Tortilla boss remains ‘quietly confident’ despite investment and Brexit challenges
The boss of fast-food Mexican chain Tortilla, Richard Morris, has said that soaring costs and a tumultuous two years for restaurants has led the sector to be hit “quite badly” from a lack of investment.
Tortilla, which serves lunchtime burritos and salads, floated in 2021 on London’s junior AIM market, as part of a five year expansion plan to double its estate.
In an interview with City PM, Morris said that since the float it has been “quite challenging” in the public market to get people to invest in Britain’s fast-casual dining scene.
“The truth is that the restaurant sector has been hit quite badly from an investment perspective… which is understandable,” Morris said.
“It has had more headwinds [than] probably most other businesses [such as] utility costs, staffing costs and food costs.”
His comments come as Fulham Shore – the owners of fellow highstreet chain Franco Manca – said it would exit the London market in April after it was enticed by a £93.4m sale of its business to Japanese hospitality operator Toridoll.
At the time, chief of the sourdough pizza brand, David Page, said that deal would help the business “fulfil its long-term potential.” with the group planning to open six new restaurants this year.
Morris said he has no current plans to take Tortilla private, with the business “quietly confident,” about plans to expand the business into mainland Europe.
He said: “We’re very happy where we are. And we still believe that we will deliver what we said we were going to deliver.”
Tortilla Mexican Grill – which also owns 62 sites across the UK – raked in revenues of £32.7m during the first leg of the year, up 22 per cent compared to last year.
Morris credited the lift to new store openings, and ‘happy hour’ promotional deals for late night diners.
This year the business has opened five new stores in London, as demand for lunchtime meals picks up as workers return to the office, “London has been incredibly resilient during all these challenging times,” Morris said.
Morris also said he was keen to further expand Toritlla’s presence in Northern and Southern Ireland – recently opening its first store in Belfast.
However, Morris said that the whole “Brexit scenario” has had an impact around products moving through Northern Ireland.
He said: “There are still quite a lot of logistical challenges and a lot more sign offs on getting products into Northern Ireland.”
“Naively, we just assumed as Belfast was in the UK that it wouldn’t have any issues.”
To ship food into Northern Ireland Morris said he has to send it across in a freezer, a method he is not required to do in England, Scotland and Wales.
“The product remains perfectly good but it’s just logistically more of a challenge and we can really well do without it.”
Like many businesses Morris said he is “hanging his hat” on the Windsor Agreement, which will hopefully restore the smooth flow of trade within the UK internal market; including Northern Ireland.
From September 2024, a full “green lane” will take effect for the movement of all goods between Britain and Northern Ireland.