Q2 2021 State of the English restaurant industry report

Throughout the pandemic, we’ve been tracking daily and weekly sales numbers from our customers based in England, to see how lockdowns and reopenings have affected the restaurant and wider F&B industry and put together an English restaurant industry report.

In our Q1 report, we saw that sales were hovering at the -40% mark compared to 2019. Throughout that quarter all dine-in service was banned as England experienced its third lockdown. Businesses needed to diversify in order to bring in revenue or risked being shut for over three months.

However, this quarter, restaurants were finally allowed to reopen, at first for outdoor only on April 12th and finally inside with social distancing in place on May 17th. Restaurants that hadn’t been able to offer alternative channels were finally able to recoup some of their lost revenue. Many were also anxious to see whether diners would be keen to return to eat-in dining, or if people were still skeptical of being so close to each other in public.

See how sales were affected in Q2 in 2023 here.

Average weekly sales vs 2019 in open locations

We can immediately see that the reopening of outdoor dining had a positive impact on sales numbers – customers were keen to get back to hospitality come rain or shine. However, as the weeks went on, we saw a falling off in sales as people got over the novelty of being in a restaurant and started to feel the cold (this April was one of our coldest and rainiest ever).

The same pattern emerged as indoor dining reopened. At first, diners were keen to be allowed inside, but once the excitement has worn off we level out again. For context, week 21 (May 24th in the graph above) included the Spring Bank Holiday in 2019, whereas this year it was in week 22 (May 31st) which explains the dip and subsequent rise in comparable sales over those two weeks.    

Average daily sales vs 2019 in open locations since indoor reopening

When we dive deeper and look at daily average sales compared to 2019 since indoor dining resumed, we can see that sales are by far the best on weekends and businesses are regularly exceeding their 2019 sales levels on those days. It also appears that we have now levelled off during the weekdays at just shy of 2019 numbers.

Percentage change in average transaction value per day compared to 2019

What we can see is that those higher weekend sales are being driven by higher transaction values across all channels. People are spending more when they go out than they did pre-pandemic. This may have something to do with the ease of ordering now that most restaurants offer app-based ordering or that customers are keen to spend their saved income.

As restaurants are able to fully reopen their dining rooms, it will be interesting to see if that increase in average transaction value remains. If it does, it looks like businesses will surpass their 2019 sales level quite easily.

Delivery vs Eat-in

A big question surrounding reopening was whether delivery demand would shrink back to 2019 levels (unlikely) or would stay at a similar level as it had been pre-reopening.

Our data shows that consumer habits have changed and that we have gotten used to our weekly takeaways or deliveries. The graph above shows that total sales have risen 121% in the 5 weeks since indoor reopening compared to the 5 weeks pre-outdoor reopening, but delivery/takeaway has stayed quite stable only falling 22% in that time period. This means that businesses will have to keep prioritising these channels.

Conclusion

The long-awaited reopening has brought sales back to almost sustainable levels for F&B businesses. However, the pushing back of ‘Freedom Day’ from June 21st to July 19th has delayed the chance for restaurants to open their dining rooms entirely free from social distancing which would have given a further boost to sales.

Hopefully, as the country reopens and more and more office workers head back to the office, we will see increased sales on weekdays especially around lunch. It just remains to be seen how total freedom will affect sales over the coming months.