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An article in Peach Report last week documented that pub and restaurant groups in Britain have enjoyed a successful start to the year so far. According to the latest Coffer Peach Business Tracker, collective like-for-like sales were up 7.2% year-on-year in January and total sales, including the impact of new openings, were ahead 10.1%.
Tales of retailer expansion and new openings have been prominent in the news so far in 2014…
• Dim Sum eatery, Ping Pong, has unveiled plans to open another 20-25 sites in and outside of the capital over the next four years, as part of their organic growth plans. Currently their 8 sites are all in London, with a ninth due to open at Westfield Stratford shopping centre in March and their first outside the capital expected to open in 2015.
• Thai restaurant group Busaba Eathai confirmed plans to double its estate in the next three years, with a focus on expanding beyond London into other key cities including Manchester, Liverpool, Leeds and Bristol.
• Peace Dining Corporation has announced their launch of Japanese fast-casual restaurant, Hai Street Kitchen & Co, in the UK this March. The brand is launching at a site in London’s Leadenhall Market, with plans to open a further 2 outlets in the capital this year and reach 20 UK sites by the end of 2020.
• London-based bar operator Adventure Bars is launching a pilot Caribbean themed dining venue, Dub Jam, in Covent Garden next month, with plans to opening more, larger venues in the future.
• Restaurant chain Giraffe is to open the first of a new brand of ‘grab-and-go’ outlets at King’s Cross Square in London this month. The new Kiosk site follows their launch of fast-food offering Giraffe Stop at King’s Cross Station last year, and will offer quick service casual dining. The chain has plans to open further kiosk sites around the UK, as well as larger Stop sites at various key travel hubs.
FSP see this growth as an optimistic sign for UK retailing centres more widely: a sign of increasing offerings for shoppers beyond the retailers themselves. Looking at the longer term trend in this sector, collective like-for-like sales for pub, restaurant and bar groups were 2.4% ahead of the previous year for the 12 months up to the end of January.
A word of warning: as Food and Beverage retailers expand, they need to be aware of challenges and potential risks. Ping Pong, for example, are taking great care in finding new locations as they are using organic growth rather than financial investment, they need to choose locations carefully in order to make sure they will be successful. Looking at geographical areas which match their demographics is the right starting point, and choosing the right site within those areas will be equally important. While this is essential for Ping Pong, all retailers should choose locations which are ideal for them and their customers, rather than which seem to be the most mainstream or generally popular, in order to maximise their chances of successful expansion. FSP’s consultancy can advise on a retailer’s location strategy and help identify trading potential of new sites.
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