Hospitality confidence falls amid Plan B measures

Hospitality confidence falls amid Plan B measures
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A report from market insight firm CGA has revealed the ”major” impact of Plan B measures on business confidence, as venues gear up for “a difficult winter.”


New Plan B measures are a “major risk” to both consumer and business confidence according to a new report from CGA, as restrictions combine with existing supply chain issues to create “a difficult winter” for UK hospitality.

The Business Confidence Survey Q4 2021 reveals a decline in like-for-like sales of food and drink from 98 percent of 2019 sales in Q3, to just 86 percent of pre- Covid figures since the Omicron variant was identified.

“The Christmas period is estimated to be worth £9.2bn to the hospitality sector and operators will have been hoping to maximise every opportunity during this key trading period after a difficult 2020 and 2021,” said CGA CEO Phil Tate.

“With parties and bookings being cancelled, the hospitality sector, whilst already facing a number of challenges including supply issues, staff shortages and rising costs, will be looking at a difficult winter without substantial and focused government support.”

Despite the Q4 findings noting that 99 percent of businesses were experiencing supply chain issues, two thirds of business leaders reported they were “optimistic” about their business, while four fifths were in profit, as 42 percent planned new sites in 2022.

Though the Q4 report only covers the period from 15 to 24 November, prior to Plan B being announced, CGA noted that the new restrictions have already heavily impacted both consumer confidence and sales, with more recent figures revealing a 14 percent drop in average sales compared to 2019.

“Like-for-like sales of food and drinks have fallen to 89 percent and 86 percent of 2019 levels in the two weeks since Omicron’s emergence, having averaged 98 percent in the previous 12 weeks – a clear sign that the Omicron variant, working from home advice and Plan B measures in England are impacting consumers’ confidence.”

Supply chain problems were already creating concern among operators prior to increased restrictions, with 91 percent reporting higher supply costs, 89 percent stating goods were reduced or unavailable, and 86 revealing products had simply not been delivered.

“Before Plan B was announced, underlying optimism and performance were relatively stable, albeit with major operational issues around staffing and supply chains.”

“The new restrictions are a major risk to consumer confidence during this vital festive season.”


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