The Restaurant Group’s shares have dropped 5.4% amid concerns that its struggling restaurants are being outcompeted by branded pub chains like Wetherspoons.
UBS analysts, who compared Frankie & Benny’s’ new menu with that of 20 competitors, have said that the new menu will not be enough to stop sales from dipping. They are also concerned that the menu is too complex, with more than double the number of main courses than competitors’ average.
Although the brand has reduced its prices by 6% on average, chains like Wetherspoons are still roughly 22% cheaper than, UBS analysts believe. The analysts said that the turnaround for Frankie & Benny’s looks challenging based on changes implemented so far.”
UBS said: “A significant value gap remains with the branded pub chains… which we believe limits the ability of the new menu to drive the required footfall increase from the core family value-orientated customer F&B is looking to attract.”
CEO of TGI Fridays, Karen Forrester, revealed how it recently simplified its menu and opened up its kitchens so that guests could trust that food is made fresh, given the substantial size of the menu.