By Angela Green
It is quite remarkable that hospitality and catering operators, of all sizes, and from different sectors of the industry are more and more taking to their keyboards to raise levels of awareness of the issues they face challenging their businesses. Despite differences in sectors and size, many of the issues are common.
Yesterday we published – Hospitality’s solutions prove detrimental to HM Treasury – by Robin Sheppard, President, Bespoke Hotels. Sheppard’s thoughts concluded: “This has forced hospitality professionals to come up with their own solutions and cut their cloth accordingly. This sees pubs no longer open on Mondays and Tuesdays, restaurants moved to not operating lunchtime service, and entire wings of hotels mothballed due to a lack of people available to service them. Solutions have been found, but are detrimental to all cast into the situation, including HM Treasury.”
Today we are delighted to feature Paul Askew, Chef Patron of The Art School in Liverpool, who wrote: “Wednesday 19th July marked two years since Freedom Day and when all of the Covid-19 restrictions were lifted.
“Whilst that deeply challenging time is thankfully behind the nation and wider world, it still feels that for the UK’s hospitality industry, we have barely moved on since the very dark days tens of thousands of operators faced – and still do now.
“We are currently seeing between 6-7 independent restaurants, pubs, bars, hotels and clubs per day shuttering for good in the face of ongoing pressures from the cost of living crisis and high interest rates affecting consumers. There are supply chain problems with roots in Brexit plus debts incurred from the pandemic. Energy costs remain a huge issue in running a hospitality business, as does finding the next generation of employees – apprenticeships are down by 1/3 in most academies.
“As staff costs rise by around 10% and PAYE costs increase, plus restaurant food inflation hovers at around 25%, there’s pressure to increase menu prices to compensate, but this only created higher inflation which effects how many people can afford to dine out and further adds fuel to the inflationary fires. There’s been little respite in the last 24 months, as consumers have been slowly squeezed with all bills higher and simply living from day to day is a more expensive proposition.
“Hospitality is not alone in suffering and other industries are facing ever slimmer margins on which to operate. We are seeing a contraction of businesses here in Liverpool which is being reflected across the cities and town and rural destinations everywhere, as the pressure points become too much to bear.
“A full recalibration of the hospitality industry is long overdue. COVID-19, Brexit and now inflation have all accelerated the stresses. The taxation system is not for fit purpose. VAT has to be reduced to be in line with Europe to 10—15% max. The government and regional councils need to treat hospitality better. In Liverpool we’ve been lucky with Eurovision, graduations and now The Open plus other large scale events, but how long can these sustain us? And what about everywhere else?
“There is still time to turn this around but the hospitality industry needs urgent, targeted help. The future of tens of thousands of independent hospitality businesses and the supply chain eco-systems around them are failing in ever greater numbers.”
Thank you Paul.