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Festive sales slide despite increase in productivity

Figures from Fourth show that combined sales across pubs, restaurants, hotels, and quick service restaurants (QSR) in 2021 were 24.4% down from December 2019

Festive sales were considerably down in comparison to 2019, but staff headcounts and hours worked are heading in the right direction according to the latest figures from Fourth, the global software provider for the hospitality, retail, and leisure industries.

Fourth’s figures show that combined sales across pubs, restaurants, hotels, and quick service restaurants (QSR) in 2021 were 24.4% down from December 2019.

It said the industry snapshot shows how the “re-introduction of trading restrictions across the UK and concerns about the spread of the COVID-19 omicron variant led to many consumers staying away from the on-trade in the run up to Christmas”.

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Sales on New Year’s Eve were some 30% down on 2019, making December 31 only the sixth most lucrative trading occasion of the month. The four best days were all in the first two weeks of December.

Hotel and pub sales were hit the hardest. The former experienced a 56.5% decline across the month when compared to December 2019, while pubs were down by 29.2%. Restaurants witnessed a 20.1% sales drop, but QSR – the least impacted by restrictions – saw sales decline by just 2.9%.

Sales figures were also hit hard in November – down 35.4% overall against November 2019. Pubs (-35.6%), restaurants (-29.8%), QSR (-21.2%) and hotels (-68.8%) all felt the pinch.

Sales in the sector were in a far healthier position than 12 months ago when a national lockdown in November was followed by the tiering system. Overall, hospitality sales were up by 186% when compared to December 2020.

The number of people working in hospitality in December 2021 was the highest it had been since the summer of 2020, when the government introduced the Eat Out to Help Out scheme and furlough was in operation.

However, numbers remain some distance back on pre-pandemic levels, highlighting the significant recruitment challenges the industry continues to face. Overall, the hospitality headcount is 14.8% behind where it was in December 2019, and 18.6% up on December 2020.

The collective hours worked across hospitality were also down (-22.9%) on December 2019 but up (112.3%) compared to 2020.

Yet the study revealed productivity in December 2021 was much the same as in December 2019, perhaps showing that businesses are learning to do more with less. Fourth’s Spend Per Labour Hour metric reveals productivity by calculating total sales and dividing this by the total number of hours worked. This shows that the Spend Per Labour Hour in December was £26.41, not far behind the £26.75 of 2019, and an improvement on the £19.22 of December 2020.

Sebastien Sepierre, managing director – EMEA, Fourth, said: “The re-introduction of ‘work from home’ guidance, restrictive trading measures and a cautious consumer outlook seriously hampered hospitality’s hopes for a bumper December. As the latest Fourth Hospitality Report clearly shows, there is still some way to go to reach pre-pandemic trading and staffing levels.

“However, there are encouraging signs, with staff headcounts in all sub-sectors up on this time last year. Hours worked are heading in the right direction and businesses are seeing similar levels of productivity to 2019.”

He added: “With COVID measures and restrictions set to be lifted and workers returning to offices, businesses can look forward to better conditions to aid their recovery in 2022. With new recruits required and a New Minimum Wage on the horizon they will need to work on ways to attract and retain talent.

Technology and digital solutions play an important role in helping operators hire, onboard, engage and retain team members. Businesses will ultimately have to be smart with their labour scheduling strategies to ensure consumer demand continues to be met and the guest experience doesn’t suffer.”

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