Restaurants & nightclubs have been the hardest hit channels over the last two years PROOF’s latest OUTLET on trade database reveals there have been over 4,000 net restaurant closures between February 2020 and June 2022 (-14%), the majority (84%) being independent sites, and 40% being value-led outlets. Nightclubs have seen a 19% net reduction in sites, with over 200 closures, almost all independent. Overall, there has been a net 8.3% reduction in on trade sites. Rural venues (-7%) have fared better than urban (-9%); regional groups (-2.5%) better than nationals (-5%) and independent traders (-9.5%); and the upmarket/premium sector (-6%) better than value/midmarket (-9%). Yet despite these shifts, the shape of the trade remains broadly unchanged, which is dominated by independent sites (71%), urban venues (73%) and value or midmarket sites (70%). Bars have fared better than other sectors in the hospitality industry, reducing by just 2% overall, with over 200 net new craft, activity and cocktail bars combined, as operators adapt towards the changes in consumer occasions on-trade, with younger consumers increasingly seeking premium and activity-led experiences on their nights out. Looking ahead, whilst more venues are likely to close their doors, we will continue to see regional groups snap up viable sites – particularly those with a specialist and all-day proposition that are seeing success with consumers. Contact PROOF to find out how we can help you in the changing competitor landscape Source: PROOF Insight OUTLET.gb |
Hospitality affected as workers attend office an average of 1.5 days a week A recent market survey of over 40 UK offices, representing circa 50,000 employees across a range of sectors, suggests that workers attended the office an average of 1.5 days a week, against the pre-covid average of 3.8 days. Consultancy Advanced Workplace Associates found that average daily attendance was around 29% of staff, peaking at 39% mid-week and with only 13% in on a Friday. In sectors where viable, home or hybrid working has continued post-pandemic for many organisations. The survey found that companies with a hybrid policy specifying attendance for a certain number of days had higher attendance than those that didn’t but suggested that employees were going into the office less than mandated. The switch to home and hybrid working has impacted hospitality businesses that relied on office workers for custom, with London’s financial district and Birmingham particularly affected as one in seven licensed premises, including restaurants, cafés, and pubs, shut doors between March 2020 and June 2022. Hospitality businesses in financial districts have been adapting their opening days to follow the three-day weeks, mainly Tuesday to Thursday, adopted by companies. Initiatives to drive footfall to such areas outside those days; such as the City of London Corporations’ £2.5m investment in the arts and hospitality sector, are looking to reimagine the district as a destination for visitors and residents as well as workers by hosting upcoming outdoor festivals, arts and music events. Source: BBC News, The Financial Times, CGA |
Further shortages expected for drinks industry Breweries and drinks manufacturers worldwide already experiencing shortages and supply problems of CO2 are faced with further disruption and greater scarcity of the carbon dioxide vital to production of drinks. European supplies were last significantly hit in the summer of 2018, affecting UK producers importing CO2 from the EU. Carbon dioxide is produced at only a few sites in the UK, mainly those run by firm CF industries that capture CO2 as a by-product of ammonia production. Spiralling energy costs and reduced gas supply due to the war in Ukraine, mean CO2 production is now cost prohibitive for CF, ceasing the process at one UK site and possibly closing another. Furthermore, plans by the EU to reduce gas usage by 15% as Russia threats to cut further gas supplies, will affect CO2 imports. Many smaller brewers now struggling to source sufficient CO2 or pay higher prices for it have scaled down, outsourced production, or turned to CO2 alternatives such as nitrogen. Larger brewers in the main have navigated some supply difficulty so far, although Heineken is reportedly preparing to cut beer production this winter if facing an insurmountable shortage. Brewer Tennent Caledonian moved in recent years to produce CO2 in-house; their brewery at Wellpark features a carbon-capture facility that generates more than 4200 tonnes yearly as a by-product of the on-site fermentation process. Parent company C&C Group also has a recovery system at their cider plant in Ireland, leaving the company relatively self-sufficient in CO2 and at an advantage to weather any upcoming shortages. Source: The Drinks Business, The Herald |
Investments, Mergers & Acquisitions
Sources: Big Hospitality, Propel, Beverage Daily |
Drinks Product Launches & Campaigns
Sources: Spirits Business, Drinks Business, Morning Advertiser |