Thanks to years of economic and political uncertainty brought on by the pandemic, issues with the market and general malpractice in government, it is an incredibly hard time for a variety of different businesses. It doesn’t matter whether an organisation is big or small, there are common problems which are being encountered and these are leading to organisations having to close down. One of the most recent of these businesses is the Belgian coffee chain, Le Pain Quotidien.
Recently it was announced that the Belgian coffee house has collapsed into administration. Londoners were no strangers to the coffee house as there are 10 different sites across London and Oxford. All of these are now set to close down except for the one which is located in St Pancras Station, likely because of the amount of foot traffic it sees and also due to the fact it is owned by a sister company, SPQ Limited, which has not been impacted by the administration.
What Has Happened to Le Pain Quotidien
The news of this administration comes shortly after a note was passed around some of the different sites for the chain. This note simply read, “the affairs business and property of the Bruncho UK Limited (trading as Le Pain Quotidien) are being managed by the Joint Administrators, Sarah Rayment and Philip Dakin of Kroll Advisory.”
All of the stores closed at the back end of June as the company told the Daily Mirror that the business had “explored every possible option,” to try and save itself but it had “not been possible to rescue it.” There are a number of different reasons as to why the chain thinks it has gone into administration and these include higher wage costs, fewer people on the street and therefore fewer people buying coffee and the rigid rental market.
Staff members who had been working at these sites across London have been made redundant; however, the chain is refusing to divulge how many staff members this actually equates to. The company has also commented on the fact there are a number of different pressures that have been put on various parts of the hospitality and dining sector which are being felt throughout the entire industry. Bruncho UK, over the past few years, has continuously suffered from reduced revenue as a result of less footfall throughout the Capital, as well as higher rent prices and also increased wage costs.
What Does the Future Hold for Le Pain Quotidien?
Moving forward, the chain is going to be focusing much more on developing franchised stores and it is currently having talks with a number of potential partners throughout the UK so that they can franchise in new cities, within hotels and in travel spots. The chain has referred to the St Pancras chain and said they will use this as the brand’s anchor within the UK.
The CEO of Le Pain Quotidien, Annick Van Overstraeten, has commented on the current situation saying, “Le Pain Quotidien is steering its strategy with a more forceful focus on franchising in the UK and elsewhere,” they continued, “now that the UK has left the European Union, Le pain Quotidien will rely on its franchise model more than ever, as well as the know-how of local partners.”
Which Branches of Le Pain Quotidien Have Closed?
Londoners will likely be aware of the branches which have closed down, but for confirmation, the following have shut their doors for the foreseeable future:
- The Westgate Centre, Oxford
- Marylebone High Street, London
- Hyde Park, London
- Mayfair, London
- Covent Garden, London
- South Kensington, London
- Royal Festival Hall, London
- Monument, London
- Parsons Green, London
Other Problems Facing Businesses in 2023
As stated above, the problems which Le Pain Quotidien came into contact with were a general downturn in the industry which subsequently reduced revenue, less footfall in city centres and also increased rent. That being said, there are currently a number of different problems that face businesses in 2023 which can lead to organisations struggling to stay open. These include but are not limited to some of the following:
- Issues with Supply Chains
Supply chains are currently being affected thanks to rising costs which are making it much more difficult for businesses to get quick and reliable delivery of the various materials that they might need. There are also labour shortages that continue to be a problem because people are leaving their current roles in order to seek out better opportunities.
Continued disruptions in international trade also severely impact a lot of businesses and their ability to operate at full capacity. A lot of countries are also experiencing soaring storage fees and continued shortages of raw materials, which again are affecting supply chains across the UK.
- Rising Energy Prices
A topic on everyone’s tongue this year has been the soaring energy prices. Energy costs have risen sharply recently and these are continuing to have a negative impact on businesses. Employers need to keep offices heated in winter and cool in summer but doing so is taking a larger chunk out of budgets than it did previously, decreasing overall revenue as a result.
- The Cost-of-Living Crisis
The cost of living is impacting people across the country, both businesses and individuals alike. Businesses are struggling because buying certain materials and necessities is harder. Individuals also struggle with buying essentials, so they have less money to spend in total and this is stopping them from buying from other businesses, again, leading to a reduction in revenue.
Does Your Business Need Help?
As can be seen with the situation with Le Pain Quotidien, no business is immune to the hardships that are currently facing different markets. If your organisation is currently struggling because of the likes of energy costs and issues with supply chains, it might be worth reaching out to Simple Liquidation. Our team of experts will work with your business and creditors in order to find a viable way forward. If you have any questions or require any further information then do not hesitate to get in touch.