Langton Capital – 2017-03-31 – Price rises, Brewdog, sugar, travel costs & other:
Price rises, Brewdog, sugar, travel costs & other:
A DAY IN THE LIFE:
Struggling to get some admin tasks completed so let’s move straight on to the news:
PUB, RESTAURANT & DRINK PRODUCERS:
• Pernod Ricard has confirmed that it is looking to raise prices in the UK because of the devaluation of the Pound. A spokesperson is quoted as saying ‘this is a commercially sensitive topic and Pernod Ricard is still in the process of negotiating price increases with its customers, so the group is not providing further details on the scale and extent.’
• BrewDog has issued a candid response on its website to the recent stories surrounding trademark protection. While the incident involving The Lone Wolf might have called into question the brewer’s status as an underdog, it is common practice for corporations to protect their intellectual property and Sharon Daboul, trademark attorney at EIP Europe reasons that ‘From BrewDog’s perspective, allowing others to register or use names or insignia in the drinks industry, that consumers identify so strongly with BrewDog’s brand, could muddy the waters and dilute its registered trademark.’
• The ALMR says that, while the pub sector is ‘ready and willing’ to abide by Public Health England’s guidelines on reducing sugar consumption, ‘there is a worry that blanket measures will increase pressures on businesses already working hard to promote healthy lifestyles’.
• The ALMR has responded to the publication of Public Health England’s guidelines on reducing sugar consumption, warning that licensed hospitality venues will be scrutinised and reiterating that the sector is working hard to promote healthy attitudes to food. ALMR Chief Executive Kate Nicholls commented: ‘The ALMR will continue to work closely with PHE to ensure that the efforts of the sector are recognised and will ensure that pubs and restaurants are fully aware of the action they will need to take.’
• Meanwhile, The British Beer & Pub Association (BBPA) Chief Executive, Brigid Simmonds, said: ‘The vast majority of pubs are small independent businesses. For those serving food there is a diverse approach to food preparation and provision and there is therefore typically no such thing as a standard meal. Pubs are already under considerable regulatory and financial pressure and we would be wary of over-regulation in this area.
• Deliveroo has announced the launch of employee gift cards as the group attempts to capitalise on the office lunch trade. The cards will be available next month and will be offered to business customers to be given to employees as a reward.
• Domino’s has announced a new partnership with Starship Technologies for autonomous delivery robots. The concept will be rolled out initially in Hamburg, Germany.
• Research from academics at Cardiff University believe that charging coffee drinkers for their disposable cups could reduce their use by up to 300 million a year in the UK. The most notable finding was that, while a charge on disposable cups increased the use of reusable coffee cups, a discount on reusable coffee cups had no impact on their usage. Prof Poortinga said: ‘There is an important nuance when it comes to financial incentives. People are far more sensitive to losses than to gains when making decisions – so if we really want to change a customer’s behaviour then a charge on a disposable cup is more likely to be effective.’
• Brasserie Bar Co, parent company to Brasserie Blanc and White Brasserie Company, has lined up its first hotel-based site, reports the MCA. The group has signed a deal to operate a site at the Marriott Highcliff Hotel on Bournemouth’s Seafront.
• The ALMR has allayed Brexit fears for the pubs, restaurants and nightclubs industry by working closely with policy-makers to make sure vital access to people and products are secured. Kate Nicholls, Chief Executive of the ALMR said ‘the ALMR has had regular meetings with the Government and been in constant contact to ensure that the voices of pubs and restaurants are heard. The licensed hospitality sector is a crucial employer and we have been making that point to the Government forcefully’.
• The BBPA has welcomed the government’s Great Repeal Bill White Paper and the ‘certainty’ it brings to UK business. CEO Brigid Simmonds commented: ‘The decision to leave the European Union presents the Government with an opportunity to stimulate the brewing sector, by fostering a more competitive rate of tax for beer and pubs, that both supports beer as a low-strength alcoholic option, and supports the pub as a responsible environment for drinking.’ The trade body proposes a raise from its current level of 2.8% to 3.5% ABV, a pub-specific VAT rate of 15%, an export-friendly trade deal, and clarity regarding the status of foreign nationals and their right to remain in the UK.
