ANALYSIS: Menu innovation propels Zizzi and ASK Italian’s multimillion pound business

Ask Italian Swindon

Azzurri Group, the owner of ASK Italian and Zizzi, has credited its creativity in the kitchen and willingness to embrace new delivery channels with driving a robust set of annual results that defy the market conditions cited by some market players. FEJ reports.

As the owner of some of the most ubiquitous high street names in the foodservice industry, Azzurri Group remains a bellwether for the multi-site chain market. And if its latest full-year performance is anything to go by then it’s clear that solid growth is still possible with the right strategy. BOX-OUT 1 - Stephen Holmes

Full-year sales at the group climbed 12.5% to £263m for the 12 months to 2 July 2017, while group adjusted EBITDA rose 8.6%. Bosses said the “careful management” of industry-wide cost pressures meant its margin declined only slightly to 14.5%. Flagship brands Zizzi and ASK Italian both delivered their fifth consecutive year of like-for-like and EBITDA growth.

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Azzurri Group CEO, Steve Holmes, says the company’s investment in ensuring that what comes out of its kitchens is fresh and innovative played a significant part in the growth.

We are constantly evolving our menus and introducing new dishes”

“Menu innovation is a key part of our strategy and has been instrumental in us remaining competitive in the market,” he explains. “We are constantly evolving our menus and introducing new dishes so that our offer stays fresh and interesting to consumers and their changing tastes. For example, we have broadened our range of vegan dishes across our brands and introduced a new pizza range in ASK Italian.”

Azzurri Group sales

Holmes adds that takeaway and home delivery was also becoming increasingly important for Azzurri’s brands.

“It is our belief that delivery can fulfil new at-home occasions rather than leading to the cannibalisation of our restaurants,” he explains. “Last year we increased our sales both through Deliveroo and owned channels, and we have since invested significantly in developing state-of-the-art takeaway packaging for Zizzi.”

Azzurri has expanded its estate by 17 new sites over the past 12 months, taking the size of its portfolio to 280 units.

“Investment in our existing estate is fundamental to our strategy and ensures our brands remain relevant in today’s market; 31 sites have undergone refurbishments, which are delivering very strong returns,” says Holmes.

He said that newly-renovated Zizzis, which now comprise just under 40% of the estate, had seen “exceptional returns”, while the transformation of nine ASK Italians to an “evolved look and feel” had gone down well with customers.

Azzurri also owns Coco di Mama, which it said continues to trade successfully. “We have nearly tripled the size of the estate since we acquired the business in 2015, including six new openings last year,” says Holmes.

“As the brand grows, we are focused on developing its proposition; we have refurbished two sites and have improved our pasta and breakfast offering. We have also extended our opening hours to cater for early evening customers. The strength and awareness of Coco di Mama is increasing, and the new openings outside Coco di Mama’s City heartland in Piccadilly and Westminster suggest it has potential for growth beyond London.”

Busiest kitchens in the business

In November last year it launched its new pizzeria brand, Radio Alice. There are now two Radio Alice sites, in Hoxton Square and Clapham, and the concept has been well-received by customers, Holmes insists.

He also remains confident about the group’s prospects for the next 12 months: “Azzurri has begun the new financial year with good momentum and positive trading despite the challenging environment. We see opportunities for all our brands to expand further in the UK, and have a strong pipeline of new sites for the year ahead.”

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