18th December 2009

Grim January ahead warns Horizons

Consumers are likely to spend more on eating out in the week before Christmas than they have in any other week of 2009, but are expected to rein-in their spending considerably in the New Year as the reality of continued economic uncertainty and fear of unemployment kicks in.

“For restaurant operators, December is a crucial period,” said Peter Backman, managing director, Horizons. “Our research shows that trading for restaurants, quick service restaurants and pubs through December tends to rise by an average of 22%.

“Sales are likely to pick up next week, but will still be lower than they have been in previous years. We would also anticipate that people will cut back much more in January as VAT rises, credit card bills start arriving, the weather gets colder and strike action from the likes of BA depresses the nation’s mood. The more formal sit-down restaurants are likely to suffer most during January and February, although takeaways could see trade rise, as they did during the heavy snowfall of 2009.”

Horizons’ recent QuickBite survey of over 1000 consumers showed that between the second and third quarters of 2009, eating out increased 8.1%. However, sales were still 4.2% lower than they were during 2009.

Some 75% of consumers surveyed by Horizons in September 2009 said they had eaten out over the past two weeks, a rise of 4% since June. On average consumers are eating out 1.58 times a week. Spend per head also showed a slight increase, up from £10.76 per head in June to £10.80 per head in September.

Horizons’ data shows that quick service restaurants, such as fast food outlets, cafés, and takeaways, along with managed pubs, have become increasingly popular with consumers, while tenanted pubs continue to lose market share. This year the number of people visiting a pub for a meal has declined by 11%, compared with last year.

Horizons is an analyst and specialist information consultancy for the foodservice and hospitality sector.