Sir Terence Conran’s restaurant group has called in administrators as the leisure and hospitality industry suffers from weak consumer demand and rising costs.
The design and restaurant mogul’s Prescott & Conran business, which he set up with colleague Peter Prescott in 2006, had three remaining outlets all located in London: Lutyens in Fleet Street; Parabola at the Design Museum in Kensington and Albion in Clerkenwell. The restaurants shut on Wednesday morning with the loss of 72 jobs.
Three other Prescott & Conran venues in the capital – Les Deux Salons in Soho, 56 Redchurch St in Shoreditch, and Albion in Bankside – had closed in recent months.
Conran, 86, launched high-end eateries such as Le Pont de la Tour, Bibendum and Coq d’Argent, which he subsequently sold, as well as the furniture chain Habitat.
The administrator of Prescott & Conran, Stephen Clancy of Duff & Phelps, said: “The restaurant trade is going through a period of sustained change off the back of changing consumer demand. As such, the group’s directors made the difficult decision to exit underperforming restaurants.”
Conran’s problems come at a tough time for restaurateurs as diners rein in spending amid a squeeze on spare cash. Meanwhile, costs are rising because of the increase in the legal minimum wage, business rate increases in London and higher prices on imported goods after the fall in the value of the pound.
Restaurant chains including Carluccio’s, Prezzo, which is the owner of the Chimichanga chain, Jamie’s Italian and upmarket burger bar Byron have all been forced to close outlets in recent months due to a “casual dining crunch”.
One industry insider said upmarket establishments were also struggling as underlying sales were falling across the industry while costs were up.
“Casual dining is not the only sector in hospitality that is being affected. What tends to happen if people are going out less is they are more selective. They make a bigger effort to go to the first-choice restaurants or hotels and they can get busier. It’s the second, third or fourth choices that suffer,” he said.
“Even if you are doing the same level of sales as last year, profits are down. It’s only a matter of time before we start to see more closures.”
Clancy said Prescott & Conran had been undertaking an operational review in recent months to improve profitability. That came after Prescott stepped back in January and Conran’s son Ned took over the chairmanship.
The administration does not include the Boundary Project – a bar, restaurant and hotel complex in a former warehouse inShoreditch, central London, which the Conran family will continue to own and operate.
Clancy said Boundary, which employs 96 people, was now the family’s “core focus for investment and growth”.
Conran sold his 49 per cent stake in the Conran Restaurant Group about 12 years ago, offloading some of his best-known establishments, including Le Pont de Le Tour, Quaglino’s and Bluebird. The group now operates as D&D London.