UK still most popular place to open restaurants despite increasing costs and competition

The UK remains the most attractive European market for restaurant groups to open in, but saturated high streets and the threat of increasing import costs are making some think twice.

Research conducted by the Global Restaurant Investment Forum, being held in Amsterdam, found the UK market was still the most popular in Europe, followed by France, the Netherlands and Germany.

Those questioned, including Five Guys, Wagamama, Jamie's Italian and Brewdog, said it was easy to find partners in the UK but that intense competition and high rates and rents were considerations.

Nicholas Schapira, CEO of Vapiano Franchising International and formerly of Jamie's Italian, told the conference: "I'm surprised when chatting to people that they predominantly do focus on the UK as the number one market to enter in Europe.

"What I have experienced with Jamie's Italian and chatting to other UK operators it's bewildering. There is potential but that casual dining market is incredibly saturated, highly competitive and the economics of the F&B model are getting extremely hard - margins are small."

Schapira cited high rents, Brexit driving up import costs and wage cost rises as factors making operating in the UK less attractive. He added: "You can wipe off £1m-£2m of profitability without doing anything.

"I look at the UK and say why would you not be looking at the Netherlands or Germany."