Caffè Nero

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Caffè Nero Group Ltd.
TypePrivate company limited by shares
IndustryCoffee shops
HeadquartersLondon, England, UK
Number of locations
Increase 1,017 (2019)
Key people
ProductsEspresso based coffees
Frappé
Tea
Savoury and Sweet goods
RevenueIncrease £227.9 million GBP
Number of employees
Increase 5,000
SubsidiariesHarris + Hoole
Coffee#1
Websitewww.caffenero.com

Caffè Nero is an Italian-influenced coffeehouse company headquartered in London, England. Founded in 1997 by Gerry Ford, currently the company runs more than 1000 coffee houses in eleven countries: the UK, Ireland, Sweden, Poland, Cyprus, Croatia, Turkey, the UAE, Oman, and the United States. In 2009 Caffè Nero bought and opened its own coffee roastery, which supplies the coffee to all its coffee houses worldwide.

Caffè Nero Ltd is wholly owned, through a long chain of intermediary companies – including UK-based Nero Group Holdings Ltd and Luxembourg-based Rome Intermediate Holdings Sarl – by the holding company Saratoga Limited based on the Isle of Man,[1] a known tax haven. The company has been subject of controversies due to its non-payment of any UK tax.[2]

History[]

In 1997, Gerry Ford led a small group of investors in the purchase of 5 central London shops with the name Caffe Nero from Ian Semp who established the name in 1990.[3] Gerry Ford subsequently redesigned those units and founded the Caffè Nero brand as recognized today.[4][5] At the same time the signature coffee house blend - Classico - was introduced, and has gone on to receive awards for its quality. The Classico blend is still served in every store today.[6][7]

Cafe in Warsaw, Poland, where it is branded as Green Cafe Nero

In March 2001 Caffè Nero joined the London Stock Exchange under the symbol CFN. In early 2007, the company was the subject of a management buy-out by the newly formed Rome Bidco Ltd and taken private.[8] Since 2007, the company expanded to Turkey in 2007, the UAE in 2009, Poland in 2012, Cyprus in 2013, and Ireland and the United States in 2014, Croatia in 2017, Oman in 2018 and Sweden.[9] Caffè Nero's parent company is based in Luxembourg.[citation needed]

In June 2016, the Caffè Nero Group completed the purchase of the Harris + Hoole brand from Tesco which consisted of 43 sites.,[10] and in January 2019 the Group expanded further by completing the purchase of the majority shareholding of the 92 strong coffee chain Coffee#1 from SA Brains.[11]

In 2013, Caffè Nero's coffee was rated best tasting among five major UK brands by experts at the independent consumer magazine Which?[12]

In 2020, like many businesses in the hospitality sector, Caffè Nero suffered from poor trading conditions because of the COVID-19 pandemic. Due to the second lockdown in November 2020, the company proposed entering a company voluntary arrangement with its creditors.[13] Mr Ford's hope being that successful renegotiation of rent agreements with landlords, and a reduction in overall costs, would enable the company to rebuild its business when the pandemic ends.[14][15] The CVA vote by creditors held on 30th Nov 2020 was successful, with more than 90% of creditors voting in favour.[16] The CVA was approved the day after Caffè Nero confirmed it had rejected an unsolicited takeover approach from Mohsin and Zuber Issa, stating that the brothers had "clear intention" to disrupt the CVA "as a precursor to opportunistically acquiring the company at a later date."[16][17][18] The brothers are behind the EG Group.

Products[]

The company has a reward scheme for customers. Each time a coffee is purchased, the customer's loyalty card is stamped with the 'Nero Coffee Bean Logo'. Once a card has nine stamps, the bearer is entitled to a free drink.[19] Caffè Nero also offers double reward stamps for every customer who uses a reusable cup in its stores[20]

Caffè Nero participates in numerous waste and recycling initiatives including the London First Mile scheme which collects coffee grounds and converts it into bio-fuel[21]

Controversies[]

Caffè Nero has not paid any corporation tax in the UK since 2007 on sales of £2 billion and has been subject to ongoing criticism,[2] although the BBC has reported that "there is no suggestion that Caffe Nero has done anything illegal" and that "Caffe Nero has previously rejected accusations that its complex corporate structure involving various holding companies is designed to avoid corporation tax."[2] Paul Monaghan, chief executive of the Fair Tax Mark campaign group, said the firm's tax arrangements were “parasitic” and “insulting to the intelligence of the British people” [22]

A handful of the company's stores have either had planning permission controversies and/or enforcement action taken. One town accused Caffè Nero of "bully-boy tactics"[23] following the opening of several stores in the United Kingdom, without the required planning permission. However, all 11 stores where there have been planning permission issues have subsequently been granted planning permission.

