Italian high street chain Prezzo and the Tex-Mex-themed brand Chimichanga (which Prezzo owns) is on the verge a major restructuring, which could see up to a third of its 300-site portfolio close in the coming weeks and months. According to a report by Sky News, as part of a proposed restructuring of the company to be agreed with its creditors, up to 100 sites could close — a number that would include every one of the 33 Chimichangas currently trading.
Hundreds of jobs are expected to be at risk as the measures are put into place. Prezzo currently employs in the region of 4,500 members of staff.
In light of the developments, Sunday Times (and restaurant chain) critic Marina O’Loughlin observed that it was “a potential bloodbath out there.” News of Prezzo’s fate follows, so far this year, restructuring and closures at Strada, Byron and Jamie Oliver Restaurant Group. The CEO of the latter, Jon Knight, last week remarked that the the company had “rested on its laurels” and “didn’t take notice of the competition or how it was developing.”
As has been cited by all affected restaurant businesses, the dramatic change in fortune for high street chains has been down to rising costs — specifically the increase in business rates in April 2017, and the introduction on the National Living Wage — but also due to increased competition, not just from other brands, but by the undercutting of convenience platforms and delivery partners like Deliveroo.
Prezzo opened its first restaurant in November 2000 on New Oxford Street in central London. It operates in the region of 20 Prezzo sites in the London area. The group, including its affiliate brands, has been owned by private equity firm TGP Capital since 2015.