Out-of-home food and drink sales fall nearly 60 per cent in March

17 April 2020

Britain’s managed pub, restaurant and bar sector saw collective like-for-like sales drop 57.6 per cent in March as the country moved into lockdown, latest data from the Coffer Peach Business Tracker show.

All parts of the market were hit hard, as the slowdown in sales, which started in February, continued during the first half of the month before the total shut down on 20 March. Managed pub operators reported a 57.8 per cent fall in like-for-like trading compared to March 2019, with restaurant groups down 56.2 per cent and bar chains down 60 per cent.

London trading was down 60.4 per cent, with outside the M25 down 56.8 per cent.

'The drop in sales that began in February and escalated in the next month, means that even by the end of March, the eating and drinking out sector had fallen into year on year decline, down 4.1 per cent on the previous 12 months, with London down 3.7 per cent,' said Karl Chessell, director of CGA, the business insight consultancy that produces the Tracker, in partnership with The Coffer Group and RSM.

'With shut down wiping out April sales, apart from a small amount of delivery income, and May likely to be the same, the devastating effect on the market is self-evident. Even if there is an early easing of restrictions, which is far from certain, reopening of the market will almost certainly be phased and gradual. We are looking at a substantial loss of revenue right across the sector,' he added.

Paul Newman, Head of Leisure and Hospitality at RSM added: 'These latest results simply underline what we already know: that the eating and drinking out sector has been at the coalface of Covid-19 disruption. There has been tremendous support from Government but more still needs to be done to protect the 3.2 million jobs of those who work in the sector. At a time when cash is so desperately needed to meet the upfront wages for furloughed staff, most operators are still struggling to access the Coronavirus Business Interruption Loan Scheme under current lending criteria. Great uncertainty remains not only as to the extent of the current shutdown, but also as to what the lifting of lockdown might look like. More support is needed with property related costs and this includes support for landlords themselves who remain liable to pay business rates for empty sites.'

Mark Sheehan, Managing Director, Coffer Corporate Leisure added: 'Every single consumer is a stakeholder and a participant in the hospitality sector, and we all feel a sense of pain at the industry’s suffering since the enforced closures. The re-opening of outlets to full capacity will take months and the sector desperately needs ongoing support. Whilst an earlier release from lockdown appears at first sight to be a good thing; consumers will be anxious about socialising and trading levels will be subdued. The future in terms of consumer behaviour is very uncertain making any form of planning for future very difficult.'

Delivery accounted for 7.4 per cent of sales among the casual dining groups in the Tracker cohort, up from 5.5 per cent in January. 'Although there has been growth in delivery and there is plenty of evidence to suggest more consumers are turning to delivered food during the lockdown, the picture is patchy. As well as more companies establishing delivery options, there are also a number of major players that have closed down their delivery businesses altogether for safety reasons,' added Chessell.

Due to the effect of the lockdown, the number of companies taking part in the March data collection was smaller than usual, totalling 44, but still representing operators across all parts of the sector, with collectively 7,000 plus sites and total annual sales of £8.1billion.