Sales above pre-Corona levels: Germany’s catering industry is booming again – but not everywhere

Sales above pre-Corona levels
Germany’s gastronomy is booming again – but not everywhere

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The catering industry is suffering massively from the corona pandemic. Around a year after the end, the industry is recording increasing sales again, in some regions even significantly above the level before 2019. However, the restaurant association does not want to be optimistic.

According to the IFO Institute, the catering industry in Germany has recovered significantly – at least in larger cities. The Munich economic researchers said that sales there, adjusted for inflation, were above the values ​​before the corona pandemic. Berlin, Hamburg, Munich, Stuttgart and Dresden were examined. “There is an upswing in the catering industry after the corona pandemic, despite the war in Ukraine and inflation,” says IFO expert Simon Krause. However, outside of the big cities, sales development is less positive.

“The remarkable result of this analysis is that inflation-adjusted restaurant sales in all five cities have been consistently above pre-crisis levels since the end of all Corona restrictions in April 2022,” the study says. In all five major cities, sales are currently at least 20 percent higher than in 2019, and in Berlin they are significantly higher.

“The companies were able to pass on part of their increased costs for staff, food and energy without the guests staying away,” said co-author Carla Krolage. According to data from the Federal Statistical Office, prices in the catering industry have recently risen faster than overall inflation. In addition to the general increase in sales, the IFO researchers also observed a shift. The catering trade in the outlying areas, which actually have lower sales, grew relatively more than in the centers.

High costs depress sentiment

The hotel and restaurant association DEHOGA, on the other hand, painted a less optimistic picture for the entire country last week. Almost half of the companies stated in a survey that their business would be worse in the next three months than before. 28 percent feared making losses in 2023, primarily due to higher costs. In the first six months of 2023, the industry’s sales – adjusted for rising prices – fell by 10.4 percent in real terms compared to the pre-Corona level of 2019. Nominal revenue, on the other hand, was almost ten percent higher due to inflation.

According to the IFO Institute, the use of more home offices leads to a shift in restaurant sales from the city center to residential areas and suburbs, the so-called donut effect. There is also an increase in sales on weekends compared to weekdays. For the survey, the IFO Institute evaluated anonymized card payments for catering sales between January 2019 and March 2023.

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