Hospitality chiefs set for Brexit showdown talks

LONDON - NOVEMBER 03:  A general view of shoppers taking a break at restaurant areas at the newly opened Westfield shopping centre on November 3, 2008 in the west London, England.  Despite the current economic downturn in the retail industry, Europe's largest urban shopping mall, which opened to the public this week, is expected to attract 25 million shoppers each year to its 265 shops.  (Photo by Oli Scarff/Getty Images)

Top dogs from the wider British hospitality industry will have their first chance to collectively discuss the repercussions of Britain’s exit from the EU today when they gather for the BHA’s annual summit in London.

Ufi Ibrahim, CEO of the BHA, which represents more than 40,000 businesses, including restaurants, hotels and foodservice operators, confirmed that one of the things it would be looking to discuss is its intention to seek as much involvement as possible in shaping negotiations.

“We will be framing a plan to ensure that we have a seat at the table on all negotiations including taxation, immigration and regulation,” she said. “As we go through this process, the BHA will call upon every politician in this country to do all they can to guard the strong reputation that our industry has built representing a hospitable and welcoming country all around the world. Our industry is one of the key drivers of exports, prosperity and the fourth largest employer supporting 4.5 million jobs.”

Ibrahim said that members, industry experts and political leaders would be at the summit to debate the short-term economic and political ramifications of the result.

“The EU referendum question represented a profound moment for the future of our industry. Hospitality and tourism benefits from a flourishing economy and any level of uncertainty will have an impact. The UK’s withdrawal from the European Union is the beginning of a process which could take years.”

Andrew Lennox, CEO of The Koh Group, which operates 11 sites, said separately that, for the benefit of the industry, the UK shouldn’t waste time in agreeing trade deals. “Whilst we believe that in the short term there will be uncertainty, the UK is a resilient country and we feel that in the long term a truly global focus will be of benefit to the country as a whole, the restaurant industry buys product from all over the world so putting in place trade agreements is a matter of priority,” he said.

The Association of Licensed Multiple Retailers vowed to work closely with the government and its agencies to protect the commercial interests of foodservice members.

“While the uncertainties that will result from the referendum’s outcome are unwelcome, the fact is that the UK has spoken about an issue that it holds close to its heart,” said chief executive Kate Nicholls. “From here, all parties must move forward in a manner that best serves the UK’s citizens – our teams and our guests as well as our businesses, including the pubs, clubs and restaurants that remain at the heart of our society.”

On Friday, Peter Backman, managing director of analyst firm Horizons, said market uncertainty could last for at least five years as Britain finds its new way in the world.

“Notably for foodservice, the pound will remain volatile and will trade at lower rates than over the last few years. Consumer sentiment will probably remain depressed, costs will be elevated, and there will be some uncertainty over employment because of our reliance on European labour.

“The foodservice sector will be less buoyant than it would have otherwise been – but the impact is likely to be felt differently in different areas of the business. Sectors that could benefit include tourism-related business including hotels and leisure, while restaurants, QSR and pubs could lose out. However, profitability, and therefore investment in the sector, is now under threat.”

Backman added that overall the industry could be facing reduced sales, increased costs and lower demand from the home market, which would pose huge challenges. “While this could be offset to a small degree by more foreign tourists coming here due to the fall in the value of the pound, the eating out market now faces less growth than we predicted for this year and next.”

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