Coronavirus Bites Into UK Hospitality Dollars

Coronavirus is having a strong negative impact on sales for even the strongest UK hospitality business, according to analysis of 136 typically high-performing food and beverage businesses from Tenzo, a restaurant business intelligence and forecasting platform. 

Cafes are being far more affected than restaurants, with a 16 percent year-on-year decrease in sales in the first week of March, compared to a 6.39 percent reduction for restaurants. Results for pubs are so far inconsistent.

A smaller analysis also showed that the reductions in sales have in part been compensated for by an increase in delivery orders, with some businesses seeing an increase of up to 25 percent in delivery sales.

The sample businesses, including multi-site and single-site quick service, fine dining, and casual dining restaurants, pubs, and cafes, are all users of the Tenzo platform. They had recorded on average year-on-year sales growth of 6.04 percent for an average week in November, 6.38 percent in December, and 1.18 percent in January.

However, after the first UK case of the Covid-19 coronavirus was confirmed on January 31, sales growth was reversed, dropping to -0.73 percent in February, and then much further to -6.74 percent in the first week of March. The sample includes a majority of sites in and around London.

For the average business in the sample, this meant a year-on-year reduction in sales in the first week of March of £1,883.

Compared to Tenzo’s AI sales prediction, which uses machine learning to analyse past sales, growth trends, weather forecasts, and holidays, the impact looks even worse, with sales down on average 11.29 percent in the first week of March, compared to what Tenzo’s AI would expect the businesses to take in the same period.