The Oxford pub-restaurant will close tomorrow [Saturday] after trading for 29 months on George Street, leaving two other branches in Cambridge and Birmingham.
Co-owner Richard Holmes says Oxford was lossmaking and the business could not sustain it. “We’ve tried everything over the past couple of years, adapted the offer, repositioned the basement and given it its own identity but we can’t close the gap. So it’s time to cut our losses and move on.”
He blamed local market conditions and the new Westgate shopping centre which opened 18 months ago. “We took a site that was quite basement heavy. We thought we could put our food offer into a basement space and I think that was a mistake in hindsight.”
“We know a lot more know about what we can and can’t do now as a business.”
He says Cambridge was five years old and the restaurant side had been expanded about a year ago and was “on the whole really good” as was Birmingham, which opened four months ago.
Holmes says: “We just need to cut the lossmaking site and move on. It’s a shame because the people in Oxford were really good and the product was good – really proud of it.”
He says the business probably needed six months of “consolidation”. Closing the site would hurt “so we need to regroup and see what the business looks like without that lossmaking site in there. From a business point of view we will be in a much better position without it.”
Moving to a smaller model
Homes revealed he had been thinking for a long time that big sites, like its existing estate, were “quite high risk” with a lot of investment needed, generally high rents and business rates and increasing labour costs.
“Fully-skilled, fully-serviced big operations are becoming increasingly difficult to make good money on so we’ve got a smaller model we’ve developed that we would like to trial that is a much smaller footprint per unit and we think we could operate multiples of those within the same city.”
He hoped the business could be looking at the new model “within the next year or so. The future for us is definitely in smaller sites."
He estimated it would be possible to get down to around 2,000 sq ft “give or take”. Birmingham is was 5,000 sq ft.
The idea, he said, was to merge the drinks area, which also has food, and the separate restaurant area into one trading space in smaller units with food ordering at the bar rather than table service.
The proposed move to smaller spin-offs matches a recent trend for brands to downsize.
Burrito brand Tortilla announced in November 2017 plans to launch a mini version of its high-street restaurants, Casual Dining Group tested a grab-and-go version of Rapide in Inverness Airport two years ago and Costa launched its fast-service Pronto brand in London transport hubs the same year.