Photo: sbarro.ru

The Sbarro pizzeria chain (part of the Planet of Hospitality holding) is reducing its presence in the St. Petersburg market. According to Fontanka , almost half of these establishments have closed in the city in recent months.

Food courts

In May, in particular, the flagship Sbarro restaurant at 42 Nevsky Prospekt, as well as in the Leto and Piterland shopping malls, ceased operations. According to the director of Piterland, Alexey Rozhkov, the reason for the breakdown in relations was debts on rent. The Leto shopping and entertainment complex did not comment on the reasons for the tenant’s departure. As for the premises on Nevsky, the file of the arbitration court contains a claim by the Diasto company registered at this address against the manager of Sbarro, Brothers and Company (part of the Planet of Hospitality holding) for 310 thousand rubles.

Prior to this, Sbarro restaurants closed in the Galereya, Europolis, Academ Park, Mega-Parnas and Mega-Dybenko shopping centers. Moreover, another project of Planet of Hospitality, the Eastern Bazaar bistro, also left the last shopping center.
To be fair, it is worth noting that the management of the Europolis and Academ Park shopping center Fort Group reported that the work of restaurants has now already been resumed.

Today, there are seven Sbarro cafes in St. Petersburg, located in the Galereya shopping center, the Europolis shopping center, the Academ Park shopping center, the Ligov shopping center (although the management of this complex has claims against the tenant), and the Continent shopping center. , shopping center "PIK", shopping center "Grand Canyon". In addition, other brands of the company operate in the city, for example, restaurants of Middle Eastern cuisine “East Bazaar”, which are located in the Grand Canyon shopping center, Europolis shopping center and Gallery shopping center.

Franchisee plans

Operations Director of G.M.R. Planet of Hospitality" Sergei Sakhnin told RBC St. Petersburg that at the end of 2015 the company began to experience operational difficulties due to the economic crisis. “However, now the situation has stabilized, we are gradually regaining our positions, resuming the work of Italian cafes. For example, the Italian cafe “Sbarro” has reopened in the shopping center “Europolis”, “Academ Park”, “Grand Canyon”, and our flagship establishment has opened in the shopping center “Gallery”, said a company representative.

“As for closures: Nevsky can hardly be called a flagship restaurant, and the closure of a location there is related to the sale of the premises to a new owner, and not problems with rent; PeterLand - we are in negotiations and will definitely find a common language with the landlord, the restaurant will open in the near future; Summer is closed because... the landlord raises the rent relative to the current rate at a time when other shopping centers are looking for compromises in order to retain tenants; MEGA is a decision by the head office of IKEAMos and is completely unrelated to business in St. Petersburg,” added S. Sakhnin.

At the same time, he added that since the end of 2015, visits to the shopping center, and most importantly, the consumer activity of city residents, have sharply decreased. “We continue to negotiate with some shopping centers to reduce rents and fix the exchange rate in rubles. Sbarro has no plans to leave St. Petersburg. The brand will increase its presence on the St. Petersburg market in 2016 by opening franchise points,” he noted.

Key Products

Earlier, the head of the company’s business efficiency department, Roman Vorobyov, said in an interview with Kommersant that the company had financial problems due to the Russian embargo on products from the EU, a jump in the dollar exchange rate and rising rental prices in shopping centers. These factors led, among other things, to non-payment of salaries to the restaurant chain's employees. Vorobiev explained that Russia’s decision to introduce counter-sanctions in response to EU restrictions “seriously affected” the business of restaurants, “because it affected key products - pizza cheese, flour.”

After this, according to Vorobyov, purchasing prices for Russian products increased from 50% to 300%: “It turns out that before we purchased goods for a nominal 10 rubles, and sold the final product for 60 rubles. And now the same product costs us 50 rubles! And raise your price to 150 rubles. We can’t, because Russians’ wages haven’t increased.” The result of this was that Sbarro “catastrophically increased the cost of purchases” while it was impossible to similarly raise the selling price. “Since December 2014, our prices have increased by about 30%. And this is the limit, we can’t do more - people simply won’t buy,” explained Vorobiev.

Another reason for the company's problems was the cost of rent in shopping centers. “The business fell into the same ambush as foreign currency mortgage holders, only on a much larger scale. It’s no secret that 80-90% of lease agreements are concluded in foreign currency and are tied to the current exchange rate,” he said, adding that “if rent used to account for 25% of revenue, then at some points it began to reach 50%.” At the same time, Vorobyov noted a decrease in traffic in shopping centers - “people stopped buying.” “And if traffic has dropped by 70%, then no matter how hard I dance, I cannot cover the rent. If the revenue was 2 million rubles, but became 500 thousand rubles, it is not economically profitable for me to keep the restaurant and I close it. And competitors do the same,” he concluded.

Challenge for the industry

Other restaurant holdings are facing similar problems. Earlier, RBC wrote about financial problems in the Rosinter holding (manages the restaurants IL Patio, Planet Sushi, etc.). Its net loss almost doubled in 2015, to 391.6 million, while revenue fell. Moreover, the results turned out to be even worse than in the crisis year of 2008. “The past 2015 became a challenge for the Russian restaurant industry,” noted Sergei Zaitsev, President and CEO of Rosinter. “The stagnation of the economy, caused by a number of external and internal factors, provoked a decrease in household incomes and, as a consequence, a significant decline in consumer demand.” The company also closed about 50 restaurants and laid off about 300 people in 2015.

“At the end of 2014 and the beginning of 2015, we were in a very difficult situation, we had to adapt to all the effects of the crisis. According to the founder of Rosinter, Rostislav Ordovsky-Tanaevsky Blanco, the two main problems the company faced due to the crisis and devaluation of the ruble were dollar rent and imported products (some products were embargoed, others increased in price).

Statistics for food courts

Official statistics indicate a contraction in the public catering market: according to Rosstat, total sales of Russian restaurants, bars and cafes in 2015 fell by 6%, to 1.293 trillion rubles. In 2016, the rate of decline slowed down slightly - to 5.7% in January-February, sales amounted to 190.3 billion rubles.

The restaurant market at the beginning of the year was slightly supported by the fact that, due to savings, Russians began to deny themselves many other entertainments, for example, traveling abroad, Elena Perepelitsa, director of the consulting company RestCon, told RBC.

Reference

A Nielsen study showed that most compatriots prefer food courts to all HoReCa segments. Fast food restaurants are in second place in terms of attendance (29%), followed by bars and snack bars in third place (24%). Full service restaurants and vending machine food are less popular (11% and 3% respectively). Europeans, on the contrary, most like to eat at full-service restaurants (47%), followed by fast food establishments (37%).

An international pizzeria chain is closing restaurants in St. Petersburg