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Flat February for hospitality as consumer spending tightens

This latest figure, from the CGA RSM Hospitality Business Tracker, is well below the current rate of inflation and continues a downward trend from January which saw a year-on-year drop of 1.3%.

The Tracker, produced by CGA by NIQ in partnership with RSM UK, shows that February delivered 2.5% growth in total sales, including all venues opened by groups in the last 12 months. However, with key costs still inflationary – including extra National Insurance contributions from April – margins in hospitality remain extremely tight.

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Pubs performed the best of the major hospitality channels in the Tracker for the third month in a row. Like-for-like sales finished 1.7% ahead of February 2024, having been partly boosted by the start of the Six Nations rugby tournament. Bars meanwhile continued a long-term drop in growth, with like-for-like sales down by 7.9% in February.

Karl Chessell, director of hospitality operators and food, EMEA at CGA by NIQ, said: “After a flurry of spending over Christmas, it’s clearly been a challenging start to 2025 for the hospitality sector. Growth is very fragile, and hikes in National Insurance Contributions will pile even more pressure on managed groups. We remain optimistic that spending will start to loosen, and brighter weather and big occasions like St Patrick’s Day, Mother’s Day and Easter should help to rally sales. Nevertheless, real-terms growth will remain hard-earned for the foreseeable future.”

CGA by NIQ collected sales figures directly from 113 leading managed groups for February’s edition of the CGA RSM Hospitality Business Tracker. The groups span the restaurant, pub and bar sector and include businesses such as Azzurri Group (Ask Italian, Coco di Mama, Zizzi), Bill’s Restaurants, Comptoir Group, Dishoom, Gaucho Grill, Greene King, Mitchells & Butlers and New World Trading Company.

The Tracker shows that hospitality had a slightly tougher month in London than elsewhere. Groups’ sales inside the M25 were down by 1.2% year-on-year. Beyond the M25, they recorded a marginal rise of 0.5%.

Saxon Moseley, head of leisure and hospitality at RSM UK, added: “A second month of lacklustre trading results means that the hospitality sector remains in negative territory for the year to date. Consumers are opting to cut back on discretionary spending amidst growing apprehension about the UK economy and global instability. While the medium-term outlook appears more positive, the coming months will be critical for businesses grappling with both waning demand and rising costs. Next week’s Spring Statement represents a final opportunity for the government to support the sector through this challenging period, with a phased introduction of National Insurance increases and a delay to implementing the Employment Rights Act high on operators’ wish lists.”

• CGA
• Restaurants
• Bars
• sales
• growth
• hospitality
• groups