Not going out: sales down 4.5 per cent for pubs, bars and restaurants
The hospitality sector is struggling to bounce back from Covid-19 as Brits take a cautious attitude to spending post-lockdown.
Rolling sales for managed pubs, bars and restaurants are down 4.5 per cent over the past 12 months as the sector continues to be hit hard by supply chain pressures, high energy prices and recruitment issues. While October sales were up 64 per cent on last year, when trading was limited by covid restrictions, the growth rate dropped from eight per cent in September to just three per cent the following month according to data from the Coffer CGA Business Tracker.
Karl Chessell, the director of hospitality operators and food for Europe at CGA, said: “managed groups battled hard to sustain sales in October, but patchy consumer confidence and a host of external challenges are making real-terms growth elusive. COVID has taken a heavy toll on hospitality, and while some businesses have flourished since the end of lockdown, others remain extremely fragile.”
Chessell stressed the need for “sustained support” for pubs, bars and restaurants to continue into 2022.
Paul Newman, head of leisure and hospitality at RSM, which helped to produce the tracker, said: “Post lockdown euphoria appears to be waning… as consumers begin to feel the impact of rising household bills on discretionary spending.”
“It could spell the start of a long, hard winter for the sector if this downward trajectory in sales growth continues for the rest of the year,” warned Newman.
The Tracker highlighted a contrast in trading in London, where a shortage of office workers and tourists meant sales were down by 4 per cent compared to October 2019, and the rest of the country. Beyond the M25 sales rose by six per cent compared to pre-pandemic.
In the capital October was a slightly better month for pubs than restaurants, with total sales growth of three and two per cent respectively. Bars performed best of all with an increase of 13 per cent as the recovery of the late-night market continued.
It comes as many City firms revealed they will be cancelling their Christmas parties for the second year in a row amid concerns about Covid-19.
Insurers, accounting and law firms have decided to scale back celebrations with small restaurant trips and team activities replacing the traditional Christmas blowouts. EY, a big four accounting firm which has previously held lavish festive parties complete with fire-eaters and dancers, has confirmed office-wide events will not go ahead. Meanwhile, magic circle firm Slaughter and May will cancel its annual dinner dance.