British coffee and sandwich chain Pret A Manger is set to launch in Israel, opening at least 40 cafes in the country over the next decade.
The London-based chain has entered into a non-binding agreement with the Israeli fashion store chain Fox-Wizel Ltd. and restaurant group operator Yarzin Sella to establish and operate the coffeeshops in Israel. As part of the agreement, a jointly owned company for the purpose of the franchise will be set up in which Fox will hold 75% and Sella 25%.
The 10-year franchise is conditional on Fox and Sella opening at least 40 Pret A Manger branches over the next decade. According to the initial agreement, the franchise partners have an option to extend the arrangement for another 10 years subject to meeting certain conditions and milestones.
As part of the franchise deal, Fox and Sella will pay Pret A Manger a monthly rate of the total net sales. The parties said they expect to sign binding agreements during the first quarter of 2023.
Pret A Manger, which serves organic coffee and fresh food prepared on the spot to grab and go has over 600 branches in countries across Europe, North America and Asia and employs over 13,000 people worldwide. In the UK, the chain sells a range of sandwiches filled with ingredients such as falafel and squash, hummus and roasted pepper, or ham and cheese, as well as wraps and flatbreads.
Owned by investment group JAB, the coffee chain has recently entered new geographical markets, including Ireland, in a move to double the size of its business within five years. Founded in 1986, Pret A Manger has operations in the United Kingdom, the US, Hong Kong, France, Dubai, Switzerland, Brussels, Singapore and Germany.
Fox, a family-owned business known for its inexpensive T-shirts and sweatshirts emblazoned with the all-capital FOX name brand, has become Israel’s largest fashion group, bringing an assortment of international brands to the Israeli shopper. Listed on the Tel Aviv Stock Exchange, the retailer has the Israeli franchise for Nike and Foot Locker (through its subsidiary Retailers), as well as for other brands such as American Eagle, Billabong, and Mango.
The initial deal with Pret A Manger marks Fox’s first entry into the food sector, which the retailer said is an “important pillar for diversifying the portfolio of its brands and expanding its areas of activity.”
“The signing of the agreement for the establishment of the Pret A Manger chain in Israel together with the Yarzin Sella group is a big step to increase value, variety and competition in the Israeli market,” said Fox owner and CEO Harel Wiesel. “Israeli consumers will benefit from the opening of the international chain here in Israel with a wide nationwide spread and a variety of products that they love and look for every time they visit Europe or the US.”