To back up this claim, Karl Chessell, director hospitality operators and food EMEA at CGA by NiQ, told the MA Leaders Club in Bristol, on Wednesday 13 September, that although the pub sector had lost 3,776 sites since the pandemic, this was a reduction of 9.5% as opposed to a 13% average in other sectors.
He said the group study of operators, sites, and consumer and leaders sentiment in its PubTrack survey, found “challenges to the sector are still pretty prevalent” with interest rates being the number one challenge, according to business leaders, followed by energy prices and contracts, with food and drink inflation being the next most worrying.
Despite fears, business leader confidence has climbed again for the third consecutive quarter.
Chessell said independent sites in the on-trade had been hit hardest while numbers of managed pubs have remained stable as many operators convert portions of their tenanted estate to managed.
Although pubs have seen stronger like-for-like growth than the wider market, poor weather during the summer had led to a drop in performance.
“People haven’t dampened their love for pubs,” Chessel explained. “People are really satisfied with the quality of food and drinks” they receive at pubs.
He added a key factor was ‘value for money’ and one the insights expert is tracking and added visits to on-premise is number 1 use of disposable income and wet-led pubs are leading when it comes to the most-visited places to spend disposable income.
Despite cost-of-living increases and a lack of disposable income, key to the success of the on-trade is the quality of service and Chessell described this as “a really important driver”.
CGA client business partner Dani Rowlands told the MA Leaders Club, the PubTrack survey delved into what consumers see in a hierarchy of needs. Fundamentally, a pub must have elements including safety, clean, friendly staff and a good atmosphere.
To elevate the experience, it requires a good range of drinks plus good value, high-quality food and a relaxed atmosphere while high-quality food and drinks make it a ‘top tier’ site with “aspirational attributes”.
Rowlands said the more rural a pub is there is more importance placed on friendly staff while a more urban site needs a better atmosphere.
Small and large operators good at events
Small independents, such as the Prince of Peckham pub in south London is a “fantastic example of an elevated experience, with a packed and diverse event schedule including DJs, Zumba classes and Sip & Paint” but added “it’s not just small operators, big operators are really hitting those keys events as well” and cited Greene King as an exponent of this.
There is an appetite among consumers for higher quality produce in pubs and many consumers are willing to pay a premium for it, she added, stating 61 % would be “likely” to pay for higher quality food with 50% saying the same for better standard drinks.
CGA by NiQ listed a table of its five operators “delivering the perfect pub experience” with Brunning & Price leading followed by McMullen, St Austell, Everards and Brakspear.
Rowlands added some things operators can offer are “polarising” such as sport and to stand out is “really tricky” but said Greene King was particularly good in this field.
“Atmosphere is the absolute number one consideration for people when deciding where to watch sport,” she said.
Summarising, Chessell said: “The love for the pub is still there and we need to get through these headwinds. Pubs are loved throughout the land.”