Leon to Focus on London, Stations, and Airports to Revive Fortunes, Boss Says
Fast-food chain Leon is shifting its strategy, prioritizing locations in service stations, airports, and train stations as it prepares to close 20 of its High Street outlets. Company co-founder John Vincent outlined the challenges facing the business, emphasizing that rising business rates and overall operational costs have rendered High Street locations less profitable.
Highlights of the Current Situation
– Financial Losses: Leon has been facing annual losses of £10 million.
– Restructuring Efforts: Following a recent administration appointment, the company is overhauling its 71 restaurants, which employ about 1,000 people.
– Government Support: The government is launching a support package aimed at helping hospitality businesses manage increasing costs.
– Increased Costs: Vincent noted that upcoming tax rises are “incredibly toxic” for the hospitality sector. He warned that if taxes rise further, only lower-quality food providers may survive.
Upcoming Changes in the Market
– End of Business Rates Relief: The relief that had been in effect during the pandemic will terminate in April, coinciding with new rateable value increases.
– Treasury Support: While the Treasury is pledging £4.3 billion in support for pubs, it has faced criticism for not including other hospitality businesses.
Refocusing on Quality and Locations
Vincent believes Leon has strayed from its foundational goal of providing quality fast food for everyone. Initially, the menu featured healthier options like meatballs and superfood salads during a time when traditional fast food was dominated by less nutritious choices. He expressed concerns that after the 2021 sale of the company, Leon lost chutzpah, leadership, and confidence, leading to unclear brand messaging.
Plans for Revitalization
– Location Strategy: With the closure of non-London locations, Vincent acknowledges that while running a business in the capital is costly due to high rents, airports can provide viable alternatives despite taking a significant cut of revenue.
– Menu Simplification: Plans for menu adjustments are underway, aiming to return to Leon’s roots by focusing on quality and accessibility. Vincent stressed, “We were always about the best food for the most people,” distancing the brand from the premium trend in fast food.
Conclusion
Leon’s renewed focus on London and strategically significant locations like service stations and airports aims to reinvigorate its brand and financial health. As it navigates a challenging economic landscape, Vincent’s commitment to returning to the brand’s original mission may prove crucial in restoring its reputation and profitability in the fast food sector.