Caffe Nero drafts in KPMG for landlord negotiations

Caffe Nero has drafted in KPMG in a bid to negotiate high street rent cuts with landlords, according to Sky News.

It comes as the coffee chain, which operates 660 stores across the UK, is looking to “review its options” regarding its property portfolio amid the latest government restrictions concerning the virus.

According to Sky News, KPMG is now consulting with the chain on a “range” of possible options for rent negotiations.

Analysts told Sky that these are “likely to include mechanisms that would enable rent cuts and possible limited store closures”.

Another source added that Caffe Nero executives had “been engaged in constructive dialogue with landlords but needed to intensify talks”.

A spokesperson for Caffe Nero told Sky: “It has been a difficult period since lockdown measures were introduced by the government and we’re working incredibly hard to navigate our way forward.

“As part of this, we are working closely with advisors to help review our options and assist with our ongoing negotiations with landlords.”

News of the negotiations comes one week after Costa announced that 1,650 roles are at risk of redundancy following a newly-launched bid to restructure the group as it attempts to weather the impact of Covid-19.

The coffee chain said the ongoing impact of Covid-19 has required the business to “make difficult decisions to ensure that as many jobs as possible are protected long-term”.

The company said it will work to find affected employees alternative roles within the business “where possible”.

The move also follows news that Pret a Manger will cut 2,800 jobs as part of a restructuring following almost two months of consultations with team members.

The high street chain said that while sales and footfall have started to show “clear signs of recovery”, sales over the last month stand at where they were around 10 years ago, when the business was “considerably” smaller.

It said the reduction in roles was a reflection of “shorter opening hours, lower transaction levels, and the losses faced by the business in 2020”.