Hey Hot Potatoes,

Welcome to the latest edition of the Hot Potato Newsletter! I have one question - where on earth has summer just gone? The past few months have flown by but you know what I have actually missed a bit of rain. Summer's on the way out, the schools are back, and hospitality is properly back with it.

This week we're diving into the latest headlines across UK hospitality, unpacking how a struggling four-store frozen yoghurt brand became a 79-store machine on 21% net margins, looking at why Wagamama has just bought its way into the wellness world, and I've got a spicy take on why nostalgia is the fastest way into your customers' hearts. Let's get into it.

In today’s email: The Frozen Yoghurt Brand Printing Money, Why Wagamama Is Sponsoring Hyrox & How Nostalgia Wins Customers

Read Time: Approx 3-4 mins

We take a look at some of the hottest headlines happening right now in UK Hospitality.

Sources: Propel Info, MCA Insight, Restaurant Online

🔥 THE MONEY: Blacklock grew revenue 25.5% to £24.6m and turned a £44,794 pre-tax profit into £1.1m - a reminder that growth across a small estate sometimes beats aggressive site expansion. Sixth Street's £428m Wingstop UK price tag, revealed this week, values a proven franchise model at roughly 2x revenue. Big Table has hired investment bank Stifel to field overseas franchise interest in Las Iguanas and Bella Italia: casual dining can work if you’ve got the model nailed down.

🔥 SCALING UP: Tops Pizza wants to triple its 90-site estate and is building a northern distribution centre to do it. Canada's Groupe Grandio brings sports brasserie La Cage to High Street Kensington this month, already viewing a second London site. Loungers thinks it could open hundreds in Germany. All three are betting on the same thing - that the sites are cheap right now if you've got the balance sheet.

🔥 THE INDIES: Woongchul Park, chef-owner of Michelin-starred Sollip, has opened Korean fried chicken concept Papa Dak in Flat Iron Square - the latest fine-dining chef to build a fast-casual second brand, because that's where the volume and the scalability are. Beer + Burger Store co-owner Andy Perritt has opened a New York-style luncheonette in Notting Hill. All the American lunch classics (bagels, sandwiches etc) then phase two turns it into a late-night martini and dessert bar - all day parts maximised.

🔥 THE BIG PICTURE AND INITIATIVES: Takeaway and click-and-collect sales have fallen for sixteen straight months while delivery grew 4%. At-home is now nearly a fifth of restaurant spend, but the commission-free half is the half that's shrinking. Everyone's chasing the cold drink. Caffè Nero's iced sales grew 52% last year with matcha doing much of the work and Blank Street now takes most of its money in the afternoon - enough that it's rebuilt its menu, store design and service flow around it.

Some of the most successful brands out there in hospitality more or less have one thing in common.

They didn't reinvent the wheel or create something original, they just tweaked something that already worked, like the frozen yoghurt brand that's just landed in London, Yo-Chi.

It started in 2012 as a single self-serve store in Melbourne. By 2020 it was down to just four stores and struggling, until Boost Juice founder's sons Oliver and Riley Allis bought it. Five years later, that's grown to 75+ stores across Australia, an international launch in Singapore and now its first UK site in Notting Hill.

Numbers That Tell The Story:
👉 75+ stores in Australia, up from just 4 in 2020 and 2 in Singapore
👉 Founded in 2012 in Melbourne
👉 Latest figures from 2024 - $54m revenue with a net profit of $11.5m (Australian dollars), big margins!
👉 400 store target

Here's what they're doing differently:

🍦 Real product, real difference - Made with real Australian cows' milk rather than powdered mix, with live probiotics and dairy-free, vegan, gluten-friendly and nut-free options across nine flavours and 30+ toppings.

🪩 Experience is everything - The Notting Hill site isn't a grab-and-go counter - it's 2,000+ sq ft across two floors with a DJ booth, disco ball, double-height ceilings and space for 120+ guests. They wanted to create a space where you would want to spend time with friends as opposed to a quick pop in.

💸 A highly lucrative model - Priced by weight, so customers build their own bowl and end up spending more than they were meant to! Yo-Chi are operating on some of the best margins I’ve seen with their latest figures showing a net profit margin around 21%. Yoghurt mix carries around 90% gross margin, they have very little wastage and the self serve model reduces labour needed. A model that just works!

The playbook: nail the product, create an experience around it and then once proven take the concept globally!

The crossover between wellness and hospitality isn’t exactly new but a recent headline caught my eye.

Wagamama are the first official restaurant sponsor for Hyrox UK and Ireland starting this October, running for multiple years with 42 events across seven locations.

This is a new era in the hospitality and wellness crossover. You see, typically when it comes to this crossover it’s looked like - menu led, like protein inspired menus, wellness focused brand collabs like Salad Project x Cadence and smoothie bars in gyms or padel courts.

This is the first time a restaurant brand with zero wellness heritage has essentially bought its way into the wellness community and I think it's a smart move!

There is no other restaurant sponsor in the category and they’re introducing themselves to a whole new audience that they can win over.

Which other big brand do you think buys into the wellness sector next?

Nostalgia is the key to your customers’ hearts.

Marks and Spencer recently coined 'new-stalgia' as one of nine trends to watch this summer, with retro desserts leading the charge.

I’ve been observing in the last few weeks that nostalgic concepts are making a comeback, here are a few I’ve noticed:

👉 Frozen yoghurt is having a full revival, spurred on by the viral Yo-Chi
👉 Starbucks brought back the 'Unicorn' Frappuccino after '2026 is the new 2016' started doing the rounds online
👉 Heard Burger launched a limited edition ‘Happy Meal’
👉 Whippies has opened a retro Mr Whippy ice cream bar in Covent Garden, from the team behind Big Kid Ice Cream

Brands that are tapping into nostalgia are instantly creating emotional connections with their customers.

I'm all here for it and as marketing strategies go it's definitely something to try, whether new limited edition menu items or spin off concepts.

That wraps this edition of Hot Potato! Hit reply with any thoughts - I read everything and it genuinely shapes what comes next.

Been anywhere lately worth shouting about? Noticed something others aren't? Or simply want to share an opinion? Let me know!

Bon appétit,

Max Shipman, Founder, Hot Potato

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