LONDON — If you stand exterior the Bank underground station, within the coronary heart of the monetary middle of Britain, and wish to decide up a fast lunch, inside about 10 minutes you may attain 25 Pret A Manger shops.
Pret, a 37-year-old British sandwich and occasional chain, turned ubiquitous in central London with the mantra “follow the skyscrapers,” serving up London’s harried workplace staff Posh Cheddar & Pickle baguettes and Classic Super Club sandwiches to eat at their keyboards.
This “is the basis of how we built Pret,” mentioned Pano Christou, chief govt of the chain, which was acquired by the meals conglomerate JAB two years in the past. It stretches to New York and Hong Kong, however its roots nonetheless run deep in London, home to greater than 300 of its 533 shops worldwide. Over the years Pret (nobody makes use of its full identify, French for “ready to eat”) has seeped into Britain’s cultural life with traditions like its Christmas sandwich, a part of an annual casual competitors among the many nation’s lunch counters and supermarkets.
But in March, when the coronavirus emptied workplace buildings, Pret’s prospects vanished. Seven months later, they’ve barely returned. And what was Pret’s biggest benefit — its central London stronghold — has all of the sudden change into its largest weak spot.
The pandemic has turned again the clock on Pret’s accounts by a decade. In August, weekly gross sales in Britain had been about 5.5 million kilos ($7.1 million), barely greater than in August 2010, when it had about 150 fewer shops. It has laid off 2,890 folks, a 3rd of its workers. Thousands of those that stay have gone from 35-hour contracts to 28 hours per week.
Pret has change into a logo of the needy metropolis middle struggling with out commuters, and its troubles spawned a flurry of newspaper articles about whether or not folks ought to or shouldn’t “Save Pret.” Photos of high-ranking authorities officers popping in and out of a Pret close to Parliament in July despatched a transparent message about which facet of the argument the federal government was on earlier than it instructed staff to return to their places of work, albeit quickly.
For some corporations, the one response to the pandemic has been to hunker down and attempt to keep away from operating out of money earlier than their prospects can return (think about the airline trade), however others can’t look forward to a return to normalcy as a result of it could by no means come. Pret is among the many corporations compelled to rethink their enterprise as everybody reconsiders private day-to-day routines. The predicament has compelled a profitable firm to enter survival mode, to determine what the workplace lunch is with out the workplace.
And it’s now clearly keen to attempt something.
It needs to promote Pret meals in supermarkets, and has already begun promoting espresso beans on Amazon; it has signed as much as all the main meals supply platforms to take its sandwiches, soups and salads to its work-from-home prospects, and opened a so-called darkish kitchen in North London to arrange its meals strictly for supply, modeled on the success of Sweetgreen and Shake Shack, and hopes to open one other darkish kitchen in both New York or New Jersey quickly; and it’s devising a particular menu of sizzling night meals for supply, similar to a Chipotle Chicken Burrito Bowl.
Then there’s the espresso subscription, an effort to drive folks again to the shops: Five drinks a day made by a barista (coffees, teas and smoothies) for £20 a month. On the face of it, it might be a very whole lot. With two lattes per week, a subscriber will break even. And the primary month is free. (Small print: You can’t order 5 drinks without delay — there have to be 30 minutes between every drink order.)
Pret’s complete enterprise mannequin hasn’t collapsed, only one essential a part of it, mentioned Jessica Spungin, who teaches technique and entrepreneurship at London Business School. Many individuals are nonetheless working, and so they nonetheless must eat a fast lunch. “How they can sell it to them is different because these people are no longer where they used to be,” she mentioned.
The solely manner by way of this, if there’s a manner by way of this, is for Pret to experiment with plenty of “small, low risk” concepts without delay, Ms. Spungin mentioned.
Mr. Christou, 42, sees this as a possibility for Pret to change into a unique kind of firm. Rather than fear about whether or not staff will return to their places of work and what the federal government’s recommendation will likely be, Pret wants to remodel.
“I don’t think customers should help Pret. I think it’s down to Pret to figure out what it does and how it evolves,” Mr. Christou mentioned on the firm’s headquarters final month, on his first anniversary of changing into chief govt.
He joined Pret 20 years in the past as an assistant supervisor, after a stint at McDonald’s. Since then, he has risen up the ranks by way of operational roles overseeing shops in London, Edinburgh and Leeds. When he took over the helm, he was speculated to be overseeing an growth. His predecessor had simply purchased a rival chain to speed up the expansion of the corporate’s vegetarian and vegan spinoff, Veggie Pret.
Now, the purpose is survival, and the brand new mantra, he mentioned, is “bring Pret to the people.”
Mr. Christou mentioned he had gotten the concept for the espresso subscription from Panera Bread, the U.S. chain that can also be owned by JAB Holding. (The chief executives of the businesses owned by JAB chat and talk about new concepts in a WhatsApp group, he mentioned.)
The different advantage of the subscription plan is the prospect to collect extra knowledge about its prospects, who will scan a QR code every time they use it.
“Pret have been very, very late adapters to this,” Mr. Christou mentioned. Panera, he mentioned, has a database of greater than 40 million prospects throughout the United States. “Pret’s been run over the last 30 years with gut feel and intuition, and we haven’t done that badly, but I think the richness of data today gives you an opportunity to learn much more about your customers.”
Ms. Spungin mentioned that knowledge might show “invaluable” to Pret in figuring out its loyal followers, those that “care enough and miss Pret enough that they’ll sign up.” With that info, she mentioned, the corporate ought to think about a meals supply subscription, the place folks can decide their lunches for the week and have them delivered every morning.
Regardless of what Pret does to diversify its enterprise, “doing nothing was definitely not going to work,” Ms. Spungin mentioned. “This has a higher chance of success.”
Mr. Christou’s optimism about Pret’s future comes with a dose of realism. “It’s still very much a turbulent time,” he mentioned. “We are not out of the woods.”
The British authorities’s furlough program, which is ready to finish on Oct. 31, remains to be serving to to pay a few of Pret’s retailer workers, together with about three million different folks in Britain.
And paying hire stays a difficulty for Pret, as it’s for a lot of hospitality companies in Britain, particularly these within the middle of London. The authorities put in place a moratorium on evictions, successfully permitting companies to delay their hire funds, which has twice been prolonged, now to the tip of the 12 months.
“The extension of the moratorium is huge for us,” Mr. Christou mentioned.
The downside with hire goes past the shops, of which 26 have been completely closed in Britain. Pret has additionally put the lease for its headquarters, within the Victoria space of London, close to the placement of the primary Pret, available on the market. It’s a big industrial expanse of glass and concrete, with loads of spots for employees to congregate, which are actually pointless.
Pret, a sufferer of workplace downsizing and firms permitting workers to work from home indefinitely, finds it should make the identical calculations for its personal workers. Mr. Christou mentioned the pinnacle workplace would in all probability keep in London however could be much less central, and accommodate about 60 % of its newly depleted workplace workers (90 folks had been laid off in August).
Mr. Christou additionally hopes a smaller, much less grand workplace will give the corporate extra of a start-up tradition, and recall the earlier, “quirky” days when the corporate’s founders, Sinclair Beecham and Julian Metcalfe, had been consistently experimenting with new sandwich formulation, together with a crayfish and arugula sandwich that turned a menu staple for years.
“When you’re in survival mode, you’ve got to try things,” Mr. Christou mentioned.