Category Archives: Hospitality

Food, Hospitality

The hole story: a history of Dunkin’ Donuts in Britain

Leave a comment

Dunkin’ Donuts has failed in the British market twice. Will it succeed on its third attempt?

1965 – 1968
Dunkin’ Donuts announced plans to establish a chain of 250 shops across Britain in 1965. The first outlet was opened at Ludgate Circus, London in October 1965. The venture was a “flop” according to The Economist, and the operation entered into liquidation in 1968.

1988 – 1999
The second attempt began in 1988. Somewhat frivolously, its British head office was at 48 Carnaby Street, London. Four outlets were opened in the Birmingham area, with a bakery at Leamington Spa. Six Dunkin’ Donuts (including a 24-hour branch in Glasgow) and a bakery in Livingston were established in Scotland. The plan was to open 100 outlets, with a focus on the London area. The outlets and bakeries were all closed down in 1999, after continuously losing money.

During its second attempt, Dunkin’ Donuts was actually owned by a British company, Allied Domecq, which has substantial knowledge of the local property and catering markets, as the owner of J Lyons (including the Wimpy burger chain) and 3,500 pubs.

2013 to present
Dunkin’ Donuts returned to Britain in 2013. Management may have been encouraged by the success of rival doughnut retailer Krispy Kreme. The chairman and chief executive of Dunkin’ Donuts in America is also a Brit. But Krispy Kreme clearly presents itself as a premium priced “treat”, whereas the Dunkin’ Donuts model is more of a value proposition akin to Greggs.

Hospitality

A history of TGI Friday’s in the UK

1 Comment

TGI Friday’s was one of the first American casual dining chains to expand overseas.

Background
Alan Stillman, a perfume salesman, established TGI Friday’s on the east side of Manhattan in 1965. At a time when New York pubs and bars were aimed at men, Stillman made his bar brighter, cleaner and more domestic in order to make it more attractive to women. Stillman recalled, “there were really no good places for singles to hang out. No places where a single girl felt comfortable going into a bar area.” The venue quickly developed a reputation as a singles bar, popular with airline stewardesses and junior executives.

Stillman also pushed the food offering, with large portions at reasonable prices. In the first full year the 60 cover venue took over $500,000.

Stillman soon opened more outlets across New York City.

The flamboyant bartenders became the direct inspiration for the Tom Cruise movie Cocktail (1988), which was filmed in the original Friday’s.

Franchise outlets were opened in the Midwest. The Dallas branch became the most successful restaurant in the chain, with annual sales of $2 million by 1972.

TGI Friday’s became the first chain of themed casual dining restaurants. The restaurant claims to have invented loaded potato skins in 1974, and helped to popularise nachos. From the mid-1980s the business was repositioned from a singles bars to a restaurant.

Whitbread establishes the franchise in Britain
Whitbread had established the Beefeater restaurant chain in Britain in 1974. Eager to replicate its success, Whitbread experimented with a number of new restaurant concepts in the 1980s. A 50 percent stake in the British franchise for Pizza Hut was to prove highly successful from 1982. The franchise for Quick, a Belgian fast food chain, was acquired, but the concept failed.

Whitbread opened the first TGI Friday’s in Britain in Birmingham in 1986. A former Wendy’s in Covent Garden, London was converted in 1987. The site enjoyed a £1 million makeover, and was an exact replica of the American model. By the end of the 1980s further outlets had been established at Fareham, Reading and Cardiff.292px-TGI_Fridays_logo.svg

The chain was an instant success in Britain. Whitbread had insight into the mindset of the British public, and knowledge of the property market.

The Covent Garden site was the busiest TGI Friday’s in the world by 1992, and reputedly the busiest restaurant in Europe. In one week, its 260 seats yielded a turnover of £180,000.

There were 12 sites in Britain by 1993, and the average annual turnover was £2.5 million. According to Sally Dibb and Lyndon Simkin, Friday’s altered the UK dining scene “beyond recognition” due to its vitality, enthusiasm and tight quality control standards. The company hired staff with extrovert personalities, and the restaurants provided a theatrical experience. From the beginning, TGI Friday’s was an early example of a company that tried to be “nice”, to treat its employees fairly and to be a good corporate citizen.

The chain grew to 41 outlets by 2004. At this time, Whitbread indicated that it would divest the business if profits failed to improve. Sales remained disappointing throughout 2005. Whitbread felt that they had grown the chain as much as they could, and sold the chain to the American parent company, Carlson, for £70.4 million in 2007.

Electra Private Equity acquired the business for £99 million in 2014. Electra spun off TGI Friday’s as Hostmore, a listed company, in 2021.

