Dry January, cautious spending dampen UK hospitality sales

(Sharecast News) - Restaurant, pub and bar sales in the UK retreated last month with analysts blaming Dry January and the Christmas squeeze on consumer spending. According to the Hospitality Business Tracker from CGA by NielsenIQ and RSM, sales across the industry were 1.3% lower than the year before in January, after year-on-year growth of 3.2% in December.

This was the lowest figure for the tracker in nine months and only the second month of a year-on-year decline since early-2022.

In addition to a cutback in discretionary spending and widespread participation in Dry January, the survey found that footfall was affected by Storm Éowyn which arrived towards the end of the month.

Pub sales were down 0.1% on a like-for-like basis, restaurant sales fell 1.1% and bar sales slumped 10.2%, while the on-to-go segment saw a drop of 4.8%.

"After a happy Christmas for hospitality groups and their suppliers, trading came back down to earth with a bump in January," said Karl Chessell, director of hospitality operators and food, EMEA at CGA by NIQ,

"It shows many consumers remain hesitant about their spending, and while inflation has eased in some areas, business costs remain very high across the sector, and energy price rises and the government's planned changes to National Insurance thresholds and rates could hardly be coming at a worse time."