Casual dining chains get burnt by pubs when sun shines


Hot weather in May helped boost trade in Britain’s pubs, but hit restaurant sales, figures from the latest Coffer Peach Business Tracker reveal.

Overall, the country’s managed pub, bar and restaurant groups saw collective like-for-like sales up 1.4% on May last year, according to data released this morning.

While managed pubs saw collective like-for-likes jump 3.5% for the month, with drink-led outlets doing best, casual dining brands saw like-for-like sales drop 2.1% against the same period last year.

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“It’s a familiar story. When the sun shines people head for the pub, or more precisely the pub garden. In contrast, restaurants do better when it’s dull and damp. Weather remains the biggest factor when it comes to sales in the out-of-home market. It’s the way it is,” said Peter Martin, vice president of CGA, the business insight consultancy that produces the Tracker, in partnership with Coffer Group and RSM.

Regionally London did marginally better than the rest of the country with like-for-like sales up 1.6% against 1.4% for outside the M25, with the difference between pubs and restaurants mirroring the national picture.

“The effect of the Royal Wedding on trade is hard to judge, but if anything, it may have depressed sales with many people staying home to watch on the TV,” said Martin.

“The good news is that overall the sector saw an uplift in trading in May, which contrasts with the 1.2% fall in April. The public continues to go out to eat and drink, and confidence among operators is also returning, if not yet to pre-Brexit levels,” he added.

Mark Sheehan, managing director of Coffer Corporate Leisure, commented: “It’s always easy to blame the weather. But it was a long wait until May when the pub sector got the benefits of some sunshine. Better weather and a World Cup with a record 32 teams should see very strong trading for many pub businesses over the coming period. Restaurants and food led pubs may have a tougher summer to add to the pressures they are under. In the longer term, we see competition for casual dining chains become little less intense as poorer performing units are closed.”

While it has been a challenging year so far for the eating out market, the recent acquisition of Pret A Manger and Rosa’s underline the enduring attractiveness of growth opportunities for overseas investors in the sector.

Further deals are expected to follow as well-capitalised businesses look to take advantage of better sites at lower rents.

Mr Martin added: “The shake-out of sites in the casual dining sector seems to be helping by reducing the threat of oversupply, and deals are also being done in the market, showing that investors also want to be involved in pubs, bars and restaurants.”

Underlying like-for-like growth for the 39 companies in the Tracker cohort, which represents both large and small groups, is still subdued, running at just 0.6% for the 12 months to the end of May, but up from 0.4% at the end of April.

Total sales growth across the cohort, which includes the effect of new openings, was 4.5% in May, reflecting continuing if slower brand roll-outs, and running at 3.8% for the 12 months to the end of the month.

The Coffer Peach Tracker industry sales monitor for the UK pub, bar and restaurant sector collects and analyses performance data from 39 operating groups, with a combined turnover of over £9 billion.

Tags : Casual diningCoffer Peach Business TrackerPubsresearchRestaurants
Andrew Seymour

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