Since June 23, 2016, when 52% of British voters voted in favor of leaving the European Union, the British economy has seen some serious fluctuations. The pound has reached its lowest point since 1985, falling drastically against the dollar and euro; the economy has grown by 0.5%; and tourism has increased with 18% more foreign visitors and 11% more British tourists in London compared to the same period last year. Here at Avero, we wanted to leverage our extensive restaurant data to understand how Brexit has specifically affected restaurants within the United Kingdom.
Although many British restaurateurs feared Brexit hurting their sales, in the five months since the vote year-over-year same-store restaurant sales have dramatically increased (21%). This increase is seen across both food and beverage sales.
So despite economic turmoil hitting the UK, the restaurant industry seems to be doing more than fine. But what about other industry segments; have hotels seen a similar jump because of increased tourism? As it turns out, yes, but restaurants have outperformed hotels by 4%.
Restaurants have been able to capitalize on changing economic environments in the United Kingdom, but these trends may not last forever. As new policies begin to take place, restaurants may see labor and food costs increase and sales decrease, and Avero will continue to monitor how UK restaurants perform.