London shines as lfl sales grow for 4th month in row

22-Feb-2023 - Last updated on 22-Feb-2023 at 16:36 GMT

Workers and tourists return: London stood out with a lfl growth of 19.9% versus the same period in 2022 (credit: Getty/Gary Yeowell)

Managed pubs, bars and restaurant groups collectively achieved like-for-like (lfl) sales growth of 10.9% in January 2023, marking a rise for four months in row.

January’s figure is also marginally ahead of the current 10.1% rate of inflation, as measured by the Consumer Prices Index, according to the latest Coffer CGA Business Tracker.

However, trading in January benefited from comparisons with early 2022, when some consumers stayed at home amid concerns about the Omicron variant of Covid. According to the tracker, which is produced by CGA by NielsenIQ in partnership with The Coffer Group and RSM UK, high inflation means sales continue to lag pre-pandemic levels in real terms.

Pubs carried the momentum they built over Christmas into 2023, with like-for-like sales 12.9% ahead of January 2022. Restaurant groups’ growth also reached double digits at 10.3%, but sales in the bars segment were down 3.1%.

Return to the capital

The tracker indicated London enjoyed a very strong month as office workers and visitors continued their return to the capital. January sales within the M25 were 19.9% ahead of 2022, which was more than twice the growth of 8.8% outside the M25.

Karl Chessell, director – hospitality operators and food, EMEA at CGA by NielsenIQ, said: “These figures show consumers remain eager to eat and drink out despite the mounting pressure on disposable incomes.

“It’s particularly pleasing to see such a strong bounce back in London, where sales have been hit harder than in other cities by Covid disruption. Optimism for 2023 must be tempered by ongoing concerns about fragile consumer confidence and the debilitating inflation that businesses face in energy, food, labour and other key costs. But while hospitality faces challenges in the months ahead, it remains a dynamic sector with a bright long-term future.”

Coffer Corporate Leisure managing director Mark Sheehan added: “These numbers are despite train strikes hitting trade severely. Consumers and workers have worked around strikes and trade is shown resilience. Like-for-likes are still difficult, but consumers continue to return to eating and drinking out despite economic pressures.”

Turning point

Paul Newman, head of leisure and hospitality at RSM UK, said: “After 15 consecutive months of like-for-like sales growth failing to beat inflation, these results represent a significant turning point for the sector even if the comparative period was somewhat subdued due to omicron concerns.

“This growth underscores the resourcefulness of operators to adapt their January offering to cater to the increasingly popular Veganuary and Dry January campaigns while managing the well-versed cost pressures that the sector is facing.

“These results will be a welcome confidence booster to an industry that has been in desperate need of some good news and will hopefully herald the start of a sustained period of stronger trading.”

CGA collected sales figures directly from 79 leading companies for the latest edition of the Coffer CGA Business Tracker.