- Neat Burger owner Neat Meat posted a post-tax loss of around £7.9m for 2022
- Group opened its third non-UK restaurant in Italy just last week
Lewis Hamilton and Leonardo DiCaprio-backed synthetic meat restaurant group Neat Meat is set to close four of its eight UK burger venues, This is Money understands.
Neat Meat, which saw losses expand by around 140 per cent last year, currently has Neat Burger restaurants in London’s Camden, Soho, Stratford, Oxford Circus, Canary Wharf, Victoria, Liverpool Street and Wembley.
The group, which also received backing from Japanese investment giant Softbank, will axe the Liverpool Street, Canary Wharf, Oxford Street and Westfield Stratford sites before Christmas, according to sources familiar with the business’ plans.
And redundancies are being lined up as bosses have warned staff that the company’s ‘future is at risk’.
Neat Meat’s Neat Burger restaurant and takeaway sites offer vegan burgers
The company told employees it had been driven to closures as a result of soaring property rents, the cost of living crisis and the impact of hybrid working patterns on London lunch trade.
It also accepted it had grown too quickly in its earlier stages and currently only has three sites that are beating sales versus last year. It will instead focus on venues still delivering growth.
It told staff: ‘Sometimes it’s necessary to take a step back to take a bigger leap forward.’
The group also has a franchise offering as well as a dark kitchen business, whereby it sells meals exclusively through delivery.
According to the group’s most recently filed Companies House report, Neat Meat made a post-tax loss of almost £7.9million for 2022, up from £3.2million the previous year.
The report also reveals the group had been forced to shelve the opening of a new venue within London’s O2 Arena, while it assigned its Finsbury Park site to a third party ‘in line with our overarching strategy to focus our efforts on smaller venues in areas of high footfall’.
But this did not stop Neat Meat revealing the opening of its third location outside of the UK just last week, with the Milan site adding to restaurants in New York and Mumbai.
It also last week announced a new charity partner, Made In Hackney, a local community food kitchen.
Led by chief executive and early Beyond Meat investor Ryan Bishti, Neat Meat completed a funding round in 2021 that saw the group valued at $70million and opened up plans for rapid expansion.
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But it follows a more difficult trading environment for makers and providers of meat alternatives, which had surged in popularity only a few years ago.
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It’s claimed the vegan market may be worth as much as £50billion globally by 2030, but sales in the UK seemed to have flatlined.
It has possibly been compounded by the cost of living crisis – vegan products tend to be more expensive than meat and dairy – alongside an oversaturation of the market.
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Earlier this year, Beyond Meat reported a 33 per cent loss in sales, while UK brand Meatless Farm went into administration in June.
Bishti himself told the Telegraph in May that consumers have become ‘fatigued’ with low-quality vegan products.
Investment house PGIM wrote this summer: ‘Plant-based meats have dominated headlines, but reality does not match the hype.
‘The steep growth rates for plant-based meats producers have either plateaued or peaked.
‘Only a few years ago – as fast food chains began to offer Beyond Meat burgers – there were expectations for continued exponential growth and drastic changes in consumer preferences.
‘But growth rates have faltered, and today, the alternative meat market remains a tiny sliver – less than 0.2 per cent – of the $1.7trillion global meat market.
‘In fact, alternative meat demand is in decline while global demand for animal-based meat is set to grow by 14 per cent by 2030.’
Neat Meat has not responded to request for comment.
Leo backs Neat Burger
Lewis Hamilton and Leonardo DiCaprio are both investors in Neat Meat
British Formula One star Lewis Hamilton is an investor in Neat Meat, and said this year he was ‘really proud of the boundaries we have been able to push in this space and the plans for expansion are really exciting’.
The Mercedes driver added: ‘As someone who follows a plant-based diet, I believe we need a healthier high street option that tastes amazing but also offers something exciting to those who want to be meat-free every now and again.’
Hamilton is joined as an investor by Hollywood Al-lister Leonardo DiCaprio.
DiCaprio said: ‘Disrupting our food system with sustainable alternatives is one of the key ways we can make a real difference in reducing global emissions.
‘Neat Burger’s pioneering approach to alternative-proteins is a great example of the type of solutions we need moving forward.’
The group’s Victoria store front – not one marked for closure