| 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