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City-centre hospitality shows signs of recovery

Hospitality businesses are starting to build sales momentum in Britain’s big cities after a steady return of workers, shoppers and visitors, new research reveals.

The latest ‘Top Cities’ report from CGA and Wireless Social combines sales and device log-in data to assess the performance of Britain’s 10 most populous cities over the four weeks to 12 March 2022.

Across the cities, sales increased by 3% on the equivalent pre-pandemic period in 2019. It marks a steady recovery from the previous four-week period, when sales were down by 3% on 2019; and from a challenging end to 2021, when many consumers stayed at home because of COVID concerns. Every city measured by achieved better sales growth than in the latest ‘Top Cities’ report in mid-February.

Glasgow is the most vibrant of the 10 cities, with sales in high single-digit growth from 2019 and check-in numbers increasing for the third period in a row. Birmingham rose five places up the list to second and Manchester was third after recording double-digit sales growth.

Slowest to revive is London with trading and check-ins remaining well below the levels of 2019, however, they did increase over the four weeks to 12 March. Further improvements are expected as people return towards their usual habits in the capital.

With inflation now topping 6%, hospitality’s sales remain well below the levels of 2019 in real terms. Rising costs in energy, food and other key inputs are meanwhile squeezing operators’ margins, and the cost-of-living crisis may stifle consumers’ spending as the year goes on.

CGA client director Chris Jeffrey said: “It’s good to see the hospitality sectors in Britain’s top cities recovering much of their pre-COVID vibrancy after the removal of restrictions. As consumers continue to head back to city centre offices, retail centres and attractions we can hope for further increases in sales and footfall. Appetite for pubs, bars and restaurants is clearly as strong as ever, but mounting inflationary pressures and the upcoming return to the full rate of VAT threaten many fragile businesses. Hospitality can undoubtedly power cities’ economic revival, but a lack of support in last week's Spring statement risks stalling the recovery just as it begins.”

Rankings for the four weeks to 12th March 2022. Numbers in brackets indicate position for the previous four weeks to 12th February 2022.

1. Glasgow (3)

2. Birmingham (7)

3. Manchester (2)

4. Leicester (6)

5. Leeds (9)

6. Bristol (1)

7. Liverpool (5)

8. Edinburgh (8)

9. Sheffield (4)

10. London (10)

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