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Morning Briefing for pub, restaurant and food wervice operators

Mon 20th May 2013 - Draft House, Le Bistrot Pierre and Tossed

Weekend newspaper round up:

Inside the City: M&B shakes off pub brawl hangover: The old showbiz adage says there’s only one thing worse than being talked about, and that’s not being talked about. But the cast of one of the City’s favourite soap operas is probably grateful to be away from the limelight these days. For a couple of years, Mitchells & Butlers, the pub operator behind Harvester and All Bar One, was in the news for all the wrong reasons. A string of directors quit, there was an unwanted takeover bid and the quest to find a new chief executive seemed to go on for ever. All the headlines about brawls referred to the boardroom, not to the company’s bars. Since the arrival of Alistair Darby to run M&B last autumn, a degree of normality has returned. True, almost half the company’s shares are still owned by Joe Lewis, the billionaire trader, and the Irish racing duo of John Magnier and JP McManus, making it one of the least liquid companies of its size. But when Darby presents interim results this Thursday, the discussion will focus on trading and business improvement rather than on how easy it is to find a seat at board meetings. The former Marston’s executive is expected to use his presentation to explain how he is getting the most out of the company’s 1,600 pubs and restaurants. This is not a story of swingeing cuts and redundancies but making small changes to generate improvements, such as organising shifts more efficiently, and trying to think harder about what customers want. Another old saying, retail is detail, applies equally to selling pints and pies in pubs as it does to peep-toe pumps in fashion emporia. As for the numbers themselves, there are unlikely to be any big surprises. As some of its rivals have shown during this reporting season, the harsh winter weather has hardly helped, but analysts at Morgan Stanley still predict a 12% rise in pre-tax profits to £76m, with sales breaking through the £1bn mark. Despite a stable performance, there are still some plot lines to be resolved before institutional investors will really feel comfortable owning M&B shares. The company is working out the extent of its obligations towards its pension fund. Three years ago, the deficit stood at £400m, a figure expected to rise significantly when the actuaries work out the size of the hole now. Only once the company’s commitments are agreed will Darby be able to think about reinstating the dividend, something that may happen by the time of the full-year results. And there is also the question of what Lewis will do with his stake. Panmure Gordon, the stockbroker, has raised the possibility of the tycoon cashing in some of his chips by placing part of his holding. The shares closed at 405.6p on Friday, more than treble Lewis’s average purchase price of 130p. That’s not bad for a company nobody talks about these days. 
The Sunday Times

Falling fuel and beer prices herald rare inflation drop: Easing pain for motorists at the petrol pump and Chancellor George Osborne’s Budget beer duty largesse should this week herald the first fall in inflation since last September. The Bank of England’s Consumer Prices Index inflation benchmark is expected to ease to 2.6% in April from 2.8% in March as a 2% fall in fuel costs contrasts with price hikes a year earlier. The effect of March’s 1p cut in beer duty should also feed through to figures on Tuesday, economists say. April’s better news on the inflation front may, however, be a temporary respite as student tuition fees and sterling’s weakness conspire to push the cost of living higher once more. In a television interview, the outgoing Bank Governor, Sir Mervyn said: “We are seeing a recovery. It’s only a modest recovery, and we certainly can’t be satisfied with it. We need to do more to use up the spare capacity, and to get back to a healthy, growing economy. But we are in a recovery period, I think.” Attention will also fall on whether Sir Mervyn changes his stance on calling for more money printing when minutes of the latest policy meeting are published this week. The economy grew more strongly than expected in the first three months of 2013 and the bank expects growth to accelerate to 0.5% in the current quarter.
The Independent on Sunday

