800 licensed premises lost in Q4
Food-led pubs have been relatively resilient, with a 7.6% drop since March 2020, while community and high street pubs have dipped by 11.8% and 11.2% respectively
The number of licensed premises in the UK dropped by 0.8% in the fourth quarter of 2023, with a net loss of 803 in the three months, according to data from CGA.
It represents an acceleration of closures from the third quarter of last year, when numbers fell by only 0.3%, but it is much healthier than the average of 24 closures a day that the Monitor recorded in mid-2022.
Britain had 99,113 licensed premises at December 2023, nearly 3,000 fewer than 12 months earlier, and 16,000 fewer than at March 2020.
Food-led pubs have been relatively resilient, with a 7.6% drop since March 2020, while community and high street pubs have dipped by 11.8% and 11.2% respectively.
Managed pub groups have achieved growth of 4.2% in that time, while independents (down 14.1%) and leased operators (down 14.4%) have found it harder to recover from Covid lockdowns.
Karl Chessell, CGA by NIQ’s director – hospitality operators and food, EMEA, said: “Given all the pressures on hospitality in recent months, it is no surprise to see more contraction in site numbers in late 2023. More closures can be expected in the coming months as inflation and labour issues continue to put strain on businesses, and independent operators are particularly vulnerable.
“However, CGA’s data points to solid trading for managed pubs, bars and restaurants, and likely drops in inflation and interest rates will hopefully ease costs and loosen people’s spending as 2024 goes on. Whether or not this leads to a slowing of closures and a trigger for new openings remains to be seen.”
Graeme Smith, AlixPartners’ managing director, added: “Prevailing economic conditions meant 2023 was a difficult year for many hospitality and leisure businesses. However, it was and clearly remains an uneven market. Well capitalised, well-run establishments in resilient parts of the market enjoyed continued growth through 2023, whereas smaller independent businesses struggled to absorb the increase in operating costs.
“While the long-term headline-grabbing pub closure rates are on the face of it shocking, they speak to a societal shift, from drinking-out to more food-led occasions. This has happened amid a 20-year structural expansion in food venues across the country. It is a hospitality mega-trend of the first quarter of this century.”
