Pubs face fightback in smoking ban price war

The local curry house can be expected to mount a strong defence as pubs try to steal food trade from rivals.

With more 'casual diners' expected to eat in pubs after the smoking ban, market analyst Friary Marketing & Consumer Group (FMCG) has warned that Indian and Chinese restaurants may start price cutting to hang on to customers.

FMCG's latest QuickBite survey of consumers shows that mainstream casual diners - defined as those spending between £11 and £17 per head on a meal out with drinks - are willing to eat more in pubs after the smoking ban comes into effect in England on July 1.

However, FMCG director David Humphreys warned: "Pubs will have to fight other mid-market pubs and restaurants for the same customer.

"Amongst the most likely to switch more to pub meal usage are people who used Chinese and Indian restaurants, which might lead to a price war as pubs' competitors fight back to retain their customers."

JD Wetherspoon has already shown that it's ready to fight hard for new customers, with a leaflet delivered to households up and down England last week containing £50 worth of discounts on both food and drink, effective from July 1.

The leaflet focuses on products areas such as wine, coffee, cask ale and super chilled lager, and features offers such as beer, burger and chips for 4.25 and two curry meals for £5.99.

Humphrey said FMCG had been warning operators for some time that they should feature more Eastern and Oriental dishes on pub menus. "These two segments account for some £9bn a year in meals out of the home, either eaten on the premises or as a takeaway," he said.

To avoid simply competing on price for the casual diner, he suggested pub operators need to differentiate their food offer with a carefully selected core menu, supplemented by a rotating range of specials which allow customers "to try something new or unusual occasionally".