Mark Edwards, Head of Restaurants and Bars sectors at BDO, assesses the restaurants and bars market and what to look out for this year.

While recent years have seen better performance from pubs, 2019 suggested that the decline in alcohol sales, rising health consciousness and increasing competition from supermarkets is beginning to take its toll.

Despite the risk of consumers balancing their household budgets by cutting down on eating and drinking out, managed pubs, bars and restaurants experienced a positive performance during the first three quarters of 2019. The positive collective results demonstrate that people continue to drink and dine out. However, with competition growing fiercely, the risk of stagnation in the eating and drinking-out market remains certain.

Operators who are clear in their proposition, deliver it with operational excellence and can offer an experience as part of serving a meal or drink will outperform all else. While 2020 may see some further casualties, we anticipate some exciting transactions as the light at the end of the tunnel begins to shine a little brighter

Five key predictions for the restaurants and bar sector

1. Demand for experience: 2020 will see a shift towards experiences as consumers are now looking for more than just a casual dining environment. It is expected that new activities such as ‘immersive’ shows, escape rooms and axe throwing will grow along with traditional social activities.
2. Health conscious diners: The trends for health will continue in 2020 where we will see one in four consumers now following restrictive diets. With the growth of veganism, zero-proof gin and buying local becoming more important, this trend is set to stay.
3. Changing worker habits: With more people opting for flexible working and looking for different working spaces, 2020 could be the year where more pubs, bars and restaurants investigate the remote-worker opportunity.
4. The rise of ghost kitchens: The ‘ghost’ or ‘dark’ kitchen concept (kitchens which sell meals exclusively through delivery) is set to grow in 2020 and become the norm, as many large restaurants jump onto delivery apps to gain more customers, fulfil orders and save money.
5. Food halls: the future of casual dining: Food operators will continue to take over empty property space left over by department stores that went into administration in 2018/19, turning them into food halls. The food hall concept has also expanded to seafronts and commercial districts such as Canary Wharf and Bishopsgate.

Gain more insights into the restaurants and bars sector and read our other five predictions by downloading our latest report here.

Mark Edwards is Head of Restaurants and Bars sectors at BDO.

“While 2020 may see further casualties, we anticipate some exciting transactions as the light at the end of the tunnel begins to shine a little brighter.”

Mark Edwards, Head of Restaurants and Bars sectors at BDO

Is there light at the end of the tunnel for the Restaurants and Bars sector?

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