How the Olympics affected the foodservice trade

A new report looks at the effects – positive and negative – of the 2012 London Games on the foodservice sector. Kevin Whitlock investigates

Britiain, not to say the rest of the world, was rather surprised surprised on 6 July 2005 when London was awarded the 2012 Olympics.

Many were apprehensive – would we be able to pull it off, or would the event degenerate into A Very British Farce? – but in the end London 2012 was a triumph for the nation, its athletes and broadcasters.

However, there was one big loser – and that was the foodservice sector. Horizons, the foodservice analyst, predicted that the market would take a hit. In August 2011, it said that there would be a reduction of £75m in food and beverage sales compared with what would have happened without the Games.

Horizons’ post-Games analysis shows that this was accurate, if slightly pessimistic. In the end, the Games led to a downturn of £55m in takings.

However, Horizons says it is important to keep all this in perspective because, while the impact may have been significant for some companies, the overall impact was equivalent to less than 0.1% of total UK eating.

Ironically – given that much of London was deserted during the Games – the biggest winner was the capital. According to Horizons, the effect will be long-term. “London’s friendliness and ability to put on a really great show, plus the range and quality of British restaurant  and pub food was a strong feature – and one, no doubt, that will attract more visitors in the years to come,” says a spokesperson.

The foodservice industry also showed how well and quickly it could rise to the challenge of change – with night-time deliveries, additional security checks and an array of foreign language speakers to contend with just a few of the additional challenges.

Particular winners were operators of the concession restaurants and fast food places around the Olympic Park, and contract caterers that operated inside the fence in the Olympic Park, and at other locations: Weymouth for sailing, Eton Dorney for rowing, Lea Valley for white- water sports and other sites around the country such as football stadia that featured Olympic football. Other winners included, ironically, Paris, an unsuccessful bidder for the 2012 Games, (which attracted non-sporty holidaymakers who otherwise would have gone to London)

Notable losers included: restaurants in the West End; wholesalers geared up to serve these restaurants; food kiosks in Oxford Street; food-led pubs around the country and their suppliers; hotels which sat back and waited for the Olympics bonanza, and London museums.

Construction of the Olympic Park, which started in 2008, involved the displacement of many small businesses including a number of wholesalers and Foreman’s, the smoked salmon supplier. However the feeding of construction workers over the next four years required considerable input from suppliers and contract caterers.

During this period, and indeed right up to the time when the Olympics became “real” during the month-long Torch Relay around the entire United Kingdom, surveys found that Britons were generally indifferent to the Games and many had plans to stay away or go on holiday while the Games were on.

Consumer interest speeded up as tickets started to become available in early 2012, and a further boost to consumer interest was provided in the late Spring by the Royal Jubilee.

As the Olympics opened, central London became unusually quiet as locals heeded warning of transport chaos on the tubes and buses (Wholesale News, August 2012). In the end travel was hardly affected, and eating out activity by Londoners was almost up to normal August levels during the second week of the Games.

However, overseas visitors were fewer than usual during the period of the Games – BAA traveller numbers were 2% down in August – and so their contribution to the normal London eating out scene was less than normal.

Meanwhile “inside the fence”, McDonald’s served 55,000 customers on its busiest day in its two Olympic Park outlets – and 13,000 in its athletes’ village site. Contractors such as Compass, and Aramark, did very brisk business not only with athletes, the media and the Olympic “family”, but also from the many concessions that they operated inside the fence. Their offers covered a wide range from healthy food options to Mexican, and Indian ethnic cuisines.

Winners and losers

Teams GB and Paralympics GB won 185 medals – the third highest after China and USA. The British total included 63 Golds, 60 Silvers and 62 Bronze.

There was a net loss of £55m in takings by restaurants, quick service, and pub food over the period of the Olympics and Paralympics compared with what would otherwise have been expected at the time of year.

Food amp; Beverage sales compared to a normal August/September

OUTSIDE OLYMPIC SITES

Sales + or –

Restaurants

-£26m

Quick service restaurants

-£27m

Pubs

-£11m

Hotels

-£14m

Staff feeding

Negligible decline

SUB-TOTAL

-£78m

INSIDE OLYMPIC SITES

Sales + or –

All

+£23m

SUB-TOTAL

+£23m

TOTAL

_£55m

Source: Horizons

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