PIZZA Express
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PIZZA Express could become the next iconic chain facing closures as the British high street crisis rages on.

Fears are growing over the future of the pizza restaurant franchise after it emerged owners may not be repaying its full debt. The company is owned by Chinese private equity firm Hony Capital, which is due to repay around £650million over the next three years. But their efforts may fall short, as the total debt accrued by Pizza Express amounts to more than £1billion, according to the group’s 2017 annual report.

Pizza Express faced interest costs of nearly £90million in that year alone, when it lost £28.7million before tax.

And the chain has suffered from the rising cost of food, as well as high rents and business rates, plus increases in national living wage and national minimum wage.

The possible crisis of Pizza Express would be the latest to hit Britain’s High Street.

Among the restaurant chains already suffering losses and closures are Byron Hamburgers, Prezzo and Jaime’s Italian.

And as many as 14 shops are closing every day, according to a report from accountancy firm PwC which spoke of the toughest trading climate the High Street has faced in the past five years.

A staggering 2,692 stores were shut down in the first six months of 2018 alone, with fashion and electrical stores suffering the most.

And the opening of new shops fail to replace the closures, as only 1,569 new stores popped up during the same period.

Across the UK, London is the area hit the hardest by the crisis, while Wales suffered the lowest number of closure.

Lisa Hooker, consumer markets leader at PwC, said: “Looking ahead, the turmoil facing the sector is unlikely to abate.

Related: Fast Food Franchises in the UK – 10 Things Every Would-Be Franchisee Must Know

“Store closures in the second half of the year due to administrations and company voluntary arrangements a form of insolvency already announced will further intensify the situation.”

One of the major triggers of the crisis of the UK’s High Street is the fact that consumers are spending less and prefer shopping on online stores, often cheaper than physical shops.

This left many independent and franchise retailers struggling to pay rents, salaries and business rates.

Chancellor Philip Hammond promised in his 2018 Spring Budget to tackle the problem and help businesses, saying he would reduce the business rates bill of 500,000 small retailers by a third.

But this manoeuvre was deemed unsatisfying by the British Retail Consortium, who said the Mr Hammond was “tinkering around the edges” and called for “wholesale reform” of the business rates system.

Source: Express

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