The hospitality sector has suffered “devastating” gross sales falls within the final week of the yr, in keeping with the newest pub, bar and restaurant market figures from UKH and CGA.
The wider hospitality sector witnessed a 40% drop in gross sales for the month versus the identical interval in 2019, as depleted gross sales represented a £3bn hit to the trade in opposition to 2019.
UKH stated that what would historically be a bumper gross sales interval for 1000’s of hospitality companies is now “likely to be remembered as a lost chance to rebuild crucial cash reserves in the sector – delaying the recovery and leaving many businesses exposed going into the fallow winter months”.
It comes as gross sales have been 60% down on Christmas Day, whereas Boxing Day gross sales fell by a 3rd (31%). Takings on New Year’s Eve, one of many largest particular person buying and selling days within the trade, have been down by 27%.
Venues in Scotland and Wales have been hit “even worse” within the week main as much as New Year, amid stricter restrictions. In the week ending 1 January 2022, hospitality in Wales carried out twice as badly as England, and in Scotland 2.5 instances worse.
The total findings are stated to reveal how the trade’s battle to get well from the pandemic has been “severely hampered” by Omicron, as weeks previous to the brand new variant, gross sales had been recovering steadily and have been near pre-pandemic ranges (98%).
UKHospitality CEO Kate Nicholls, stated: “December is a crucial interval for hospitality companies, equal to 3 months’ price of buying and selling for a lot of. These new figures are crippling for an trade already struggling but additionally spell catastrophe for the broader UK financial restoration, as ONS figures confirmed that total progress in Q3 was pushed by hospitality.
“These sales drops versus 2019, and also against our members’ projections before the onset of the new Omicron variant, will have taken most businesses from healthy trading for the month to painful losses, delaying the sector’s recovery and extending hospitality’s long covid. Cash reserves are severely depleted, and some businesses will struggle to survive the first quarter of 2022.”
She added: “This dreadfully disappointing December has further stymied our ability to deliver jobs, growth and investment at pace, which we all know is so crucial to the recovery of our economy overall.”
UKH additionally warned that hospitality is dealing with “significant” headwinds in 2022, “compounding a challenging outlook for thousands of businesses and millions of workers”. It added that companies now face a “cliff edge” in April when VAT is about to return to twenty%, plus an increase in enterprise charges and labour prices, in addition to hovering vitality prices, the rising price of foods and drinks and an finish to the hire moratorium.
Nicholls added: “A pivotal second for the restoration is approaching. As latest quarterly GDP figures present, the hospitality sector can play a number one position in driving the restoration.
“Crucial to this is the right support and keeping VAT at 12.5% will enable the sector to safeguard jobs and crucially, it will help keep down costs for our guests amid some very strong inflationary pressures. Reducing rates bills in 2022/23 will also be important in enabling businesses to recover again.”