Thu 27th Feb 2025 - Hospitality suffers a January hangover as sales slip and costs rise Hospitality suffers a January hangover as sales slip and costs rise: Sales at Britain’s leading restaurant, pub and bar groups fell by 1.3% year-on-year in January, the latest CGA RSM Hospitality Business Tracker reveals. It marks an abrupt end to a strong period of trading for managed operators following like-for-like growth of 3.2% in December. January’s figure is the tracker’s lowest since April 2024, and only the second month of negative trading since early 2022. Sales in early January were restricted by a squeeze on consumers’ spending after Christmas and widespread participation in “Dry January”. Footfall was also affected by Storm Éowyn, which kept people at home in many parts of the country over the last weekend of the month. The tracker shows fractional growth of 0.6% in total sales, including at venues opened in the last 12 months. However, this is still below the UK’s rate of inflation of 3%, as measured by the consumer prices index. Despite “Dry January”, pubs performed the best of the major hospitality channels in the tracker, with like-for-like sales down by just 0.1%. Restaurants fell 1.1% as some consumers restricted their meals out after the festive season. After briefly returning to growth in December, bars’ sales fell away in January to finish 10.2% behind January 2024. The on-the-go segment of the market dropped 4.8%. London had a slightly tougher January than the rest of the country as groups’ sales inside the M25 were down by 1.9% year-on-year, while venues beyond the M25 were 1.1% behind. Karl Chessell, director of hospitality operators and food, EMEA at CGA by NIQ, said: “After a happy Christmas for hospitality groups and their suppliers, trading came back down to earth with a bump in January. It shows many consumers remain hesitant about their spending, and while inflation has eased in some areas, business costs remain very high across the sector. Energy price rises and the government’s planned changes to national insurance thresholds and rates could hardly be coming at a worse time. Hospitality’s outlook is positive in the long run, but it deserves much better support than it is currently getting.”