In a move to restructure its operations, the popular British fast-food chain Leon has announced plans to close around 20 of its 71 restaurants and cut jobs as part of a major overhaul. The company has appointed Quantuma as administrators after the company’s original co-founder, John Vincent, reacquired Leon from Asda last month.
The decision to shutter the worst-performing stores puts the future of these locations at risk, though no specific closures have been confirmed yet as all stores remain open for now. Leon employs around 1,000 staff, but the company has not disclosed how many workers will be affected, stating that it will first try to find positions for those impacted in the remaining stores.
According to Vincent, the company was losing approximately £10 million per year, and the “immediate priority” after the initial review was to close the “most unprofitable restaurants.” He said, “In many cases, we have found other brands to replace us, and in others, we will be asking the landlords to take the leases back and find better-suited operators themselves.”
Customers can expect to see significant changes to the menu from next spring, as Leon looks to refocus on its core values. The company has also developed a programme with Pret A Manger to help staff who cannot be placed in other Leon outlets, allowing them to apply for jobs with the coffee chain.
Vincent acknowledged that Leon had “drifted from its core values” under the leadership of EG and Asda, but he was also sympathetic to the challenges they faced in running a “healthier” fast-food chain. He said, “In the last two years, Asda had bigger fish to fry, and Leon was always a business they didn’t feel fitted their strategy.”
The broader hospitality sector has faced significant challenges, with companies reporting substantial losses due to changing work patterns and increasingly unsustainable taxes. Vincent stated that the government needs to review the tax burden it has placed on the industry, noting that for every pound received from customers, around 36 pence goes to the government in tax, leaving only 2 pence for the company.
This announcement comes after Pizza Hut’s UK operator, DC London Pie, revealed plans to close 68 restaurants and 11 delivery sites in October, resulting in more than 1,200 redundancies. Administrators cited “challenging trading conditions and increased costs,” including “tax-related obligations,” as the primary factors behind DC London Pie’s decision.
As the fast-food industry navigates these turbulent times, Leon’s restructuring efforts aim to position the chain for a more sustainable future, though the road ahead remains uncertain for both the company and its employees.