Trading has continued to worsen at beleaguered restaurant group PizzaExpress.
In the 14 weeks to 6 April, like-for-like sales at the group’s Pizza Express restaurants in the UK, Ireland and Channel Islands fell by almost 10%, compared with the same period a year earlier.
Like-for-like turnover its Café Pasta and Marzano restaurants fell by 2.2% during the same 14-week period.
PizzaExpress said although it had introduced a number of “operational initiatives”, such as increasing the size of its pizzas, intense competition, coupled with the current economic and political situation continued to delay improvements in sales.
|Pizza Express: sales keep falling|
The company is in the midst of takeover talks and said that costs relating to the bids had risen to £1.5m by 6 April and that it they would continue to increase before the end of the year.
Venice Bidder, a company set up by former PizzaExpress chairman Luke Johnson, tabled a £263m bid for the restaurant group in February. But earlier this month the bid was trumped by venture capitalists Capricorn Ventures International (CVI) and TDR Capital, which offered £278m for the company.
PizzaExpress’s directors have recommended the CVI and TDR bid to shareholders, but a higher competing offer from Johnson has not yet been ruled out.
Talking Point: Why do you think PizzaExpress is performing so badly? Email us your comments and we’ll publish them at the bottom of this article.
Their arrogance in reducing their pizza size and assuming no one would notice or care, instead they voted with their feet. Insistance that, despite levels of experience, all managers spend six months learning how to do the job they are mostly already doing by displacing them in busy restaurants in London. Lack of local knowledge on site selection. Lack of choice on their menus and too slow to react to market forces in their arrogance again. Too driven by share price.
– Brian Cowley
They need to install wood fired ovens.
– Arby Wood
My view is simply the quality of Pizza Express isn’t authentic enough and lacking product creativity. On the other hand, the cutthroat competition out there in the dynamic market posed a direct threat to the company growth strategy. Pizza Express seems to be losing out their market share to the competitors and unable to sustain the level of profitability. In the consumer prospective, I mean in London, there is plenty of good food and high quality restaurants serving competitive similar products, for instance the Ask chain, which is situated in landmark locations like Victoria with its elegant decor and atmosphere that attracts a rather broad business segment with its menu variety and choice.
– Lawrence Ngan, MHCIMA
I can safely say that Pizza Express has never shrunk the size of the pizzas, but only increased the quantity of ingredients added and has in fact recently increased the pizza size significantly. The reputation had by Pizza Express in the past was second to none; the shrinking pizza story must have been invented just to damage the pristine record of excellence that the restaurants held. Bad performance is purely because of executives at head office level, loosing touch of the way a restaurant is run: too many profit-orientated persons wishing only to please shareholders. Communication between outlets and head office is ridiculous, resulting in an old, tired restaurant chain, not serving quality pizza and pasta, but small profits (or losses) to greedy shareholders.
– Anthony (Pizza Express employee)