I can see how it would be annoying to have people come into a furniture shop and sit there eating their lunch, but surely he should put up a big sign banning food, not foreign students. How does he know that some of the people eating McDonalds weren't from the UK anyway?
I think the law probably says that a shopkeeper can refuse to serve anyone without giving a reason, but I'm fairly sure they can't display a notice effectively saying "no foreigners". A polite notice asking people not to bring food into the shop should be good enough.
It seems rather odd. And puts me in mind of the door-stepping investigative journalist on a hidden camera show who confronted a landlord on air for placing an advert which stipulated "No Asians". The poor landlord was baffled until they realised he had asked for his ad to say "No Agents"