Welcome to the June Edition of Bord Bia's Ireland Market Foodservice Newsletter.
The June bank holiday weekend saw plenty of sunshine across the country with Bord Bia Bloom welcoming over 100,000 visitors to the Phoenix Park. And there’s further positive news from the latest AIB Spend Trend for May – they are reporting a YoY increase of 9% on May 2023 for AIB customers using their cards in pubs, restaurants and hotels. A welcome news story for those involved in the hospitality sector and hopefully the start of a busy tourist season ahead.
Monthly Spotlight: UK Foodservice Forum
On May 15th, Bord Bia London hosted it’s second UK Foodservice Forum in Kings Cross. This was a half day (afternoon) event with UK Foodservice operators and Bord Bia client companies in attendance.
Keynote presentation from Simon Stenning of Future Foodservice confirmed that although consumers continue to face economic pressures through 2024, there are reasons for optimism for the 2nd half of the year as the economy picks up. In value terms, the UK foodservice market is forecast to grow by 2.8% in 2024, to a total value of £103BN. In a market where total outlet numbers are falling, fast food (QSR) continues to steal share, appealing to consumers seeking value and convenience.
At the other end of the market, fine dining continues to hold firm. It’s those in the middle that are getting squeezed. Future foodservice is anticipated to steal share from grocery retail, with 15% growth forecast through 2030 in response to an on-the-go consumer lifestyle, resulting in increased out of home meals and snacking occasions
General Industry News
Economic growth set to moderate but remain robust in coming years - AIB
www.rte.ie – 31.05.2024
The Irish economy is expected to continue expanding at a robust pace in the coming years, according to a new report from AIB. However, it states that this growth will be more moderate than the pace of recent years as the economy bounced back from the Covid-19 pandemic. The inaugural AIB Economic Outlook Report forecasts that gross domestic product (GDP) will grow by 2.6% in 2025 and 2.4% in 2026. Last year, GDP fell 3.2% due to a downturn in the pharmaceuticals sector. The report states that Ireland's industrial output and goods exports are expected to bounce back in 2024 and 2025.
Exchequer returns: Strong tax revenues boost Government’s position ahead of budget
The Irish Times – 06.06.2024
Strong tax revenues, including another spike in corporate tax receipts, have boosted the Government’s financial position ahead of the budget. Exchequer returns published by the Department of Finance show the Government collected €35.2 billion in taxes during the first five months of the year, 6 per cent or €2 billion more than the same period last year. Worries about a possible fall-off in corporation tax have been alleviated with the May figures showing receipts up strongly year on year. The business tax, now the second-largest source of income for the Government, generated €3.6 billion in May, which was 30 per cent or €836 million up on the same month last year.
Quick Service Restaurant (QSR) & Pub Sector
Irish entrepreneur invests €731k in salad chain Sprout
Business Post – 20.05.2024
Rosaleen Blair, the Irish entrepreneur, has invested €731,000 in Sprout & Co, the Dublin-based healthy food company, new filings show. Documents show that Blair, the founder and former CEO of Alexander Mann Solutions (AMS), the London-based recruitment firm, was issued 731,000 shares valued at €1 in Claragold Ltd, an investment company controlled by Blair. The €731,000 represented an aggregate of several historical investments in Sprout, Blair has backed the business since its 2015 launch by brothers Jack and Theo Kirwan.
Some 37% of Irish Publicans Considering Retirement in next Two Years
Hospitality Ireland – 13.05.2024
The Vintners’ Federation of Ireland (VFI) notes that ‘urgent challenges’ facing the pub trade – including unsustainable labour costs and the escalating overall cost of doing business – are forcing many publicans to consider retirement in the next two years. The federation is calling on the government to introduce key supports to ensure the sustainability of the hospitality sector. A recent VFI benchmarking survey found that 36% of pub turnover is currently consumed by labour costs alone, and that figure will increase to over 40% with the introduction of the Living Wage.The same survey found that 37% of publicans are considering retirement within the next two years, and 84% report that no family member wishes to inherit the pub.
Hotel & Restaurant Sector
Irish hotel market set for record breaking sales in 2024
Drinks Industry Ireland – 05.06.2024
In Ireland, after an exceptional opening few months of the year for hotel transactions, vendors are still electing to test the market through discrete processes. CBRE estimates that there are in excess of €600 million of Irish hotels currently on the market or being prepped for sale. Total annual Irish hotel sales could surpass €1.2 billion in 2024 – a record level of spend. There are several notable hotels on the market at present, including the Morrison Hotel in Dublin 1, the G Hotel in Galway, and the Slieve Russell in Cavan, along with several off-market trophy assets both in Dublin and in regional Ireland.
Irish Restaurants Worried About Future Survival Due to Increased VAT Rate
Hospitality Ireland – 30.05.2024
A new survey conducted by Interpath Advisory and the Restaurants Association of Ireland (RAI) has shown a concerning pessimism within the industry due to the increased VAT rate. More than nine in ten respondents said that the reduced VAT rate of 9% for the food-led hospitality sector, which increased to 13.5% last September, had been critical to the survival of their business. Over two thirds of respondents (69.8%) to the survey said that trading conditions had deteriorated for them over the past 12 months, and the majority (62.8%) said that their business had traded below expectations.
Route to Market / Contract Catering Sector
Drone deliveries pass ice-cream test with flying colours in Dublin trial
Irish Times – 08.06.2024
Manna, an Irish drone delivery service is promising to revolutionise food ordering. After successful delivery runs in the midlands and west, a more extensive trail is taking place in Dublin 15, Between 200 and 300 food deliveries are currently being processed daily by Manna, with plans in train to roll it out across the capital this year. The drones can carry a payload of 3.5KG - roughly the weight of a takeaway meal for four – and Manna plans to co-locate more hubs beside other restaurant clusters across the city.
Center Parcs Announces €100m Project to Begin in September
Hospitality Ireland – 10.06.2024
Center Parcs has announced that construction on an approved circa €100 million development of Longford Forest will begin in September. The development includes the addition of 198 lodges, including four of Center Parcs’ most luxurious types of accommodation (Treehouses), increasing the capacity of the resort to approximately 3,500 guests per break. The project will also allow for existing facilities to be developed, including the addition of a new restaurant, (Coffee House) and leisure and car park facilities.