EU to ban olive oil jugs from restaurants: The small glass jugs filled with green or gold coloured extra virgin olive oil are familiar and traditional for restaurant goers across Europe but they will be banned from 1 January 2014 after a decision taken in an obscure Brussels committee earlier this week. From next year olive oil “presented at a restaurant table” must be in pre-packaged, factory bottles with a tamper-proof dispensing nozzle and labelling in line with EU industrial standards. The use of classic, refillable glass jugs or glazed terracotta dipping bowls and the choice of a restaurateur to buy olive oil from a small artisan producer or family business will be outlawed. Sam Clark, the food writer, chef and proprietor of the award winning Moro restaurant in London, told The Daily Telegraph that the ban would stop him serving his customers specially selected Spanish olive oil in dipping bowls with bread when they are seated at their table. “This will affect us. It is about choice and freedom of choice. We buy our oil, which we have selected from a farm in Spain, to serve our customers,” he said.
The Daily Telegraph

MPs’ booze culture: Parliament is gripped by a booze culture with one in four MPs finding their colleagues guilty of drinking “unhealthy” amounts. Speaker John Bercow tried to curb boozing after Eric Joyce went on a bar-room rampage last year. And in a poll politicians were most concerned by blotto colleagues, with 31% of Labour members saying fellow MPs drink too much. Another 20% of Tories and 19% of Lib Dems also thought Parliament needed to sober up. Parliamentary authorities have insisted drinks in Westminster’s nine bars – which took £1.33 million in one year – are not subsidised. But they are still cheaper than in most nearby pubs. Alcohol Concern, which commissioned the poll of 150 MPs, said the findings should come as a wake-up call. Chief executive Eric Appleby said: “If a quarter of employees reported an unhealthy drinking culture in any other organisation it would provoke immediate action by bosses. Surely it’s time for Parliament to rethink its drinking culture and lead by example.” Speaker Bercow took action after Eric Joyce attacked fellow MPs in the Strangers’ Bar just over a year ago. Bar staff were told not to serve MPs if they were already drunk.
Daily Mirror

Impact of Olympics and Jubilee is hard to figure: London’s 2012 Olympic Games were a triumph and Britons cheered two days off last June for the Queen’s Jubilee, but the impact of both on the economy offers less cause for celebration. The Office for National Statistics said on Friday that it was impossible to tell which areas of the economy had benefited from the Olympic and Paralympic Games. Meanwhile, it estimated the Diamond Jubilee shaved between 0.3 and 0.4% off GDP. “While we might expect the overall impact (of the Games) on economic activity to be positive, in most cases it is impossible to distinguish the precise effects of the Games,” the ONS said. “And even the direction of the impact may not always be clear, to the extent that the Games might have displaced other activities, the impact on some sectors could even be negative.” One economic benefit that was simple to quantify was ticket sales. The £580m sold added 0.2 percentage points to output in the third quarter of 2012. The benefits for tourism were less obvious. The International Passenger Survey, which collects information about visitor numbers and their spending habits, estimated that 698,000 people travelled from abroad to see events at London 2012. However, fears that London would be overcrowded during the games could have dissuaded others from coming; in the three months from July to September 2012 numbers were 3.9% down on a year earlier. 
The Financial Times

Lib Dem minister urges coalition to carry out plain cigarette packet plan: A health minister has urged the coalition to press ahead with forcing cigarettes to be sold in plain packets to reduce sales, despite the plan being dropped from the Queen’s speech because of unease in Downing Street. Norman Lamb, a Liberal Democrat, has urged ministers to make Britain the first country in Europe to adopt what he claims would become a key element of the legacy of government’s time in power. “As a liberal I would always defend someone’s right to smoke, if that’s what they choose to do. But, given we’re dealing here with a product that kills between 80,000 and 100,000 people a year, I think it’s legitimate for government to seek to control the marketing of that deadly product,” said Lamb.
The Guardian

Dominance of UK singleton households focuses minds in marketing: Single-person households are becoming an increasingly dominant feature of British society in a demographic shift that is forcing businesses to review their marketing messages. The latest census data show there are now almost twice as many one-person households as traditional family homes containing two parents and children. The number rose 1m to 7.1m in 2011 from the previous census in 2001. This represents 30% of all households in England and Wales – more than any other category. The trend towards solo living is forcing businesses to adapt their marketing strategies to reflect the diminishing role of the nuclear family. However, single-person households are far from a homogeneous group.
The Financial Times

