ROO, McDonald’s, tips, service sector, delivery, strikes, WFH & other:

A DAY IN THE LIFE:

I’ve taken a real dislike to that dry, dusty ink that you get in printers.

You know, the sort that needs to be heated up in order to bond with paper because, though heat may be necessary in some situations, the ink does a pretty good job of sticking to work shirts, light coloured trousers and other clothing under pretty much any and all circumstances.

And, if you get a paper jam and are asked to ‘open front cover’ or ‘rake around like an idiot for a few minutes with your bare hands to find the sheet of paper that somehow has a staple in it’ you’re almost bound to get the ink on you and then you only have to scratch your nose, rub your eyes and pat your pockets looking for a pen and you’re Coco the Clown for the rest of the day.

Maybe I should sue.

Either that, cancel all subsequent meetings or only clear paper jams in the evening. On to the news:

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PUBS & RESTAURANTS:

Tips:

Ping Pong, a London dim sum chain, has replaced its service charge with a discretionary 15% ‘brand charge’ to support wage increases for its restaurant teams, starting from April 1st. The decision to remove the service charge was influenced by upcoming tipping legislation in July, which requires hospitality businesses to pay staff all tips left to them. The company stated that this change aims to ensure employees receive wages comparable to those from service charge distribution, with the starting rate set at £12.44 per hour….

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Services sector:

S&P yesterday updated on the UK service sector, by far the largest contributor to GDP in the UK, saying that ‘March data pointed to a solid increase in business activity…which extended the current period of expansion to five months’. S&P says there has been something of a ‘loss of momentum since February, largely due to a weaker rise in new work’. S&P’s measure was 53.1 in March, down from 53.8 in February. Any number over 50.0 implies expansion…

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Tube strikes.

Strikes due to take place from Monday have been called off. ASLEF had planned two strikes for 8 April and 4 May. The union reports ‘after a series of meetings at ACAS, our negotiating team has received a proposal that resolves the key issues in our dispute….’

TV chef Tom Kerridge as been quoted as warning that almost every UK food business was now on the brink of going bust – including his own Michelin-starred outlet….

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Delivery:

Lumina Intelligence’s UK Foodservice Delivery Report 2024 reports that the foodservice delivery market is projected to grow by +2.8% in 2024, reaching a value of £14.1bn….

And takeaway food:

A study by the Institute for Fiscal Studies suggests that Britain’s appetite for takeaway food, fostered during the peak of the Covid pandemic, has become a lasting habit…

WFH:

Startups.co.uk reports the new Flexible Working bill in the UK, effective April 6, grants workers the right to request flexible arrangements from their first day on the job, marking a significant shift in workplace dynamics….

Food supply uncertainty:

Farmers are urging the government to provide a universal basic income, citing financial struggles exacerbated by delays in post-Brexit agriculture subsidy schemes in England….

THE TREATMENT OF TIPS:

We accept that labour is more expensive and that change is coming via legislation in the summer. But labour is also scarce and it could be choosy. And consumers don’t want to feel that they have been misled. Herewith something that we put out to clients earlier in the week:

Summary: This is a sensitive topic. It has the ability to alienate staff, customers, just about everybody if not handled sensitively. The Tronc, tax treatment and the differences between cash and credit card tips aren’t something that we’ll go into today. But, given the capacity to inflame, we’ll make a few comments on the treatment of service charges – particularly in the face of back to back c10% increases in the NLW.

Some work-arounds: Companies could take some of the tip-jar to…

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COMPANY NEWS:

Deliveroo has announced that all of its B shares will ‘automatically convert into A Ordinary Shares of £0.005 each of equivalent number at 11.59 pm on 7 April 2024.’ It says that following this conversion, the Company ‘will therefore have one class of shares in issue, being Ordinary Shares of £0.005 each.’ It clarifies the issue, saying ‘each Ordinary Share will have the same rights and will be subject to the same restrictions as those which are attached to each A Ordinary Share immediately prior to the Redesignation’.

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McDonald’s is to buy 225 restaurants from its franchisee in Israel of more than 30yrs, Alonyal Limited. Alonyal says ‘we’ve grown the brand to be the leading and most successful restaurant chain in Israel and are grateful to our management, employees, suppliers, and customers who made this possible. We are encouraged by what the future holds.’ The terms of the deal were not disclosed.

Smokehouse restaurant Hotbox is seeking to raise £1.5m to fuel its expansion plans…

London-based specialty coffee roaster and café group WatchHouse has opened its first US location on New York’s 5th Avenue….

HOLIDAYS, HOTELS & LEISURE TRAVEL:

The World Travel & Tourism Council has suggested that this year should be a record-breaking one for travel and tourism. It says that revenues from the sector globally should top $11.1 trillion….

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Hilton Worldwide has acquired a majority stake in the parent company of the luxury NoMad Hotel in London, with plans to expand the brand globally. Hilton aims to develop approximately 10 new NoMad projects in the near future, with potential for up to 100 over time, all participating in Hilton’s loyalty program and tech platforms.

The Port Dinorwic Marina has been acquired by The Waterside Consortium after almost one year of administration. Azets administrators facilitated the sale, ensuring trading continuity by securing a loan and engaging Christie & Co. for asset marketing.

OTHER LEISURE:

US rock band Kiss is reported to have sold its back catalogue and its brand to a Swedish music investor for around $300m.

Samsung Electronics has reported profits for Q1 up around 10-fold compared to the same period in the prior year.

FINANCE & MARKETS:

In March, the S&P Global UK PMI Composite Output Index slightly eased to 52.8 from February’s nine-month high of 53.0 but still indicated a solid upturn in private sector business activity….

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Jay Powell reiterated the Federal Reserve’s commitment to data-driven decision-making during his recent speech at Stanford University…

The SMMT has reported that sales of electric cars are failing to grow at the same pace as the wider market as consumers digest recent falls in the value of second hand electric vehicles. Some 15.2% of new cars registered in March were battery electric vehicles, down from 16.2% a year earlier.

The US stock market fell sharply yesterday after comment coming out of the Fed were interpreted as meaning that interest rate cuts could be delayed. Non-farm payroll numbers are to be announced today. Six Fed members gave speeches yesterday. Richmond Fed president Thomas Barkin said it would be ‘smart for the Fed to take time’ before cutting rates….

Sterling weaker at $1.2625 and €1.1659. Oil higher, through the $90 mark at $91.06. UK 10yr gilt yield down 6bps at 4.02%. World markets heading lower yesterday on Fed news and UK set to open down around 85 points as at 6.30am.

RETAIL WITH NICK BUBB:

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