Early signs of recovery - a mixed feast for London restaurants

15th July 2009

The tables are starting to turn for London restaurants but the effects of the recession are still being felt. That’s the message according to Business Link in London’s monthly Restaurant Barometer – an online poll of nearly 150 restaurants in the capital gauging how they are faring in the recession.

The poll found that restaurants continue to recover steadily. Nearly 30% of restaurants have reported an increase in takings and customers, and a further third said it has stayed the same on a month-by-month basis.

Upmarket restaurants in particular are showing healthy signs of recovery with 40% reporting increases in profit and customers this month.

The picture also looks promising when compared with the previous quarter with 40% of restaurants experiencing an increase in profits and customers.

However, the business environment remains tough with the impact of the recession deeply felt, 40% reporting losses in profit and 38% seeing less customers who are also reducing their spend.

Ashley de Safrin, Business Adviser for the Hospitality sector, at Business Link in London said: “This month’s poll shows that things are on the up for restaurants, particularly the high-end sector, but that the heat is still on as the recession bites into customer spend.

People continue to be prudent, opting for cheaper alternatives – tap water, house wines and set menus. Restaurants need to bear these factors in mind when designing their menus and ordering their supplies. All costs need to be managed very carefully backed by a strong marketing drive.

Restaurants should capitalise on summer dining and the rising number of tourists choosing London as their holiday destination. This is also the time when service needs to be impeccable.”

Ashley says that Business Link in London’s Barometer is an extremely useful tool and urges restaurants to continue to use the poll on a monthly basis.

“The restaurant barometer is easy and quick to fill in. It provides valuable insight in to the ups and downs of the sector and enables restaurants to compare themselves to other businesses.

While these signs are encouraging, we are still facing one of the deepest recessions. It is therefore crucial for business to monitor how they are doing compared to others – if they don’t want to be another flash in the pan.”

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