Pubs & Bars in the UK Industry Market Research Report Now Updated by IBISWorld

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The British pub is an institution under threat as over the past decade a series of legislative, social, economic and climatic trends have conspired to squeeze industry revenue and margins and force many operators out of the business. Conditions are anticipated to remain challenging over the next five years through 2018-19 but the industry is expected to return to modest growth and those publicans that diversify their offerings to serve quality food or those that cater to the value end of the spectrum should perform best.

IBISWorld industry market research
The industry diversifies services to combat declining revenue

The British pub is an institution under threat. During the past decade, a series of legislative, social, economic and climatic trends have conspired to squeeze industry revenue and margins and force many operators out of the business. A ban on smoking in public places and the beer duty escalator, which has increased the tax payable on a pint of beer by 42% since 2008, have hurt patronage. According to IBISWorld industry analyst Steven Connell, “pubs have been unable to compete with competition from supermarkets, which have exploited their rising market power to discount alcohol prices and introduce cheap, multibuy offers”. On top of this, the Pubs & Bars industry has been hit hard by the economic downturn, with soaring unemployment, plunging consumer sentiment and falling disposable income leading many to cut back on their entertainment spending. The long-term falls in beer consumption have also affected publicans. More recently, wetter- and colder-than-average weather has also weighed on pub and bar patronage, particularly in the summer months, which are usually peak times.
Together, these conditions have resulted in thousands of pub closures. Establishment and employment numbers are expected to decline sharply over the five years as many of the major players have attempted to consolidate or dispose of their unprofitable operations. Industry profitability has also taken a hammering, due to rising beer taxes, falling patronage, and food and wage inflation. During 2013-14, the industry should receive some respite in the form of a freeze on beer duty increases, but this is not likely to be enough to stop revenue from contracting by 1.0% over the current year. Industry revenue is estimated to contract at a compound annual rate of 0.2% over the five years through 2013-14, to £18.5 billion.
Conditions are anticipated to remain challenging during the next five years. Connell adds, “those publicans that diversify their offerings to serve quality food or those that cater to the value end of the spectrum should perform best”. Operators are also likely to focus on added amenities such as accommodation, conference and business facilities, hosting community groups and extended morning hours, to attract a diverse group of consumers for a range of different reasons. Potential legislative change could affect the industry further in the future. IBISWorld expects industry revenue to return to modest growth over the five years through 2018-19.
Market share concentration in the Pubs & Bars industry is low, with the largest four companies accounting for a combined market share of 20.6%. Major companies include J D Wetherspoon and Mitchells & Butler.
For more information on the Pubs & Bars industry, including latest industry trends, statistics, analysis and market share information, purchase the full report from IBISWorld, the nation’s largest publisher of industry research.

IBISWorld industry Report Key Topics

Pubs and bars in this industry prepare and serve beverages for consumption on their own premises. Nightclubs, hotels, restaurants and private members’ clubs are not included in the industry. Off-licences are also not covered.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
Globalisation & Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
Major Companies
Operating Conditions
Capital Intensity
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on many UK industries. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in London, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.co.uk or call (020) 3008 6568.

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Gavin Smith
IBISWorld
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