Spirit to restructure in light of falling sales

04 September 2008 by
Spirit to restructure in light of falling sales

Spirit, the managed division at pub giant Punch Taverns, is poised to embark on a wide-ranging restructuring programme in an effort to address falling sales.

The group, which has nearly 900 outlets, is overhauling its operations, marketing and finance functions after it failed to hit its sales budget for the year.

A leaked memo from Mike Tye, the newly appointed managing director of Spirit, revealed the performance of the business was "lagging behind our major competitors and has been for a while".

"We have not achieved our sales budget for the year and when compared against our competitors we are within the bottom quartile," the memo read.

In a statement released to Caterer, Tye said: "Spirit has all the ingredients to become a really great business. The last financial trading year was challenging, and whilst the business has made considerable progress in terms of professional retailing, it has not achieved its true potential.

"To respond to the changing nature of the pub market and the UK business economy, the company has decided to restructure its operations, marketing and finance functions. This will enable us to respond better to our customers' needs and to further drive development of our concepts across the whole of the market."

The memo suggested there would be a reduction in head count across the finance department, and Tye confirmed to Caterer that Spirit would be "taking cost out of the business in recognition of an unacceptably high overhead cost in today's environment".

Under the planned changes, the operations team will be split into five regions: North & Scotland London South West and East. Each regional team will report to one of a new team of regional operations directors. In marketing, Spirit is creating two new roles, drink category manager and head of concepts, while offer managers will be renamed concept managers. In finance, the company is changing a number of reporting lines to speed up the decision-making process.

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By Daniel Thomas

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