London restaurants have shown an extraordinary resilience in the last twelve months and achieved the third highest level of annual growth ever, with 140 openings and only 72 closings since this time last year. This is the key finding of the 20th edition of Harden’s London Restaurants, which will be published in September 2010, in association with Rémy Martin Fine Champagne Cognac.
Openings are right at the upper end of the range (120 to 142) observed for most of the last decade and at a level exceeded in only two prior years. Closings – in the mid-60s to early-70s for the last four years – remain at a moderate rate historically.
The average price of dinner for one at establishments listed in the guide is £41.75. However, although prices have on average risen by 2.5% in the past 12 months, restaurateurs had the temporary benefit last year of paying a lower rate of VAT, so that pre-tax prices are effectively flat (up a meagre 0.3% year-on-year). This is the weakest level of price growth since Harden’s started tracking it ten years ago.
According to co-editor Peter Harden, who has been recording the London restaurant scene for twenty years now, lessons can be learnt from the last deep recession of the early ‘90s when Harden’s London Restaurants first hit the bookshops. “When we first launched the guide in 1991, restaurants were closing left, right and centre as – due to soaring interest rates – people with mortgages just couldn’t afford to go out. It’s been very different this time: interest rates have stayed so low that people in stable employment seem to find eating out as affordable, if not more affordable than ever.
Co-editor Richard Harden adds: “A positive factor for the London restaurant trade is that it has become more professional and commercially savvy. For decades it was an accepted truth that ‘good restaurants don’t advertise’. But – via discount sites, targeted emails and social media – the internet has transformed the ability for restaurants to market themselves more subtly – one of the major factors allowing them to ride out the current economic storm. Another stabilising factor has been the broadening range of London’s regular diners as couples have delayed having kids. Whereas in the early ’90s when we first launched top restaurants would generally cater to older tastes, the last 20 years has seen the growth of trendier restaurants aimed at those twenty- and thirty-somethings who in former eras would have been spending their money on nest-making. “
Peter Harden concludes: “As London starts to emerge from the worst post-war recession restaurants still face numerous challenges. This year’s feeble price inflation shows just how hard the trade is having to work to keep attracting custom. But it’s great news that restaurant growth has remained so strong during a period in which everyone expected closures by the dozen – a sign of the restaurant scene’s surprisingly rude health.”
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