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Tue 11th Sep 2018 - Licensed premises closing at almost double the rate they were three months ago
Licensed premises closing at almost double the rate they were three months ago, all regions see decline: Licensed premises in Britain are closing at almost double the rate they were three months ago, according to the latest edition of the Market Growth Monitor, from CGA and AlixPartners. The report showed Britain has 3,116 fewer restaurants, pubs, bars and other licensed premises than 12 months ago. There were 119,800 licensed sites across the country in June 2018 – a fall of 2.5% since the previous year. It represents average net closures during the past year of about eight premises a day. The rate of closures has nearly doubled since the last edition of the monitor three months ago, when the year-on-year decline measured 1.3%. Every part of the country has seen a decline, ranging from 3.4% in Wales to 1% in the West Midlands, with London seeing a 2.3% fall. Continuing the trend of the past few years, community pubs continue to account for the majority of closures – but the monitor indicated restaurant numbers are falling too. After a period of growth that has seen Britain’s total restaurants increase 11% in five years, numbers fell 1% in the 12 months to June 2018. The findings confirm other CGA research revealing a host of challenges in the restaurant sector, including fierce competition, flat like-for-like sales and escalating input costs. The casual dining sector has seen a series of closures and company voluntary arrangements from a number of high-profile names in the first half of 2018, although others, especially ambitious fledgling brands, continue to expand. The monitor revealed other bright spots for openings – especially in northern city centres including Manchester, Liverpool and Leeds, which all have at least a fifth more licensed premises than five years ago. Operators are increasingly looking beyond London and the south east for openings, with the number of managed, branded restaurants outside the M25 increasing 5.9% in the past year, compared with 1.5% within it. CGA vice-president Peter Martin said: “People continue to eat and drink out, and new and exciting restaurant, pub and bar brands are still achieving impressive growth. But competition from these dynamic startups, rising costs and the fickle nature of many consumers are combining to turn up the heat on established restaurant brands. In the current climate, standing still is simply not an option.” AlixPartners managing director Graeme Smith added: “The monitor tells the story of a market responding to current pressures. Restaurant expansion is still on the agenda for some companies, particularly in those locations across the UK that have previously been underserved by casual dining operators – but management teams and investors need to carefully consider their opening strategies. When it comes to pubs, operators with a well-executed food offer remain attractive, and those who add accommodation to the mix are under the spotlight of investors looking to businesses with more diversified revenue streams and broader trading windows.”


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