Hospitality

Squaring off: Wendy’s Hamburgers in the UK

Leave a comment

Wendy’s is the third largest hamburger chain in the world. It has failed twice in the British market- will it succeed on its third attempt?

Wendy’s and Grand Metropolitan
Wendy’s entered the British market with a flagship restaurant on Oxford Street in 1980. For trademark reasons it was called Wendy, not Wendy’s. The operation was a joint venture with Grand Metropolitan, a large British hospitality concern. Grand Met was an experienced local operator, having already enjoyed great success with the Berni Inn casual dining chain. Plans were announced to open 500 outlets across Britain, with an over-25s target demographic.

Grand Met exited the joint venture after just six months. Wendy’s International assumed full control of the British operations.

A second outlet was opened on the Strand in 1981.

Wendy expanded to 16 restaurants. However high rental costs at its central London sites, menu problems, and a weak economy left the business struggling to make a profit.

The sites, all of which were located in London and the South East, were sold to Whitbread for £6.8 million in 1986. Whitbread converted the sites into Quick, the Belgian fast food brand, and Pizza Hut outlets.

Denny Lynch, vice president of communications for Wendy’s, explained:

we were doing so well in the US, we just kind of assumed that it would carry over. But it’s a lot harder to do than just putting up a restaurant. It takes a better understanding of the nuances of each one of these countries you’re going into.

Wendy’s returns to the British market
Wendy’s returned for a second attempt at the UK market in 1992. The first two branches were at Shaftesbury Avenue and Oxford Street. Outlets were now branded as “Wendy’s”, and featured salad bars. Sites were concentrated at London and West Yorkshire, with plans to expand to 70 outlets.

There were twelve restaurants by 1996, including eight company-owned and four franchise sites. Wendy’s retreated from the British market for the second time in 2000. Some of its most prominent sites were taken over by McDonald’s, including Oxford Street, Shaftesbury Avenue, York Way near King’s Cross and Briggate in Leeds. Wendy’s blamed high property and operating costs for its failure in the British market.

Wendy’s announces plans to return to Britain
Wendy’s returned to Britain in 2021, with an outlet in Reading.

Hospitality

A lot on their plate: Fatty Arbuckle’s

5 Comments

Fatty Arbuckle’s was one of the largest casual dining chains in Britain during the 1990s.

Pete Shotton (1941 – 2017) and Bill Turner (died 1993), two friends from Liverpool, opened the first Fatty Arbuckle’s outlet in Plymouth in 1983. Shotton had been a member of the Quarrymen alongside John Lennon, later of Beatles fame.

Fatty Arbuckle’s was modelled on American diners, and had a retro Hollywood theme. There was a focus on large portions served on 13-inch plates. The restaurant was named after Roscoe “Fatty” Arbuckle, one of the most successful silent film actors in the 1910s.

A second Fatty Arbuckle’s restaurant was opened in Bournemouth in 1985. Adrian Lee and his wife were appointed managers of the Bournemouth restaurant.

Adrian Lee was promoted to managing director of Fatty Arbuckle’s in 1988.

Bill Turner died in 1993, and Pete Shotton acquired his stake in the business.

Each new Arbuckle’s outlet was to prove an immediate success. Franchise outlets were opened from 1991, which allowed the chain to rapidly expand to 22 restaurants by 1995. Arbuckle’s was the largest American-style restaurant chain in Britain by 1997, with 42 outlets.

Arbuckle’s, with its focus on beef burgers and steaks, was hit hard when a BSE-epidemic struck Britain in 1996. 70 percent of its sales had been burgers. Pete Shotton sold his majority stake in the business to the turnaround experts, Alchemy Partners, for £5 million.

Alchemy was widely credited with reviving the fortunes of Arbuckle’s. More profitable leisure park sites were pursued over high street locations, and the chain peaked with 58 restaurants by 1999. “Fatty” was dropped from the name in order to appeal to health-conscious diners from 2000.

After making heavy losses, Arbuckle’s entered into receivership with debts of £6.8 million in July 2000. The loss-making majority of outlets were immediately closed down.

The brand and ten outlets were acquired by the Noble House Group, headed by investor Robert Breare (1953 – 2013), for a rumoured £1 million. Breare was charismatic; a hyperactive, shambolic and disorganised man, who enjoyed the good life. He was adept at acquiring companies, but lacked managerial skill.

The ten remaining outlets were closed down in 2006. Two former managers acquired the rights to the name and opened a revamped Arbuckle’s at Downham Market in Norfolk from 2008.

The American-style restaurant is still represented in Britain by TGI Friday’s, Frankie & Benny’s and Chiquito (Tex-Mex), but other American-style restaurant chains such as Henry J Bean’s and Old Orleans have since closed down.

