Big city hospitality bounces back, but London slower to recover

The hospitality industry has seen a resurgence in the first six months of the year with the top 10 most populous cities outside London bouncing back strongly from the pandemic blues.

According to the latest ‘Top Cities’ research from CGA and Wireless Social, solid sales growth in restaurants, pubs and bars in those cities has improved on the benchmarks of 2019 in six consecutive four-week periods this year.

Sales over the latest four-week period, to 2 July, were an average of two per cent higher than at the same time in 2019.

Operating costs hit 55 per cent

It comes as another survey shows that operating costs have hit more than 55 per cent of turnover before rent, the highest since 2007.

The UKHospitality Christie & Co Benchmarking Report, covering over 5,000 hospitality businesses, shows that increased costs have been driven by the soaring utility, premise and operational costs being faced in the industry, as operators attempt to rebuild following the pandemic.

Top of the ‘Top Cities’ was Glasgow, followed by Bristol and Birmingham, but London sales were down by eight per cent in the latest period, and the capital was bottom in the survey over the whole six-month period.

Capital lags behind main cities

London was hit harder by the pandemic, with a slower return of office workers than elsewhere in the country, and the normally vibrant tourist trade badly hit.

However, the survey did show signs that sales in the capital are now approaching pre-COVID levels.

To build on the growth and mitigate the downturn in the capital, businesses could look at areas like:

Commenting on the survey, CGA client director Chris Jeffrey said:

“Britain’s cities were badly hit by two years of COVID restrictions, but this research shows how hospitality can help revitalise them. While so much retail activity moves online, restaurants, pubs and bars are giving people reasons to visit cities, and keeping their central areas vibrant.”

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