Orchid reports strong food growth
Managed pub company Orchid Group has unveiled a 2.7% increase in like-for-like sales for the 14 weeks to 5 June across all its trading pubs and restaurants.
Orchid, which wants to "aggressively increase" its number of food-led businesses, saw like-for-like food sales rise 5.5% and drink sales 0.6% over the period.
The company has also seen an increase in gross margins, "re-affirming our decision not to enter into a strategy of deep discounting".
Like-for-like sales rose most steeply in invested pubs, reinforcing Orchid's successful 'Project Shine' investment programme. This will see a further 40 businesses invested in this year with capital investment ranging from £10,000 to £250,000.
Examples include: Justinlees in Dalkeith, Modern British, 40% like-for-like growth;
Bold Forester in Southampton, Value Carvery, 49% like-for-like growth; Spyglass Inn Weymouth, Value Carvery, 22% like-for-like growth; Three Nuns in Mirfield, Free House Dining Two for One, 23% like-for-like growth.
Food sales now account for 44% of overall sales compared to 41% in 2009.
Chief executive Rufus Hall said: "With supermarkets using cheap food and drink deals to drive footfall, a clearly defined strategy for driving quality and innovation in food is now more important than ever.
"Instead of reducing dish specification we have actually improved the quality of our food across our entire portfolio whilst either holding or reducing the retail selling price.
"Customers have responded well to this strong stance on reducing the price not the quality, clearly backed up by our strong like-for-like food performance."
Food has always been at the forefront of the Orchid business model and with a recently opened food development kitchen in Warwick, Orchid is now even more committed to driving quality and innovation.
Orchid plans to add another 50 pubs to its portfolio by the end of 2010, with a further 100 following in 2011.
It has acquired four pubs in recent months: the Bread & Cheese, Benfleet, the Snow Goose, Farnborough, the Crown Point, Sevenoaks and the Cock Inn, Wing.
Orchid sees potential for further growth across its carvery (both value and contemporary), Dragon, Free House Dining and Modern British segments.
