UK restaurants are turning to sharp discounts and offers to attract customers who are opting to save rather than spend on eating out, according to The Financial Times.
The report comes as data from the Office for National Statistics indicates that the cost of eating at a restaurant or café was more than one-third higher in December than in the same month in 2019.
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Recent promotions from the restaurants include PizzaExpress offering a second main course for £1 and Frankie & Benny’s advertising a £5 burger.
Côte Brasserie is promoting “two courses for £15” on what it calls the ‘Happiest Menu’.
Some analysts have labelled such discounts a “last resort” for a sector that has yet to fully regain momentum after the pandemic and the cost-of-living squeeze.
Several brands are also harnessing loyalty schemes and apps to distribute offers. ASK Italian is running a “buy one get one free” promotion for people who sign up via its rewards application.
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By GlobalDataFranco Manca, which operates around 70 sourdough pizzerias nationwide, has linked discounts to physical activity. Customers can claim “£1 off pizza for every kilometre” recorded in a “pizza-shaped” route on fitness platforms such as Strava.
The push towards more aggressive pricing comes at a time when profitability is already under strain.
Increases in the UK minimum wage and higher national insurance contributions last year have lifted staff costs across the industry.
On the tax side, restaurants were excluded from the business rates relief announced for pubs in the November Budget.
Trade body UKHospitality estimates that this leaves restaurant operators facing an average 54% increase in their rates bills over the next three years.
Despite these headwinds, management teams are betting that bold promotions will drive footfall.
Notably, casual dining restaurant chain TGI Fridays closed 16 restaurants across the UK recently after the operating company was placed into administration. The move resulted in 456 redundancies.
