Welcome to the November edition of Bord Bia's Ireland Market Foodservice Newsletter.
Just over one week left before we close registration for our 2020 Irish Foodservice Seminar! We will be live streaming from the RDS, Dublin from 10AM-12:30PM on the morning of Wednesday, 11th November. Findings from our 2020 Irish Foodservice Market Insights report will be presented and we will host a panel discussion with representatives from Sprout; Camile Thai; Just Eat & Le Patissier. Keynote speaker Professor Stéphane Garelli, will present on the topic of: “From Breakdown to Breakthrough – Thriving in a New World”.
Detailed agenda and the ability to register your attendance via this link.
General Industry News
Irish economy to shrink by between 0.4% and 1.1% this year, says Central Bank
The Journal– 14.10.2020
The Irish economy has somewhat rebounded since the start of the pandemic but the recovery has been “partial” and “uneven”, according to the Central Bank. The Central Bank’s fourth and final Quarterly Economic Bulletin for 2020 highlights the fact that in many parts of the economy, activity remains well below pre-pandemic levels. Consumer spending and construction activity have recovered strongly since the reopening of the economy. The Covid-adjusted unemployment rate is now expected to average out at 15.1% of the labour force this year — down from 29% in April — before falling to 11.1% in the first quarter of next year. But the Central Bank the Central Bank noted a “strong divergence” between general demand levels at home and the performance of Irish exports abroad.
Several hospitality sector support measures announced as part of Budget 2021
Hospitality Ireland– 14.10.2020
The VAT rate for Ireland's hospitality sector will be reduced from 13.5% to 9% on November 1, and will remain at 9% until December of next year. This is one of several support measures that were announced for Ireland's hospitality and tourism sectors as part of Budget 2021 on Tuesday October 13. The government also announced that businesses that have to close due to COVID-19-related restrictions or that have experienced an 80% decline in turnover will be able to avail of a grant that will capped at €5,000 per week. Additionally, debt warehousing for small and medium sized businesses will be extended for a 12 month period with no interest and a €30 million fund will be administered via the Ireland Strategic Investment Fund.
Quick Service Restaurant (QSR) & Pub Sector
Domino’s see surge in third-quarter sales
Business Post– 16.10.2020
Domino's Pizza Group posted a 19 per cent jump in third-quarter sales. The company has also benefited from the reopening of contact-free collections and the return of sporting events. Domino's said it expects annual underlying pretax profit to range between £93-98 million, compared with £98.8 million for 2019. A reduction in the UK's value-added tax rate to 5 per cent from 20 per cent in July helped Domino's in controlling costs, which had weighed on the company's first-half profit as it spent more on cooking and delivering its pizzas safely during the pandemic.
JD Wetherspoon puts Irish pub plans on ice due to Covid uncertainty
Irish Examiner– 17.10.2020
British pub group JD Wetherspoon has put its longer-term Irish expansion and investment plans on hold until there is more clarity over how the bar trade can function within the Government’s Covid-19 guidelines. Wetherspoon has seven pubs in Ireland, a small number in various stages of development, and a long-term plan to have around 30 operating here. It sees scope for further openings in Cork as part of its ultimate expansion here. However, Wetherspoon still plans to open its nearly complete €21m pub/hotel project on Dublin’s Camden St in November if Government restrictions allow. Regarding longer-term investment, chairman Tim Martin said the UK will be the determining factor for the group, as almost all of Wetherspoon’s 900 or so pubs are based there, and the bulk of its revenues are generated there.
Hotel & Restaurant Sector
Deputy CEO of Dalata Hotel Group PLC hopes to see recovery in 2021
Business Post– 12.10.2020
In an interview with The Business Post, Dermot Crowley stated “We need to continue to protect our people, our business and our cash over the next 6 months. I would hope that we will start to see recovery set next year as the world is better able to manage Covid19 through a combination of vaccines, improved treatments, testing, tracing etc. We will then look to rebuild our business throughout 2021 and 2022. We will also look to complete the 3,300 rooms in our development pipeline as well as look for new opportunities that may arise out of the Covid19 crisis. We’re very focused on finding new opportunities in London and the larger UK cities. We are in a strong place financially and look forward with confidence to the post Covid world”.
Just Eat set to hire 700 additional couriers for lockdown
Irish Times– 23.10.2020
Food delivery service Just Eat is to recruit 700 additional couriers in the Republic to support an anticipated rise in online ordering during the lockdown. The company also plans to expand its delivery areas in some key urban locations and to temporarily waive commissions for 30 days for restaurants that sign up to the platform in the next two weeks. Just Eat, whose app has been downloaded more than 2.5 million times in the Republic over the past six years, said it had delivered €1 million worth of supports for Irish restaurants in recent months. In addition, it said it was extending its 14-day courier relief payment for workers who become ill or need to self-isolate as a result of the coronavirus.
Casual Dining & Contract Catering Sector
Catering Firm Compass Forecasts 19% Organic Sales Fall and £100m Hit
Hospitality Ireland– 02.10.2020
Catering firm Compass Group has said that it cannot predict how quickly its revenue will recover from the coronavirus pandemic as it forecast a 19% organic sales fall and a £100 million hit on its biggest businesses. Shares in Compass, the cafeterias and catering operations of which serve workers at Google, Shell and HSBC as well as schools, old age homes and the armed forces, have slumped 40% this year and were down 4.5% after the FTSE 100 firm reported a 36% preliminary fall in fourth-quarter revenue.
GBK restaurant chain bought in rescue deal
Irish Examiner – 14.10.2020
International restaurant chain Gourmet Burger Kitchen (GBK) — which runs over 60 outlets in the UK and five in Ireland — has been acquired from its South African owner in a so-called pre-pack rescue deal. The UK-based Boparan Restaurant Group (BRG) has taken over GBK, saying the deal will save 35 restaurants and 669 jobs. However, more than 360 people will be made redundant with 26 outlets due to close. South Africa’s Famous Brands said GBK had entered administration after becoming the latest victim of brutal trading conditions in the face of Covid-19.