How tax avoiders cost each one of us £183: Every British taxpayer is being cheated out of £183 as global giants including Google and Amazon avoid annual taxes of as much as £5.5bn. The shocking extent of the scandal has been uncovered by a Sunday Mirror investigation, which found that a massive £1.4bn comes from just eight firms. Starbucks has paid no corporation tax on sales of £1.2bn. But last December the coffee giant volunteered to pay £20m to the Treasury after the revelation sparked public protests at its outlets.
Sunday Mirror

£1m to expand Ocean Terminal catering outlets: The owner of Ocean Terminal in Leith, Resolution Property, is investing £1 million to increase the space dedicated to catering outlets while retail is in the doldrums. Work has started that will open up views to Edinburgh Castle and Calton Hill in addition to the panorama available to bar and restaurant goers overlooking the Firth of Forth and the Royal Yacht Britannia. Subjit Jassy, investment manager at Resolution, said: “Retail’s woes have been widely reported, but it is clear to us that the mix of shopping, leisure, eating and drinking that we have at Ocean Terminal is the way forward.”
The Scotsman

Zizzi restaurant staff refused to blend up pasta for disabled 17-year-old: A family claim a restaurant refused to blend food for their severely disabled son because it would break health and safety rules. Ryan Moss, 17, has a severe form of quadriplegic cerebral palsy and cannot eat solid foods. His family had visited a branch of Zizzi in Manchester’s Trafford Centre on Wednesday and ordered a bowl of pasta for the teenager. When Ryan’s step-dad Chris King, 49, challenged the restaurant manager he was told using the blender would breach health and safety rules. Zizzi bosses have since apologised for the incident, saying they were sorry for any distress caused. A spokesperson said: “We strive to offer the very best customer service at all of our restaurants and are looking into this incident as a matter of urgency to ensure levels are maintained in the future.”
Mail Online

DJ Fatboy gets with the meat: Fatboy Slim is set to take over Heather Mills’ vegan café – and will put meat back on the menu. The DJ, real name Norman Cook, is said to be buying Vbites in Hove, East Sussex, from Sir Paul McCartney’s ex-wife and reopening it as The Big Beach Café. Carnivore-friendly nosh will replace the meat substitutes and plant extracts served up by Heather, who opened her café in 2009. The animal rights campaigner has moved it to another site which is run by her sister Fiona Mills. Norman already owns a Japanese restaurant in nearby Brighton.
Sunday People

Pub beats grub, guys: Single men spend more on alcohol than on groceries. Their monthly booze bill tops £200 but they spend just £160 on food, says a study of 18-35 year old UK males. Shopping site vouchercodes.co.uk, which conducted the poll, said: “The pub culture is well established. But it its surprising the bar tab outweighs the grocery bill.”
Sunday Mirror

Foodie alert: Goat has been neglected by chefs in the UK: It is the most popular meat in the world and far healthier than the leanest chicken breast. Yet goat has long failed to butt its way on to British menus. The nearest many will have been to goat is purchasing a curry at the Notting Hill carnival and feeling daringly experimental. That is changing, with a clutch of top fine-dining chefs cooking with goat. In fact, farmers are struggling to breed enough goats to meet demand, with one breeder revealing that existing herds were too small to meet a recent request from Morrisons supermarket. “They’d need our yearly supply every day,” said Sharon Peacock, who chairs the British Boer Goat Society. This weekend goat is on the menu at two popular London restaurants, joining dishes at the capital’s champions of British fare St John and Quo Vadis, as well as at Manchester’s Michelin-starred Aumbry and the Epicurean near Bath.
The Independent on Sunday

