35 of UK’s Top 100 restaurant groups now loss-making – up 75% in just a year

  • Oversaturated market, minimum wage hike put pressure on restaurants
  • Another minimum wage rise just weeks away

35 of the UK’s Top 100 restaurant groups are now loss-making, up 75% from just 20 last year, shows research by UHY Hacker Young, the national accountancy group.
UHY Hacker Young says that trading conditions have become increasingly difficult for restaurant chains dealing with oversaturation in the market as well as rising costs.
The firm adds that this research comes on the back of the high-profile struggles of several major restaurant chains in recent weeks, including:

  • Jamie’s Italian, started by Jamie Oliver, which has closed 12 branches as part of a Company Voluntary Arrangement (CVA) to restructure its £71.5m debt
  • Byron, the burger chain, which may close up to 20 of its 67 branches following a period of paying reduced rent
  • Prezzo, the Italian chain, which is expected to close some of its 300 branches as part of a restructuring
  • Strada, another Italian chain, which closed 11 branches over the festive period
  • Barbecoa, another Jamie Oliver chain, which entered administration in mid-February
  • EAT, the sandwich chain, which was rumoured in early February to be considering closing some of its 100 branches

UHY Hacker Young says that pressures of competing with numerous similar ‘fast casual’ restaurants in an overcrowded high street are a major driver of many large restaurant groups registering losses over the past year.

It adds that the National Minimum wage, which has risen by an above-inflation 19% to £7.50 per hour over the last five years, has added a substantial cost burden to large restaurant chains. From April 2018, the minimum wage will rise even further to £7.83.

Peter Kubik, Partner at UHY Hacker Young, comments: “More than a third of the biggest companies in the restaurant sector are losing money, and there is little respite on the horizon.”

“Pressures on the restaurant sector have been building for years, and the last year has pushed a number of major groups to breaking point.”

“With Brexit hanging over consumers like a dark cloud, restaurants can’t expect a bailout from a surge in discretionary spending.”

“Consumers only have a finite amount of spending power when it comes to eating out, and the oversaturation of the market means that groups that fall foul of changing trends can very easily fail.”

“The Government has ratcheted up costs with a series of above-inflation rises in the minimum wage, and we are just weeks away from another 4.4% rise in April. That will be tough for a lot of restaurants to absorb.”

About UHY Hacker Young:

 The UHY Hacker Young Group is one of the UK’s Top 15 accountancy networks with 110 partners and more than 620 professional staff working from 22 locations around the country. The offices within the Group provide a wide range of accounting, tax and business advisory services, with a reputation for integrity and reliability within the financial community, and particularly with London’s Stock Markets. UHY Hacker Young are also ranked 15th in the ARL Corporate Advisers Rankings Guide amongst other UK audit firms for advising London Stock Exchange listed companies.

UHY Hacker Young is a founder member of the UHY International network with offices in every major financial centre in the world. Further information can be found at www.uhy-uk.com



How restaurants are reacting to Vegetarian Month

March is vegetarian month. Recent news shows that an estimated 29% of evening meals in the UK are vegetarian or vegan. These numbers only seem to be increasing, but just how is the hospitality industry reacting? Wayne Redge reports

Reports show that sales of meat-free ready meals were up by 15% in January compared to 12 months before. Vegan numbers went up from 150,000 in 2006 to 540,000 just a decade later, with 1.2 million vegetarians in addition to this in the UK. Not only that, but there has been an uprising of ‘flexitarians’, those who reduce their meat consumption by choosing to have meat-free days. As a result, evidence shows that 25% of people in Britain have cut back on how much meat they eat. With all of these figures on the rise, the transitions to a meat-free way of living aren’t just a ‘fad’.

Signs of the hospitality industry acknowledging these statistics has come with many different reactions. Nando’s, the Afro-Portuguese chain restaurant known for its chicken, has been consistently adding to its range of vegetarian and vegan options over the past few years. The spiced chicken giant has now announced that two more vegetarian dishes will be added to its menu: golden brown halloumi sticks served with a pot of sweet chilli jam dip to start, alongside a new main of Veggie Cataplana (a South African inspired stew dish.)

