Industry feedback, voids, trading, labour issues, belt-tightening etc.:

A DAY IN THE LIFE:

A bit behind after the long weekend, so just time to say welcome to another short working week, this being one in which we’ll spend our time thinking Tuesday is Monday, Wednesday is Tuesday, etc.

Anyway, Hull City seems determined to a) escape demotion but b) to do it be the narrowest possible, humanly achievable amount. On to the news:

LANGTON EMAIL:

The Free Email is now written in short form. Extended versions of many stories are in the Premium Email. Reply to this email if you would like to upgrade.

See Twitter for in-day comment. Let us know if you would like an example of the Premium Email or to comment on the new format.

Prices for the Premium, unchanged for 2yrs, are £295 for one subscription, £495 for multiple, both plus VAT. Reply to this email to order & request invoice.

Or sign up for easy in, easy out monthly option HERE

PUBS & RESTAURANTS:

Trading:

Feedback welcome on how trading turned out over the long weekend.

CGA has reported that drink sales dipped in the week to 9 April, despite a strong Saturday. It says ‘on Premise drinks sales were once again just shy of pre-COVID-19 levels last week, with decent weekend trading outweighed by quieter weekdays.’ CGA says that total sales were down 3%. As regards categories, beer sales were down by 5%, cider sales down 11%, soft drink sales down 6% and wine sales were some 13% lower. Spirits sales, however, were up by 13%.

• See premium. Reply to this email to upgrade.

Looking at footfall, Springboard was forecasting for the Easter Weekend, that UK retail footfall would be up by 6.2%. We do not yet have actual data. Springboard says that it expects High Streets to be up by 17% on Saturday ‘supported by the forecast of warm and sunny weather which will draw people to outdoor destinations, and shoppers are likely to head to retail parks to purchase garden products and food and groceries for home entertaining of family and friends.’

Labour:

The UK Home Office has reported that the number of non-EU migrants coming to the UK to work and study rose sharply last year. The number of work-related visas granted was up 25% on 2019 with less than 10% of those going to EU citizens.

In the US, NRN reports that menus have adapted, largely as a result of the problems found in securing labour. It says that they have become smaller and ‘more efficient & flexible’. It says ‘dishes have become simpler, ingredients are being cross-utilized better and local purveyors are appreciated even more.’

CGA & Fourth’s latest Business Leaders’ Survey has suggested that staffing issues still dominate corporate thinking. The survey says around 59% of respondents believe ‘they will recruit at a greater rate than usual this year, a jump of 13 percentage points since the last confidence survey in December.’

• See premium. Reply to this email to upgrade.

The consumer: discretionary spending:

As the price of essentials rises, wages have thus far failed to keep up. there will be, therefore, less money around to spend on non-essential goods & services.

Interest rates, energy, food & fuel prices are rising. Rightmove also claims that tenants are grappling with ‘the most competitive rental market ever recorded’ as the average advertised rent outside London is 10.8% higher than a year ago, increasing average rent to a record £1,088 a month. In London, rents jumped by as much as 14% to an average of £2,193 a month.

Some evidence of belt-tightening: Kantar says it is seeing evidence of consumers cancelling streaming subscriptions as the cost of living crisis begins to be felt.

• See premium. Reply to this email to upgrade.

Covid regs.

The Scottish Government has confirmed that face masks will no longer be required to be worn in hospitality businesses from next week. However, the Government is strongly advising people to continue wearing masks in crowded indoor places and on public transport.

Coffee:

World Coffee Portal’s Project Café Europe 2022 has found that the total market grew 3.2% over the last 12 months to reach 40,675 outlets. The UK remains the largest branded coffee shop market in Europe with 9,540 outlets, ahead of Germany with 5,464 outlets.

WFH.

Cabinet Office Minister Jacob Rees Mogg has called on his colleagues to send a “clear message” to the civil service about returning to the office. Average daily attendance at the office in the week of 4 April was reportedly 44%. The BBC reports that Mr Rees Mogg’s letter says ministers should “review any guidance within your departments that sets an expectation of the minimum number of days in the office per week.”

Vacant space:

See also below. The Daily Mail reports that landlords could be forced to let out empty shops that have been vacant for more than six months. The Mail said that the plan would see local authorities able to force landlords to rent out high street commercial properties through a Compulsory Rental Auction.

GENERAL THOUGHTS: THE RETAIL ENVIRONMENT (1 of 2)…

LDC summarises major changes between H1 and H2 last year.