Food giants to bag crisp maker: A crisp maker started by a Herefordshire farmer is about to become the focus of a global takeover tussle. A colourful cast of food companies from around the world is hoping to gobble up Tyrrells, the upmarket crisp maker, which turned William Chase, a potato farmer, into a multimillionaire in 2008. Langholm Capital, a private equity firm, has put the business up for sale, five years after buying it from Chase – who pocketed £30m from the deal. This time round, Tyrrells has drawn interest from: Kellogg’s, the American food giant; Calbee, a Japanese snacks firm; and Tangerine, the Blackpool-based confectionery company that includes Butterkist popcorn in its stable of brands. First-round bids are this week. Langholm, which is backed by the household goods giant Unilever and also owns Dorset Cereals, is thought to have slapped a price tag of more than £100m on the business. Interest could also come from Hain Daniels, the American food group that has been steadily assembling an empire in Britain. Last month it snapped up Ella’s Kitchen, the company that makes organic baby food. Germany’s Intersnack, which bought KP Snacks last year, could also be tempted.
The Sunday Times

Your secrets served up at Internet cafes: Confidential personal information, including passports, bank details, court documents and the health data of vulnerable care patients, has been left on computers at internet cafes, an investigation by The Sunday Times has found. A few minutes spent on pay-to-browse computers around the country uncovered a mine of sensitive, potentially damaging information left behind by customers. After being alerted to the findings, the Information Commissioner’s Office (ICO) has started investigating several companies for possible breaches of the Data Protection Act by their employees who had left information behind. Reporters tested more than 50 internet cafes in London, Manchester, Birmingham, Nottingham and Carlisle. At each cafe we bought up to one hour’s use of at least one computer, and opened document folders freely accessed from the PC’s desktop or menu. Many cafes have timed sessions and delete such folders after each customer logs out, but others have no such process of document deletion. 
The Sunday Times

Tesco to battle ‘breathtaking’ level of food waste: The chief executive of Tesco is to launch a major campaign against food waste this week, saying that the scale of the problem is “breathtaking” and that every family wastes £700 a year throwing away food. In a major move aimed at showing that Tesco can use its scale to create social change, Philip Clarke will say that it is important that the supermarket promotes a new image to its customers. Food will come in smaller sizes, and food promotions will be tailored to stop encouraging people to buy large amounts of food with a short shelf life. The food waste initiative is part of the Tesco and Society campaign, to be launched with a major report this week. The study will lay out a series of targets on food waste, creating opportunities for young people and healthy eating. It will also commit the retailer to publish Clubcard figures on how “healthy” the average shop is and on reducing food waste. “When many people in the world think that big is bad, we are setting out to prove that big can be good,” Mr Clarke said. “We’ve given ourselves a new value, that scale can be good.” Mr Clarke’s move follows the horsemeat scandal, which saw the whole supermarket sector criticised for failures in its supply chain, which allowed contaminated food to enter products. Tesco has also been attacked for its size in the UK and for threatening traditional high streets with out-of-town hypermarkets. Mr Clarke has already called for an end to the building “space race”. 
The Sunday Telegraph

Marks and Spencer customer fears over contactless payments: Shoppers at Marks and Spencer have complained that the retailer’s “contactless” payment system has taken money from their accounts without their permission. The customers said the money was taken from their cards, when they intended to pay in other ways. The system, which can by used for payments of up to £20, is only supposed to take money from the cards when they are around two inches away from the contactless terminal. But two customers, who contacted the BBC’s Money Box programme, said the payments were taken when their cards were in purses which they were holding in their other hand well away from the device. In both cases, the cards were charged as the shopper was attempting to make a standard “chip and pin” payment with a different card. Sandwich chain Pret A Manger also said it was investigating similar claims after a customer reported paying with a card that was more than 11 inches away from the reader.
The Sunday Telegraph

Science promises strawberry fields forever: As Britain steels itself for the prospect of yet another washout summer, strawberry growers are finding themselves forced to come up with increasingly sophisticated ways of assessing the threat posed to their livelihoods by inclement weather. For fruit growers, predicting the weather is vital. It causes fruit yields to vary by as much as 70%, making for an erratic growing season if poor conditions are not anticipated. The last few years has seen a glut of strawberries arrive during rainy periods, when demand was limited. Conversely, this has meant a shortage of the fruit in some parts of the country at peak times – for example outside London when Wimbledon fortnight started last year. But as the year’s first crop of British field-grown strawberries goes on sale this weekend, growers have a new hi-tech weapon in their armoury. The biggest growers are using a state-of-the-art forecasting system that allows them to predict the yields in individual fields. The specialist technology compares historical yield curves, the recorded effect weather has on the crop and the planting date of the strawberries in their respective locations. The information is then fed into a computer along with long-term weather forecasts, specific growing data for some of the 600 varieties of strawberry produced in the UK, and growth charts for each field. The new system is helping the UK’s biggest growers, who are responsible for producing around 20,000 tonnes of strawberries – a third of the annual UK crop.
The Observer

