60 Seconds: A Tale of Two Septembers
Out-of-home Leisure: Weather matters
- Structural trends in out-of-home Leisure have grabbed the headlines recently, resulting in a string of profit warnings.
- More and more operators are stepping forward to comment on soft summer trading across the industry.
- This is because of factors including oversupply, commodity inflation, rising labour costs, and extortionate rents.
- Year-on-year weather variation also plays a key, albeit much more volatile, role in consumer demand. This must be accounted for.
Summer into Autumn: 2016 vs. 2017
- The three months ending August 2017 (14.7°C) has been broadly similar to the same period last year (14.9°C).
- This implies that the weather has had little to do with poor dining out figures so far, although figures are beginning to diverge.
- August was ‘a cooler month’ per Planalytics. London averaged 1.4°C cooler.
- September 2016 was remarkable. It contained the hottest day of the year (34.4°C on the 13th) and was some 2.2°C above average.
- September 2017, meanwhile, has been considerably less spectacular; today’s avg. temperature of 15.8°C compares to 24.9°C last year…
What might this Mean?
- If operators have found trading difficult even with stable year-on-year weather, then the September comps should be interesting.
- The weaker demand experienced so far might be exacerbated by less inviting weather.
- Some indoor leisure might benefit. Sites with beer gardens and outside seating will most likely see a pronounced decline.