Report: Overcrowded market to slow restaurant growth

By Liam Garrahan contact

- Last updated on GMT

Report: Overcrowded market to slow restaurant growth

Related tags: Restaurant

The UK’s restaurant industry is set to suffer a slump in growth as the market becomes overcrowded, according to a report by foodservice consultancy, Horizons.

The prediction comes after a period of bumper growth for the sector which saw 1,770 new restaurants open in the 12 months between October 2014 and October 2015, a 6.9 per cent increase​.

Over the past decade the number of chain restaurants in the UK has increased by 55 per cent, a growth percentage that Horizons say is unsustainable in the long-run.

 “It is difficult to see how this level growth in food outlets can be sustained in the longer term,” said Horizons’ managing director, Peter Backman.

“Competition amongst operators means there will be a struggle to improve like-for-like sales across the sector, keeping menu prices fairly flat and margins low.”

The consultancy expects to see a ‘blurring’ of eating-out formats as operators seek to differentiate themselves from one-another, with chains expected to appear in a wider variety of places offering different options to guests depending on the location. Starbucks, for example, has turned its London Covent Garden site into a wine bar during the evenings, and Pre a Manger has developed a sit-down evening food offer.

“Consumers are looking for a good quality eating experience wherever they are. This, and the pressure on sites means that operators are being extremely innovative and changing their offer to adapt,” said Backman.

“The year ahead is likely to be a challenge for operators with competition at its most intense. Those that maintain their quality, keep their menus fresh, their prices competitive and adapt to changing demand will emerge the winners.”

Related news

Show more

Related products

show more

Restaurant magazine – digital edition

Restaurant magazine – digital edition

William Reed Business Media | 01-May-2020 | Sponsored Link

In light of the current circumstances and many businesses being closed during this period, Restaurant magazine will temporarily be going digital only....

Restaurant Media Pack 2020

Restaurant Media Pack 2020

William Reed Business Media | 27-Jan-2020 | Technical / White Paper

The Restaurant portfolio continues to be the essential source of news and information for those working within the restaurant industry, helping to navigate...

Sustainability Report

Sustainability Report

William Reed Business Media | 27-Jun-2019 | Technical / White Paper

Six areas to make your restaurant more sustainable.

From growing herbs on the wall to using ethical dairy suppliers, we run-down the key...

Creative development in the kitchen

Creative development in the kitchen

Nestlé Professional | 19-Jun-2019 | Technical / White Paper

Produced by Restaurant magazine in partnership with Nestlé Professional’s CHEF® brand, Creative Development in the Kitchen explores how high-profile chefs...

Related suppliers

Spotlight

Follow us

Hospitality Guides

View more

Featured Suppliers

All suppliers