The data points to a rapid rate of churn in the sector, which has substantially changed the landscape of eating and drinking out since the start of the COVID-19 pandemic. With segment and tenure patterns set to morph again in 2025, suppliers, operators and investors will all need to keep close tabs on the shape of the market and adapt nimbly. These are some of the most significant features of churn in recent years.
Total sites
RISE reveals that 27,951 venues closed their doors between March 2020 and September 2024—equivalent to around 119 every week. However, 12,767 have opened during that time, either in vacated premises or in converted or new-build sites. This equates to 54 new openings a week, or nearly 8 per day. The net result is that the estate of licensed premises has shrunk by 13% in four years—but 13% of today’s sector is occupied by venues that have opened during that time. This shows that while the twin crises of COVID and inflation have hurt hospitality, new entrants have kept it fresh and diverse.
On a longer-term measure, the change is even more dramatic. The total number of premises has been reduced by nearly a fifth (19%) in the last decade and only just over half (55%) of sites trading in 2014 have the same identity today. A third (32%) of today’s venues have launched in the last ten years.
Channels
Some of the fastest churn has come in the bar sector, where familiar names have been lost but fresh faces have appeared. More than a third (35%) of bars and a quarter (25%) of bar restaurants at September 2024 were new openings since 2020, as some managed groups expanded and others contracted, or adapted their formats.
The restaurant sector has changed too, with just under a quarter of casual dining venues (24%) and other restaurants (23%) new since 2020. Just over 7,000 restaurants have closed in the last four years, but around 3,500 have opened.
Some other channels have been relatively stable. Only small numbers of community pubs (6%), food pubs (6%) and high street pubs (10%) have opened since 2020, with thousands of closed pubs either converted for non-hospitality use or lying empty. When these pubs close, it can often be difficult to get them open again—especially in rural communities. In closure terms, nightclubs have been hardest hit, with net losses of 33% in just four years.
Tenures
CGA’s RISE service shows managed groups have been much more resilient to the double whammy of COVID and high costs than independents. While the managed sector has contracted by just 2% since 2020, indies have shrunk by 16%, with an average of 88 closures a week and only 38 new openings. By contrast, four in five (80%) managed sites that were open in March 2020 have stayed in that format. Among the 20% that do not, the majority have been either rebadged by their parent companies or promptly acquired by other operators—often small but fast-growing groups. Pub companies have also expanded their managed estates by taking large numbers of tenanted venues under direct control.
Longer term, the gap in fortunes is even wider. While 61% of managed venues from 2014 remained open in the same format at September 2024, only 52% of independents have endured. This reflects the greater ability of well-resourced groups to ride out crises like COVID, and the vulnerability of smaller businesses with fewer reserves to draw on.
Regions
Churn has also been notably high in London. This has long been Britain’s centre of eating and drinking out, with a steady turnover of operators, especially in central areas. But the pace of change has stepped up since COVID, and there have been nearly 3,000 new openings to offset 6,000 closures since 2020. Nearly one in six (16%) of today’s licensed premises is new since 2020—a sign of the high level of investment and innovation in the capital.
This number is also relatively large in Lancashire (16%) and the North East (14%), but lower in areas like Wales (9%) and the East (10%) and South West (10%) of England. Venues that have closed in these areas have been much less likely to reopen again—perhaps because there are lower levels of demand and fewer sources of investment.
Reuben Pullan, senior insight consultant at CGA by NIQ, said: “These numbers show the heavy impact of COVID, high costs and weak consumer confidence on Britain’s hospitality sector in the last few years. But they also highlight another big trend that is sometimes overlooked: the constant stream of new entrants into the market. Fresh concepts and expanding multi-site groups are keeping the On Premise diverse and dynamic, and they provide suppliers with great potential to sustain sales and reach new consumers.”
“However, amid so much change and churn, it’s crucial to stay right up to date with the outlet universe and ensure that the right brands are being positioned in the right ways in the right venues. Our RISE solution is the ideal foundation for smart, data-led strategies that ensure businesses don’t miss out on growth opportunities in 2025.”
CGA by NIQ’s Retailer Intelligence and Sales Effectiveness (RISE) solution delivers a comprehensive and up-to-date directory of licensed venues, supporting sales targeting and location planning strategies. It comes with sophisticated segmentation and is available in 24 countries around the world. To discover more about how it can boost your business, click here and contact the CGA team.
