The Restaurant Group (TRG) has begun price and menu trials across Frankie & Benny’s – and indicated that it will take some similar measures to boost some of its other brands.
TRG said last year that it was looking closely at Frankie & Benny’s business model in a bid to make the brand more relevant in today’s competitive market place.
It admitted at the time that the chain’s performance had suffered due to insufficient focus on value, unsuccessful menu development and poor operational execution.
And it confirmed this morning that steps to improve its position are underway. “As presented at our Interim results, we have started price and menu trials across Frankie & Benny’s, which confirm that substantial price and proposition changes are required,” it said. “Our strategic review of our other Leisure brands has revealed a need for similarly significant change.”
A post-close trading update issued by the group, which runs more than 500 restaurants, said that total turnover for the past 12 months is up almost 4% to £711m, but on a like-for-like basis it has declined 4%. In the period the group closed 37 sites and opened 24 sites.
“Recent trading continues to be challenging, with 2016 quarter four like-for-like sales down 5.9%, driven by underperformance across our Leisure brands,” it said.
TRG said it was now at the beginning of a “transformation programme” focused on ensuring it is competitive on value and service. Its aim is to build a better business which is leaner, faster and more focused, it said.
“We expect the trading performance of the business in the first half of 2017 to remain difficult, but anticipate momentum improving towards the end of this transitional year as our initiatives start to take effect,” it said.
“During 2017, the Group will also face well documented external cost pressures from the increases in the National Living Wage, the National Minimum Wage, the Apprenticeship Levy, the revaluation of business rates, higher energy taxes and increased purchasing costs due to the combined effects of a devalued pound, and commodity inflation.”