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May sales boost for restaurant chains

17 | 06 | 13

May was a positive month for the UK's restaurants and pubs, according to the latest sales figures from the Coffer Peach Business Tracker.

It found that like-for-like sales were up by 1.2 per cent compared to May 2012. 

This is reflective of a general pattern of growth, as the tracker, which is based on the performance of 27 selected chains, showed that on a yearly basis, like-for-like volumes for the 12 months up to the end of May have increased by one per cent. 

Meanwhile, total sales are up by 4.1 per cent year-on-year. 

Peter Martin of Peach Factory - the firm that produces the tracker - said the industry will be pleased to see these signs of "real growth". 

"Despite May being colder and wetter than average, the public have shown they still have the appetite to go out to eat and drink," he stated. 

An increase in restaurant sales will be welcomed by catering equipment companies, who will benefit from any earnings that are reinvested into new openings and appliances.

London leads the way

In terms of regional variation, London showed the greatest level of growth, with venues in the capital seeing their like-for-like sales increase by 1.8 per cent. 

However, for the leading restaurant chains results were best outside of London, with Mr Martin saying the majority of major openings came from outside of the M25. 

Meanwhile, Jarrod Castle, leisure analyst at UBS European Leisure Research, predicted that brands covered by the tracker will experience site growth of 3.8 per cent away from London and 2.4 per cent within.

Things aren't all positive outside of the capital though, as drink-led pubs in the rest of the UK experienced a like-for-like sales decline.

Trevor Watson, director at Davis Coffer Lyons - which contributed to the tracker - commented: "Although London performed strongly, the underlying trade across the country still looks fragile. The weather in May 2013 was below the long-term average, however, it was better than May 2012."

He added that the housing market recovery in the south-east is helping to boost consumer confidence and he expects sales figures to improve further in the summer months.

International attraction 

Part of the growth experienced in May can be attributed to international brands seeking to expand their presence in the UK. 

Paul Newman, head of leisure and hospitality at accountancy firm Baker Tilly - which also contributed to the tracker - said Britain's food and drink market is proving increasingly attractive to foreign companies.

He commented: "US burger chains Five Guys and Shake Shack are following the likes of Chipotle by testing their concepts in the London market and Jumeirah-owned brand Noodle House is also poised to hit the UK over the coming months."

Mr Newman warned that while this is good news for consumers, the entrance of these businesses will only serve to increase the pressure in what is already a highly competitive market.

However, this will be welcomed by catering equipment suppliers and manufacturers, whose services will be in increased demand if more firms choose to set up shop in the UK. ADNFCR-16001031-ID-801599957-ADNFCR


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