Licensed premises closing at rate of 30 per day

Almost 12,000 licensed premises have closed in Britain since December 2019, according to the latest CGA and AlixPartners Market Recovery Monitor.

This closure rate equates to around 30 premises day, on average – the highest rate on record, indicating the scale of the impact of Covid-19 restrictions. 

Over the period, 4,170 new sites have opened, but 11,894 have closed, resulting in a net loss of 7,724 premises.

The number of permanent closures is also expected to rise sharply as the effects of trading restrictions take their toll, predicts the report.

The new Market Recovery Monitor found that the food-led sector has been the hardest hit, losing 7.6% of sites, compared to 5.5% in the drink-led market. While the casual dining market has contracted by 15.8%.

“These numbers set out the full, devastating impact of the pandemic on Britain’s licensed premises,” said Karl Chessell, CGA’s business unit director for hospitality operators and food, EMEA.

“The wipeout of Christmas trade was clearly the final blow for many businesses, and the long wait that others now face to open their doors sadly means closures will mount even higher.”

AlixPartners managing director Graeme Smith said the hospitality sector faced months of subjugation.

“The rapid acceleration in site closures since the start of the year demonstrates just how brutal the situation is. Businesses are burning through cash at an alarming rate as costs stack up, and within the sector there is despair as to why hospitality is at the back of the queue when it comes to reopening,” he said.

However the report suggests there are areas of resilience, however. Many city centres have seen lower than average site closures, with the London market declining by 6.3%, and fewer than 3% in Liverpool, Edinburgh and Nottingham.

“Pubs have proved more durable than restaurants in recent months, and outside service will give many of them a useful kickstart if the sun shines,” added Chessell.

“Amid all the closures, it’s also encouraging to see a steady flow of new entrants to the market. We remain very confident about the long-term future of the sector, but unfortunately there is more pain to come first.”