Confidence in the hospitality sector among multi-site business leaders continues to fall as they face high inflation rates, rising costs and economic uncertainty, with just eight per cent feeling confident about the next 12 months, new research reveals.
The October Business Confidence Survey from CGA by NielsenIQ and Fourth showed that the latest figure fell from 23% of business leaders who felt confident about the eating and drinking out market in the last survey in June, which was also a sharp decline from the 65% reported in March.
The number of business leaders who feel confident about the next 12 months for their own business in the latest study was higher at 29%, falling from 53% in the last survey.
Some respondents also expressed concerns about the viability of their business, with 13% expecting their business to either be running at a loss or to be completely unviable by the end of this year.
Around 86% of these business leaders reported high inflation rates in the prices of energy and food, while staffing challenges were also highlighted, with 11% of roles at their business currently vacant.
Although the majority of multi-site business leaders said their business was still operating at a profit, 53% of them said their profit margins were less than before the onset of the Covid-19 pandemic.
Karl Chessell, director of hospitality operators and food for EMEA at CGA, said: “Hospitality businesses have shown remarkable resilience since the start of the pandemic, but these figures show they are facing their greatest challenges yet.
“With no sign of relief on inflationary pressures for firms and consumers alike, sales and margins will be under severe strain and thousands of companies are now vulnerable.
“Political upheaval and market shocks have only made things worse, and urgent and targeted government support is needed to sustain the sector through this very difficult period.”