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Hospitality ready to invest, but cost barriers remain

Access the full results.

Quarterly members survey - Q2 2024

A joint survey by UKHospitality, the British Beer & Pub Association, Hospitality Ulster and the British Institute of Innkeeping showed that pubs and hospitality venues have the appetite to invest in the future of their businesses, despite the wide range of cost pressures they continue to face.

The survey revealed the clear desire from businesses to invest, both in development and training of their teams, and in venue refurbishments and improvements.

It also showed the challenges around rising wage bills, food and drink costs and disproportionately high taxation in relation to other sectors.

Investment

Despite these pressures, the survey demonstrated the willingness to invest:

  1. 1

    Customer service

    95% of operators are planning to invest in customer service.

    Those intending to increase investment in this area rose by 24%.

  2. 2

    Staff training

    92% are planning to invest in staff training.

    Those intending to increase investment in this area rose by 16%.

  3. 3

    Employee engagement

    72% of businesses are planning to invest in employee engagement.

    Those intending to increase investment in this area rose by 19%.

  4. 4

    Venue refurbishments

    Venue refurbishments are an investment priority for 71% of respondents.

Costs

The survey reinforces that the sector continues to face significant cost pressures. Looking at a year-on-year comparison, businesses told us:

70%of venues saw a reduction in profit.

50%are breaking even or operating at a loss.

1-in-4have no cash reserves

66%have significantly increased wage costs.

Joint statement

In a joint statement, the trade bodies said: “Our regular survey of our joint memberships showed the resilience of our sector, as well as an appetite to invest in teams and venues for the future.

“Consumers choosing to spend their disposable income in pubs, restaurants, hotels, and cafes is no surprise, as we provide a much-needed opportunity for fun, celebration and vital social connection, but in order for our members to survive and thrive, they need to be profitable.

“Their profitability has been heavily impacted by high inflation in food and drink, high energy costs, disruption from rail strikes and the impact of increased labour costs, that have had a ripple effect at every level.

“The sector is innovative, adaptable and has the potential to provide much needed growth for the economy, creating vital local employment and bolstering local supply chains, all whilst supporting essential social connection in high streets, towns and cities.

“In order for operators to invest in this potential, however, the sector also needs a fairer, modern and more proportionate tax and regulatory regime, enabling them to remain at the heart of local economies and communities across the UK.”

CGA by NIQ surveyed hospitality businesses from 8 to 23 April 2024.