According to its new UK Restaurant Market Report 2020/21, Lumina Intelligence forecasts the UK restaurant market will grow +32.1% to £11.7bn in 2021, following a catastrophic 2020, which saw the market contract -53.1% to £8.9bn. This prediction is based on the roadmap to recovery recently set out by the government, with all restrictions on social contact being removed on 21 June 2021.
The report also offers two alternative scenarios for market recovery in 2021. The second scenario, which may be more likely based on historical events, assumes a slight delay to the government’s proposed timeline, with hospitality remaining closed for indoor dining until late May and all restrictions being relaxed from August. Lumina Intelligence predict that this scenario would result in market growth being stifled slightly to +24%, with the market reaching a value of £11bn.
The third scenario offers a worst-case picture where restrictions only ease fully by October and the possibility of some restrictions being reintroduced towards the end of the year (for example in the case of a new strain of coronavirus). This scenario would see the UK restaurant market grow by just +6.2% in 2021 to a value of £9.4bn.
Technology key to reassuring consumers, with many eager to return
The report highlights that 52% of consumers are very/extremely likely to dine-in at restaurants before June and consumer confidence is slowing improving. However, technology will play a key role in reassuring consumers and maximising footfall once restrictions ease.
40% of consumers either ‘agree’ or ‘strongly agree’ that they feel confident eating out regardless of contactless ordering and payment technology. However, this number rises to 56% of consumers if a restaurant has implemented technologies such as apps and QR codes that limit contact with staff and menus.
Events offer an opportunity to attract consumers
According to the report, 26% of consumers would be strongly encouraged to dine out in restaurants once lockdown is lifted if restaurants offered live music events. 23% would be strongly encouraged to dine out in restaurants once lockdown is lifted if a bottomless brunch was available and 17% if a restaurant hosted quiz nights. This reiterates the importance of restaurants offering experiences that cannot easily be replicated at home.
Customisable dishes on menus grow 83%
Customisable dishes on restaurant menus have grown by +83% in the total market and by +60% on chain restaurant menus compared to last year. Over a fifth of dishes on restaurant menus are now customisable. The top three customisable dishes on restaurant menus are burgers, pizzas and burritos/wraps.
Katherine Prowse, Insight Manager at Lumina Intelligence said, “The roadmap recently announced by the government outlines when the current restrictions will be eased. With a series of dates to work towards, operators can start to build a clear plan for the reopening of the hospitality sector.”
“Despite pent up demand from consumers for returning to the channel, operators will need to work hard to reassure consumers of the safety measures in place. Technology will play a key role in doing this. Nearly two-thirds of consumers say they would be more confident in visiting a restaurant if contact with staff and menus is restricted through the use of apps and QR codes.”
“Focusing on the experiential side of dining out will be key to driving footfall. Over a quarter of consumers would be more likely to dine in at a restaurant that offered live music. With unemployment at its highest since 2016 and the threat of increased inflation, we have to recognise that restaurant visits are likely to be an infrequent treat. Experiences and events – as well as tech innovation – should encourage visits whilst discretionary income is under greater scrutiny.”
Find out more about Lumina Intelligence’s UK Restaurant Market Report 2020/21 here.