The Individual Restaurant Company, owners of Piccolino, Restaurant Bar & Grill, Bank Restaurants and Zinc Bar & Grill, will open four new restaurants this year. Are they bucking the trend of the recession? Heather Gibson met with Iain Donald, Operations Director, to find out
“The biggest challenge for our business is that people perceive us to be a chain restaurant, when, in fact, we want to differentiate ourselves from this market. Our aim is to apply the principles of a stand-alone, fine-dining establishment into all of our restaurants. However, we strive to maintain what I call a ‘chain mentality’ behind the scenes as this provides the discipline to ensure we can operate a business with 35 restaurants or 70 restaurants. Piccolino is the brand most often thought of as a chain, however, it’s not a cookie-cutter business and we continually try to break the boundaries.”
Founded in 1999, the Individual Restaurant Company (IRC) operates 34 restaurants in two main formats: the Italian Piccolino, which comprises the majority of its portfolio, and the Zinc, Bank and Restaurant Bar & Grill concepts (collectively referred to as Bar & Grill). Last year the Group reported that revenue had increased by 17% and, while their pre-tax profits fell by 55% to £1.15 million, the company’s preferred profit measure (which adds back pre-opening costs) increased by 6% to £10.2 million.
As we meet, Aaron Craze has just been appointed as Development Chef for Piccolino, to be based in its Product Development Centre. Aaron was Jamie Oliver’s protégé at Fifteen and operated his Essex pub The Cock, most recently appearing in programmes such as Market Kitchen. According to Iain, the appointment is a demonstration of what he calls “the relentless pursuit of differentiation by the IRC leadership team”.
Iain continues: “We also have a Development Chef for Bar & Grill whose role is to inspire the business. For example, a tandoori concept is being trialled in Bar & Grill at the moment. For me, it is about ensuring that we reflect market trends. Aaron’s appointment is a major coup and really reflects our desire to work with the ‘top of the pops’ of people in the industry.” With confirmation that the business will open four new sites this year, I am interested to hear Iain’s views on whether IRC is bucking the trend of the recession. Iain confirms that the business is taking a prudent view as to further expansion beyond those where leases are already signed. The business has deliberately focused on cost control rather than initiating discounting practices, which appear to be everywhere at this moment in time.
One of IRC’s interesting responses to the downturn has been to take pizzas off some of the menus. With other restaurant chains developing business streams through discount offers, it’s part of a deliberate strategy to differentiate the restaurants and position IRC for an upward cycle.
“In the past 10 years there have been numerous Italian restaurant brands enter the market and we are actually in the slipstream of that business. This means there might be a tendency to be benchmarked to the same type of customer base. However, we are not a Pizza Express, for example, so we have decided to make our menu smaller, remove some commodities and look at repositioning ourselves. How many people know we actually produce fresh food in all our restaurants? There is a real point of difference with our brands and ensuring we are not buttonholed is our biggest single challenge, and it is a slow process.”
Though the business is not currently planning to introduce any new restaurant concepts, it does see great potential in the growth of its Bar & Grill brand. Of the 34 restaurants currently operated by IRC, 23 are Piccolinos. Iain comments that at one point Chief Executive Steven Walker had challenged him to move to a single brand and sell Bar & Grill, but the decision was made to stick with both formats. “Bar & Grill has evolved in its product offering and we are now seeing great success, which is very important. There will be a new Bar & Grill in the City this year. We have made a conscious decision to stay focused on our two existing formats; it can be easy to be tempted to try new things.”
Few operators would disagree that keeping an eye on current trends is central to the evolution of a business. However, the IRC business has the capacity to leverage flexibility in its offer, while remaining disciplined in its process behind the scenes. As with so many successful organisations, this often reflects a strong combination at the top of a business. In IRC’s case, Chief Executive Steven Walker is a 39-year-old former stockbroker who has owned a number of successful businesses in the retail and leisure sector, including The Roberts Food Groups. Having commenced his own career as a chef, Iain has worked both in luxury hotels such as Gleneagles and The Dorchester, and airport catering with Scandinavian Service Partner (SSP). Prior to joining IRC he had developed his profile by growing the Est Est Est chain of Italian restaurants, which is part of the Living Ventures Group. Iain believes that Steven’s background has enabled the business to apply retail processes, particularly from an F&B perspective, while his own passion for food and travel is central to the philosophy. Having spent his career in operational roles, Iain now remains committed to looking at what is happening in the industry to ensure the business does not become introverted.
“We continually challenge each other, which creates the drive and focus of the business. This flows to every level of our team.
“It’s fair to say that there was more ‘perspiration than inspiration’ earlier on in my career; but you have to do the first part to enjoy the second. I can be quite analytical in looking at new areas where we want to do business and look at all aspects of what is happening in the industry.
“We have never been big at selling ourselves. When we get endorsement from industry peers, it is quite important. As a business that started out being based
in the north of England, we have since expanded further south. Businesses have the same problems whether they are northern-based or southern-based,
yet you have to spend time in the areas to effectively understand the needs of your local customer base. We are finding that what might work in the north has
to subtly change in philosophy to meet what the consumer wants in the south, and vice versa.”
When we first meet in the Heddon Street Piccolino, Iain is commenting on a newsletter produced by the Union Square Café in New York, which, among other things, shares what it has learnt from surviving previous recessions. “Life is short. No recession warrants wasting precious time,” is one such item. He regards some of the philosophies as similar to those shaping the IRC value set.
“There is not really an agenda at the moment apart from how we can improve the business for our customers. Fortuitously, the current climate is allowing us to get back to our knitting. The truth is we are now looking for further differentiation and at what we are doing to meet the next challenge. Our evolution hasn’t really started.”