Former Pizza Express boss David Page has built his career on the increase in the number of people eating out, but now he says Britain has too many restaurants.
He observes the ‘Armageddon’ in the hospitality industry and says that 30 percent of restaurants in the UK will never reopen after the coronavirus crisis – and applauds the idea of converting dozens of high street shopping into housing.
Despite taking advantage of Pizza Express’s ‘golden period’ of expansion in the post-recession of the early 1990s, he says fewer chain restaurants in Britain’s ailing high street would be ‘absolutely brilliant’, and now no single chain should have more than 170 locations.
Opportunity: David Page hopes to create sites for bargain prices
Focusing on the plethora of soulless chains that have sprung up like mushrooms in the UK since the millennium, he says, ‘You need restaurants interspersed with residences, not huge zoning in a restaurant strip or a shopping strip.’
Last week, Pizza Express joined the long list of casual food chains sunk by Covid when it announced it would put its UK business up for sale and close about 15 percent, or 67, of its restaurants.
Page, who left when the chain was bought by private equity firm TDR Capital in 2003, calls the news “ very sad, ” but says the demise of the debt-laden group, now owned by Chinese private equity firm Hony Capital. could have been avoided by a more careful expansion. “It’s not their fault,” he says. “But they should have seen it coming.”
He adds, “When we were building Pizza Express, there was no competition. So we kept the product simple, and we could be on any shopping street and be very popular and very busy. It was the best thing since sliced bread. But then Café Rouge opened in 1989, and then everyone else opened too – and yet Pizza Express kept expanding. ‘
Page also attacks the private equity ownership model of casual food chains such as Café Rouge, Byron Burger and Zizzi, which he said allowed venture capitalists with ‘no experience working in restaurants’ to pursue debt-induced over-expansion to squeeze out short-term profits. .
I’ve never known anything like it
“These guys see that something is successful, so they invest a few hundred million pounds in restaurants and don’t really know what they own,” he says. “Then they throw in money to expand, and then they start getting involved – and they don’t really know what they’re talking about.”
He adds, ‘She [private equity] wouldn’t spend less than £ 70 per person on a meal so wouldn’t even want to eat in the restaurants they own. That’s negative I would say. ‘
Page is one of the most seasoned operators in the restaurant industry with 40 years of deals to his credit. After building the largest franchise at Pizza Express in the run-up to its 1993 IPO, he made millions building and selling Bombay Bicycle Club and Gourmet Burger Kitchen. “The restaurant industry is good for me,” says Page.
He now runs the AIM-listed restaurant group Fulham Shore, which owns the restaurants Franco Manca and The Real Greek.
In demand: sales at pizza chain Franco Manca rose by 30 percent last week compared to last August
While the rivals are struggling, Fulham Shore had record sales last week in the 64 locations it has reopened since the lockdown, boosted by the Chancellor’s Eat Out to Help Out discount scheme for meals between Monday and Wednesday in August.
Sales at pizza chain Franco Manca were up 30 percent in the first three days of last week compared to last August, and sales at The Real Greek were up 48 percent.
“I’ve never known anything like it in forty years,” says Page. “It was the most amazing three days I’ve ever been in restaurants.”
The requirement allowed Page to take all of its 1,100 restaurant staff off leave – “that was probably the purpose of the drill as far as the government was concerned” – and take on ten new staff at two locations in Reading.
“Rishi has been very busy,” said Page, who plans to continue the cut on his own in September if the government does not renew the action. “I’ve never been in a company that effectively delivered 50 percent more customers in a week.”
David Page, 68: Loves to play the fool
Family: Married to Andrea, a children’s book writer. He has four children from his first marriage and two stepchildren.
Lives: Wandsworth, South West London, with a holiday home north of Toulouse in the South of France.
Harrison Ford in The Fugitive
School: Wimbledon College high school, who expelled Page at age 17 for truancy and smoking, along with three other boys, one of whom is now recovering the Queen’s photos.
Restaurant career: Led the largest Pizza Express franchise until 1993 before becoming CEO and Chairman. Left in 2003 and co-founded Clapham House, which owned Gourmet Burger Kitchen and the Bombay Bicycle Club. Now chairman of investment firm Fulham Shore, owner of Franco Manca and The Real Greek.
Hobbies: Playing the fool with his four grandchildren.
Favorite movie: The Fugitive (above).
Favorite song: Gloria, by The Cadillacs.
Favorite book: Slaughterhouse-Five, by Kurt Vonnegut.
Before the pandemic, Page had planned to open up to ten restaurants next year, and now sees an opportunity to discover sites shut down by bankruptcy chains at bargain prices.
Before the crisis, it cost £ 650,000 to open a Franco Manca restaurant, but Page says he could now take over locations for as little as £ 200,000 as they are already set up as restaurants.
“Six months ago, we should have paid premiums and invested capital into furnishing – but now we can walk into these stores because the previous tenants did CVAs or administration,” he says.
His targets are Carluccio’s in a shopping center near Windsor, and central London locations on Kensington High Street, Parsons Green and Borough Market. ‘We watch them all: the Byron Burgers, Carluccio’s, Prezzo, Le Pain Quotidien. There are so many sites available. ‘
Once Pizza Express has confirmed which UK restaurants will be closing, it says they could also be ripe to take over.
Some wouldn’t eat in their own restaurants
In the new, down-to-earth climate, growth will be controlled to avoid over-expansion in the wrong locations – and he’s taking a tough stance when negotiating rents.
“The problem with many of these locations is whether the landlord has finally gotten to grips with accepting less rent than they used to,” he says. ‘Commercial rents can potentially halve.’
Page, 68, spends August at his holiday home near Toulouse, where he grows figs and peaches with his second wife Andrea.
Last Thursday, Fulham Shore announced a fund-raising campaign at the exchange – sparking teasing from Page’s friend Tim Martin, the founder of pub group Wetherspoons, who called Page a ‘virtual boss’ for running his business from the South of France.
Page’s friend Tim Martin, the founder of pub group Wetherspoons, called Page a ‘virtual boss’ for running his business from the South of France
Page finds Martin’s banter very funny and says the fundraiser is a ‘buffer’ as he expects Fulham Shore to make a profit of £ 8.3 million for the year to the end of March and even be in the black for the six months from April 1. until the end of September, for a three-month lockdown.
He says the new £ 18m capital raised by increasing bank debt to £ 25.8m and a £ 2.25m share sale supported by Page and other management, including restaurateur Des Gunewardena, will be ‘defensive’ if there is a second or third wave, and “offensive” to fund growth if the virus withdraws.
Page says, ‘We’ll take a look at Christmas. If the business is doing so well, we’ll hit the expand button again because we’ve got the money. ‘
Looking back on his four decades in the restaurant industry after starting potty washing at Pizza Express on Wimbledon High Street, Page has one major regret: not supporting Deliveroo.
He was offered a 20 percent stake in the restaurant delivery business for £ 200,000 about five years ago, but turned it down thinking the concept would ‘never work’.
“Deliveroo is now worth about $ 2 billion,” he says, bursting out laughing. ‘That was a disaster. I should have a ‘mug’ on my forehead. ‘
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