Out-of-home food and drink sales fall nearly 60% in March

April 17, 2020

Out-of-home food and drink sales fall nearly 60% in March

Britain’s managed pub, restaurant and bar sector saw collective like-for-like sales drop 57.6% in March as the country moved into lockdown, latest data from the Coffer Peach Business Tracker show.

All parts of the market were hit hard, as the slowdown in sales, which started in February, continued during the first half of the month before the total shut down on March 20. Managed pub operators reported a 57.8% fall in like-for-like trading compared to March 2019, with restaurant groups down 56.2% and bar chains down 60.0%.

London trading was down 60.4%, with outside the M25 down 56.8%.

“The drop in sales that began in February and escalated in the next month, means that even by the end of March, the eating and drinking out sector had fallen into year on year decline, down 4.1% on the previous 12 months, with London down 3.7%,” said Karl Chessell, director of CGA, the business insight consultancy that produces the Tracker, in partnership with The Coffer Group and RSM.

“With shut down wiping out April sales, apart from a small amount of delivery income, and May likely to be the same, the devastating effect on the market is self-evident. Even if there is an early easing of restrictions, which is far from certain, reopening of the market will almost certainly be phased and gradual. We are looking at a substantial loss of revenue right across the sector,” he added.

Mark Sheehan, Managing Director, Coffer Corporate Leisure added: “Every single consumer is a stakeholder and a participant in the hospitality sector, and we all feel a sense of pain at the industry’s suffering since the enforced closures. The re-opening of outlets to full capacity will take months and the sector desperately needs ongoing support. Whilst an earlier release from lockdown appears at first sight to be a good thing; consumers will be anxious about socialising and trading levels will be subdued. The future in terms of consumer behaviour is very uncertain making any form of planning for future very difficult.”

Paul Newman, Head of Leisure and Hospitality, RSM added: “These latest results simply underline what we already know: that the eating and drinking out sector has been at the coalface of Covid-19 disruption. There has been tremendous support from Government but more still needs to be done to protect the 3.2 million jobs of those who work in the sector. At a time when cash is so desperately needed to meet the upfront wages for furloughed staff, most operators are still struggling to access the Coronavirus Business Interruption Loan Scheme under current lending criteria. Great uncertainty remains not only as to the extent of the current shutdown, but also as to what the lifting of lockdown might look like. More support is needed with property related costs and this includes support for landlords themselves who remain liable to pay business rates for empty sites.”

Delivery accounted for 7.4% of sales among the casual dining groups in the Tracker cohort, up from 5.5% in January. “Although there has been growth in delivery and there is plenty of evidence to suggest more consumers are turning to delivered food during the lockdown, the picture is patchy. As well as more companies establishing delivery options, there are also a number of major players that have closed down their delivery businesses altogether for safety reasons,” added Chessell.

Due to the effect of the lockdown, the number of companies taking part in the March data collection was smaller than usual, totalling 44, but still representing operators across all parts of the sector, with collectively 7,000 plus sites and total annual sales of £8.1billion.

Participating companies receive a fuller detailed breakdown of monthly trading. To join the cohort, contact Andrew Dean, Andrew.Dean@cga.co.uk

About Coffer Peach Business Tracker
CGA collected sales figures directly from 44 leading companies. Participants include: Alchemist, Amber Taverns, Azzurri Group (Zizzi, ASK), Banana Tree Restaurants, Bermondsey Pub Company (part of Ei Group), Bills, BrewDog, Buzzworks, Casual Dining Group (Café Rouge, Bella Italia, Las Iguanas), Deltic, Dominion Hospitality, Drake & Morgan, Fazenda, Fuller Smith & Turner, Gaucho Grill, Giggling Squid, Greene King (Chef & Brewer, Flaming Grill, Fayre & Square), Gusto, Hall & Woodhouse, Honest Burgers, Laine Pub Co, Le Bistrot Pierre, Le Pain Quotidien, McMullen, Mitchells & Butlers (Harvester, Toby, Miller & Carter, All Bar One), Mowgli, New World Trading Co, Oakman Inns, Peach Pubs, Pizza Express, Prezzo, Revolution Bars, Rileys, Rosa’s Thai Café, Snug Bar, St Austell, Star Pubs & Bars, Stonegate Pub Co (Slug & Lettuce, Yates’, Walkabout), TGI Fridays, True North Brew Co, Upham Pub Company, Various Eateries (Strada, Coppa Club), Whitbread (Beefeater, Brewers Fayre, Table Table), YO! Sushi and Youngs.