Warner brothers Ben and Hugo predict great things for Benugo with the arrival of their first restaurant on London's Southbank
Ben and Hugo Warner, owners of 18 Benugo café delis, have just launched their first restaurant venture, the Benugo Bar & Kitchen, in the newly refurbished British Film Institute on London's South Bank. In addition, it has also won the contract to take over the National Film Theatre's iconic waterside café.
The company predicts it will take £15m this year and yet, says younger brother Hugo, "We didn't have a proper, written-down business plan until about six months ago."
Their first Benugo, which they opened in Clerkenwell nine years ago, was very nearly a wood-fired pizza place. "We could have been Strada," quips Hugo. But because they hadn't checked the legalities, they secured the site before discovering that they couldn't get a licence for a wood-burning oven.
So they headed to Italy and New York to research a new delistyle sandwich bar format instead.
The brothers raised £200,000 through the bank and their family to open the first site. Since then, the company has grown organically to include sites within corporate companies, such as Lehman Brothers, as well as at the V&A museum. There are also five Benugo franchises in Japan, where one of the brothers' seven siblings lives. Coming from a large family (Ben and Hugo are twins – but not to each other), Ben says, "Food was always central in a kind of ‘if I don't eat that last biscuit somebody else will' way."
Ben came into the industry via a route that included an apprenticeship in Le Manoir's bakery and later as a Pret A Manger franchisee for two London sites; while Hugo worked under Henry Harris in the Harvey Nichols kitchen before going into the wine trade. Ben was one of the investors in restaurateur Will Ricker's Cicada, E&O and the Great Eastern, so they used his restaurant model to calculate that if they managed to make £20-25,000 per week they could pay back the £200,000 in a year. However, they soon found this was difficult to do with a sandwich bar rather than a restaurant. Hugo says, "Whatever you do to it, a sandwich has a perceived value and people won't pay more. For the first six months (in Clerkenwell)
we took about £10,000 a week, then it went up to about £15,000. Break-even point was about £12,000 a week."
Although a projected £15m turnover plus 18 sites and counting looks like success from where I'm sitting, the brothers say had they "focused purely on the high street then we would have been more financially successful"
and are shifting their focus accordingly.
They are also altering the way they run the business. "When you start a company it's like a baby and you can't see its faults," explains Ben. "And if, say, we liked a mural then we'd be more likely to think about putting that in a site rather than working out the practicalities of where the bread knives go."
One of their sites, in Soho, was shut down because they didn't get it right, blaming the location and loss of business focus. However, they've become more business savvy. Hugo used to be in charge of operations but has now hired someone else to oversee that side of the company, and although they feel they've grown quite slowly, Ben says, "I know Pret took a similar time to grow and next year we're going to have a bigger high street presence; this year we've got London openings at St Pancras, White City, Chancery Lane, Covent Garden, Cheapside..."
But back to the present. As part of the BFI contract, the brothers will open the BFI Southbank (formerly the NFT Film Café) as a Benugo Café & Bar by next summer. It's currently being run by Compass. Hugo says, "It's one of the best sites, ask anybody where it is and they'll tell you, it's iconic."
Benugo Bar & Kitchen has been operating with the bar and its eye-bleeding sofas at the front of the space, with restaurant tables in the more dimly-lit rear of the building.
However, this will be changed around imminently. They're not quite happy with the menu or the lunchtime trade, although "it is making money even now". They should take £3.5m a year when both sites are up and running, predicts Ben.
One thing they don't have their eye on yet is floatation. "We might consider it in a few years, maybe when the company is worth £50-100m but it does take an enormous amount of time," says Ben. In the meantime, they will measure their success by Benugo's high street presence "when we've rolled out to 50 and have more franchises across the world, in Dubai and we'd love to do America, though we'd love to conquer Manchester and Liverpool too," adds Hugo. Ben concludes, "If we opened in Morocco, we could sell falafel and hummus; we see ourselves as a valueled brand which is versatile above all else."