A host of vegetarian restaurants are also popping up, giving people who have adopted this lifestyle a lot more options. Run by former mentee of Gordon Ramsay, Minal Patel, “Prashad” is a 2 rosette and Bib Gourmand standard Indian cuisine restaurant. The personalised and crafted menu boards created by Smart Hospitality encase an all vegetarian menu that has been the talk of popular review site, Trip Advisor, since the restaurant opened its doors. Receiving the “Most Talked About Restaurant On Trip Advisor Award” and a “Certificate of Excellence” on the site, it is proof of the popularity that a vegetarian restaurant can receive by focusing its efforts towards a collective audience.

January of this year saw a mass of high-profile restaurants trying out full vegan menus or dishes for ‘Veganuary’. Harvey Nichols brought a full vegan menu to its OXO Tower restaurant in the shape of a three course vegan meal and vegan wine list. Upon opening their menu cover, guests were welcomed by the sights of Grilled Tofu with Miso and a Poached Pear and Blackberry Dessert.


Even Michelin Star chef, Tom Aitken took part in his Tom’s Kitchen restaurant . Teaming up with vegetarian burger company, The Vurger Co, he served up a hoisin glazed mushroom patty with pak choi, red cabbage and crunchy spring onions ( pictured above). Due to the success of this vegan burger, he has adopted a vegetarian burger to his main menu since then.

The amount of vegan festivals has seen a massive increase too, with at least 75 festivals lined up for 2018 in the UK alone. The festivals are a celebration of the natural lifestyle whilst also introducing its participants to new vegan restaurants and foods that they may not have tried before. Restaurants are creating pop ups at these events to promote themselves to the vegan following and gain some new supporters.

So, with the popularity of no-meat lifestyles on the rise, it is clear that restaurants have an opportunity to increase their offerings and enable themselves to appeal to a wider clientele. If 25% of evening meals being eaten are meat free, would restaurants do well to make 25% of their offerings meat free? It might even serve as a cost effective alternative whilst not compromising on quality.

Wayne Redge is marketing assistant, Smart Hospitality Supplies

Single-use plastic-free hotel launches in Bangkok


With over 8 million tonnes of plastic thrown away each year and and the existence of the Great Pacific garbage patch, the world is waking up to the dangers of plastic waste.

Whilst supermarkets plan for plastic free aisles and coffee brands ditch the cup lids, Akaryn Hotel Group plan to become a single-use plastic free hotel group by 2020. The newest opening, akyra TAS Sukhumvit Bangkok, launching May 2018, is set to lead the charge in this initiative.

Effort has been made to source glass bottle containers and there are is no single-use plastic used in the bars. Stainless steel water bottles, which can be refilled anytime during their stay, are handed to guests on arrival. Self-service drinkable water will be conveniently located on every floor. Guests will notice that in the bathroom, toiletry products are presented in locally manufactured celadon containers filled with essential oils-based products. Bio-degradable bin bags are used in room and shopping bags can be borrowed from the wardrobes to encourage guests to refuse plastic bags when out shopping in Bangkok.

akyra_sukhumvit_BSC02886 web res


Why is the casual dining sector in trouble?

Byron is one of a number of casual dining chains that are shrinking their estates

Five years ago, the casual dining sector was booming. Private equity houses were investing large amounts of money into new chains of restaurants which quickly expanded their outlets, for example Byron, the burger chain, was bought for £100m.

Today, the sector is, to say the least, struggling. EAT is the latest brand to announce closures. Byron is going through a restructuring, Jamie’s Italian has entered into a company voluntary arrangement, and Strada is implementing a closure programme.

What has happened to bring about this sudden reversal of fortunes? Roger Gregory, partner at Pitmans Law, has the answers. Read on

Roger Gregory
Partner, Pitmans
D +44 (0)207 634 4634
M +44 (0)774 760 3864
E rgregory@pitmans.com

Pitmans Law is a Business Partner of the Institute of Hospitality.

Food additives are a cause of obesity, says Mike Duckett MBE FIH

Mike Duckett MBE FIH, centre, meets HRH The Prince of Wales

The hospitality industry has a responsibility to promote healthy eating habits, writes Mike Duckett MBE FIH, the ambassador for good hospital food and the former award-winning head of catering at The Royal Brompton Hospital, London.

“I have always worried about the amount of chemical additives added to food during manufacturing and the number of alien ingredients used to extend the colour and the shelf life of food, especially ready frozen meals. I have been very vocal in expressing my concerns which were confirmed recently when I visited the local hospital here in Surrey.

