Sandwich course

Irish made-to-order sandwich bar O'Briens is taking the shopping centre industry by storm

Published: 22 June, 2006

Page 6

Made-to-order sandwich operator O'Briens is embarking on a major expansion with its main focus being to increase exposure within the shopping centre market.

The company currently operates 135 stores in Ireland, 145 in the UK and another 30 overseas, but with plans to open 50 to 60 stores a year in the UK and Ireland we can expect to see O'Briens popping up all over the UK in the near future.

At the moment O'Briens has a 50/50 split between shopping centre locations and out-of-town office and business park sites, where it serves the lunchtime trade, but group property director Peter Atkinson sees that changing in the future with shopping centres eventually making up 75 per cent of O'Briens' portfolio.

Atkinson says he is constantly looking for new franchises to take up new town centre sites, and adds that the main interest lies with operating mall cafes, mainly positioned in the centre of malls where people can sit and watch the world go by.

According to Atkinson, "The product is on its own in shopping centres. There are not many places you can go and get a sandwich, so when we establish ourselves in a shopping centre we do well."

The made-to-order sandwiches continue to be the main focus of the chain's operations, but it also sells espresso-based coffees, soups and hot food in certain shopping centres. Juice bars are also available within some of the units.

Last year O'Briens' group turnover grew to E85m compared to E70m in 2004, while like-for-like sales were up 5 per cent, with total sales growth rising to 7-8 per cent when new stores are included. And that success is only set to continue.

Atkinson says he is exploring all towns across the UK and Ireland and is especially keen to find locations that are in secondary sites within prime shopping towns.

"Maybe a town has one or two big shopping centres," he says. "We would happily locate in a subsidiary mall, taking a mall cafe site.

"Most of the shopping centres we are not already in are in the large towns. We have a stronger presence in Scotland at the moment with 42 stores, where in terms of mall cafe operations we are the market leader. With shopping centres it's difficult to accelerate beyond 50 to 60 openings a year as opportunities don't come up at the same frequency as on the high street."

O'Briens takes the head lease on all its properties, then sublets to its franchisees, who Atkinson says have the drive to push the stores' success hard. "They offer a level of customer service that a company of our size might struggle to maintain," says Atkinson, who adds that the company is constantly searching for franchisees to take opportunities in England and Wales, while in Ireland and Scotland the brand is so well known that franchise interest is high.

"Across England and Wales we have 105 units, which is a fairly small number within a large area, so brand awareness has some way to go," he adds.

Overseas the company has 12 units in operation in Singapore and five in Malaysia, while it also has a few in Australia, South Africa and Saudi Arabia. Expansion is just starting in mainland Spain where O'Briens has opened three units and one store has already opened in the Netherlands. Plans are also in place to open in China.

"In the UK we're trying to build slowly and steadily," says Atkinson. "If we can add on 40 units a year then that would be great. In Ireland we will at some point come to saturation. We thought 100 would be it, but we're happy adding more and more stores.

"It really is a huge market. At lunchtime the sandwich is said to be bigger than all the other food products put together."