24
| Hospitality Today | Christmas 2016 / January 2017
The Market in 2017
A‘ perfect storm’ of conflicting economic factors and looming uncertainties will make 2017 a year of mixed blessings for the UK hospitality sector, predicts recruitment specialists the Change Group:
“ Savvy businesses that grasp emerging opportunities and adapt to fast-changing economic conditions with innovation and a focus on quality and sustainability will thrive. While there will be continuing shake-out, overall the sector will emerge stronger.” Change Group believe the plus and minus factors for the UK hospitality sector are:
Plus factors:
A weak pound balanced by a strong dollar will bring an influx of US tourists
Many more Britons will enjoy a“ staycation” as a result of a weaker pound.
Economic growth( the 2.1 % increase in GDP forecast for 2017 is more fthan any other G7 nation) will boost morale and encourage the sector to invest in development.
The anticipated 5 % rise in unemployment will create a talent pool for those willing to retrain for a career in hospitality.
The London restaurant scene will remain vibrant, with even more options for the choosy diner.
Quality brands such as The Ivy Café and Grill will bring more high-end food to the high street, attracting more people to eat out again.
Minus factors:
Restaurant closures will increase and the ratio of the number of restaurant openings to closures( currently 2.6:1) will edge closer to 2:1.
High street independents will struggle in the face of higher rents and rates, and will be targeted ever more strongly by branded chains.
Tourists may avoid the UK because of Brexit’ s unwelcoming perception
A weaker Euro-zone will attract more tourists away from the UK.
A rise in unemployment will decrease domestic purchasing power, which will hit budgets for going out for meals.
Wine prices will continue to rise in UK
Food inflation of between 2 % and 4 % will drive up the cost of a meal out by at least 10 %.
Brexit’ s focus on all things British will prompt a renaissance in British food and ingredients. Restaurants and pubs will pioneer home produced, regional ingredients and more seasonality.
More restaurants will innovate for emerging food trends and menu diversity