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Restaurant visits predicted to drop in 2017 due to "hard Brexit"

18 January 2017 by
Restaurant visits predicted to drop in 2017 due to "hard Brexit"

Restaurant visits are set to drop 0.2% to 11.28 billion as a result of a hard Brexit and the UK leaving the single market, according to research undertaken by global information company, the NPD Group.

In contrast, NPD has suggested that the British out-of-home (OOH) foodservice market could grow visits by as much as 0.4% in 2017 to 11.34 billion and a further 1.6% in 2018 to 11.52 billion in the event of a soft Brexit, with a slightly smaller increase of 1.3% to 11.43 billion predicted in 2018 in the event of a hard Brexit.

Prime Minister Theresa May's speech yesterday (17 January) suggested a hard Brexit may be more likely, with May announcing her intention for the UK to leave the single market.

Following the 1.1% actual growth in OOH foodservice visits in Britain in 2016, the third consecutive year the sector has recorded a rise in visits, total OOH spend to year end November 2016 was £53.46b, in line with NPD's prediction.

For 2017, NPD is predicting total OOH spend of £55.54b, up 3.9% on 2016, and a 3.7% increase in 2018 to £57.60b assuming a soft Brexit environment. NPD's hard Brexit spend figures are £55.30b for 2017 (up 3.4% on 2016) and £57.17b for 2018 (also up 3.4% on 2017).

Whatever the outcome of the Brexit negotations, NPD believes foodservice operators will do well. It suggested that despite the challenges of lower consumer confidence, cost increases from wages, inflation, weaker sterling and growing business rents, the sector's track record of changing menus, investing for the future and efforts to understand customers will win out.

Cyril Lavenant, foodservice director UK at the NPD Group, said: "The good news is that there's a relatively narrow difference between ‘soft' and ‘hard' visit estimates for the next two years, even though Brexit clearly began to slow the pace of growth in 2016. So with many parts of the British foodservice market showing clear signs of strength and resilience, we don't anticipate a sharp drop, either in a ‘soft Brexit' or ‘hard Brexit' environment".

Foodservice pricing falls but remains 2% up on last year >>

Food prices to rise 3.4% in 2017 >>

Foodservice providers feel the strain as inflation increases by 2% >>
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