New Report Reveals The True State Of The Hospitality Sector

A staggering 86% of UK hospitality operators will likely have to close in the next three years if their business costs don’t reduce and their revenue doesn’t increase , according to a new repor t

Half of these (50%) will likely have to close within 12 months’ time

The Plates to Profits Repor t* by Creed Foodser vice sur veyed directors, owners, managers and chefs in restaurants, hotels and pubs, and brings to life the impact the pandemic , rising inflation and increasing food costs, together with the squeezed consumer purse , is having on their operations

Philip de Ternant, Managing Director at Creed Foodser vice , says: “We all know the hospitality sector has taken a real hammering but to see the number of operators, who could ver y realistically be forced to close in the coming months, is sobering and stark

“Inflation and rising food costs are affecting the entire supply chain, from suppliers, logistics companies, transpor tation, the front line such as restaurants, pubs and hotels, and wholesalers like us Over the last year we ’ ve seen a 27% increase on eggs and baking potatoes, another staple , has risen by £8 a case

“Combine this with consumers who are also having to review their expenditure – nearly half of operators told us that the number of bookings at their establishment have reduced – the pressure mounts even more ”

Unsurprisingly, two thirds (63%) of operators said business concerns around revenue and profit has impacted their mental health over the past 12 months

Philip de Ternant continues: “Our Plates to Profits Repor t is in par t about genuinely understanding what state the sector is in but more so about giving operators advice , guidance and actionable ideas on how they can increase the profit on ever y plate they ser ve and drive maximum revenue into their establishment

“The vast majority of operators (85%) told us they will need to increase their menu prices to stay financially viable However 83% are worried that if they do this it will alienate consumers and put them off visiting their establishment They feel stuck between a rock and hard place

“We’ve worked with our insights team chefs categor y specialists and senior figures to look at ever y aspect of an operation; from reducing food waste maximising margins on dishes navigating staff shor tages to still create quality dishes, communicating the stor y behind the menu to consumers, utilising seasonal produce , recipe ideas and increasing prices through offering premium sides, high-quality specials and set-menus We ve also liaised with some of our restaurant and pub customers who have also contributed thoughts to the Repor t ”

Key Report Discoveries

Changing Consumer Behaviour

Operators told Creed:

Nearly half (47%) have seen the number of bookings reduce

45% said customers are choosing sharing food options

43% said customers are reducing the number of courses they order

Four out of ten (40%) said customers are choosing more affordable dishes and reducing the number of sides they order

A third (33%) said customers are booking into earlier time slots to make the most of ‘early bird’ menu deals

Three out of ten (29%) said customers are not ordering coffee or tea at the end of their meal

Nearly two out of ten (19%) said customers are not ordering alcohol and instead choosing soft drinks or water

Navigating staff shor tages

Due to not having a highly skilled chef / catering team, operators told Creed:

Half (49%) have had to change their menu to more simpler dishes