I was disturbed to hear of two eight-year-old boys who were hospitalised with severe pain from type-one diabetes. The senior nurse on duty told me that the main cause was their poor diet and lack of a variety of healthy food.

We therefore as the hospitality fraternity  have a collective responsibility to ensure that the food we serve is healthier.  We should persuade those who manufacture meals to be more aware of the steps needed to reducing high levels of obesity.

Statistics show that we are eating out more regularly and that we tend to eat more in a restaurant than in the home environment. This raises one important question. How safe is it to eat out these days? Recently we have heard that a major meat supplier was told by the FSA to stop supplying, a popular pub chain received a zero rating for hygiene,  and food factories change best before dates on food.  We also hear of customers dying from eating food that cause allergies. It makes you wonder if eating out is taking your life in their hands.

Hospitals, care homes, meals on wheels services and the general public are in the habit of purchasing  ready frozen microwave meals. These meals are high in fat, sugar and salt. Scientists have warned that emulsifiers – the chemicals widely used in processed foods including ice cream, bread and chocolate – may be a key cause of obesity. These emulsifiers are used to make smoother textures in foods such as peanut butter, sausages and mayonnaise. They are understood to be chemically active long after we digest them and they increase hunger and therefore we eat more.

If we are going to take the growing obesity epidemic seriously, we need an urgent look at what is being used in our food manufacturing and in the type of food and ready meals we serve our customers and campaign for the use of fresh local ingredients from as near the point of service as possible.”

Institute of Hospitality Showcases Student Research in New Digest

Digest coverThe Institute of Hospitality has published its inaugural Annual Digest of research by students from universities and colleges that are members of its Education Membership Scheme.

The subjects explored in the research papers include sophisticated menu engineering; the impact of the airbnb on the UK hotel industry; revenue management in ski resorts; and waffleshop franchises.

Alistair Sandall FIH, the Institute’s head of professional development, says: “We thank the students for their submissions to this inaugural Annual Digest. Thanks too must be passed to their lecturers for encouraging them to submit their research. ”

“If through this publication we can bring new insights and ideas into the bright lights and away from university shelves,  hopefully we can help to create closer links and ties between educators and practitioners.”

The following students’ research is showcased in the Digest;

Rosie Magurie, BA Professional Culinary Arts, University of Derby

Haroon Khan Afridi, MSc International Hotel Management, University of Surrey

Mara Leidi, BSc International Hospitality Management, Ecole Hoteliere de Lausanne

Ida Davidsen, UG studies BSc (Hons) Hospitality Leadership and Management, Leeds Beckett University.

The Institute has 75 universities and colleges on its Education Membership Scheme, adding up to more than 3,000 student members across the world.

Download the 2017 Digest Here

Submissions for the 2018 Digest will be open from September with a deadline of 31st October. Full information can be found by downloading the Institute of Hospitality Digest Submission Guidelines.

If you have any queries, please email digest@instituteofhospitality.org

If you would like your college or university to get involved but are not yet members of the Institute, contact the Membership Department on 020 8661 4900 or membership@instituteofhospitality.org




25th Hotel General Managers’ Conference celebrates ‘The Spirit of the Time’

Delegates (2)Over 470 hotel professionals gathered at the De Vere Grand Connaught Rooms, London, on 15 and 16 January for the 25th Hotel General Managers’ Conference. The sold-out event, entitled ‘The Spirit of the Time’, reflected on the past, analysed the present and looked forward to the future of the industry during a programme of expert talks and panel discussions with thought-leaders.

Cyber security

The conference began with CEO & Co-Founder of cyber security platform Trustlight, Oliver Rees, introducing delegates to an era of ‘New Innovators’. Rees shared stories of how companies are engaging with hackers to keep their own cyber security ahead of the game: “When it comes to data security, think about ‘when’, not ‘if’. You need to have a strategy in place to limit the damage and communicate it to customers”. Rees also advised delegates not to be afraid of trial and error with experimenting with technology and to embrace innovation.


