Pubs taking share of tougher food market

Pubs are still gaining share of the eating out market, despite consumers being more cautious overall, according to new market data.

The latest figures from Friary Marketing and Consulting Group (FMCG) show meal prices creeping up in managed pubs, and pubs taking a bigger slice of consumer spend.

FMCG believes an overall decline in the eating-out market 2006, shown in its Menurama survey, is mainly down to a fall in spend on convenience meals, principally fast food, at the cheaper end of the market.

By contrast, higher spending 16-34 year old consumers have switched more towards table service, which has benefited more upmarket food led pubs.

Even in table service, the Mainstream Casual segment declined during 2006, while the Premium Casual and Premium segments both saw volume growth.

Along with individually operated food-led pubs, brands such as the Restaurant Group's Blubecker's chain and Mitchells & Butler's (M&B) Project S food pubs are in the Premium segment.

David Humphreys of FMCG said that the Spirit-owned Chef & Brewer chain, which has recently introduced table service, is also entering this market, while Greene King's Wayside Inns business also has the potential to move up.

Since last year, FMCG's ongoing QuickBite survey has tracked growing pessimism among blue collar workers and first-time house buyers as pressure grows on their disposable incomes. Humphreys suggested this shows a new two-tier economy emerging, as better off AB consumers spend more, while others cut back.

This echoes comments made by M&B chief executive Tim Clarke last month, when he suggested trading patterns had split along socio-economic lines. He said mainstream suburban consumers were seeing little growth in their earnings as "high mortgage rates, stealth taxes and council tax" hit their pockets.

Interestingly, the most recent Menurama report shows M&B has increased its meal prices by 3.4 per cent against the same time last year.

Humphreys added that better off consumers are also putting their money where their mouth is when it comes to locally sourced food. "Consumers have said to us for some time that they'd be prepared to pay a little more for local produce. The evidence is that they are now doing so, particularly at the top end of the eating out market."