Hospitality

On the trail: a history of Slug and Lettuce

Leave a comment

Slug and Lettuce is a British chain of bar restaurants with 70 outlets.

Slug and Lettuce was established by entrepreneur Hugh Corbett (born 1943) in 1985. Corbett brought a degree of trendiness and relative luxury to his pubs, with an increased focus on wine and food. His pubs were all given nonsensical names, which differentiated them from their competitors. Eventually Slug and Lettuce became the standard name. “I wanted a name that would stick in the memory, and Slug and Lettuce certainly does that”, reflected Corbett.

Corbett imitated the stripped-back character of David Bruce’s Firkin pub chain. Bare pine board flooring, no curtains, and large glass windows were the order of the day. This meant that people could look into the pub from the street, and the new light and airy open plan design made the pubs more attractive to women.

Corbett cannily located the first Slug and Lettuce in Islington, which was beginning to undergo gentrification due to its proximity to the newly liberalised City of London.

There were six outlets by 1986.

Slug and Lettuce was sold to David Bruce for £2.25 million in 1992. Bruce began to pursue the relatively untapped female market in earnest, imitating elements of the upmarket Pitcher & Piano chain and increasing the emphasis on food.

Slug and Lettuce underwent another rebranding, aimed at creating an English pub/Continental bar hybrid, in 1995.

Hospitality

The rise and fall of the Little Chef empire (1958 – 2018)

Leave a comment

Little Chef was the largest restaurant chain in Britain with 433 outlets.

The Little Chef concept is developed
Sam Alper (1924 – 2002), a caravan manufacturer, and Peter Merchant, a caterer, had been inspired by diner caravans they had seen in America. They introduced the concept to Britain when they opened the first Little Chef restaurant in 1958.

The first outlets were portable prefabricated roadside snack bars. Outlets could be built, assembled and opened within a matter of hours.

Little Chef was acquired by Trust Houses, a hotel operator, in 1961. Trust Houses announced plans to invest heavily to expand the Little Chef concept.

By 1964 Shell-Mex and BP had discovered that opening Little Chef outlets next to its petrol forecourts helped to boost fuel sales.

Outlets began to be built from brick from 1965. The Little Chef brand guaranteed consistency for weary travellers in unfamiliar locations. There were twelve outlets in 1965, and 28 by the end of 1968.

Trust House Forte expand the business
Trust Houses merged with Forte to form Trust House Forte, a large catering and hotels company, in 1970. The new owner had the necessary funds necessary to roll out a rapid expansion of Little Chef.

As it was difficult to acquire roadside planning permission, Trust House Forte acquired a large number of existing transport cafes, and converted them to the Little Chef format.

A typical Little Chef meal cost 35p in 1972. It was around this time that the “Fat Charlie” logo was introduced.

Due to rapid expansion there were 174 outlets by 1976. Little Chef was the largest restaurant chain in Britain by 1983, with 314 outlets.

In 1986 the Competition Commission found that a significant proportion of customers were locals, not commuting drivers. Little Chef was innovative and forward-thinking, providing high chairs and baby food when most British restaurateurs regarded children as irritants rather than potential customers. Meanwhile, strict roadside planning laws preventing new buildings effectively worked to maintain the company’s monopoly.

Trust House Forte acquired Happy Eater, Little Chef’s only major rival with 90 outlets, in 1986.

Subsequent owners and decline
Little Chef was acquired by Granada, an operator of motorway service stations, in 1996. Granada hiked prices, charging £7.95 for a full English breakfast in 1996! The high prices did not guarantee quality: even the omelettes were frozen and then reheated.

Granada described Little Chef in 1996 as “tired and neglected”. Management Today described the chain in 1997 as “perhaps the most neglected part of the old Forte empire”.

Under Granada the total number of restaurants expanded to 433 (68 of which were Happy Eater outlets) by 1999.  Granada also began to franchise Burger King in some of their existing outlets. Upon conversion, Burger King outlets would see double the turnover of former Little Chefs.

In 2002 Little Chef was serving 30 million people a year.

Little Chef was the first branded roadside restaurant chain in Britain, and had few competitors until the motorway service stations began to improve exponentially in the mid 2000s. They now offer a range of desirable high street brands such as Burger King, W H Smith and M&S Simply Food. Meanwhile McDonald’s have vastly extended their drive-thru presence and offer faster service and lower prices.

In 2013, a Kuwaiti private equity conglomerate acquired the company. In 2014 there were only 72 outlets.

The remaining outlets were sold to Euro Garages in 2017. Euro Garages lost the rights to the Little Chef brand after one year, and all remaining outlets were converted to the EG Diner fascia.