Chicken restaurants: poultry in motion

The fast-food focus may still be dominated by gourmet burger restaurants, but there are other, arguably more interesting, stories out there, not least the recent expansion of gourmet chicken restaurants.

From pretty much a standing start there are now 37 chicken restaurants in London excluding Nando’s and KFC chains, according to Savills. A further six independent chicken brands operate in London from vans.

An influx of new UK and existing US brands is expected, while existing London restaurants are expected to expand both in the capital and to the regions. So what is driving the growth? And what impact is it having on the property market?

Part of the move towards chicken is economic, as Ross Kirton, head of UK leisure agency at Colliers International, explains: “Chicken, in general, is a relatively cheap meat to buy from a supplier and the price hasn’t increased at the same rate as beef, so from an operator’s perspective, not only is chicken a popular and versatile cuisine, but it’s also generating good returns,” he says.

Free-range meat

Of course, any owner of a fast-food chicken shop can tell you chicken makes sense financially, but what we are seeing with the new breed of chicken restaurants is different to the kebab shop or KFC chain-style experience.

The old image of unhealthy, greasy fried chicken has been blown out of the water by an emphasis on free-range meat that has been locally sourced and prepared for a health-conscious consumer. It is the demand for this type of product - alongside the affordability of the meat and its flexibility - that is driving the trend.

Carlene Hughes, associate director in the leisure team at Savills, says that what unites the new restaurants is quality ingredients that often include free-range chicken - 21 out of the 37 London restaurants use free-range birds - and a trendy alcohol offer.

“The new generation of gourmet chicken restaurants has emerged as part of a rise in consumer demand for premium casual dining and conscious eating, with a focus on locally sourced, free-range ingredients,” says Hughes.

“They are a ‘grown-up’ option aimed at young professionals looking for an experience that is not mainstream, with brands such as Chick ‘n’ Sours and Absurd Bird fusing their food offers with cocktails and local beers. They are a completely different concept from established mid-market chains aimed at families.”

Some operators have started to spice up their USP with international and exotic influences - Ross Kirton, Colliers

Those established chains include Nando’s, but analysts do not think these new restaurants will necessarily eat into its market.

“The dominance of Nando’s in the market is testament to just how good it is. You can’t fault its consistency, branding and price point,” explains Nick Weir, joint managing partner at Shelley Sandzer.

Whereas the established brands have a tried and tested formula, the new operators tend to be more experimental.

“[Some] operators have started to spice up their USP with international and exotic influences, such as Keralan chicken restaurant Kricket in Soho,” says Kirton. “In addition, pop-up stalls now seem to be taking permanent fixtures, such as Butchies, which opened in Camden. Other gourmet chicken shops are placing emphasis on having fun with the brand from the design and fit-out of the stores right down to the menu.”

Far from a fad

Among the new wave of brands is Chick ‘n’ Sours, which has developed in a way that suggests the concept is far from a fad. “Chick ‘n’ Sours in Seven Dials [Covent Garden] is a standout example of the type of offer and environment for the chicken-focused, fast-casual concepts that have emerged over the past 12 to 18 months,” says Hughes.

“Following its debut site in Haggerston, the Seven Dials site has been a massive success and brought the concept to a much bigger market due to high footfall and great location. This has led the brand to springboard into launching another concept, CHIK’N, demonstrating both the potential that Seven Dials holds for brands as a location and also the demand for this kind of offer.”

This is no one-brand movement, however. Bird has restaurants in Camden, Westfield, Shoreditch and Islington. Chicken Shop has 10 locations in London (along with a restaurant in Chicago and one in Barcelona). And the trend isn’t confined to London. Absurd Bird has restaurants in Exeter and Bath, as well as Spitalfields and Soho and Yard & Coop opened at Liverpool ONE at the end of 2016.

The regional presence of such brands is set to expand, says Hughes: “Bird and Chicken Shop are known to be considering regional cities and Absurd Bird has plans to open in Leeds and Newcastle.”

Weir adds: “Growing these brands in the regions is important, and I would expect other brands to follow suit.”

All this expansion comes at the same time as eating-out options in general are growing, specifically burger restaurants. With similar property requirements, that could put an already limited supply of property under increased strain. “Site requirements are similar to those for burger restaurants as both serve one key product that can be produced in a small space, with a high turnover of covers. They are usually around 1,000 sq ft to 2,000 sq ft,” says Hughes.

Burger fatigue

However, despite the growing competition, rents have not been forced upwards yet. Hughes believes this is down to “burger fatigue” limiting expansion of those restaurants. Kirton agrees: “It should be noted that there is a cooling in the sector and thus a number of these operators that have ridden the wave of expansion are no longer seeking space,” he says.

Carl Clarke, co-founder of Chick ‘n’ Sours, adds that there is still a lot of choice remaining in terms of location especially for chicken shops. He believes the biggest hurdle to expansion is the unrealistic expectations of landlords.

“The right property location for CHIK’N was always going to be vital given the volumes we need to sell to make the business viable due to the high quality of produce, competitive price point and all the property and employee costs involved. So location needs to be high footfall with the right mix of tourists and professional workers. Yes, there is a lot of choice, but some landlords and operators have unrealistic expectations on rent and premiums.”

When they do secure property, the fit-outs tend to be ambitious. Bricks and mortar are no longer enough to persuade people to eat out, Kirton explains. “[They have to] work harder to compete and draw people in, in order to create something that cannot be replicated online,” he says.

Convenience eating is here to stay and gourmet chicken restaurants are likely to be permanent - Carlene Hughes, Savills

That quest for differentiation will accelerate as more players enter the market. Hughes says an expansion of domestic brands “likely centred around edgier locations such as Manchester’s Northern Quarter” will be matched by that of US imports - with chicken concept Fuku, Shake Shack offshoot Chick’n’Shack and market leader Chick-fil-A likely to lead the way.

More burger restaurants will also get in on the act - in the wake of Shake Shack’s move Honest Burgers has added free-range chicken options to its menus, for instance.

Is there enough demand for chicken to sustain that expansion?

“Convenience eating is here to stay,” says Hughes, “and gourmet chicken restaurants are likely to be a permanent feature. Office workers and young people in urban locations want a fast-casual offer that still feels independent, and many see white meat as a healthier option than burgers.”

Gourmet chicken restaurants are, it seems, set to be the next big thing.

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