Restaurant operator Fulham Shore was incorporated three years ago to tap into potentially attractive investment opportunities within the restaurant and foodservice sectors in the UK. Its latest agreement transports it into the charcoal grill market, as FEJ reports.
For a company with a mission to grab a larger share of the ever-expanding London dining scene, diversification was always likely to be a major part of Fulham Shore’s strategy.
Last year the business opened one new outlet of The Real Greek restaurant and six branches of Franco Manco pizzerias, all in London, but it’s the franchise agreement with Bukowski that arguably provides it with the biggest reason to get excited. Bukowski, which currently has two restaurants in London at Brixton Market and Shoreditch, specialises in food cooked on a Josper charcoal grill and will extend Fulham Shore’s presence into a new sector of the market.
The company holds a 15-year lease on a site in Soho that will now be used to open the third Bukowski restaurant. Fit-out of the site is expected to commence shortly, with the franchise restaurant expected to begin trading in early 2016. Total installation costs are expected to be around £500,000.
Fulham Shore will pay Bukowski an upfront franchise fee of £8,500 and an ongoing franchise royalty calculated at the rate of 5% of the restaurant’s revenue. The agreement is for an initial period of three years.
“We are thrilled to be opening a Bukowski in Soho,” says David Page, executive chairman of Fulham Shore. “Bukowski sells great breakfasts, burgers, ribs and steak accompanied by delicious beer and wine. This three-year franchise agreement will add to Fulham Shore’s exposure to, and knowledge of, the thriving London market.”
Meanwhile, Fulham Shore will be responsible for sourcing and purchasing relevant ingredients and prepared products for the restaurant at an agreed price from Bukowski’s central kitchen. In addition, through Fulham Shore’s existing third party supply arrangements, Bukowski’s central kitchen will now prepare and supply certain ingredients to Fulham Shore’s chain of Franco Manca restaurants at an agreed price. It is anticipated that the value of these ingredients will initially be around £200,000 per annum, the company said.
This three-year franchise agreement will add to Fulham Shore’s exposure to, and knowledge of, the exciting and thriving London restaurant market”
Fulham Shore and Bukowski know each other well. David Page and Nabil Mankarious, both of whom are directors of Fulham Shore, are both significant shareholders in Bukowski Ltd (holding between them 31.6% of Bukowski’s issued share capital) and Nabil Mankarious is a director of Bukowski.
The deal will extend Fulham Shore’s restaurant portfolio, which presently comprises 26 restaurants made up of nine The Real Greek stores and 17 Franco Manca stores. Latest available results show the company made sales of £8.3m for the nine months to the end of March 2015, almost the same amount as it took them a year12 months to make the year before, while nine-month operating profits reached £790,000.
The company’s directors will point to this as evidence that with their collective experience in the restaurant sector they can create a profitable and sustainable business. Investors will be watching keenly to see if they can repeat the trick with Bukowski.
Profile: Bukowski Grill
Bukowski Grill opened four years ago and was a collaboration between Robin Freeman, ex-head chef at Blacks, the Soho private members club, and Giuseppe Mascoli, Blacks’ former owner and founder of Franco Manca. Inspired by the American diner, its menu showcases carefully-sourced British produce cooked over charcoal in a Josper oven.
The first site, located in BoxPark, Shoreditch, focused on hamburgers with all condiments being made in-house. Adventurous toppings became a Bukowski trademark. A larger second site in Brixton Market opened in 2012, offering the chance to extend the diner concept to include dishes like 72 hour-cooked beef short ribs with tobacco onions. The next site that it plans to launch, in Soho’s D’Arblay Street, will offer an extended all-day menu.