Eating out market sees like-for-likes fall in February but ‘worst yet to come'
Flooding and the coronavirus saw year-on-year, like-for-like sales across pubs, bars and restaurants fall by 3.3% in February.
The biggest fall was seen across pub groups at 4.2%, with restaurants down 1.8% and bar chains recording a 2.8% downturn. Despite recording a smaller fall in like-for-like sales, restaurants reported a fall of 4.9% in the number of covers served.
Karl Chessell, business unit director of food and retail at CGA, the business insight consultancy that produces the Tracker in partnership with the Coffer Group and RSM, said: "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 it 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.
"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."
The sharpest like-for-like decline was seen in London at 3.7%, compared to 3.2% outside the M25.
Trevor Watson, executive director of valuations at Davis Coffer Lyons, added: "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, which is hitting city centres and travel hubs the hardest. Operators' biggest fear is 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. Nonetheless, there has been a clearly compelling case for some government support and intervention to ease the impact on the sector, which is under significant strain."
The Coffer Peach Tracker analyses the performance of 58 pub, bar and restaurant groups with a total of almost 10,000 sites.
*Picture: Shutterstock
