Closures of drink-led establishments in the UK is slowing down, says the new edition of the Market Growth Monitor from CGA and AlixPartners.
It found that closures of drink-led pubs and bars averaged 3.6 a day in the last five years, but in the last 12 months that rate slowed to 2.2 a day, largely, suggests the research, thanks to the heatwave, the World Cup and the ‘rising popularity’ of craft beer, cocktails and artisan spirits.
The report also said that the number of casual dining restaurants in Britain fell for the first time in nine years as several chain operators were forced to close branches.
It said that the number of casual dining outlets slipped by 0.1% from December 2017, through the total number of managed restaurants in Britain in December 2018 was 5,780 —27.3% or 1,241 more than just five years ago.
There was a 0.9% drop to December 2018 everywhere apart from London, where there was a 1.5% rise. Managed restaurant numbers on the high street dipped 1.1% year on year, while suburban areas recorded 2.2% growth.
CGA vice-president Peter Martin said, “The boom in managed restaurants has been one of the British economy’s great success stories of the past decade. However, after a string of closures and company voluntary arrangements in the casual dining sector in the past 12 months, the sector is now in net decline – albeit a very modest one. We can expect to see further contraction in numbers over the course of 2019. Many casual dining brands continue to thrive and we are seeing continued strong growth for small and medium-sized groups in particular. With consumer drinking trends working in the sector’s favour and food-led pub operators facing the same challenges as managed restaurants, the outlook for drinkers’ pubs is better than it has been for a long time.”
AlixPartners managing director Graeme Smith added, “The more positive outlook for pubs and bars is reflective of the buoyant mergers and acquisitions activity in the sector. This reflects not only the saturation of certain parts of the restaurant market but also the combination of reduced supply and the continued rise of quality wet-led pub and bar operators.”