Franco Manca, the beloved pizza chain, is set to close 16 of its UK locations, a move that will see approximately 225 jobs lost. This decision follows the approval of a company voluntary arrangement (CVA) by creditors, signalling a significant restructuring for its parent company, The Fulham Shore. The closures are attributed to the escalating business challenges, including high taxation and insufficient relief on business rates that have rendered several outlets unsustainable.
Details of the Closures
The closures, which affect a number of locations across the UK, will leave Franco Manca with a reduced portfolio of 54 restaurants. Currently boasting 70 sites, the brand has been a mainstay in the UK’s dining scene, known for its sourdough pizzas and vibrant flavours. The decision to shutter these venues comes on the heels of economic pressures that have increasingly burdened the hospitality sector, particularly in light of the ongoing recovery from the pandemic.
The affected locations include popular areas such as Battersea, Brixton, and Plymouth. The move follows a similar fate for The Real Greek, another brand under The Fulham Shore umbrella, which was placed into administration shortly before Franco Manca’s announcement. Despite being quickly acquired by the Karali Group, The Real Greek’s restructuring resulted in the closure of nine out of its 28 restaurants.
CEO’s Statement on the Situation
Marcel Khan, Chief Executive of Fulham Shore, expressed gratitude for the creditors’ support during this challenging time. “Franco Manca is a fantastic brand with a strong heritage and loyal customer base,” he stated. Khan emphasised that the restructuring would allow them to stabilise the business and focus on enhancing the customer experience moving forward.
Paul Berkovi, Managing Director at Alvarez & Marsal, highlighted the significance of the creditor vote, which received overwhelming support from over 90 per cent of those involved. “Today’s vote reflects constructive engagement across stakeholders,” Berkovi noted, adding that this step is crucial for Franco Manca to navigate its financial restructuring and operational transformation amid a challenging industry landscape.
The Bigger Picture
The closures underscore the broader issues facing the UK restaurant industry, where rising costs and economic uncertainties continue to challenge many establishments. Franco Manca’s troubles are symptomatic of a sector grappling with the dual pressures of heightened taxation and a lack of support for businesses trying to recover from the pandemic’s fallout.
The Fulham Shore, acquired by Japanese group Toridoll in 2023 for £93.4 million, is clearly seeking to adapt to these challenging conditions. The hope is that by streamlining operations, Franco Manca can emerge more resilient and focused on its core offerings.
Why it Matters
The closure of these Franco Manca restaurants is more than just a corporate restructuring; it reflects the seismic shifts taking place within the UK hospitality sector. As businesses struggle with rising costs and a competitive market, the fate of Franco Manca serves as a cautionary tale about the vulnerabilities of even well-loved brands. The impact on employees, local economies, and the dining landscape is significant, highlighting the urgent need for supportive measures that can help sustain the sector through these turbulent times.