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ARE HOSPITALITY BUSINESSES ON THE BRINK OF COLLAPSE?

ARE HOSPITALITY BUSINESSES ON THE BRINK OF COLLAPSE?

New research by Peckwater Brands has revealed the impact of Covid-19 on the hospitality sector, and the action businesses have taken to safeguard their future. It found:

  • The majority (58%) of UK hospitality businesses say the pandemic has put them at risk of closure.
  • 43% do not believe their business will exist in five years’ time.
  • 67% have seen a substantial decline in income since the onset of the pandemic

Covid-19 has pushed the majority of UK hospitality businesses to the brink of closure, the research reveals. 

The virtual brand specialist surveyed 250 senior decision-makers within UK restaurants, bars, cafés and takeaways. It found that 64% of hospitality business leaders had seen their mental wellbeing significantly impacted by the stresses of Covid-19.

More than three fifths (63%) have experienced a decline in demand for their goods or services since the beginning of the pandemic, while 67% have seen their income shrink notably. 

The majority (58%) of hospitality decision-makers say Covid-19 has pushed their businesses to the brink of closure. Over a third (36%) do not believe their business will exist by the end of 2022, with 43% fearing closure by the end of 2027.

Peckwater Brands’ research also found that 74% of hospitality business leaders had analysed their existing operations to find areas of improvement to increase their chances of survival.

Three quarters (75%) said they have relied on takeaway services to stay afloat during the pandemic, while 69% have sourced new, cheaper suppliers to improve profit margins.

Sam Martin, COO of Peckwater Brands, said: “While the pandemic has impacted all industries, few have had to overcome harder or more numerous blows than the hospitality sector. Multiple lockdowns, social distancing rules, health and safety improvements, and uncertainty surrounding new Covid variants – it is understandable that confidence among restaurants and takeaways is so low.

“Positively, however, our research suggests managers have accepted that they must adapt to survive. From finding cheaper suppliers to embracing takeaway services, it’s encouraging to see hospitality businesses thinking creatively about how they can increase their income throughout such a challenging time.

“Many challenges lie ahead. Restrictions might be easing again, but there remains the prevalent threat of a fresh variant setting back the sector’s much-needed recovery. Yet if businesses are willing to be flexible and creative with their approach to operations, I have every confidence that 2022 will be a much brighter year for the hospitality sector.”

 

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