Improving product quality, store refurbishments, and reducing costs are on the agenda in 2024 for bakery business Paul UK as it aims to return to profit.
The business, which operates around 30 sites across London as well as ones in Oxford and Reading, reported a loss after tax of £863k for the year ended 31 December 2023, according to its latest accounts filed on Companies House. This represents an improvement on the £2.4m loss for 2022 with a small uptick also seen in total revenue, which rose 3% versus the previous year to £35.9m.
Unsustainably high utility costs for most of the year coupled with the continued increase in minimum wage as well as rising costs on the back of global conflicts all impacted the profitability of the business, it said. As such, it has sought to focus on areas of the business on which it can have a positive impact rather than factors outside its control.
“It is not possible to pass all these increases directly onto the customer which has led the company to try to attract and serve more customers each week and introduce new and innovative products,” stated the business in its latest strategic report.
“The company’s standards have been reintroduced during the year and amended to ensure they are relevant to the business today and meet the customers’ expectations of Paul. Focusing on staff training and development has helped improve staff retention and provide enthusiastic, knowledgeable, well-trained staff which is critical to enhance the customer’s experience of Paul.”
In addition, several stores were identified as requiring urgent improvements with a refurbishment programme implemented to manage this and upgrade work continuing during 2024. Kings Road, South Kensington, and Bow Lane were among the stores to be revamped. Paul UK noted that not all the work was customer facing but the improvements significantly helped the teams in these stores.
During 2024 the refurbishment of several of the company’s original stores – such as Holland Park, Marylebone, and Brompton Road – will see the Parisian style introduced into the UK, which can already be seen in stores in Paris and elsewhere in the world.
It also refurbished and rebranded the 3 Quays store from a Paul to Paul Le Café in line with the wider group’s development of the latter brand. The design and style of this brand and its focus on quality coffee has seen an increase in sales, the firm noted. The St Pancras shop is next for the Paul Le Café makeover followed by another store during 2024.
The potential to grow sales via the website is another important avenue for Paul UK. More store hubs will be introduced, which will increase the area into which its products can be delivered.
The celebration cake range will also be developed to tap into different seasons and on-trend flavours; however, Paul UK highlighted the challenge of delivering freshly produced cakes, which are made without palm oil and additives, to ensure all cakes are received by customers as intended.
