According to Lumina Intelligence’s UK Pubs & Bars Market Report 2022, the UK pub and bar market is expected to grow by 56.7% in 2022, reaching a value of £22.5bn, equating to 98% of its 2019 value.
A year of unrestricted trading is predicted to see the market gain back £8bn of lost value from the pandemic.
However, further prospects of growth have been thwarted by the immediate challenges around consumer behaviour amid the cost-of-living crisis, surging inflation and rocketing energy costs.
While six pubs are expected to close every week this year, outlet closures are easing following a long-term trend of decline in the market, underpinned by pub group tenanted pub disposal programmes ending, according to the report.
Market segment
Moreover, the independent segment of the market is predicted to see decline of 1.5% in 2022 – with less support for operators leading to unviable sites.
Almost six in 10 (58%) of hospitality business leaders are anticipating trading conditions to deteriorate over the next 12 months with the cost of living, inflation and labour shortages all immediate concerns.
Furthermore, the survey also revealed more than half (51%) of responses from hospitality professionals noted the impact of the cost-of-living crisis on consumer spending was the top concern.
This was followed by inflation was a worry for more than a third (37%), while labour shortages were the third biggest concern at 29%.
About a fifth (22%) cited rising costs for operators while two in 20 (20%) said supply chain and its challenges.
Financial aspect
Meanwhile, the report also showed Mitchells & Butlers led the top pub groups in turnover at £2.4bn, followed by JD Wetherspoon at just under £1.34bn and Greene King was third at £1.3bn.
Marston’s were fourth, Stonegate Pub Company came in at fifth, Young’s followed then Whitbread, Fuller’s, Loungers and Star Pubs & Bars.
In terms of acquisitions in this group, the top 10 groups saw outlets grow by a third (33.4%) from 2019 to 2022, as a result of selling and closing underperforming sites and buying pub packages from other groups, the report stated.
Admiral Taverns more than doubled its estate in this period after buying 150 pubs from Star and acquiring Hawthorn the Community Pub Company however, Stonegate Pub Company saw the biggest growth at 492.4%.
