12 March 2020

Out-of-home food and drink sales down 3.3% in February

Total Like For Like Sales Growth

• Managed pubs, restaurants and bars all see like-for-like trading fall
• Floods and growing impact of coronavirus hitting across country

The scale of the impact of the developing coronavirus crisis, plus the effect of floods earlier in the month, on Britain’s managed pub, bar and restaurant sector in February is revealed in the latest sales data from the Coffer Peach Business Tracker, the established market barometer.

Like-for-like sales across the sector fell 3.3% compared to February last year, with managed pubs, restaurants and bars all suffering declines. Managed pub groups saw collective like-for-like sales fall 4.2%, with restaurant groups down 1.8% and bar chains down 2.8%.

“The month started with flooding hitting sales in parts of the country, with pubs and restaurants actually closed in some areas. But as the month progressed, the impact of the developing coronavirus emergency began to take its toll on business – and we can only expect that will have an increasingly negative impact on sales in coming months. The weekly results for the last week in February showed like-for-like sales down 4.4%. We know that members of the cohort will be watching the weekly results closely to track the market performance through these uncertain times,” said Karl Chessell, Business Unit Director of Food & retail at CGA, the business insight consultancy that produces the Tracker, in partnership with The Coffer Group and RSM.

“It is impossible to predict how bad the effect of the coronavirus emergency will be on the market longer term, but as CGA’s snap poll of industry leaders last week showed, operators are expecting major disruption. All we can say from these figures is that all parts of the business are being affected, and the worst is probably yet to come,” added Chessell.

  • Regionally, London had a tougher time seeing like-for-likes down 3.7% compared to 3.2% decline outside the M25.
  • Pubs saw decline in both food and drink sales, down 3.9% and 4.6% respectively.
  • While restaurant groups recorded a relatively smaller decline in sales, down 1.8%, the number of covers served in the month fell by 4.9%.

Trevor Watson, Executive Director, Valuations at Davis Coffer Lyons, said, “The exceptionally wet weather last month was always going to adversely affect turnover for most operators which wasn’t helped by Valentine’s Day falling on a Friday depriving operators of a good midweek day.

“As to the Coronavirus effect, regardless of the real level of medical risk the public is changing its behaviour, hitting city centres and travel hubs the hardest. Operators biggest fear is on staff infection which would necessitate complete closure. Paradoxically, local pubs and restaurants might see trade sustained as people stay local – people will not shut themselves away indefinitely and will see smaller scale local pubs and restaurants as less of a health risk. This will undoubtedly lead to a re-distribution of trade. It is good to see that the Government has decided to act decisively in supporting businesses in various ways. The suspension of rates for smaller businesses this year will be well received but these changes are of limited benefit to larger businesses,” Watson concluded.

Paul Newman, Head of Leisure and Hospitality at RSM, said, “At the beginning of the month, it seemed that the government’s new immigration proposals following Brexit would be the next big challenge for the sector. These proposals have been swiftly eclipsed by the social and economic disruption from coronavirus. The latest industry like-for-likes point to the start of a prolonged period of falling sales for restaurant and bar businesses. The leisure and hospitality sector will welcome the support announced in yesterday’s Budget to deal with what could be a massive hit to short-term cash flows.”

The downturn in February has also had an immediate effect on the underlying annual like-for-like growth rate for the Tracker cohort, which represents both large and small groups. It fell to 0.9% for the 12 months to the end of month, compared to 1.6% at the end of January.

Total sales for the month, which include the effect of new openings since this time last year, were down 0.7% compared to same period in 2019.

The Coffer Peach Tracker industry sales monitor for the UK pub, bar and restaurant sector collects and analyses performance data from 58 operating groups, with together almost 10,000 sites and a combined turnover of over £11bn and is the established industry benchmark.

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 collects sales figures directly from 58 leading companies. Participants include: Alchemist, All Star Lanes, Amber Taverns, Azzurri Group (Zizzi, ASK), Banana Tree Restaurants, Bermondsey Pub Company (part of Ei Group), Bills, BrewDog, Buzzworks, Byron, Carluccio’s, Casual Dining Group (Café Rouge, Bella Italia, Las Iguanas), Coaching Inn Group, Deltic, Dominion Hospitality, Drake & Morgan, Fazenda, Fuller Smith & Turner, Gaucho Grill, Giggling Squid, Giraffe Restaurants, Greene King (Chef & Brewer, Flaming Grill, Fayre & Square), Gusto, Hall & Woodhouse, Honest Burgers, Laine Pub Co, Le Bistrot Pierre, Le Pain Quotidien, Liberation, Loungers, Marston’s, McMullen, Mitchells & Butlers (Harvester, Toby, Miller & Carter, All Bar One), Mowgli, New World Trading Co, Oakman Inns, Peach Pubs, Pizza Express, Pizza Hut Restaurants, Prezzo, Punch Pub Co, The Restaurant Group (Frankie & Bennys, Chiquitos, Brunning & Price), 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), Wadworth, Wagamama, Whitbread (Beefeater, Brewers Fayre, Table Table), YO! Sushi and Youngs.