City centres
The late-night market
After months of lockdowns and restrictions, city centres have
steadily welcomed back office workers and visitors in the last
12 months, with positive results for hospitality.
Data for this edition of the Hospitality Market Monitor shows a
4.2% net fall in licensed premises in Britain's city centres in the
12 months to June 2023. This is a better figure than the drops
of 5.9% and 5.4% in large and small towns respectively over
the same period.
Cities are increasingly drawing in people from the suburbs
and 'satellite' towns-not just to workplaces after an extended
period of working from home, but for leisure too. They have also
benefited from a growth in city centre residents. A wave of
residential developments in cities like Manchester, Liverpool
and Leeds over the last few years has increased the target
Late-night venues were the last to come out of COVID-19
restrictions, and lockdowns took a heavy toll on their numbers.
Britain lost nearly a third (30.0%) of its nightclubs between
March 2020 and June 2023, with the independent segment
worst hit at 33.0%.
As well as a consequence of lockdowns, this reflects a longer
term change in consumers' late-night habits. The nightclub
sector was contracting well before COVID, and it is now less
than half the size it was ten years ago.
However, we may be starting to see club closures bottoming
out. Numbers in the segment were in marginal growth of 0.9%
in the last quarter, leading to optimism that the clear-out of
unsustainable venues has slowed, and that supply is now
much better suited to demand.
market for pubs and restaurants, particularly during midweek
trading periods.
These trends mean city-centre operators have been relatively
well insulated against closures over the last quarter. Manchester (down 0.3%
since March), Bristol (0.5%) and Cardiff (0.0%)
have lost only a small fraction of their outlets. Several key cities
have actually achieved modest growth, including Birmingham
(up 0.3%), Edinburgh (up 0.6%) and Liverpool (up 0.9%).
Central London, which has more licensed premises than the
next six biggest cities put together, has lost 0.5% of its sites.
The Coffer CGA Business Tracker has meanwhile recorded
significantly higher sales growth within the M25 than beyond it
in every month of 2023 so far. While the last three years have
been tough for operators in the capital, recent trends point to a
brighter future.
Another positive is that some closed nightclubs have reopened
as late-night bars. The number of venues in the bars channel
has fallen by only 3.1% % since COVID hit in March 2020, and
longer term trends have been notably more positive than in
clubs (see graph). While consumers no longer visit clubs in
the volumes they did, many of them have not ditched their
late-night habits but simply switched to bars or pubs. Others
are going out earlier in the evening and choosing alternative
experiences like competitive socialising venues, instead.
Number of nightclubs v bars / bar restaurants, 2012-2022
10000
Sites at June 2022 Sites at March 2023 Sites at June 2023
% change in sites,
June 2023 v March 2023
% change in sites,
June 2023 v June 2022
City centre 10,567 10,206 10,121 -0.8% -4.2%
Large town 36,792 35,026 34,638 -1.1% -5.9%
Small town 34,014 32,535 32,189 -1.1% -5.4%
Outlets by location, June 2023 v March 2023 and June 2022 -30.0% -3.1%
Net decline in
nightclubs, March
2020 to June 2023
Net decline in
bars, March 2020
to June 2023
8000
6000
4000
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2023
2000
Bar & Restaurant Nightclub
0
Contact: CGA by NIQ's director - hospitality operators and food, Karl Chessell: karl.chessell@cgastrategy.com