The Evolution of Food Panel (2)The Evolution of Food panel discussion was chaired by hospitality consultant Amanda Afiya. Founder of Gorgeous Group Robbie Bargh, Group Operations Director at Marcus Wareing Restaurants, Chantelle Nicolson, and Store Director of Selfridges, David Jarvis, discussed the growing popularity of plant-based diets, meeting changing consumer demands and standing out from the crowd. According to Bargh plant-based diets are here to stay and represent a ‘culture shift’ rather than a trend. Nicolson stated that the “rising costs, uncertainty in the economy and a squeeze on disposable incomes will mean 2018 is one of the toughest for trading” and Jarvis pointed out that “everything nowadays in hospitality can be copied, except your staff and the experience they give”.



The importance of creating a brand was a key focus over the two days. In Revolution Through Revelation, Managing Director of Mixxa Ltd Paul Martin said: “The brand lives in your people and it’s not about what you do but how you do it.” Branding consultant Tim Watson also touched upon this in his session, Why Brand?: “You need to communicate from the inside out, and once you have internal buy in, then you are on your way to being an authentic brand.”

Leadership, performance and mindfulness

Performance coach Nigel Risner inspired delegates with his session on leadership and communication. He suggested that people can be divided into four groups based on their preferred communication style – Lions, Monkeys, Dolphins and Elephants – and asked the audience to decide which animal they are.

Risner also said that people spend too much time talking about what was rather than what will be in meetings, and any meeting should be no longer than 40 minutes.

Olympic Gold Medallist Crista Cullen MBE gave an inspiring presentation about Crista Cullenteamwork. Cullen was a member of the GB Hockey team that made history in the Rio 2016 Olympics. Cullen said: “We invested time in getting to know each other, analysing each of our strengths and weaknesses to understand how we can work together efficiently.” Cullen explained that  honest conversations are what made the team resilient and hungry for the challenge, making them train harder.

In a session about mindfulness, Director at Soul Nutrition, Katie Sheen, shared her tips on how to become more self-aware and how to calm the mind to lower levels of anxiety. “The more positive and self-aware we are, the more resilient we become, and this feeds happiness and innovation” she said.


The Future of Hotel Design panel chaired by SPACE magazine and Hotel Spec Editor Can Faik, discussed whether design is becoming too extreme. When asked where hotels need to begin, Creative Director at HBA London Constantina Tsoutsikou, said: “The lobby is the heart of the hotel so if you want to convey what you’re about, that’s where you start.” Creative Director at David Collins Studio, Simon Rawlings believes there’s a danger that hotels are trying to be and do too many things and forgetting what they do best.


Founder & Chairman of 80 DAYS, Mark Forrester and Co-Founder & CEO of Avvio, Frank Reeves gave two different talks in the Consumer Behaviours in the Digital Age session. Forrester outlined the advantages of using digital benchmarking to get the best understanding of how hotel websites are performing. “For country hotels, there is a conversion rate of 0.49% meaning that out of 200 visitors to your website, only one will make a booking. The conversion rate is nearly double for city hotels at 0.94%.” Reeves followed with a talk on Artificial Intelligence (AI). According to Reeves all hotels of all types must start looking into AI to improve the user experience and convert website visits to bookings.


In a time of adversity and disruption for the industry, the conference programme included a round-up of Everything You (Really Do) Need to Know to continue business. Covering National Minimum Wage, GDPR and the most recent update in licensing, the data and information provided ensured hoteliers were aware of all the legislation to come into place over the next 12 months.

On the evening of Monday 16 January, guests were treated to a Moët & Chandon Sue WilliamsChampagne reception before indulging in a three-course dinner created by Principle London’s Executive Chef Rodger Olsson and his team. The Caterer’s new Editor, Chris Gamm, introduced the Hotelier of the Year winner Sue Williams FIH MI, General Manager of Whatley Manor. Williams urged guests to get behind their teams and inspire the future professionals of the industry. Guests generously took part in a prize draw to raise vital funds for the Master Innholders Charitable Turst, Springboard and Hospitality Action, raising over £10,000. Acclaimed food writer Matthew Fort took to the stage after dinner to share his anecdotes of his time in hospitality.

The two-day event was chaired by Pride of Britain Hotels chief executive Peter Hancock FIH MI on day one and by award-winning photographer and hotel consultant Jeremy Rata FIH MI on day two.

Chairman of the Master Innholders Conference and General Manager of Grosvenor House, A JW Marriott Hotel Stuart Bowery FIH MI concluded the conference by inviting hoteliers to apply for the upcoming Master Innholders accolade and Aspiring Leaders Diploma.

For more information on the Master Innholders, please visit www.masterinnholders.co.uk