Cold and Wet April Hits Spending on Eating and Drinking Out
May 17, 2012
Poor weather hit sales across the eating and drinking-out market in April, according to latest Coffer Peach Business Tracker data with pub and restaurant groups seeing collective like-for-like sales down 2% for the month.
Pubs, and in particular drink-led businesses, were worst hit, although high street casual dining restaurants saw sales increase against the same month last year.
As ever, the weather is a major factor in where, or whether, people choose to go out and eat. In general, if its sunny people go to the pub; when its wet restaurants tend to benefit, said Peter Martin of Peach Factory, the business intelligence specialist that produces the sector Tracker, in partnership with Coffer Group and UBS.
Last April, not only did we have hotter weather, but we had the Royal Wedding and Mothers Day in the month, as well as the Easter holidays. That benefited the market overall last year, but pubs and pub restaurants in particular, added Martin.
Total sales in April this year were, however, up by 1.9% on 2011, reflecting the effect of new openings. The Coffer Peach Tracker* industry sales monitor for the UK pub and restaurant sector collects and analyses monthly performance data from 24 operating groups.
Despite the fact that bad weather was a major dampener and April 2011 was an especially good month in comparison, with like-for-like sales up 3.8% on 2010, operators will nonetheless be disappointed with the results. The market remains volatile and these figures cancel out the modest bounce-back in out-of-home food and drink sales seen in March, after a very shaky start to 2012 in January and February, added Martin.
The market will be hoping for real boost from the Diamond Jubilee in June and the Olympics later in the summer.
Mark Sheehan, managing director at Coffer Corporate Leisure, said: Given the poor weather in April, these figures show remarkable hardiness from the sector. Last year we had a combination of unseasonable spring sunshine and an extra bank holiday for the royal wedding. As we continue to suffer from poor weather in May we are becoming dependent on the summer for an uplift. Many hospitality operators remain nervous about the Olympics and with a strong pound it may be that summer 2012 is painful for some. Yet the real legacy of the Games and the Diamond Jubilee for the restaurant sector, and the hospitality industry as a whole, could very well be the very long-term benefit resulting from the surrounding publicity both will bring.
Jonathan Leinster, Head of UBS European Leisure Research, commented: We do not see todays data as particularly surprising, and remains within the range of typical monthly volatility. We would however hope for a significant rebound in May, given a c4% easing of the comps, and a further improvement in June as trading benefits from the Queens Jubilee bank holiday and Euro2012.
We believe consumers are still happy to allocate discretionary spend to eating and drinking out, and pub-restaurants and other low-cost food options are growing share within that market. The March 2012 UBS UK household cash flow indicates that average household discretionary expenditure, excluding- utilities, fuel and debt payments, will rise 4.6% in the current year.