Trends

Pizza and pasta to deal with Brexit

Some major chains – including Jamie’s Italian, owned by celebrity chef Jamie Oliver – have started to close stores as they prepare to deal with more challenging times

Research firm MCA Insight expects to see a slowdown in the UK’s branded Italian pizza and pasta market, which includes brands with two or more outlets. The sector, which it values at about £2 billion, is seen growing 3.8 percent year on year in the period 2017-2020, lower than a rate of 5.9 percent annually between 2014 and 2017. Some major chains have started to close stores as they prepare to deal with more challenging times. Jamie’s Italian, owned by celebrity chef Jamie Oliver, has announced it plans to shut down 12 of its 37 outlets, mentioning in media reports that the rising price of ingredients was partly the reason for its decision. The weakening of the pound since Britain’s vote to leave the European Union in 2016 has made it much more expensive to import from Europe, pushing up prices of food and wine from countries like Italy. If extra tariffs, duties or delays are imposed at customs, this could cause further problems and price pressures for restaurants, especially for those bringing across fresh produce.

The challenge of Brexit

We import almost all our ingredients from Italy, said Serena Sarnataro, who runs L’Antica Pizzeria da Michele in London’s Stoke Newington. The fior di latte is a concern. Produce could get stuck at customs for ages. And it is not so much a problem with tomatoes or flour because they have a longer shelf life. But fresh fior di latte will not survive, she said. Brexit is also expected to pose some challenges on the employment front, making it harder for Italian-style restaurants to find quality waiters and kitchen staff. The biggest problem when you talk about Brexit is work. When you are working in a restaurant, that is classed as not-skilled, and increasingly people are going to have to be classed as skilled if they want to come into the country. If workers are no longer coming into the country, that is the biggest concern, said Jean-Pierre Lormant, whose family run La Margherita restaurant in Cambridge. With inflation running at high rates and wage growth still weak, consumer morale among Britons is low and this is seeing price considerations gain momentum, according to Mintel research. It said any further weakening in confidence could lead to people cutting back restaurant spending and looking for cheaper alternatives. MCA said successful operators were managing to push through above-inflation price increases, while not damaging their image of value for money or compromising quality.

Health trends and competition from Asian cuisine

This will also be a key consideration to help Italian restaurants fight off competition from new types of cuisines, such as Asian and fusion varieties, especially when trying to attract younger customers. Newer, more adventurous cuisines, including South East Asian, Japanese and also burgers, are better capturing the interest of the influential Millennial market in particular, said MCA. Health trends in the UK are meanwhile encouraging some people to avoid eating too many carbohydrates, which analysts say could weigh on demand for pizza and pasta, and will mean restaurants have to introduce lighter options. Nevertheless, pizza is expected to remain a popular option for dinner, especially as it appeals to families with young children. People are obsessed with pizza. Kids love pizza. The thing about Italian is that it is great for families and kids said Lormant. Sarnataro, who offers only two types of pizzas: Margherita and Marinara, in two different sizes, said that at first British people were quite surprised by the limited choice but they have come to appreciate this approach as more authentic. She said she was not too concerned about health consciousness hitting her business because she expected there will always be a moment when people give themselves a guilty pleasure and she pointed out that her pizza recipes were already quite light, with the Marinara option for example not including any cheese.