That was the underlying message at the Horizons Breakfast Briefing held this morning in London’s Armourers’ Hall, which revealed some of the latest trends and forecasts for the restaurant sector.
“We’re not talking about an industry that’s booming right now, but there is certainly excitement and opportunity,” said Horizons’ managing director Peter Backman. “It looks as though conditions are bottoming out around about now and will hopefully begin rising ever so slowly over the next 18 months.
“There may be little growth in the sector overall, but there’s plenty of innovation – the sector is in good shape as operators continue to invest in new concepts, adapt their menus, open new locations and examine their pricing structures with vouchers driving business.
“We reckon that the foodservice market is going to get back to about 2006 levels by the end of this year and possibly 2008 by the end of next year.”
Weathered the storm
Figures presented at the Briefing showed that consumers’ average spend on eating out now stands at £13.80, up from £10.29, while 72 per cent of UK adults eat out on a regular basis. Innovation in the market, in terms of outlets and menus, is partly responsible for the sector’s buoyancy, along with the continued growth of coffee shops, managed food-led pubs and casual dining outlets.
Emma Read, director of marketing and business development at Horizons, added: “It’s been tough, but when you look at the recent developments on the high street and if you listen to Mary Portas about the decline of the high street, the foodservice market has actually weathered the storm pretty effectively.
“There have been casualties, but not in the way we have seen for the rest of the high street. Eating out in the UK now is habit. Over 70 per cent of the population are eating out despite all of the current financial problems. So the foodservice sector is very well positioned for post-recession recovery.”
Olympics to cause decline
Read went on to highlight the ‘special factors’ that should also be taken into consideration for restaurants this summer, with two May bank holidays, the Jubilee weekend and the Olympics all falling within the space of three months.
But, despite many thinking the Olympics will bring increased footfall for restaurants, Backman revealed that Horizons actually expects the number of visitors to the UK to drop for the duration of the event, leading to a decline in food and beverage sales
“Although there will be people coming to the UK for the Olympics, there will also be people not wanting to come here because of the event,” he said. “Overall, if you take the whole Olympic piece, we expect there to be a decline in F&B sales compared with what we would normally expect, by around £70m – a relatively small amount in a £42bn market, but a decline nonetheless.”
The Horizons Annual Briefing, entitled 'Consumer change: adapting business to new demands', also featured a panel of industry experts including Andrew Guy, managing director of Ed's Easy Diner, and Ian Sarson, group managing director of Compass Group. The morning's presentation concluded with the following insights:
Who will suffer in 2012?
• The financially-stretched
• Public sector dependant
• The unprepared
• Failing to offer value for money
• Independent / tenanted / leased pubs
• Health care
Who will win in 2012?
• Restaurants investing in customers
• Restaurants investing in innovation
• Restaurants investing in store numbers
• Operators in London
• Coffee shops
• Managed food-led pubs
The full Horizons presentation can be viewed here