The Italian casual dining chain, which is backed by Cain International, says soaring inflation has made it impossible to keep all its restaurants operating profitably.
About 810 jobs are at risk of redundancy as part of the overhaul, which will leave the group with 97 sites remaining.
Prezzo informed affected staff today (24 April) of the closures and launched a consultation process. It added that it will work to redeploy as many staff internally as possible and will support others in finding new opportunities.
“The last three years have been some of the hardest times I have ever seen for the high street and I’m extremely proud of the way our colleagues have retained Prezzo’s position as an appealing, trusted, great value food and drink experience,” says Dean Challenger, Prezzo chief executive.
“But the reality is that the cost-of-living crisis, the changing face of the high street and soaring inflation has made it impossible to keep all our restaurants operating profitably. That is why we have made the difficult decision to close 46 sites where the post-Covid recovery has proved harder than we had hoped.”
In the past year, Prezzo has seen various key costs rise with utility bills having more than doubled, now representing 9% of total revenues.
Core ingredients have also gone up, with the cost of dough balls rising 15%; pizza sauce by 28%; diced mozzarella by 18%; and spaghetti by 40%. Additionally, wage inflation has seen a double digit increase.
And while customer numbers are strong in high footfall areas, according to the group, in other locations they remain below pre-pandemic levels.
The group says its remaining portfolio will be in 'better locations to cater to changing consumer habits such as shopping centres, retail parks, tourist destinations and travel hubs'.
It plans to invest in continued menu development and high-quality ingredients, whilst working hard to balance the cost-of-living crisis and increasing food costs.
“We believe the tough decisions we are making today will ensure Prezzo can continue serving communities with high-quality, accessible Italian-inspired meals for many more years to come,” adds Challenger.