UK hospitality leaders are losing confidence in their businesses as the eating-and-drinking-out markets remain ‘strained’, according to a survey by Fourth and CGA.
Hospitality solution provider Fourth and data and insights company CGA’s joint business confidence survey shows the number of hospitality operators who are optimistic about their company’s prospects for the next year has fallen from 69% in February to 63% this month.
This figure comes after 23% of hospitality leaders said they traded below expectations over the last six months. Around 39% traded in line with expectations and 38% traded ahead of expectations, reflecting a rise of nine percentage points from three months earlier.
CGA group CEO Phil Tate said: “Our latest survey reflects a complex and mixed picture in the market at the moment. Many businesses continue to find conditions extremely challenging, and confidence clearly remains fragile as the year ends. Christmas trading will now have an enormous impact on the levels of optimism as we enter 2019.”
The survey showed half of the hospitality leaders are pessimistic about consumers’ frequency of eating-and-drinking-out. However, 69% of drink-led companies are positive about their business prospects compared with 63% of their food-led counterparts.
Tate added: “Many drinks-led pub businesses are clearly buoyant at the moment, riding high on the hot summer and football World Cup and anticipating a strong festive period. However, our survey shows that they, like all operators, will need to stay resolutely focused on the consumer next year, supplying not just good food and drink but embracing key trends and delivering the high-quality all-round experiences that guests now demand.”
Fourth CEO Ben Hood said: “Despite the lingering uncertainty of Brexit, the results do show the confidence of hospitality operators remains steady as they prepare for the year ahead. To manoeuvre through this tough period of rising costs, operators are rightly harnessing the power of technology to support most, if not all, aspects of their businesses.
“However, this is creating a complex digital infrastructure, with multiple logins and technologies working independently. The big challenge the industry now faces is to work together to bring myriad digital business systems into a single, integrated and coherent platform.”
The quarterly survey, last conducted in November 2018, polled corporate participants and start-ups from the pub, bar and restaurant sector.