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Morning Briefing for pub, restaurant and food wervice operators

Mon 27th Jan 2025 - UK’s first returnable cup initiative between multiple national brands, Urban Pubs & Bars, Wingstop et al
UK’s first returnable cup initiative between multiple national brands launches: The UK’s first returnable cup initiative between multiple national brands launches today (Monday, 27 January). The scheme in Glasgow aims to cut into the 388 million disposable cups used in Scotland each year. Operators including Costa Coffee, Caffè Nero and Burger King UK are joining forces to participate in “Borrow Cup”, a project set up by environmental charity Hubbub and reuse start-up Reposit. Several local cafes are also part of the initiative, which aims to expand further across the UK in future depending on the success of an initial three-month period. Customers purchasing a drink at any participating store will be given the option to use a “Borrow Cup” for a £1 deposit and will receive a discount or extra loyalty rewards at most participating locations. Cups are available in three different sizes, and customers can return them at any participating venue to either use again, swap for a clean cup for their next drink, get their deposit back at the till or a £1 voucher at a return point. To date, returnable cup initiatives have generally failed to progress due to trials being too small-scale, cumbersome user experiences have deterred engagement, and a lack of data-led traceability and measurement has limited further development. The organisers said Borrow Cup is different as it is a “pioneering collaboration” with major brands and local cafes, creating a high concentration of return points in the busiest areas of Glasgow. Borrow Cup will be offered at the following retailers across Glasgow: Costa Coffee (11 locations), Caffè Nero (14 locations) and Burger King UK (12 locations). Local cafes include Tinderbox (five locations) and Sprigg (three locations). The project has been funded by the participating brands along with environmental health service Ecosurety, distribution group Bunzl, British Plastics Federation and KFC. 

Urban Pubs & Bars increases banking facilities to £30m to support growth as it reports record-breaking Ebitda and turnover: Urban Pubs & Bars, the London pub operator founded by Malc Heap and Nick Pring and backed by Davidson Kempner and Global Mutual, has secured additional funds to “accelerate” its ambitious expansion plans as it reports record-breaking Ebitda and turnover. The group posted Ebitda of £8.7m for the financial year ending 28 April 2024 – a 26% increase compared with the previous year (2023: £6.4m). The company also reported a 16% rise in turnover to £60.5m (2023: £52.2m) and a 4% increase in like-for-like sales in the period. The 53-strong business – which has a “strong pipeline” of openings for 2025, including The George & Dragon in Wanstead, The London Fields in Hackney and a new site in Covent Garden – has also refinanced with Barclays, increasing its available facilities from £16m to £30m. Urban Pubs & Bars said this enhanced funding will enable the group, which has opened ten new sites in its current financial year, to “seize new opportunities across London’s pub and restaurant market”. Chief financial officer Jim Pickworth said: “Barclays has been a fantastic partner, and we're thrilled to extend our relationship to fuel our future growth. This increased financial flexibility puts us in an excellent position to execute our strategic vision.” It comes as the group also reported a record-breaking Christmas trading period, which saw a 16% surge in like-for-like sales in December 2024, with 75% of the estate recording its highest ever sales week. Managing director Chris Hill said: “This has been a landmark year. Our growth is a testament to the hard work and dedication of our team, which continues to deliver exceptional experiences for our customers. From iconic pubs to innovative dining and entertainment concepts, our venues represent the best of what London has to offer. While we remain mindful of economic challenges, our strong trading performance and solid financial foundation give us confidence in our ability to achieve even greater success. With new openings already planned and further opportunities on the horizon, we are excited about what 2025 and beyond will bring.” 

Wingstop UK announces biggest opening pipeline since launch: Wingstop UK, which is backed by US private equity firm Sixth Street, has announced its biggest opening pipeline since launching in the UK in 2018, with more than 20 new sites set to open this year. The 57-strong business has ten new locations confirmed so far, with dine-in restaurants opening in Swansea, Newcastle, Lakeside in Essex, Streatham in south London and Cardigan Fields in Leeds, as well a further delivery kitchen in Brighton, set to open in the first half of the year. The business opened 18 sites across the UK, including the opening of its 50th site, including a flagship site at Westfield Stratford City, the biggest Wingstop worldwide, with more than 160 covers. Chris Sherriff, chief executive at Wingstop UK, said: “2024 has been a landmark year for Wingstop UK, marked by record site openings, a new flagship location and industry accolades. This year, we are poised for even greater growth, with plans to expand into new regions and create hundreds of jobs. There is huge momentum and we can’t wait to bring our flavours to more areas across the UK.” Last month, Propel revealed Sixth Street has agreed to acquire Wingstop UK’s parent company Lemon Pepper Holdings for a price that is believed to be in excess of £400m. The California-based Sixth Street, which also owns the American Wingstop franchisee Far West Services, came out ahead of rival investment firms KKR and TSG Consumer Partners, and Domino’s Pizza Group, in the race to become Wingstop UK’s majority shareholder, and support its continued growth.

Research highlights independents at risk of falling behind in sustainability progress: New research highlights a stark divide between larger hospitality companies and independent operators when it comes to sustainability progress, due to a lack of support. The findings showed while 76% of leaders from larger companies believe their initiatives have significantly reduced their carbon footprint, only 31% of independents feel the same. There is also a clear call for increased government support to help hospitality businesses achieve their sustainability goals, as nearly three quarters (73%) of industry leaders agree grants and subsidies are essential to accelerate progress. The report from foodservice technology provider Nutritics and CGA by NIQ, “Sustainability Matters: What hospitality leaders are planning”, showed the gap stems not from lack of commitment but from differing levels of resources. Dubbed the “green gap”, the report also marked a difference in employee engagement with sustainability, with larger companies twice as a likely as independents to feel they have succeeded in fostering employee involvement. The research also revealed nearly half (47%) agree that staff in their business engage well with sustainability practices – rising to three quarters (75%) of those in charge of bigger businesses with 50-plus sites. Stephen Nolan, chief executive of Nutritics, said; “Leaders across the board agree better government support could play a transformative role in empowering businesses for change, regardless of size. The engagement gap is particularly concerning given the increasing consumer demand for sustainable practices.”

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