In May 2015, the company said that they will stop serving milk from farms in Gloucestershire's badger cull areas. On 29 May 2015, the company said: "Caffè Nero has instructed its partners supplying to stores which are situated around the cull zone areas to supply milk from farms outside of the zone.[24] On 7 July 2015, rats were videoed scurrying along the floor and counter in their Donegall Square West unit in Belfast, despite having previously been awarded a four out of possible five star rating by inspectors from Belfast City Council. Having been notified of the incident, the store was closed for a full investigation and has subsequently reopened; the source of the infestation was an adjacent disused building.[25] A 2017 study by the BBC found trace amounts of faecal bacteria in Caffè Nero's iced drinks, alongside those of Starbucks and Costa Coffee.[26]

In June 2018 Polish State Sanitary Inspectorate and media reported 63 adults and 10 children having been poisoned (21 of whom were hospitalized) after eating salmonella-contaminated cakes served in a number of Caffè Neros in Warsaw, Cracow and Wrocław.[27][28]

See also[]

References[]

  1. ^ "Caffe Nero Tax Affairs" (PDF). Tax Research. April 2014.
  2. ^ Jump up to: a b c "Caffe Nero accused over tax affairs". 6 May 2014 – via www.bbc.co.uk.
  3. ^ "Caffè Nero takeover deal completes returning the b..." The Caterer. 19 January 2007.
  4. ^ Cave, Andrew (5 April 2014). "Caffe Nero founder Gerry Ford has chutzpah - you need it if want to take a European coffee chain to America" – via www.telegraph.co.uk.
  5. ^ Walsh, Dominic (26 February 2018). "Caffè Nero records like-for-like sales growth" – via www.thetimes.co.uk.
  6. ^ "Caffe Nero enters the retail market". MCA Insight.
  7. ^ https://www.ivoryresearch.com/writers/sally-james-ivory-research-writer/%7Ctitle=Situation Analysis of the Caffè Nero Group Ltd.|website=www.ivoryresearch.com}}
  8. ^ "Caffe Nero agrees to management buyout". 7 December 2006 – via uk.reuters.com.
  9. ^ "Caffe Nero to open 80 new international sites in 2019 | Article | Xpress Recruitment". www.xpressrecruitment.com.
  10. ^ "Caffè Nero acquires Harris + Hoole brand from Tesco". 23 June 2016.
  11. ^ Gyton2019-01-31T08:28:00, Georgi. "A taste of things to come?". MCA Insight.
  12. ^ "Which coffee shop chain serves the tastiest coffee?". Which.co.uk. 11 July 2013. Retrieved 9 May 2014.
  13. ^ https://news.sky.com/story/caffe-nero-lenders-and-landlords-brace-for-launch-of-cva-plan-12125237
  14. ^ https://www.bbc.co.uk/news/business-54929684
  15. ^ https://reactnews.com/article/caffe-nero-chief-we-never-meant-pay-no-rent-to-landlords/
  16. ^ Jump up to: a b https://www.standard.co.uk/business/caffe-nero-cva-approved-b131158.html
  17. ^ https://www.thecaterer.com/news/caffe-nero-cva-5m-survival-fund
  18. ^ https://www.cityam.com/landlords-approve-caffe-nero-rescue-deal/
  19. ^ "Caffè Nero's got a whole latte love". Real Business. 27 November 2007. Archived from the original on 10 June 2015. Retrieved 9 May 2014.
  20. ^ "These London coffee shops give you a discount for being eco-friendly". Evening Standard. 31 January 2019.
  21. ^ "Being fuelled by coffee is now a reality thanks to a new, recycling partnership between Caffè Nero and First Mile". 10 February 2017.
  22. ^ Hall, Mark Reynolds and Macer (12 March 2018). "Caffe Nero ROASTED for paying little or no tax despite selling £2bn of coffee". Express.co.uk.
  23. ^ "Planners say 'no' to Caffè Nero in Skipton (From Craven Herald)". Cravenherald.co.uk. 15 December 2011. Retrieved 9 May 2014.
  24. ^ "Caffè Nero bans 'badger cull' milk after animal rights threats". Gloucester Citizen. 1 June 2015. Archived from the original on 3 August 2015. Retrieved 1 June 2015.
  25. ^ "Caffè Nero Council visit after rats filmed". BBC News. 5 August 2015.
  26. ^ Davis, Nicola (28 June 2017). "Faecal bacteria found in ice from Costa, Caffè Nero and Starbucks". The Guardian.
  27. ^ "Sanepid: 73 przypadki zachorowań, w tym 10 dzieci". warszawawpigulce.pl. 11 June 2018.
  28. ^ "Komunikat nr 4: Zatrucie pokarmowe w sieci kawiarni Green Caffe Nero" (PDF). pssewawa.pl. 11 June 2018.

External links[]

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