ROO, Time Out, MAB, SBUX, taxes, discounts, gambling & other:

A DAY IN THE LIFE:

Whenever I find myself saying ‘tech is great’ I do often find myself adding a ‘but…’

Because there often is a ‘but’ and, when I was up in the North East recently, well, a bit further North East than is usual, at least, I found myself searching for various things; dog-friendly cafes, pubs that were open for food at 4pm and the like and, though I was sure I was enunciating ‘Dunstanburgh’ correctly, I kept getting results for Dunstable.

Hence, after my initial surprise that there were more pubs and restaurants in an uninhabited hamlet than I had expected, I had to remind myself that Dunstable, wonderful though it may be, was 290 miles away and that a takeaway meal that would be ‘ready in ten minutes’ wouldn’t still be very warm if it took me five hours to pick it up.

Still, the above was better than the results I got for Alnmouth because Falmouth, tech tells me, is a full 500 miles and a nine hour drive away.

On to the news:

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PUBS & RESTAURANTS:

Taxes:

Higher taxes generally represent a ‘withdrawal’ from the economy. That is, unless they are taken from people or things that are not inclined to spend and given to people (or things) that are, consumption may fall. In that context, interesting to note that the Institute of Directors is saying that Chancellor Rachel Reeves should raise income tax in order to reduce the fiscal deficit and bolster the Treasury’s credibility in financial markets…

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Discounting:

The MCA comments on discounting in the casual dining market saying that, after peaking in the years after the financial crisis, discounting abated in the run-up to Covid as operators sought to rebuild margin and wean customers off vouchers. However, the MCA maintains that ‘value led offers are reemerging, but the design looks different. The context is affordability rather than oversupply, with operators targeting specific occasions rather than issuing blanket reductions….’

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Other news:

Retail sales: The CBI reports that ‘retail sales volumes continued to decline at a strong pace in the year to September.’ Its latest CBI Distributive Trades Survey reports that ‘annual sales volumes have now fallen for a full year, highlighting the persistently weak demand conditions facing the sector.’

Income levels: The ONS has reported that real terms incomes dropped in the UK last year. City AM interpreted the data as meaning that ‘equivalised original income for UK households dropped by £1,400 in real terms because salaries did not keep up with inflation.’

Taxed Out: UKH is urging hospitality operators to write to their MPs to complain about sector taxation. It says companies and teams can back UKH’s ‘calls for the Government to lower business rates, fix NICs and cut VAT….’

NEW COMPANIES, BUT FEWER OF THEM:

Herewith, a piece that went out to clients last week:

Is there less business activity out there? Prediction is often about looking for lead indicators. Business registrations – and registrations for PAYE and VAT – should give signals as to business activity in the near future. Returning with its ‘Chart of the Week’, the ICAEW asks whether the recent low rate of growth in numbers of businesses registered for PAYE and VAT is linked to the increasing difficulty of doing business in the UK….

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COMPANY NEWS:

M&B shares fell by 22p or 8.5% yesterday on news in the company’s Q4 update that growth had slowed (despite the warm weather) towards the end of the group’s financial year.

Deliveroo has announced that the scheme under which it will be acquired by DoorDash will become effective on 2 October. CEO Will Shu is expected to step down from his role on the same day.

Time Out Group plc has announced that its Time Out Market New York, Union Square opens to the public today. The company reports that this is the ‘Company’s 13th food and cultural market following last week’s opening of Time Out Market Budapest.’ Time Out adds that ‘there are a further four Management Agreements signed which are set to open in 2026 and beyond, with more Markets in advanced negotiations….’

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Pizza Pilgrims is reported to be considering future expansion on the continent with  Germany a potential early target. CEO Gavin Smith said at the National Restaurant, Pub & Bar Show that, if the move were made, it would not be about slavishly following UK standards and partnering with the right people to grow the business would be key.

Flat Iron, which is due to open in Brighton in October and in Bristol in December, is set to open a restaurant in Newcastle next year.

Pizza Hut UK is to tap the value end of the market via the launch of a new £5 range of individually portioned pizzas. The value offers will be launched in YUM’s Pizza Hut restaurants in the UK, the US and in other geographies at the same time.

Starbucks CEO Brian Niccol has written to staff in the US saying ‘while we’re making good progress, there is much more to do to build a better, stronger, and more resilient Starbucks.’ He writes ‘we’re further reducing non-retail headcount and expenses. This includes the difficult decision to eliminate approximately 900 current non-retail partner roles and close many open positions….’

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Compose Coffee, which is owned by Jollibee Group, has now reached some 3000 outlets in South Korea.

Drinks Business reports that ‘investors are contemplating the release of Constellation Brands’ figures next week with some anxiety.’ The group’s shares, which have been a victim of tariff actions by President Donald Trump, are down 40% in the year to date. In the US, Michelob Ultra has just knocked CB’s Modelo Especial off the number one spot for beers.

In the US, Amazon has agreed to pay $2.5bn against claims that it tricked millions of people into enrolling for its Prime service and then made it difficult to cancel. The US government had alleged that practices, such as pop-ups during checkout misled customers into making the purchase….

HOLIDAYS & LEISURE TRAVEL:

Although biometric testing stations will be opened at Eurotunnel, Eurostar and the Port of Dover in around two weeks’ time, The Guardian reports that it could be nine months before the system is fully enforced….

CoStar reports that the Us hotel industry saw critical measures decline in the week to 20 September compared to the same week a year ago. It says that occupancy was 1.1pps lower, ADR was down by 0.3% and REVPAR was some1.4% lower.

OTHER LEISURE:

A group of over 100 MPs has urged chancellor Rachel Reeves to raise taxes on online-gambling firms in order to free up cash to remove the two-child benefit cap. The MPs cited a report by the Institute for Public Policy Research, backed by Gordon Brown, which said that some £3.2 billion could be raised in this way.

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Donald Trump has signed an executive order regarding TikTok, which will allow the US business to continue its operations in the United States. VP JD Vance says the deal values the company at around $14bn…

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In the wake of complaints of long on-line waits and high prices in relation to the Oasis concerts this summer, the Competition and Markets Authority has said that fans will have to be told the range of prices for concert tickets when they join a queue.

The Guardian reports that fake Labubu dolls accounted for 90% of counterfeit toys seized at the UK border this year, with many found to contain banned chemicals or pose choking hazards.

Apple has said that the EU must repeal chunks of its technology legislation otherwise it may stop shipping some products and services to the bloc.

FINANCE & MARKETS:

Reform UK leader Nigel Farage has criticised the Bank of England’s handling of quantitative tightening (QT)…

The ECB has commented on inflation across the Eurozone saying that ‘while overall inflation has normalised and currently lies at the ECB’s 2% medium-term target, food inflation is higher.’ It says ‘to put a meal on the table, consumers pay roughly a third more than before the pandemic.’

GDP growth in the US has been revised up to an annualised rate of 3.8% in the quarter to June, up from its earlier estimate of 3.3%.

US President Donald Trump has announced new tariffs of 100% on branded or patented drug imports from 1 October, unless a company is building a factory in the US. There will also be tariffs of 25% and 50% on heavy-duty trucks and kitchen & bathroom cabinets respectively.

Sterling weaker at $1.3352 and €1.1436. Oil up at $69.58. UK 10 year gilt yield up 10 basis points to new recent records at 4.77%. World markets weaker yesterday but London set to open around 22 points higher as at 6.30am.

RETAIL WITH NICK BUBB:

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