• The ALMR has highlighted the British Hospitality Association’s report on labour migration as a key tool for the sector in the forthcoming Brexit negotiations. The report outlines how the UK hospitality sector can reduce its dependence on EU migrant employees. The Chief Executive of the ALMR, Kate Nicholls said: ‘ALMR research shows that almost a quarter of the total hospitality and tourism workforce is comprised of non-UK workers, rising to nearly 40% for eating and drinking-out businesses, and almost half of those come from within the EU. If the sector can reduce its reliance on these workers, to some degree, the sense of volatility brought on by the withdrawal will be reduced.’
• Amidst all this uncertainty, it’s a relief to note that at least the Daily Mash is keeping a sense of perspective. Comment here – here
• Amazon has opened first drive-through food stores in Seattle. The service is currently only available to employees but will eventually be rolled out to Amazon Prime members.
HOLIDAYS, LEISURE TRAVEL & HOTEL
• Trump’s revised travel ban has been suspended indefinitely by a US federal Judge in Hawaii. Trump will be barred from enforcing the ban on six mostly muslim nations while Judge Derrick Watson’s ruling stands.
• Brussels Airlines is set to become leading carrier for Thomas Cook Belgium under plans to expand existing partnership. Under the terms of the proposal, Brussels Airlines will fly the majority of Thomas Cook’s customers, offering them a wider choice of destinations, flights and departure days. Subject to completion of the deal, the operations of Thomas Cook Airlines Belgium (TCAB), Thomas Cook’s in-house airline which currently serves the Belgian market, will be absorbed into Brussels Airlines.
• Business travellers have spent as much as £500 over their travel budget as a result of currency fluctuations post-Brexit. While a quarter have managed to avoid exceeding their budgets, and 30 per cent had no budget set, 1 in 3 had exceeded specifically because of fluctuating exchange rates since the referendum last year – with an average overspend of £49.17, per research from the Dynamic Currency Conversion.
• Scottish travel group Minoan is seeking confirmation of Greek media reports that appeals against its long-running plans for a luxury resort development in Crete have been turned down. Gaining the thumbs up would represent the first approval for a major foreign leisure development in Greece for more than 30 years. The 650-room, five-star development is expected to create 1,200 jobs on the island.
• Majorca is expected to be the top foreign beach destination for British holidaymakers this Easter, according to online specialist On the Beach. Chief marketing officer, Alistair Daly, said: ‘Spain is always a popular destination for Brits heading abroad over the Easter period and it’s interesting to see the growing popularity of Majorca, which in the past was generally considered a summer sun destination for British holidaymakers.’
FINANCE & MARKETS:
• Lloyds of London has confirmed that it is to move its EU base from London to Brussels.
• David Davis has said that the UK will be looking at the status of EU citizens in the UK as well as UK citizens overseas. The border with Ireland is also a high priority. A hard border is not deemed desirable but it is not clear how goods & people can be prevented from entering the UK if the border with the south is porous
• David Davis has said that threats to pull out of security cooperation with the EU was not blackmail.
• The US economy grew by an annualised rate of 2.1% in Q4 (up from earlier estimates of 1.9%)
• Brent up a bit at $52.70
• Sterling a little stronger at 1.2483 vs US$ and 1.1693 vs Euro
• UK 10yr gilt rates fall again to 1.12% (was 1.15% yesterday)
• World markets: UK mixed but Europe up yesterday. US higher but Asia mostly down in Friday trading
• House price inflation down to 2% per major lenders. Would have to fall further to enhance affordability when interest rates rise
• Google to get involved with order-ahead tech. Will team with Dunkin’ Donuts to provide mobile ordering by App
• Mobile ordering – click & collect for donuts, coffee, burgers etc. – is fast becoming a thing. Starbucks, McDonald’s & Google now involved
RETAIL NEWS WITH NICK BUBB:
• “The Daily Retailer” is taking a well-earned rest in the US for a few days, but we’ll be back bright and early on Tuesday.