Hospitality businesses are confident about their future prospects despite the impact of the pandemic on the sector and the delay to reopening, new data has found.
According to a new survey of 92 pub, restaurant, and hotel operators by top 25 accountancy firm haysmacintyre, 70% of respondents were either confident or very confident about their business’ future prospects, even before the Prime Minister announced the full relaxation of all remaining covid-19 restrictions last week.
The July 2021 haysmacintyre Hospitality Snapshot Survey found a markedly more positive sentiment compared to haysmacintyre’s March 2021 survey, where 49% expressed confidence about the future.
The increase in confidence is primarily driven by the pub sector, with 79% of pub and bar respondents now confident or very confident about the future, compared to just 41% in March.
82% of hotel respondents are either confident or very confident about their future prospects, in line with 83% in March, whereas 60% of restaurants expressed confidence, up from 53%.
Only 9% of all survey respondents expressed a lack of confidence in their business’ future, down from 16% in March.
The gradual re-opening of some aspects of the hospitality sector since April has likely increased confidence amongst pubs, bars and restaurants, with consumers flocking to hospitality venues as lockdown measures ease and warmer weather returns, along with major sporting events.
Looking ahead, difficulties in recruiting staff appears to be the greatest challenge facing all hospitality businesses: 63% of operators cited it as their biggest issue after the initial re-opening this spring.
Furthermore, the survey also revealed that 60% of respondents reported that the VAT rate cut was the government support measure they most wanted to be continued in some form going forward; a significantly greater proportion than the 20% of businesses that selected business rates relief as their most preferred option.
Other key takeaways from the survey included:
- 62% of hospitality businesses expect trading levels to return to normal before the second half of 2022, down from 70% who believed this would be the case in the March survey.
- 43% of restaurants, along with 41% of pubs and bars, are confident of a return to normal trading levels sometime this year, compared to just 18% of hotels – a lower figure likely driven by ongoing restrictions to international tourism
Commenting on the findings, Gareth Ogden, partner in the hospitality team at haysmacintyre, said: “Despite the devastating effects the COVID-19 pandemic has had on hospitality businesses, it is hugely encouraging to see that a significant majority are now confident about their business’ future prospects.
“But it is also clear that the sector is still facing a number of significant challenges, including staff recruitment in particular; and whilst many would like to see some form of support continue, or even be made permanent – not least VAT cuts and business rates reform – as government measures unwind it is more likely that they will cease altogether as the Treasury looks to balance the books and pay for the huge cost of the pandemic. Therefore, we are yet to see the full fallout for the sector, which will inevitably play out over the next 12 months.”