JD Wetherspoon, one of the largest pub chain operators in the UK, issued a warning about annual loss for 2022 as labor, repair, and marketing expenses bite into the company’s revenue. After the announcement, the share price of the company fell 8% on July 13, 2022, reaching its lowest level since the outbreak of the COVID-19 pandemic. The company owns and operates over 800 pubs in the UK and Ireland. The sales of draught ales, lagers, and ciders, which were once the major generators of revenue for the company, were 8% below the 2019 levels.
The UK Pub, Club, and Bar Market Overview
According to GlobalData, the pub, club, and bar channel is the highest-value channel in the UK’s foodservice sector, accounting for 23% of the total sales in 2021. The market value reached GBP11.6 billion ($16 billion) in 2021, registering negative growth of 14.4% during 2016–21. The total number of outlets in the industry registered negative growth of 0.6% during 2016–21. The decline could be due to fewer occasions for consumption amid fears of COVID-19 infections and the surge in Omicron variant cases in 2020 and 2021. The implementation of national restrictions, along with time constraints on the opening and closing of pubs and bars in the country, also affected revenue generation by the industry.
Major Companies
The top five chain operators in the market generated 39.3% of the total revenue in 2021. Ei Group plc, the largest chain operator, accounted for 11.9% of the overall sales of the channel. Star Pubs & Bars Limited was the second-largest operator with 8.9% of overall sales, followed by Greene King with a market share of 7.8%. JD Wetherspoon plc was the fourth-largest operator with a 6.7% share of the total sales, while Marston’s accounted for a share of 5.2% in the UK pub, club, and bar market in 2021.
Key Trends
The availability of a greater variety of dishes/cuisines, along with convenient offerings, remains a major factor for frequent visits by consumers. Young consumers are aiding the growth of the market due to evolving lifestyles and the inclination to unwind by socializing over drinks. With the revival of tourism-related activities and easing of restrictions on pubs, clubs, and bars, consumers are bound to go out and socialize after being forced to stay indoors for long, which will boost the growth of the market in the years ahead.
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