Mon 18th Nov 2024 - Licensed premises numbers increase for second successive quarter but Budget jeopardises recovery optimism Licensed premises numbers increase for second successive quarter but Budget jeopardises recovery optimism: Britain’s number of licensed premises has increased for a second successive quarter, according to the new Hospitality Market Monitor from CGA by NIQ and AlixPartners. The report shows a 0.7% rise in outlets between July and September 2024 – equivalent to 661 net new openings, or seven per day. It follows 0.5% growth in the second quarter of the year, which was the first positive quarter-on-quarter movement since mid-2022. The latest increase brings Britain’s total sites to 99,868—virtually level with the figure 12 months ago. However, confidence for continued growth has been stifled by the government's autumn Budget, with industry-wide concerns of a stalling of this emerging outlet growth, and fears of renewed (net) closures across the hospitality market. Hospitality’s recovery is particularly fragile in the independent sector, which has been weakened by covid-19 and high inflation and is now 15.9% smaller than it was in March 2020. After contracting every quarter for four years, it has now been in growth for two quarters in a row, and site numbers increased 0.7% in the three months to September. However, added costs from the Budget now put the revival of small businesses and start-ups in doubt. The monitor also indicates some cautiously positive trends in local pubs. There are now 12.0% fewer community pubs than there were before covid, but the number rose by 0.4% between June and September. The high street pub segment measured by the tracker is meanwhile 3.8% larger than three months ago. The monitor showed modest growth in the scale of the casual dining and bar sectors while there was also some significant regional variations, including above-average increases in London and Scotland. Karl Chessell, CGA by NIQ’s business unit director – hospitality operators and food, EMEA, said: “While the sector is smaller in outlet terms than before covid, the last six months have shown that hospitality groups, investors and entrepreneurs have been confident enough to be opening rather than retrenching. With inflation, GDP and other economic indicators moving in the right directions, the sector should be looking forward to 2025 with guarded optimism. However, with substantial extra costs on labour and rates now looming, there is a real danger that hospitality’s momentum will be lost.” Graeme Smith, AlixPartners’ managing director, added: “With many businesses now looking to further consolidate their estates, market flux and churn may well create more opportunities for others.”