Home Food & Shopping Instagram killing restaurant trade? Diners snapping photos at pop-ups are threatening chains

Instagram killing restaurant trade? Diners snapping photos at pop-ups are threatening chains

25
0


Is Instagram killing the restaurant industry? Diners keen to impress with online snaps are ditching chains for trendy pop-ups – as four eateries a DAY to go bust in 2018

Image-conscious diners keen to impress with snaps at ‘pop-up’ eateries have contributed to a particularly difficult year for the restaurant industry.

The number of restaurants going bust across England, Scotland and Wales has reached its highest level since since 2010, with an average of four businesses going under every day.

Mid-price chains have faced most strain as they struggle to compete with trendy pop-ups promising customers novel, social media-friendly dining experiences, according to the analysis of Insolvency Service figures. 

Place to be seen: Image-conscious diners keen to impress with snaps at 'pop-up' eateries have contributed to a particularly difficult year for the restaurant industry. Pictured, the social media-friendly Elan Cafe, which has recently opened an 'Instagrammable' space in Selfridges

Place to be seen: Image-conscious diners keen to impress with snaps at ‘pop-up’ eateries have contributed to a particularly difficult year for the restaurant industry. Pictured, the social media-friendly Elan Cafe, which has recently opened an ‘Instagrammable’ space in Selfridges

Big names including Guacho, Byron and Sir Terrance Conran’s Prescott & Conran group are among the 1,123 restaurant businesses that became insolvent in the first three quarters of 2018. This compares to 1,075 failed restaurants in the whole of 2017.

Accountancy firm Price Bailey, which carried out the analysis, explained social media is accelerating changes in consumer tastes with people increasingly looking for novel dining experiences.

It means once popular restaurants can soon find themselves out of favour.

Paul Pittman, partner at Price Bailey, said: ‘Chain restaurants are particularly vulnerable to changing consumer fads. 

Financial trouble: Big names including Guacho, Byron and Sir Terrance Conran's Prescott & Conran group are among the 1,123 restaurant businesses that became insolvent in the first three quarters of 2018. This compares to 1,075 failed restaurants in the whole of 2017 

Financial trouble: Big names including Guacho, Byron and Sir Terrance Conran’s Prescott & Conran group are among the 1,123 restaurant businesses that became insolvent in the first three quarters of 2018. This compares to 1,075 failed restaurants in the whole of 2017 

‘What was once flavour of the month can quickly go out of fashion. The cost of acquiring leases and outfitting restaurants can run into the millions per site in prime city centre locations. You need a sustainable customer base to absorb that risk.’

Mr Pittman said it is part of the ‘perfect storm’ of adverse trading conditions. 

Huge expansion in mid-market restaurants funded by private equity means the market is over saturated. Restaurants are also having to contend with rising costs such as pressure to implement the national living wage and the apprenticeship levy.

The uncertainty of Brexit also looms large over many consumers and is credited with pushing consumers towards the food delivery market, with brands such as Just East and Deliveroo capitalising.

Advertisement

LEAVE A REPLY

Please enter your comment!
Please enter your name here