Hospitality businesses ‘cut capacity by 20%' to tackle winter challenges

Some hospitality businesses are planning to reduce their capacity by 20% as pubs and restaurants prepare for a "winter challenge like no other", a trade body has warned.

Operators hit hard by the economic hangover from 2022 are bracing themselves for an "ever-growing list of challenges" in the new year, according to UKHospitality chief executive Kate Nicholls.

Ongoing issues include soaring energy costs, staff shortages, falling consumer confidence and disruption due to rail strikes, which were estimated to have cost the industry £1.5b a day over the Christmas period.

Nicholls told The Caterer: "All of these together create a winter challenge like no other, where a third of our members felt their survival was at risk." This statistic came from the Q4 Hospitality Members' Survey, conducted jointly by UKHospitality, the British Beer and Pub Association (BBPA), British Institute of Innkeeping (BII) and Hospitality Ulster, which was published last October.

The study also revealed that more than three quarters of hospitality operators (77%) had noticed a decline in the number of people choosing to eat and drink out.

Nicholls said: "Businesses are doing all they can to stay afloat and for some, that means taking hard decisions to reduce trading hours, close more often, or even completely shut for the winter. This isn't good for business or consumers, but many have no choice."

Speaking to The Guardian, Nicholls said that many businesses had curbed their capacity "by around 20%" just to be able to match supply and demand.

Last October, The Caterer reported that a growing number of hospitality businesses, including Si Toft's Dining Room in Abersoch; Michael Caines' Harbourside Refuge restaurant and bar in Cornwall; and the Hog hotel in Suffolk had closed for the winter months in the face of rising costs.

It comes after The Times reported that the chancellor may consider halving energy support for businesses beyond March 2023.

Nicholls said: "The government's energy support scheme had been a lifeline for many hospitality businesses whose bills would have gone up more than threefold had it not been in place.

"It's vital that this support is extended, with particular consideration for vulnerable sectors like hospitality, and that the Government also tackles long-term, structural issues like business rates reform, which it committed to doing in its manifesto."