Pret A Manger, known worldwide for its quick-fix coffees and sandwiches, has had to dramatically adapt after the COVID-19 pandemic threw a wrench in its business model of serving city workers. Now, the company's CEO, Pano Christou, is eyeing a new target audience: remote workers.
Christou revealed that the coffee chain is redirecting its expansion efforts towards suburban areas and market towns, where people both live and increasingly work.
Christou took over as Pret's CEO in 2019, just months before the pandemic shuttered businesses. He has since observed the fluctuating activity levels at his Pret stores and remains skeptical about a return to office mandates, expressing confidence in the enduring trend of remote work.
“I don’t see that changing,” Christou said. “We need to adjust to that.”
Pret, which originated in the U.K. capital in 1986 and has nearly 300 London locations as of July, heavily relied on office-goer foot traffic.
The return of workers to offices is aiding Pret's recovery to pre-pandemic levels, with recent reports indicating that transactions in the City of London have reached 79% of their pre-pandemic levels.
While London remains integral to Pret's operations, a significant shift has occurred since April 2021, with the majority of new stores opening outside the city center.
Notably, the company's most rapidly expanding locations are now in north-east England, suburban areas, and London's airports, according to Bloomberg.
CEO Christou emphasizes that a strategic focus on these less-explored regions of Britain will be pivotal for Pret's growth in the upcoming years.
“We have a huge opportunity for Pret to grow over the next five to 10 years,” he said.
A government survey published in February showed that 44% of workers in Britain worked remotely or in a hybrid format, and found that "homeworking is resilient to pressures such as the end of restrictions and increases in the cost of living."
Even though Christou expects remote work to continue, several companies are starting to call their employees back to the office.
Banks like Goldman Sachs were among the first to push for in-person attendance in early 2022.
Several companies have since followed suit—the likes of Meta, Zoom and Amazon have all called employees back to the office.
Meanwhile, investment bank JPMorgan has started asking some of its staff to come in all five days, marking a complete reset from the COVID-era approach to work.
How has Pret adapted to the new normal?
Reliant on in-person buyers at its many stores, Pret faced a pandemic-induced shakeup, leading to layoffs and a shift to contract workers.
To adapt, they ventured into online coffee bean sales, ghost kitchens for food delivery, and introduced a subscription service in September 2020, allowing up to five daily barista-made drinks.
This strategy contributed to Pret's return to profitability in 2022, with a 71% sales increase and 58 million loyalty program redemptions globally.
In the first half of 2023, the company’s revenue increased 20% year-over-year.
Now, Pret plans to boost its successful subscription model.
They recently expanded "Club Pret" in the U.K., offering discounts on fresh food items and will be increasing the discount to 20% as well as making Club Pret subscriptions available worldwide starting on September 5.
“Club Pret has become a critical part of our growth strategy and we’re excited to bring it to more people than ever before, delivering great value in the process,” Christou said in a statement Thursday.
