Restaurant Sector Going Through Clear-out as 500 Venues Shut Their Doors
According to imbibe.com, Restaurants have been closing at the rate of more than 10 a week in 2018, with family businesses worst affected, according to the latest industry figures.
The somewhat ironically titled Market Growth Monitor report from CGA and consultants AlixPartners showed that, in September 2018, Britain had 26,892 restaurants – 539 fewer than the same time last year. It comes on top of recent analysis showing that profit margins in the restaurant industry have tumbled from 19% to below 2%, over this period.
The pain of the closures, however, is not spread evenly. Since the start of the year, the number of family-owned restaurants has fallen by almost 3%, with Chinese, Indian and Italian restaurants bearing the brunt of the closures. The number of managed restaurants, by contrast, has grown by 1%. This is despite a number of high profile closures from the likes of Carluccios, Prezzo and Jamie Oliver.
This year Carluccios and Jamie Oliver announced they were closing a third of their respective UK restaurants, while the chain Prezzo revealed it was to shut over 90 venues. Bars and, particularly, pubs have been worse affected than restaurants, however, with an 11% drop in numbers over the last five years. The rate of closures is higher in the south than the north.
“We have seen a steady flow of pub and bar closures for many years, but the restaurant sector is now going through its own clear-out,’ said CGA vice president Peter Martin. ‘The bulk of closures are from independents, while managed groups remain in growth. This trend is welcome news for some since it eases overcapacity and frees more property [for expansion].’
While the figures might make pretty grim reading for the hospitality sector, it’s not all bad news. The revival of ‘Boomingham’ continues apace, with the UK’s second city adding 25 new venues this year, among them 18/81 and Nocturnal Animals.
The city also has a strong presence on the shortlist for Imbibe’s Personality of the Year awards, due to be judged over the next month.