Restaurant sales rise amid challenging conditions

Restaurants saw another rise in sales in February in the face of increasingly difficult trading conditions, new data shows.

The school half term holiday helped boost like-for-like sales in restaurant groups by 2.4%, according to the Coffer Peach Business Tracker.

Managed pubs also saw a more modest 1.2% increase in like-for-like sales over the same period.

London outperformed the rest of the country, with restaurant and pub sales rising 2.6% compared to 1.4% outside the M25.

Peter Martin, vice president of CGA Peach, said the figures would bring ‘welcome relief’ to operators facing rising business rates bills and higher food costs associated with the falling pound.

“Encouraging though these figures are, pub and restaurant groups will be working even harder this year to maintain trading levels as their margins are squeezed by increasing overheads,” said Martin.

A recent CGA Peach survey of 450 senior executives across pub, bar and restaurant chains showed that almost 75% of operators were looking to pass on rising costs to the consumer.

“That means [operators] will have to redouble efforts to up the customer experience,” said Martin.

The industry will also be hit by the increase in the National Living Wage (NLW) from £7.20 to £7.50 per hour from 1 April. The government’s plan to increase the NLW to £9 per hour is expected to cost the hospitality sector an extra £13.3m in wage bills by 2020.

CGA Peach collects sales figures from 34 companies including The Restaurant Group, Byron and Gaucho.