Advertisement
Business

Hospitality sales slow in October as cost pressures mount

October’s figures have been somewhat mitigated by Halloween, which usually boosts trading, but fell on a Thursday this year

Hospitality groups achieved year-on-year sales growth of just 0.6% in October, which marks the fourth month of below-inflation growth in a row – meaning that data is currently at its lowest point since April, according to the CGA RSM Hospitality Business Tracker. 

The flattening of sales reflects fragile consumer confidence amid ongoing cost increases, as well as poor weather for much of October. 

Related Articles

In light of this, concerns have been raised for trading over the crucial Christmas period, which adds to new pressures on the sector’s tax burden set out in the government’s recent budget. 

Advertisement

In addition, October’s figures have been somewhat mitigated by Halloween, which usually boosts trading, but fell on a Thursday this year. Therefore, many celebrations have taken place over the following weekend. 

According to the tracker data from early November, Halloween has contributed to a “bright start” to the month for pubs and bars in particular. 

The Tracker, which shows total sales growth in October as well as new venue openings during the past 12 months, improved to 2.4%. Managed pubs achieved a like-for-like rise of 1.5%, whereas restaurants saw sales dip by 0.1%.  

Meanwhile, bars saw sales fall 4.2% below the levels of October 2023. 

On-the-go groups performed best of the major segments with 4.3% growth, which could possibly be attributed to some consumers trading down their spending from meals out.

For the third month in a row, growth in London lagged behind the rest of the country. Managed groups’ sales inside the M25 were down by 0.1% year-on-year, while venues further afield achieved 0.9% growth.

Karl Chessell, director at CGA by NIQ, said: “It’s clearly been a tough autumn for many restaurants, pubs and bars, and real-terms growth remains elusive. Conditions haven’t been helped by the budget, which is imposing significant new costs on businesses via National Insurance contributions while giving consumers little encouragement on spending. 

“It is going to be a make-or-break Christmas for some operators, and while underlying demand for hospitality remains good, trading conditions are likely to remain very difficult well into 2025.”

Back to top button