During February 2020, the British restaurant industry, along with the wider economy was showing tentative signs of growth. It seems like a lifetime ago now, but British foodservice visits in January and February 2020 increased by +0.4% year over year according to NPD’s CREST panel, a slight improvement on the +0.3% year over year (YoY) growth seen over the same time period in 2019.

YoY growth in total out-of-home visits – Jan & Feb

Source: NPD CREST

But in February, as the world watched the crisis unfold in China and elsewhere, the first confirmed cases of COVID-19 were appearing in the UK, and we were heading towards the restrictions that have overwhelmed so much of British foodservice. With everyone’s thoughts focused on the restart and the recovery it makes sense to try and understand how this might be achieved.

NPD’s CREST data for March highlights the early impact of the current lockdown on the restaurant industry. In March, visits to out-of-home outlets declined -29% YoY, with all market sectors negatively impacted. NPD’s SnapMyEats longitudinal panel shows how this was mostly caused by a -21% decline in trip frequency. Two-thirds of buyers made fewer trips than the previous month, with levels dropping off suddenly as the Government guidance came in, soon followed by the lockdown at the back-end of the month. 

Had the British lockdown started earlier, these figures would be far worse. For example, in Italy, CREST data for March shows visits declining by more than two-thirds YoY. 

In Britain, delivery and pre-ordering via apps were the only growth areas in March, indicating how off-premise visits were less severely impacted. Independents that stayed open, as chain restaurants took the decision to close entirely, will have benefited from any remaining consumer demand. From the end of March onwards, the eating out market reached a new baseline level of trade that represents only a small percentage of its normal size. 

Anybody in British foodservice must accept that the ‘old normal’ will not be with us for some time, if ever again. The results of NPD’s recent COVID-19 sentiment study indicates UK consumers will continue to see restaurants as risky places for infection and that social distancing measures should be kept in place. But accepting the ‘new normal’ when the lockdown begins to ease can bring some measure of success. We believe the ‘new normal’ will involve three key components: deals; delivery; and the increased use of technology.

*This content also appeared in 11 May 2020 edition of Propel Info newsletter

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