Leon will focus on stations and airports to revive fortunes, boss says

Fast-food chain Leon will open more restaurants in service stations, airports and train stations, after it closes 20 on the High Street, its boss has said.

John Vincent said the upcoming rises in business rates along with overall cost increases means the High Street is no longer as profitable. Leon has been losing £10m a year.

Vincent, an original co-founder of the chain, bought the company back from Asda last year. But last month the firm appointed administrators and announced a major restructuring of its 71 restaurants, which employ 1,000 people.

The government says it is backing hospitality businesses with a support package to limit bill rises.

Vincent told the BBC’s Big Boss Interview podcast tax rises were “incredibly toxic” for the hospitality industry.

If taxes on businesses increase further, he said, “the only people that are going to survive are those selling… food that’s not very good quality”.

In April, business rates relief for the hospitality sector which came in during Covid will end. At the same time, increases in the rateable value of premises take effect.

The Treasury has indicated it will announce further assistance for pubs in the coming days but has faced a backlash from other hospitality businesses over why they are not included.

Chancellor Rachel Reeves told a press conference on Wednesday she was “working with the hospitality sector”.

Vincent said that traditionally, “the more fast food units you have, the better the operations, the better the supply chain, the better you can buy, the better your systems can be”.

However, he added: “I’m not sure this is true anymore because of pressure on the market.”

Vincent said Leon would close its restaurants outside London, but added the high costs of operating in the capital was making business there “incredibly difficult” with “incredibly high upward-only rents”.

He said even though airports in particular take a large slice of a retailer’s takings, a 2% profit margin there “is worth the same as a 6% on the High Street”.

“You might be doing two or three times the revenue in that airport than you might in a High Street location,” Vincent said

Responding to Vincent’s comments, a Treasury spokesperson said: “We’re backing hospitality businesses with a £4.3bn support package to limit bill rises.

The spokesperson said this was in addition to “capping corporation tax at 25%, cutting red tape and taking action on the cost of living to boost high streets”.

Aside from rising costs, Vincent feels Leon is struggling because it has drifted from its original mission of good-quality fast food for the masses.

The menu started out simple: meatballs, a superfood salad and tapas – relatively healthy offerings at a time when fast food was dominated by burgers, fried chicken and kebabs, Vincent said.

But Leon “lost chutzpah, leadership and confidence” after it was sold in 2021, which resulted in “a lack of clarity about what it wants the menu to be”, he said.

He has previously said he sympathises with the company’s previous owners, because of the challenges that restaurants have faced since the pandemic.

“I think Leon needs to make sense again,” he said. “We don’t always make sense to people at the moment.”

He plans to bring simplicity back with menu changes this year: “We do have to, as a brand, realise and remember, we were always about the best food for the most people.

“We were not about posh fast food for posh people. That was never our intention.”