Restaurateurs urged to keep costs low

Restaurant operators must tighten the purse strings for the rest of the year even if they see an upturn in trade, research has warned.

Market analyst Horizons has warned that even if the economy improves, corporate spend is likely to remain low as businesses will take a longer term view and exercise restraint when it comes to corporate entertainment and Christmas parties.

"Restaurant operators shouldn't rely on an increase from corporate spend over the next few months, as companies will still be reluctant to spend money on entertaining, particularly if they are also making redundancies," said Horizons' managing director Peter Backman.

He added that operators must continue to negotiate good deals from their suppliers, put more cost-effective dishes on menus, reduce food wastage and ensure staff levels are kept to a minimum.

"Restaurateurs face further pressure in January when VAT returns to 17.5%. This will impose an increase of 2.1% across the board of items including meals eaten out, but not supermarket food, which will widen the value gap between eating out and eating at home," he said.

More diners are eating out but are spending less, says survey >>

Eating out spend set to fall after record high >>

Recession sparks changes in US dining >>

By Emma White

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