Major bar chain to close 25 more locations in bid to avoid collapse
TROUBLED Revolution Bars will close 25 more locations across the UK following approval in the High Court for a restructuring plan.
The plans mean it will avoid insolvency after struggling since the pandemic.
After the overhaul is completed, the company said it will operate 27 Revolution Bars, 15 Revolucion de Cuba bars, 22 Peach Pubs and one Founders & Co site – leaving it with 65 venues.
The company has fallen on hard times in recent years, as the cost of living crisis and young Brits drinking less has damaged sales.
The boozer needed the court to sanction its overhaul which it hopes will restore its finances after a difficult few years following the pandemic.
It is hoped that the High Court ruling will draw a line under a difficult few months for the business.
Commenting today, executive Rob Pitcher said: “The group is now well diversified across the key brands, providing a more secure financial base and we look forward to the future with improved optimism.
“We know this has been a very difficult period for all of our teams both in our sites and in our support office and I’d like to thank them for their support and resilience.”
Revolution Bars also made a string of closures of its worst performing pubs earlier this year.
However the company said its trading in bars in recent months was “undoubtedly impacted by the uncertainty and distraction of the restructuring process”, which had been the main focus of its board of directors.
It also said it had met its target of achieving about £3million in earnings, before measures like tax and interest, by the end of June.
The group is hoping its restructuring plan will put it back onto stronger financial footing, having been affected by the post-pandemic hit to the nightlife sector.
Revolution is just one of many hospitality businesses to buckle under the pressure of rising costs and customers spending less.
Rekom UK also shuttered a dozen of its sites earlier this year after it forced to call in administrators in January.
What is happening to the hospitality industry?
Many Food and drink chains have been struggling in recently as the cost of living has led to fewer people spending on eating out.
Businesses had been struggling to bounce back after the pandemic, only to be hit with soaring energy bills and inflation.
Multiple chains have been affected, resulting in big-name brands like Wetherspoons and Frankie & Benny’s closing branches.
Some chains have not survived, Byron Burger fell into administration last year, with owners saying it would result in the loss of over 200 jobs.
Pizza giant, Papa Johns is shutting down 43 of its stores soon.
Tasty, the owner of Wildwood, said it will shut sites as part of major restructuring plans.
The brand plans to close 20 loss-making restaurants after a “challenging” start to the year.
Stonegate, has raised fears about its survival as it races to plug its debts.
However, it is not all doom and gloom for the sector.
Budget chains such as Wetherspoons have continued to trade strongly as its cheap pints continue to draw customers in.
Why are retailers closing shops?
EMPTY shops have become an eyesore on many British high streets and are often symbolic of a town centre’s decline.
The Sun’s business editor Ashley Armstrong explains why so many retailers are shutting their doors.
In many cases, retailers are shutting stores because they are no longer the money-makers they once were because of the rise of online shopping.
Falling store sales and rising staff costs have made it even more expensive for shops to stay open. In some cases, retailers are shutting a store and reopening a new shop at the other end of a high street to reflect how a town has changed.
The problem is that when a big shop closes, footfall falls across the local high street, which puts more shops at risk of closing.
Retail parks are increasingly popular with shoppers, who want to be able to get easy, free parking at a time when local councils have hiked parking charges in towns.
Many retailers including Next and Marks & Spencer have been shutting stores on the high street and taking bigger stores in better-performing retail parks instead.
Boss Stuart Machin recently said that when it relocated a tired store in Chesterfield to a new big store in a retail park half a mile away, its sales in the area rose by 103 per cent.
In some cases, stores have been shut when a retailer goes bust, as in the case of Wilko, Debenhams Topshop, Dorothy Perkins and Paperchase to name a few.
What’s increasingly common is when a chain goes bust a rival retailer or private equity firm snaps up the intellectual property rights so they can own the brand and sell it online.
They may go on to open a handful of stores if there is customer demand, but there are rarely ever as many stores or in the same places.