Search
Close this search box.

New research: 44% of hospitality businesses operating at a loss in face of 45-year high food price inflation

07/06/2023
Sam Martin (CEO of Peckwater Brands)

A NEW survey of 250 senior decision-makers within UK hospitality businesses has found that:

  • 44% of businesses are operating at a loss, with 53% impacted by rising cost of goods and 50% by higher energy bills
  • 70% feel they will have to increase prices to survive, while a third (34%) do not think their business will survive the next 12 months

Over two fifths of the UK’s hospitality businesses are operating at a loss, with the vast majority eyeing price increases during the next year, new research by Peckwater Brands has found.

Subscribe to our daily newsletter

Why? Free to subscribe, no paywall, daily business news digest.

Europe’s largest virtual food brand operator commissioned an independent survey of 250 decision-makers in senior management positions within UK hospitality businesses (restaurants, takeaways, cafés and bars). It found that 44% are currently operating at a loss. 

A third (34%) of hospitality leaders do not think their business will survive the next 12 months, while 70% expect they will have to increase prices within that timeframe.

The study found that more than half of hospitality firms have been negatively impacted by the rising cost of goods (53%), with a similar number affected by record energy bills (50%). A third (34%) are struggling with higher interest rates, while 29% struggle with increased commercial rents. Most (55%) are struggling to find enough staff to operate effectively.

Inflation is not just ramping up hospitality businesses’ costs – the majority (70%) say customers are spending significantly less than they were 12 months ago. 

Sam Martin, CEO of Peckwater Brands, said: “Conditions for hospitality businesses are undoubtedly tough, with record food inflation, skyrocketing energy bills and falling consumer spending all having a notable impact. Our research shows lays bare the stark reality; so many establishments are loss-making and many fear for their survival. 

“Unfortunately, the challenges facing the hospitality sector will not disappear any time soon. Raising prices might be the only option available to many businesses, but with consumers wrestling with a cost-of-living crisis and seeking out lower prices wherever possible, this action could damage their customer bases. 

“Just as during the pandemic, hospitality businesses must rely on ingenuity, efficiency and innovation to survive, let alone thrive – they must seek out all opportunities available to them, whether that is to lower costs or find ways of boosting revenue and order volumes, such as improved marketing or operating secondary virtual food brands out of their kitchens. One can only hope that in the coming months, inflation falls sharply and overheads drop, ensuring hospitality firms are not forced to close their doors. If they were, local high streets would be greatly diminished, as would the UK economy.”

The latest stories

Quality Meat Scotland on front foot to make Scotland the choice for premium red meat

The Scottish red meat sector has demonstrated considerable progress, generated opportunities and grown its ambition, a year on from the

Ultimate whisky gift: Iconic Master Blenders curate exclusive spirits collection

Wolfcraig Distillers has released the ultimate gift for whisky lovers this Christmas . The Wolfcraig Luxury Collection is a limited

Bluewater to revolutionize UK drinking water dispenser market with launch of Bluewater Flow

Bluewater, a world leader in innovative water purification and beverage solutions, is thrilled to announce the launch of its innovative

National Smoothie Day: Three Robin launches low sugar, oat-based little Fruit Smoothies With Hidden Veg

THREE ROBINS LAUNCHES KIDS OAT-BASED SMOOTHIES WITH HIDDEN VEG + NO ADDED SUGAR In time for National Smoothie Day sees

Subscribe to our daily newsletter

Why? Free to subscribe, no paywall, daily business news digest.