Hospitality like-for-likes sales UP 9% on indoor re-opening week.

In the first full week since operators were able to serve guests indoors since November 2020, hospitality sales were up 9% compared to the same week in 2019. However, these figures paint a picture of mixed fortunes for the industry, with a significant bounce in food sales and the continued collapse in drinks revenue.

Food sales were up nearly 30% on the same week in 2019, representing significant demand for out of home dining. While there was pent up demand for eating out, remaining restrictions prohibit vertical and late-night drinking, resulting in the continued decline of drink sales, down 7% on 2019 levels.

While there was an overall bounce in like for like performance in the U.K., sites in London were level with the same week in 2019, with all the growth driven by sites outside the capital.

For the first time since hospitality re-opened in April, the majority of sites in the U.K. are trading at above 2019, even if many are only marginally so. Last week, only 19% of sites traded at 90% or less than their 2019 levels. This is in contrast with two weeks ago, when two thirds of operators were trading at below 90% of 2019.

The significance of being able to trade indoors is highlighted when looking at the difference between last weeks sales and the week prior, when it was outside only. Sales were up 83% last week compared to the last week before operators could serve guest inside and 95% up when only looking at sites outside of London.

S4labour’s Chief Customer Officer, Sam Wignell added, “life is coming back to the sector and we are buoyed by the green shoots, but we are concerned for our customers who are so heavily impacted by the restrictions. It is critical we do not delay the freeing up of our pubs and night-time venues from social distancing measures that are preventing them from trading profitably”.

Hospitality sales down over 10% on first day of indoor trading.

Sales from Monday, the first day operators were allowed to serve guests inside, were down 10.3%. The research undertaken by S4labour, analysed hospitality sales from Monday, comparing them with the same Monday in 2019, representing a normal Monday’s trade levels. The decline in sales was driven by a 24% collapse in drink sales, where restrictions continue to prohibit vertical drinking. Food sales were up 5% compared to the same Monday in 2019, indicating the majority of pent-up demand has dissipated, with outside service being re-introduced in April.

With the restrictions now allowing inside service to resume, the number of sites open jumped to 95%, up from 50% of sites open the week before. The high proportion of the industry now open means that like-for-like sales figures are particularly relevant, the sales data is no longer representative of the small portion of the sector that was able to feasibly open in the previous restricted conditions. Such weak sales performance demonstrates just how difficult it will be for hospitality to be profitable until all restrictions are lifted. This gives additional significance, as it shows the sustained damage the industry would suffer, should further restrictions not be relaxed on the 21st of June.

S4labour’s Chief Product Officer, Richard Hartley, commented “The restrictions that were lifted this week disproportionately disadvantaged wet-led sites, as vertical drinking remains prohibited, while restaurants are able to deliver a service that is a bit closer to ‘normal’. It is worrying, but not a surprise, to see drink sales so weak, but it is disappointing that, given the bounce of previous reopening, food sales were only a few percent up on a normal Monday in 2019. It is clear that the easing of restrictions are a baby step forward, but we are still a long way from being able to trade anything like profitably.

Hospitality sales continued their decline last week, sliding 23% compared to the previous week. While roughly half of sites remain closed, those that did trade saw like for likes down 15% compared to the same week in 2019.

Week on week sales had been declining since hospitality re-opened outside on the 12^th of April, with a significant amount of the decline being driven by weak London performance, while sites outside of the capital remained fairly stable, until last week. Sites outside of London saw a week-on-week sales drop of over 24%. Sites inside the capital compounded two weeks of decline with a 16% drop week-on-week.

Drink sales plunged 25.3% week on week, indicating that the public’s appetite for outside drinking was washed away by the inclement weather. At the same time food sales also fell 13.9%.

Poor trading last week resulted in a significant increase in the percentage of the market who traded at 90% or less of 2019 levels. Two thirds of operators failed to trade at 90% of 2019 levels with half failing to achieve even 70% of 2019 levels.

S4labours Chief Product Officer, Richard Hartley, commented, “this level of decline shows just how difficult it is to run a hospitality business in these conditions. The weather was awful and goes a long way to explaining this data, but for another week, the 70% of operators who are significantly down on 2019 will have their eyes firmly on May the 17^th, when they can protect their guest from our unpredictable weather, give their team more hours and increase their capacity to get profitable again”.