Sales rise again but March is slowest month of 2023

24-Apr-2023 - Last updated on 24-Apr-2023 at 09:42 GMT

Consumer spending slows: factors such as rail strikes affected hospitality sales in March (credit: Getty/smartboy10)

Like-for-like sales at Britain’s leading managed pub, bar and restaurant groups in March were 1.4% ahead of last year’s levels.

Although year-on-year growth has taken place for six successive months, the latest figures from the Coffer CGA Business Tracker, show March’s rate is the slowest of the first three months of 2023 and is substantially below the UK’s current rate of inflation.

Pressure on consumer spending, mixed weather and rail strikes all contributed to the challenges facing operators over the month, said tracker producers CGA by NIQ, The Coffer Group and RSM UK.

Pubs achieved like-for-like sales growth of 2.4% in March, while restaurants were 2.5% ahead of March 2022. The bars segment had a third consecutive month of negative figures, with sales down 13.2%.

London outpacing rest of country

The revival in London since the end of Covid-19 restrictions continued with trading outpacing the rest of the country. Sales within the M25 were 3.1% ahead year-on-year compared to 1.2% outside the motorway.

Karl Chessell, director – hospitality operators and food, EMEA at CGA by NIQ, said: “These figures emphasise trading conditions in hospitality remain challenging and operators have to work hard to grab their share of sales.

“Consumers’ interest in eating and drinking out remains strong but, after adjustments for inflation, it’s clear that in real terms, it is tougher for operators this year than last year.

“May’s three bank holidays will bring opportunities for strong trading and there is cautious optimism pressure on spending may ease as the year goes on but the Government’s reduction of support on energy bills from April and increases in minimum wage levels, will add to the squeeze on operators and real-terms growth will be difficult for some time to come.”

Some optimism

Coffer Corporate Leisure managing director Mark Sheehan added: “The market remains challenging but there is some optimism among traders.

“Whilst top-line growth lags inflation across the board, many operators are looking to take advantage of better availability of property to build a selective pipeline of new sites. Much growth in sales is being derived from price increases rather than volume.”

“The hospitality industry is not immune to the ‘slowcession’ gripping the nation and these results reflect an industry that is stuck in a rut of modest like for like growth, but way below inflation,” said RSM UK head of leisure and hospitality Paul Newman. “Operators will continue to feel the pinch until persistently high food price inflation begins to retreat but will be hopeful of an uplift in trade in mega-May to reverse this holding pattern of margin erosion.”