Fri 24th Jul 2015 - Propel Friday News Briefing Starbucks chief executive Howard Schultz has hailed a “most remarkable” Quarter Three to 28 June that saw global like-for-like sales rise 7% driven by a 4% increase in traffic. US like-for-like sales rose 8%, driven by a 4% increase in traffic, while China/Asia Pacific comp sales increased 11%, driven by a 10% increase in traffic. Europe saw like-for-like up by a more modest 3% driven by a 2% increase in traffic. Consolidated net revenues increased 18% over the same quarter the year before to a quarterly record $4.9 billion. Consolidated operating margin expanded 70 basis points to 19.2%. Starbucks Mobile Order & Pay expanded to over 4,000 US company-operated stores in Q3 – full deployment to all US company-operated stores will happen this year. 431 net new stores opened in the quarter with total store count reaching 22,519. Year over year comparable store customer transactions increased nearly 18 million in the US and over 23 million globally. Schultz said: “Starbucks Q3 fiscal 2015 stands as among the strongest and most remarkable quarters in our over 23 years as a public company. The 4% increase in global transactions we reported equates to our having served an additional 23 million customer occasions in Q3 of this year over last year, clearly evidencing a continuation of the strong momentum we have seen across our business and around the world this fiscal year.” Starbucks chief financial officer Scott Maw added: “Starbucks very strong year over year financial performance in Q3 demonstrates our commitment to delivering best in class financial and operating results while at the same time investing in our future growth – building new stores, renovating existing stores, deploying new technology – investing in our partners and delivering an elevated Starbucks Experience to our customers. We believe that by getting this balance right, we will be able to continue delivering exceptional growth, profitability and increased returns to our shareholders.” Leisure analysts at Panmure Gordon have argued, in a sector report, that supply growth in the casual dining market is making it hard for pub operators to grow like-for-likes. In a report it stated: “The pub sector continues to see a decline in pub numbers as more publicans struggle to compete against the larger pub operators and restaurants due to lack of capital and limited economies of scale. Despite the falling pub numbers, larger operators are struggling to maintain like-for-like sales momentum and we believe this could be due to the increasing supply growth of the casual dining brands, leading to market share shift. Pub like-for-like sales growth is noticeably lower than restaurants and has recently decelerated, which we believe is a result of the significant increase in new concepts and supply. Hybridisation and convergence is resulting in a blurring of the lines as cafes, restaurants, fast food outlets and pubs are all offering all-day dining increasing the competition within the industry. We believe only the strongest brands and formats will continue to take market share with weaker brands and concepts continuing to lose market share.” The New York Fast Food Wage Board has voted to phase-in a tiered $15-an-hour minimum wage at restaurants with more than 30 units, providing a faster timetable for New York City operators than for those in other parts of the state. The wage board unanimously recommended tiered increases for restaurant brands in New York City that were on a faster schedule than for those elsewhere in the state. The minimum wage for workers is now $8.75 an hour, and was already scheduled to increase to $9 on 1 January 2016. The board urged a schedule that would bring the wage to $15 an hour in New York City by 31 December 2018. Outside the city, the panel recommended a schedule that phased in increases to culminate in $15 an hour by 1 July 2021. After the comment period, the labour commissioner has 45 days to enact the order. A restaurant complex in Northampton is set for an autumn open date offering six choices over three floors. Chilli Village, in Wellingborough Road, is offering a choice of six individual restaurants, live entertainment and a shisha lounge, all within the same roof, when it opens. A spokesperson for the restaurant owner said: “All of the restaurants are going to be quite different. People will have the opportunity to visit each one and feel like they are in a different place each time. We don’t want it just to be a place where you go for a meal, it is a place to relax and enjoy and be entertained.” Chilli Village is set to offer a range of cuisine including Moroccan and Arabic-inspired dishes, a barbecue grill and a buffet. “People don’t often know where to go on a night out,” the spokesperson added. “But people will be spoiled for choice here.” An online poll, of 2,000 alcohol drinkers (aged between 24-38), reveals gin and tonic to be the spirit-based drink of choice this summer, followed by Pimms, with vodka and tonic in third place. Although the results highlight that gin and tonic is still by far the most popular gin-based drink, the survey also showed the revival in popularity of classic cocktails, including The Martini, Tom Collins and Negroni. Bombay Sapphire and Gordons are the most popular brands, with approximately 25% of respondents naming them as their favourites. Beefeater and Hendrick’s also scored well, with over 10% of respondents stating them as their preferred choice, followed closely by Tanqueray. There is a growing thirst for premium gin, ranging from established brands to smaller craft and artisan distillers, with 20% of respondents claiming they would pay more for a premium gin. 62% of respondents to the survey, commissioned by the Gin Guild, are now requesting a specific brand when ordering at the bar, rather than settling for the “house” gin, and half of all respondents also now ask for a tonic by name.Harrison, the international hospitality design consultancy with offices in the UK (London and Birmingham) and the USA (Texas), is establishing an office in Dubai to service the growing number of projects it is spearheading across the United Arab Emirates (UAE). Located in the heart of Dubai’s leisure hospitality district, the company’s Middle East headquarters will be headed up by long-serving Harrison director Jon Bentley, who has worked in the UAE for a number of years. Specialising in international brand roll-outs as well as concept creation and development, Harrison’s Middle East clients include Meraas Holding, Al Tayer Group, Meraki, Jumeirah Group and Food Fund International. The consultancy’s recent openings include the thriving Bentley Bistro & Bar on Al Maryah Island in Abu Dhabi and the popular Eat Greek restaurant at the Jumeirah Beach Residence in Dubai. A property developer who demolished a historic pub without permission has been ordered to rebuild it brick by brick. Wandsworth Council rejected an application for retrospective planning permission from Udhyam Amin following his decision to demolish the Alchemist pub in Battersea. The Victorian pub, near Clapham Junction station, was open for more than 100 years before it closed in 2013 and fell derelict. It was pulled down in May by Amin who has plans to extend it and build a block of flats. The council responded to this unlawful demolition by launching enforcement action requiring the developer to rebuild it with original materials. A new fast food delivery service has been set up in Guildford by two University of Surrey students. Hungover Express, which is the brainchild of international business management students James Nickelson and Daniel Earl, offers food from any restaurant in the Surrey town that does not already deliver. Nickelson said: “We were revising for our exams, sat in the library, and we came across an article about a lady who delivered roast dinners to people in and around her town. This gave us the idea, why not deliver food that can’t be delivered to students at the university?” They charge customers £5 per delivery and £1 per extra restaurant used in the same order and put the food in a heatproof bag. Currently, food can be delivered from outlets including Starbucks, Five Guys, Subway, Burger King, YO! Sushi, Nando’s, KFC, Krispy Kreme, Costa Coffee, Gourmet Burger Kitchen, Tesco and Kokoro. The International Wine and Spirit Competition’s 2015 spirits results saw value products triumph once again this year as supermarket spirit entries come out with some of the top medals from the competition including a prestigious Scotch Trophy. Sainsbury’s Taste the Difference Highland Single Malt Scotch Whisky was voted by judges as the winner of the Single Malt Scotch Whisky Trophy with no age statement. Eight of the competition’s Gold and Gold Outstanding accolades awarded went to supermarket own labels competing in the same arena as big name brands. The spirits undergo a rigorous judging process that includes a double blind tasting from the spirit industry’s top palates.