarish Patel and Sunny Gill.
A full interview with Douglas and Munro will appear in the February issue of Restaurant.
