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Pub Visiting - UK - May 2015

INTRODUCTION
Definition
Abbreviations
EXECUTIVE SUMMARY
The market
Figure 1: Forecast for total UK pub industry revenues, 2009-19
Figure 2: UK pub industry turnover, by segment, 2014
Market factors
Declining alcohol consumption plays a part in fall in pub visits
The pressure of rising costs
Population changes will have an impact…
…as will external factors
Companies and brands
The consumer
Pubs remain popular venues to eat and drink in
Figure 3: Frequency of visiting pubs/bars to eat and drink in, March 2015
Higher-quality food is the leading enticement for boosting visits
Figure 4: Enticements for visiting pubs more often (any mention 1-5), March 2015
Equal popularity for eating in pubs during the week and at weekends
Almost half of pub visitors value pubs as part of ‘Britishness’
Figure 5: Attitudes towards pubs, March 2015
What we think
ISSUES AND INSIGHTS
Utilising entertainment appropriately to appeal to different interests
The facts
The implications
Tapping into consumer interest in bargains
The facts
The implications
Pubs need to compete more effectively with coffee shops
The facts
The implications
The suitability of e-cigarettes in pubs
The facts
The implications
MARKET DRIVERS
Key points
Financial health continues to recover but remains fragile
Figure 6: Trends in how consumers describe their financial situation, December 2009-December 2014
Figure 7: Consumer sentiment for the coming year, December 2014
Alcohol consumption and pub visits have fallen
Figure 8: Trends in UK per capita consumption of 100% alcohol, 2006-14
Figure 9: Volume trends in the sales of beer, by channel, 2009-14
Regulatory changes aim to support pubs
New Clause 2
Pubs as Assets of Community Value
More sold pubs remain as pubs
Drink prices remains an emotive subject
Figure 10: Index of the price of beer and wine in the on- and off-trade, 2007-14
Tax changes moderate rising prices
Figure 11: UK excise duty rates for selected alcoholic drinks, 2003-15
Business rates put pressure on landlords
Figure 12: Average rateable value of pubs in England and Wales, 2005 and 2014
Councils allowed to set licence fees locally
New drink-driving laws in Scotland
Utilities and live sport costs are also on the rise
Figure 13: Trends in utility prices paid by non-domestic consumers (including the Climate Change Levy), 2007-14
Figure 14: Trends in average fuel prices at the pump for unleaded standard and diesel, 2007-15
Late-night drinking remains a controversial subject
EMROs adopted in some larger cities
Local Alcohol Action Areas
Best Bar None
Purple Flag
Business Improvement Districts
National Pubwatch
Population changes also need to be acknowledged
Decline of 18-24s set to pose a challenge
Significant growth expected among C2DEs
STRENGTHS AND WEAKNESSES
Strengths
Weaknesses
MARKET SIZE AND SEGMENTATION
Key points
Food continues to drive growth in the pub market
Figure 15: UK pub industry market size and forecast, 2009-19
Alcohol sales continue to creep up but are being overshadowed by food
Figure 16: UK pub industry turnover, by segment, 2010-14
Soft drinks are still often being overlooked
Forecasts
Figure 17: Forecast for total UK pub industry revenues, 2009-19
Figure 18: Forecast for UK pub industry revenues of alcoholic drinks, 2009-19
MARKET SHARE
Key points
Only 16% of pubs are ‘managed’ venues
Figure 19: Estimated structure of the UK pub industry, by ownership/tenancy number of outlets, 1993-2013
Figure 20: Turnover of leading pub operators in the UK, 2011/12-2013/14
Figure 21: Outlet numbers of leading pub operators in the UK, 2011/12-2013/14
Managed operators continue to thrive and grow…
…while the leased/tenanted segment continues to struggle
Freehold/independent pubs could thrive
The controversy of the ‘beer tie’
COMPANIES AND PRODUCTS
Market overview
Figure 22: Selected leading pub operators in the UK, by outlet numbers, 2012-14
Figure 23: Business mix of selected leading pub operators in the UK, 2014
Enterprise Inns
Company overview
Financial performance
Figure 24: Key financial data for Enterprise Inns PLC, 2011-14
Figure 25: Enterprise Inns PLC turnover, by segment, 2012-14
Selected recent activity and innovation
Greene King plc
Company overview
Financial performance
Figure 26: Key financial data for Greene King PLC, 2011-14
Figure 27: Greene King PLC revenue, by segment, 2012-14
Selected recent activity – disposals and takeovers
Selected recent activity – ranges and other
JD Wetherspoon plc
Company overview
Financial performance
Figure 28: Key financial data for JD Wetherspoon PLC, 2011-14
Selected recent activity and innovation
Mitchells & Butlers plc
Company overview
Financial performance
Figure 29: Key financial data for Mitchells & Butlers PLC, 2011-14
Selected recent activity and innovation
Punch Taverns
Company overview
Financial performance
Figure 30: Key financial data for Punch Taverns PLC, 2012-14
Figure 31: Punch Taverns PLC revenue, by segment, 2012-14
Selected recent activity and innovation
Spirit Pub Company
Company overview
Financial performance
Figure 32: Key financial data for Spirit Pub Company PLC, 2011-14
Figure 33: Spirit Pub Company PLC revenue, by segment, 2012-14
Selected recent activity and innovation
THE CONSUMER – FREQUENCY OF VISITING PUBS
Key points
Pubs remain popular venues to eat and drink in
Figure 34: Frequency of visiting pubs/bars to eat and drink in, March 2015
Figure 35: Frequency of visiting pubs/bars to eat and drink in, 2014 vs 2015, March 2015
21% of adults drink in pubs weekly
Figure 36: Frequency of visiting pubs/bars to drink in, by gender, March 2015
THE CONSUMER – BOOSTING PUB VISITS
Key points
Higher-quality food is the leading enticement for boosting visits
Figure 37: Enticements for visiting pubs more often (any mention 1-5), March 2015
Figure 38: Enticements for visiting pubs more often (ranked 1), March 2015
Cost also plays a key role
Figure 39: Enticements for visiting pubs more often (any mention 1-5), by gender, March 2015
Millennials can be enticed with live events and entertainment
Other factors play a more peripheral role
THE CONSUMER – PUB ACTIVITIES
Key points
Eating in pubs is equally popular during the week and at weekends
Figure 40: Pub activities undertaken by pub users, March 2015
Pubs look to tap into day and overnight trade
The divisive issues of children and smoking in pubs
THE CONSUMER – ATTITUDES TOWARDS PUBS
Key points
Almost half of pub visitors value the Britishness of pubs
Figure 41: Attitudes towards pubs, March 2015
Leveraging high-quality food and space
Figure 42: Hours of sunshine in the UK, by month, January 2010-April 2015
36% of pub visitors prefer the indies with 15% wanting a wider soft drink range
APPENDIX – MARKET SIZE AND SEGMENTATION
Figure 43: UK pub industry turnover, by segment, 2009-19
Figure 44: Best- and worst-case forecasts for the UK pub industry, by value, 2014-19
Figure 45: Best- and worst-case forecasts for UK pub industry revenues of alcoholic drinks, 2014-19
Variables for forecasts

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