Lloyds banks on cuppa for loyal custom: Loyal customers of Lloyds would be rewarded with book vouchers and free cappucinos from their favourite coffee shops, under proposals to change the image of the part-nationalised institution. Among the ideas for a relaunch of the ‘Black Horse’ brand are retail-style rewards for longstanding customers, based directly on their spending habits.
The Financial Times

Mothercare cuppa: A fledgling chain of tea shops found two years ago as a riposte to the espresso bar invasion has signed a deal with Mothercare to provide in-store outlets. Tea Monkey was set up by Tracey Bovingdon, who recently launched a franchise package. The first such store is expected to open in Southport in the next few months.
The Times

Unhappy hotel guests shown door at gunpoint: Two British holidaymakers were frogmarched out of an American hotel by an armed guard after they threatened to give it a bad review on TripAdvisor. Nick Cobban, John Howard, and an Australian friend, Alan Lloyd, were refused access to their rooms at the Knights Inn, Nashville, because Lee Wilkinson, who had made the booking, was not with them. The jet-lagged guests only made matters worse when they said they might give feedback to the popular travel website. Mr Lloyd said: “The receptionist told us he would not now rent us any rooms. Then he summoned an armed guard who stood with his hand on his gun as we picked up our suitcases and returned to the Ford Escape we’d hired.”
The Daily Telegraph

‘Fawlty Towers chaos’ ruins bride’s big day: Bride Rebecca Cutts says her perfect day was ruined by the hotel reception and her complaints have been met with a dismissive: “What do you expect from a cheap wedding?” Heartbroken Rebecca accuses the hotel of serving up a Fawlty Towers-style fiasco as some meals were still frozen, champagne was not served and desserts ordered by half her guests ran out. She says 19 of her 65 guests had to send back uncooked food. She has lodged a complaint with The Sandygate Hotel at Wath-upon-Dearne, South Yorkshire – which featured in Channel 5’s hit programme The Hotel Inspector in 2010.
The Daily Express

Coffee the morning after tonic: It’s the traditional pick-me-up for the morning after the night before. But, according to research, coffee can do much more than help get rid of a hangover – it can offset some of alcohol’s harmful effects. Regular alcohol consumption increases levels of GGT, an enzyme which is known to be a precursor to liver damage, heart disease and diabetes. But Finnish scientists found that drinking five or more cups of coffee each day can slash GGT levels by up to 50%, especially in men.
The Daily Mail

Boozing kids alert: Allowing young teens a little alcohol could increase their chances of becoming hooked on booze. People often think that supervised early drinking leads to better behaviour. The research at Germany’s University of Heidelberg says those aged 12-14 introduced to alcohol are most likely to develop drink problems.
The Daily Star

Simon Hoggart’s week: when a pub lunch becomes a flag day: Simon Hoggart writes: The other day we went back to a pub which we often used to lunch at. It had been completely refurbished, and it looked terrific. Even better, it had a superb garden at the back, with lots of tables, flowerbeds and lawns leading down to a river. Idyllic, and the food was still pretty good. But they’d decided to go all modern. So at the garden bar you ordered your food and drink, and to run a tab you gave them a credit card, in exchange for which they gave you another card with a number on it. Then they told you to take one of the four-foot-high red flags stacked by the bar, and jam it in the ground at your table, so the staff would know that the people who’d ordered on tab number 30 were near flag number 39. As they served your first course, they took the flag away. If you wanted dessert or coffee, you had to order it, then find another, different flag, because your previous one was being used by someone else who would otherwise snaffle your sticky toffee pudding. All this proved complicated. I had to order inside, but when I got out to the back, looking for a new flag to tell the dessert people about, the barman cried piteously: “Sir, sir, I need your tab number!” Meanwhile the wind had got up, and flags were beginning to fall, causing chaos in the ordering and making the garden look like a miniature golf course in Oklahoma hit by a tornado. And it used to be so simple: you ordered the food, said where you were sitting, and paid at the end. But nobody does anything so lo-tech today.
The Guardian