Introduction:

• Commenting on the retail environment, the Local Data Company reports that voids (as measured by the vacancy rate) have fallen for the first time in a number of years. Retail matters because a) hospitality numbers are included within many of the retail measures referred to by LDC and b) the drawing power of retail (on the high street or in shopping centres & retail parks) is important for the F&B operators that are co-located with it.

• LDC says the move from survival to recovery has continued. It says ‘despite a difficult start to the year [as a result of the Omicron variant] we might conclude that the worst structural effects of the pandemic are behind us.’ It says ‘vacancies and closures varied across regions, categories and location types, but all corners of the sector continue to face challenges.’

• See premium. Reply to this email to upgrade.

COMPANY NEWS:

Sky News has reported that D&D London ‘has asked corporate financiers at Interpath Advisory to launch a sale process.’ It says ‘City sources said that Interpath had been instructed to kick off talks with potential buyers after exclusive talks with Montecito Equity Partners, a little-known investment firm, failed to result in a deal.’ D&D could secure an enterprise valuation in the region of £100m.

Founder of coffee-chain Grind, David Abrahamovitch, has told the Sunday Times that Covid closures has led to the group shrinking down from ten units to eight.

Lavazza has said it expects a challenging 2022 due to raw material price rises after reporting a strong increase in profits for 2021. The company said last year that it expects revenue to rebound in 2021, reaching at least the €2.2bn it achieved in 2019, and continues to look for M&A opportunities.

Joe & The Juice could launch an IPO within 5 years according to its CEO Thomas Nørøxe. The 300-strong chain also unveiled an ambitious ten-year growth plan in the Middle East, aiming to operate 200-300 outlets by the end of the 10 years.

HOLIDAYS & LEISURE TRAVEL:

The Post Office has reported that it is selling foreign currencies to holidaymakers at “far higher levels” than it was pre-pandemic. It may have taken share from other operators. Travel Weekly says ‘purchases of the Croatian kuna are up by 137% for the first quarter of 2022 compared with the same period in 2020.’

The BBC suggests that the cost of living crisis may be beginning to impact demand for staycations. It quotes one holiday park as saying that volumes are up but it has had to drop some prices to fill capacity.

The Jurys Inn hotel brand is to disappear with the 35 units in the UK taking on the Leonardo name. Leonardo, a sister brand, already has 16 hotels in the UK.

Turing to business travel, American Express says that the recovery currently underway should ‘build strong momentum’ during the remainder of this year. It says that transaction volumes are now some 61% of pre-Covid levels.

Whilst the worst fears have not been realised as far as general travel was concerned. Network Rail has advised passengers to travel either side of the long weekend because it is closing parts of the system to carry out engineering works. The transport secretary, Grant Shapps, said in a BBC interview it would be ‘extremely busy on our roads, potentially at our ports, particularly at Dover’.

Travel agents are using the threat of potential price rises due to increasing supply chain costs to encourage clients to secure bookings for this summer and next year.

The Passport Office said that it processed a record 1.03m applications in March, 13% above the previous high in March 2019, with Brits facing a wait of up to 10 weeks for a new passport.

Wizz Air expects to operate 40% more capacity during the peak summer months than the same period in pre-pandemic 2019. Wizz Air expects to report a loss of as much as €652 million for the year to March 31.  

OTHER LEISURE:

Elon Musk has offered to buy Twitter for $54.20 a share, saying he is the right person to ‘unlock’ the social media platform’s ‘extraordinary potential’. The deal would value twitter at around $40bn. Musk said that if his offer was not accepted he would have to reconsider his position as a 9% shareholder of the company. Twitter has responded by introducing a ‘limited-duration shareholder rights plan’., which could function as a poison pill.

Company Rescue reports that the Insolvency Service website reports that The Academy of Live and Recorded Arts has been placed into liquidation. It says this follows winding up orders being made against the company.

FINANCE & MARKETS:

Sterling mixed (since last Thursday) at $1.2999 and €1.2065. Oil around $4 higher at $113.28. UK 10yr gilt yield up 7bps at 1.88%. World markets mixed on Thursday and Friday. London set to open perhaps down 3pts as at yam.

The BCC reports that the proportion of UK exporters reporting increased export sales (29%) was largely unchanged for the 4th quarter running. It says the proportion reporting decreased sales is historically high at 25%, but is also little changed since 1 year ago in Q1 2021.

RETAIL WITH NICK BUBB:

• See premium. Reply to this email to upgrade.