Heartwood Collection is aiming to create a £100m+ turnover business by 2026 as it targets 10 new openings per year.
The company, formerly known as Brasserie Bar Co, has doubled down on its premium freehold pub business and prepares to build its strongest ever pipeline.
With £100m of new funding from Alchemy Partners, the business will focus on maintaining a “‘premium and profitable approach,” CEO Richard Ferrier told MCA’s Pub Conference on Wednesday.
Discussing his vision for the next two years, Ferrier said the business plans to reach £105m turnover, with £23m site EBITDA from 58 sites and 400+ bedrooms by 2026.
Heartwood currently operates 24 pubs, and 14 Brasserie Blancs, and most recently reported £67m turnover, alongside £12m site EBITDA.
Going forward, the business is focused on “iconic, freehold pubs in affluent towns”, with 150+ internal, and 50+ external covers. A move into accommodation will also see the business seek sites with 20+ bedrooms.
”We like the unloved assets in core, affluent high streets. It’s about taking the big, hairy and scary, and the more unloved the better because we can invest in them.”
“These are big beasts, they take a lot of work to get set up but they give you a better chance of making the labour model work because you can maximise peak days,” Ferrier explained.
Heartwood Collection recently opened its first pubs with rooms, The White Horse in Dorking, following a multimillion-pound refurbishment.
It would mark Heartwood’s first venture under a new strategy, with a further four locations already confirmed by the group for 2024.
New pubs with rooms to open this year include the 43-room Ropemaker in Emsworth, earmarked for July, The White Hart in Lewes, with 23 rooms, to open in September, and The Coat & Bear in Newbury, with 26 rooms, to open in October.
Next, The Royal Forest, in Epping Forest will open with 29 rooms in November, and the Ragged Robin in Godalming will open with 20 rooms in April 2025.
In terms of standalone pubs, the business has also acquired the Old Crown in Great Bookham, Prince of Wales in East Barnet, and the White Hart in Lymington.
Ferrier also told MCA’s Pub Conference ‘We are restaurateurs running pubs’, describing a commitment to skilled, fresh cookery, and investment in young chefs.
“We operate one menu across our pubs, that enables us to drive standards and have a kitchen-first approach to our new sites. For us it is about training and developing chefs from nothing, investing in their growth. We make everything in each location and that is something we really care about, even though it is not an easy way to grow.”
These guiding principles include no central production, with four menu changes per year to retain seasonality.
He also described a key people focus for the business, including investment in career pathways, which has resulted in improved staff turnover and zero key vacancies.
”Covid had a lot of downsides but career pathways is something we were able to invest in. We developed a propriety system, that doesnt replace the face-to-face training but helps us to map people’s careers. That was a real game changer for us.
“As a result we have quite a long length of tenure- GM’s are over 5 years, head chefs are nearly 7 years, and staff turnover has been falling year on year. We’re at 57% and shooting for 50% this year,” he added.
Discussing the challenges in growing a premium pub estate in 2024, Ferrier added that stubborn food inflation and a ‘squeezed middle’ consumer were barriers. However, Heartwood is meeting these with a focus on building strong supplier relationships, flexible menus and creating a value proposition.
“We’re going to have to be really fleet of foot to navigate our way through it,” said Ferrier. “Our vision for the business is clear, exceptionally well supported by capital and that is the secret sauce of the whole thing.”
