Jobs at Risk as Franco Manca Plans Closures Amid Cost Pressures

Up to 225 jobs are at risk after sourdough pizza operator Franco Manca confirmed it intends to close around 16 sites as part of a major restructuring programme.

The move forms part of a company voluntary arrangement (CVA) being launched by parent company Fulham Shore, which said a number of restaurants within its estate are no longer financially viable under current trading conditions.

The Bournemouth town centre site closed without notice earlier this month.

Fulham Shore, which also owns The Real Greek, has not yet revealed which locations from Franco Manca’s circa 70-restaurant portfolio will be affected.

Chief executive Marcel Khan pointed to sustained cost inflation across the sector as a key driver behind the decision. He highlighted rising employer costs, including increases in National Insurance contributions and the National Living Wage, alongside what he described as a lack of meaningful business rates relief for restaurants.

Khan also noted that VAT levels for the UK hospitality sector remain comparatively high versus European markets, adding further strain to operating margins.

He said that even well-performing businesses are struggling to offset these pressures, forcing operators to reassess the viability of parts of their estate.

The restructuring follows a broader strategic review initiated earlier this year, during which Fulham Shore appointed advisers to explore options including a potential sale or wider reorganisation of the business.

Industry sources indicate that the group continues to assess the future direction of The Real Greek brand, which currently operates around 28 sites.

Fulham Shore itself was acquired in 2023 by Japanese operator Toridoll, backed by investment firm Capdesia, in a deal valued at £93.4m.

Khan said the CVA is intended to place Franco Manca on a more stable financial footing, enabling the business to focus on sustainable growth: “Even restaurant businesses that are doing all the right things from a customer and operational perspective are not immune to widely publicised pressures impacting the hospitality industry.

“This includes significant increases in national insurance and the national living wage in recent history, as well as a lack of business rates relief for the restaurant sector and disproportionately high VAT in the UK compared with Europe.”

He added: “As a result of these external cost pressures, we have to make sure that we are putting our business on a sustainable footing for long-term growth and development.

“This is why we have taken the difficult decision to undertake a CVA for Franco Manca, which will see a minority proportion of our restaurants closing where they are no longer sustainable in this cost environment.

“We are deeply saddened by the closures of a minority proportion of our restaurants, and will support our affected team members throughout this process in every way that we can.”