It’s summertime in the UK, usually a key money-spinning time for the hospitality sector, but despite the influx of big-spending tourists, all is not well beneath the surface.
Post-Brexit turbulence is exerting financial pressures on hoteliers, publicans and restaurateurs. And there are regulatory changes to contend with too. These factors combined have all the makings of a ‘perfect storm’, experts believe.
Here’s a breakdown of the challenges the hospitality sector is currently facing:
Food prices have risen by 9% while drink costs have risen by 7%.
The wavering of the pound post-Brexit has led to an inflation of food and drink costs. According to the Association of Licensed Multiple Retailers (ALMR), food prices have risen by 9% while drink costs have risen by 7%. The ALMR represents 90% of all restaurants, pubs and bars in the UK.
According to their survey, only 4% of owners felt they could pass on cost increases to their customers through higher prices. Most feared that this move would irrevocably damage their business.
Last year saw the introduction of the National Living Wage for over 25s. A measure which will see wages rise to £9 by April 2020. They have already risen to £7.20. In the wake of Brexit’s uncertainty, this is yet another financial strain for business owners.
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