Coronavirus

Floods and coronavirus see February drink sales fall 4.6%

12-Mar-2020 - Last updated on 12-Mar-2020 at 10:53 GMT

Hitting sales: floods and the developing coronavirus have started to have an accumulative adverse effect on the trade

The severe flooding that began in early February combined with the growing impact of the coronavirus crisis has started “to take its toll” across the on-trade.

According to Coffer Peach Business Tracker, pubs saw a decline in both food and drink sales, down 3.9% and 4.6% respectively, with managed pub groups also seeing collective like-for-like sales fall 4.2%.

The sector, as a whole, saw like-for-like sales dip 3.3% compared to February last year.

CGA business unit director of food and retail Karl Chessell said: “The month started with flooding hitting sales in parts of the country, with pubs and restaurants actually closed in some areas.

“But as the month progressed, the impact of the developing coronavirus emergency began to take its toll on business – and we can only expect that will have an increasingly negative impact on sales in coming months. The weekly results for the last week in February showed like-for-like sales down 4.4%.”

Major disruption

Chessell explained how it is impossible to predict how bad the effect of the coronavirus outbreak will be on the market in the long term but the company’s data shows operators are expecting major disruption.

Restaurant groups, however, did not suffer as badly after recording a relatively smaller decline in sales, down 1.8%, with the number of covers served last month falling by 4.9%.

On a regional scale, London had a tougher time, seeing like-for-likes down 3.7% compared to a 3.2% decline outside the M25.

Davis Coffer Lyons executive director Trevor Watson said: “Paradoxically, local pubs and restaurants might see trade sustained as people stay local – people will not shut themselves away indefinitely and will see smaller scale local pubs and restaurants as less of a health risk.

“This will undoubtedly lead to a redistribution of trade.”

The worst to come

The downturn in February has also had an immediate effect on the underlying annual like-for-like growth rate for the Tracker cohort, which represents both large and small groups.

It fell to 0.9% for the 12 months to the end of month, compared to 1.6% at the end of January.

Total sales for the month, which include the effect of new openings since this time last year, were down 0.7% compared to same period in 2019.

Chessel concluded: “All we can say from these figures is that all aspects of the sector are being affected, and the worst is probably yet to come.”