The increase in COVID-19 cases across much of the south of the United States has put a brake on the recovery of the out-of-home market, with sales growth slowing nationally and going into reverse in some states such as Texas as restrictions on trading are re-imposed.

With other states, including New York and Illinois, re-opening restaurants and bars properly for the first time in months, the national picture has become more complex.

Latest data from Nielsen CGA, the US arm of CGA, shows that at a national level sales have continued to improve and were only 10% down on the pre-COVID norm in the week to June 27, representing a +220% increase on March 28 when shutdown commenced. Over the last two reported weeks, sales grew by +8% and +6% to June 20 and June 27 respectively.

However, progress has stuttered in states where COVID-19 infection rates have begun to rise again. In Texas and Florida, the growth delivered over the last few months has been tempered for the first time. In Florida, sales were flat at -0.2% in the week to June 27, while in Texas sales in restaurants and bars dropped by -4% in the same week. Across both these States daily velocity has been continually down on the previous week to June 27 – and sales are expected to dip further as new trading restrictions kick in.

Since then Texas governor Greg Abbott has issued an executive order limiting certain businesses and services as part of the state's effort to contain the spike in infections. All bars and establishments with more than 51% of sales coming from alcohol had to close at 12pm on June 26, although they may remain open for delivery and takeout. Restaurants can remain open for dine-in service, but at a capacity not to exceed 50% of total listed indoor occupancy, beginning on June 29.

Florida Governor Ron DeSantis has ordered a similar bar shutdown, saying the order was issued because many people were disobeying the state’s reopening guidelines: “People weren’t following it. There was widespread noncompliance, and that led to issues. If folks just follow the guidelines, we’re going to be in good shape. When you depart from that, then it becomes problematic.”

In contrast, there has been significant growth elsewhere in the country, particularly in New York, which has seen an ease in lockdown in the NYC metro area. Restaurant and bar sales grew by +53% in the week to June 27 against the previous week to June 20 in the city with the wider state growing by +24%.

A common narrative is that major cities have performed, and continue to perform, below the rest of their respective states. With business travel and commuting still heavily restricted along with large events and late-night occasions, city centres are still having a difficult time.

In Texas, where bars first reopened in mid-May, outside of key cities, sales have remained constant at -13% below pre-COVID norms over much of June. However, cities have seen the week on week sales drop and a lower sales overall. In Dallas, the last two reported weeks saw sales drop by -4% and -10% to June 20 and 27, respectively. Sales now stands at -42% below pre-COVID norms.

In California, where sales in the week to June 27 were 7% up on the previous week, trading is also now expected to take a dip as COVID returns.

The full detailed COVID-19 impact report for the US is available from Nielsen CGA, contact Matthew Crompton via matthew.crompton@nielsencga.com.

     

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