Bavarian Beerhouse gets “a head” with franchising

“The Bavarian Beerhouse was my husband’s idea,” explains German entrepreneur Sabine von Reth. “He spent seven years traveling the world. In every city he visited, there was an authentic Baravian beerhouse – except in London.”

The pair put together a business plan for their own London-based restaurant in 2003, inspired by the traditional “Hofbräuhaus”, where waitresses in traditional Bavarian “dirndl” dresses serve dishes such as sauerkraut and one-litre “steins” of beer, and punters are entertained by "Oompah" bands and drinking games.

But the banks weren’t interested in stumping up the cash. “The general response was, ‘It won’t work here’,” says von Reth. “So we spent the next year and a half saving our pennies and looking for premises.”

They officially launched their first restaurant in Islington, pulling in sales of £1.1m in year one.

Growth has been steady – but slow. “We never planned on having just one restaurant in London,” continues von Reth. “We think this concept will work across the whole country. Once we’d been trading for three years, we decided to look at franchising options.”

The couple hired consultancy firm how2franchise.co.uk, which helps businesses build and market a franchise in return for an initial admin fee plus commission. Rod Hindmarsch has been appointed as the Bavarian Beerhouse franchise manager and has already attracted interest from entrepreneurs in Manchester, Cardiff and Newcastle, who will each need to cough up £150k to clinch the deal.

“The firm’s turnover will hit £1.5m this year. Next year, we expect to smash the £3m mark and have four franchises up and running,” says Hindmarsh.

Von Reth reckons it’s a tempting proposition for existing pub landlords: “The credit crunch is biting and many pubs have seen sales plummet by 20 per cent,” she says. “The Bavarian Beerhouse is a different entertainment-led business model. What works well in the capital is bound to work well in the region.”

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