The Restaurant Group (TRG), which owns Wagamama, Frankie & Benny’s and Chiquito has announced the closure of up to 35 sites across the UK.
Each of the restaurants earmarked for closure are loss-making, and will close over the next three years, the group says. It is thought that the move is in response to increased pressures on hospitality businesses post-Covid, including rising rent prices; increased costs tied up in energy, wages and ingredients; and a slow in diners eating out as a result of the cost of living crisis.
Overall, the closures will account for the loss of up to 30% of the group’s overall sites by 2024 – reducing the current number of 116 restaurants to around 75-85.
Despite the news, Chief executive Andy Hornby remains positive, saying the brand has had a ‘strong operating performance’ this year, adding: 'Current trading has been very encouraging to the great credit of our teams who continue to ensure our customers receive the best experience possible.
'We have a clear plan to increase... margins over the next three years and deliver significant value for all our stakeholders.'
This isn't the first time the group has had to reduce its market-share of the casual dining industry. In 2020 TRG announced plans to close up to 90 of its top restaurant sites across the UK by the end of the following year. At the time, it revealed that at least 31 sites within its portfolio would not see their contract renewed with potential for that number to rise based on further discussions with landlords. It also planned to do away with 35 other sites, sell 12 of its freeholds and convert 12 of its lower-performing restaurants into more profitable Wagamama branches.
The move was another casualty for the casual dining industry back in 2020, which saw Jamie’s Italian go under the previous year.
TRG was boosted by the acquisition of Wagamama in October 2018 which saw its sales soar by 56.4 per cent, however its unprofitable leisure restaurants weighed it down in the aftermath resulting in a £37.3m pre-tax loss for the year, compared to a £13.9m loss in 2018.
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