Company news:

Sales and profits up at Le Bistrot Pierre: French restaurant group Le Bistrot Pierre has reported a sales increase of 10% in the year to December 2012. Accounts filed at Companies House show that the group, which offers “affordable French dining”, saw turnover increase from £10.09m in 2011 to £11.06m last year. Le Bistrot Pierre attributed the increase to 4% growth in customer numbers at the nine restaurants trading last year, along with increased spend per head. Pre-tax profits more than doubled, from £430k in 2012 to £890k, with profit after tax of £587,418. The report says: “Competition in the casual dining sector is strong and the current economic climate is a risk due to the impact it may have on demand. The company manages these risks by listening to customer needs and feedback, offering good value and ensuring consistently high standards of service.” Former Mitchells & Butlers chief executive Adam Fowle joined the board of Le Bistrot Pierre as a non-executive director in December. Since year-end, the group has opened its tenth site, in Plymouth. 

Loungers opens Reading site: Loungers, the café bar operator led by Alex Reilley and Jake Bishop, has opened its 33rd site in the Reading suburb of Woodley. Loungers has invested £450k converting a former retail unit to create a 120-seater trading area, which also has substantial outside seating. Called Bosco Lounge, the new site is the group’s second venture into Reading, having opened in Alto Lounge in 2009. Loungers managing director Reilley said: “Woodley is a great area on the outskirts of Reading. There’s a very limited food and drink offer in the area so we’ve got fairly high expectations about how we’ll trade there.” The opening comes as the group reports like-for-like figures for April up by 7.7%. Reilley added: “April represented yet another very good month for us with another set a strong LFL sales. Our year-on-year sales for April show an increase of 56.3% which is a reminder to us, if nobody else, how much the business has grown in the last 12 months.” Loungers is due to open in the Brewery Square development in Dorchester on May 30, followed by Gloucester Quays in early July.

Sixth pub for Draft House: Craft beer pub group Draft House has acquired a sixth site. Work has already started on converting the former Novus Leisure site on Seething Lane, London EC4, with the pub due to open at the end of June. Once a post office, the site is the largest Draft House yet. Founder Charlie McVeigh said: “Draft House Seething is just across the river from our most successful site on Tower Bridge Road, so when this came up we jumped at the opportunity. We look forward to serving the local shipping and insurance communities as well as a goodly portion of the 1.4 million annual visitors to the Tower of London.” Draft House has also announced the appointment of Richard Peachment as operations director for the group. Peachment began his career at Ed’s Easy Diner, and spent seven years at TGI Friday’s before joining JD Wetherspoon as catering operations manager in 2004. After moving into area management, he became senior area manager in 2010. McVeigh said: “We spent a long time finding the right person and think we have hit the jackpot here. When Richard walked in I was immediately struck by his obsession with quality and service and his evident passion for all things Draft House. The clincher was when we bonded over a love of real beer and Neil Young.”

Tossed secures £1.5m Funding: Healthier restaurant operator Tossed has secured a £1.5m funding line from Santander. The funding follows the management buyout from private equity backer Beringea in April, led by Tossed’s founder and managing director Vincent Mckevitt and Neil Sebba, financial director. The business plans to open at least another eight outlets in the coming 12-18 months, remaining in its London heartland. Its flagship site reopened at Westfield London this weekend after refurbishment, while its latest outlet, at Houndsditch, opened last week. Sebba said: “This has been possibly the busiest few weeks we have ever had as a business, but we are really excited about what comes next. With supportive financiers around the table we are ideally positioned to seek out new stores and offer our people some exciting new opportunities.”

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