Restaurant and bar trade 'nearly back to pre-pandemic levels' as customers get back into the habit

BARS, restaurants and similar businesses have reported a full recovery in their income for the first time since before the pandemic – their turnover is now 2% higher than in the last 'normal' year, 2019.

July 2022 saw a total spending of €3.77 billion in eateries, cafés, pubs, fast food chains, vending machines and all other non-retail food and drink purchases, according to research by The NPD Group.

This is the highest figure seen since before the first lockdown in mid-March 2020, which would lead to another year and a half of restrictions on opening, trading hours, customer numbers, and in some cases, complete shutdown for weeks or even months on end.

The hospitality sector was among the worst-hit industries when the pandemic struck, and this continued long after 'freedom' was restored to trade and public movement: Society in general, having initially been more keen than ever to go out for dinner and drinks purely because they now could, eventually lost the habit of doing so when it ceased to be a part of their daily lives.

Now, customers are returning in droves, and are nearly up to levels seen in 2019, The NPD Group reveals.

But some of the increase in turnover is due to price-led inflation, which has made the cost of a meal or drink more expensive.

This July saw a total of 675 million visits to bars and restaurants, an increase of 19% on the same month in 2021, although this is still 5% lower than in July 2019.

Head of The NPD Group's Foodservice, Edurne Uranga, recalls that eating out and drinking out, whether going for a coffee or for late-night alcohol, is 'a very deep-rooted habit' in Spanish culture – something that has always been helped by consistently affordable prices in the hospitality sector, long months of pleasant, sunny weather and short, mild winters in most of the country.

Clearly, this habit was hard to break when Covid reached Spain, but as Sra Uranga says: “Once the restrictions were lifted, we've seen evidence that the desire to get back to this way of life has been greater than the growing uncertainty in our lives.”

In the first seven months of 2022 – the most recent figures available – people living in Spain spent 37% more on food-related services than they had in the same period in 2021, parting with in region of €21.22bn.

The 'trade-down' effect of the last three of those months – where consumers tend to go out just as often as before, but seek cheaper options or order less – coupled with rising prices are the two factors that have held back a complete return to normality based upon 2019, slightly reducing growth in the industry and increasing the differential between number of visits and money spent, or earned, Sra Uranga explains.

But the panorama remains highly optimistic – bars and restaurants fearing for their future for the best part of two years, and worries about rising unemployment in parts of the country where the catering sector provides a significant percentage of jobs, are gradually being left behind.