Pubs and and restaurants suffer ‘January sales hangover’

Britain’s managed pub and restaurant groups saw sales slump in January after a strong Christmas, according to latest figures from the Coffer Peach Business Tracker. Collective like-for-like sales were also down 1.8% against the same month last year, a downturn from December’s 4.1% like-for-like increase on the same month in 2017. Both pub and restaurant operators saw a drop in sales during the month, although pubs did slightly better with collective like-for-likes down 1.4% against 2.5% for restaurant chains. Overall like-for-like trading in London was broadly in line with the rest of the country, down 1.9% compared to a 1.7% drop outside the M25. A contrast was seen between the performance of managed pubs and group-owned restaurants in the capital, with the former down just 0.5% against a more significant 4.1% sales decline for restaurants during January. In the rest of the country outside the M25, the difference in performance was less stark, with pubs’ like-for-likes down 1.6% and restaurants down only 2%. Total sales across the 49 companies in the tracker, which include the effect of net new openings since this time last year, were ahead 0.4% compared to last January. Underlying like-for-like growth was running at 1.2% for the 12 months to the end of January. Trevor Watson, executive director, valuations at Davis Coffer Lyons, said: “The figures are indicative of the malaise affecting consumers in the post-Christmas period. Trading prospects are likely to remain weak, which mirrors statistics for the wider UK economy where there is a clear indication of a slowdown. “The strongest innovative operators who continue to exceed customer expectations in terms of service and value are trading well as indicated in Christmas trading statements." Karl Chessell, director of CGA, the business insight consultancy that produces the Tracker, in partnership with Coffer Group and RSM, added: "Despite Dry January, drink sales in pubs held up better than food sales, down 0.7% compared to minus 2%, suggesting underlying food growth in pubs appears to be peaking, as competition and choice in the food out-of-home increases generally, and premiumisation of the drinks sector is stimulating alcohol sales.” RSM’s head of leisure and hospitality, Paul Newman said: “Even if consumers went out to eat and drink in similar numbers, the increased uptake of Veganuary compared to last year reduced spend per head as diners opted for cheaper vegetable/plant-based dishes over meat options. “Wet-led operators were also hit by the growing influence of Dry January with much of December’s uplift being undone by these disappointing results. We expect discretionary spending on eating and drinking out to remain constrained as Brexit uncertainty continues to weigh on consumer sentiment.”

Pubs and and restaurants suffer ‘January sales hangover’

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