New Year brings fresh hope for the hospitality sector
We’re officially in 2022 and that means a fresh start for everyone, including the hospitality sector. It’s a chance to launch yourself into the new year with all the opportunities and challenges it may present to us.
It’s certainly been a bumpy few weeks for the sector. With plenty of bookings in the run up to the festive season, hospitality venues were looking forward to the tills ringing in a good Christmas and New Year for them after the battering of the last 20 months. It’s the most important time of year, with some venues making up to 10% of their annual profit in the Christmas/New Year week.
But then COVID had other plans. Thanks to the fast-spreading omicron variant, (and record daily infection levels) concerned diners were soon cancelling bookings so as not to jeopardise their Christmas plans, and large numbers of staff were testing positive or having to self-isolate. Add to that the ongoing uncertainty of potential further restrictions, and hospitality venues were not exactly feeling the festive cheer they had hoped to.
Having said that, the fact that the Government seems to have no intentions of implementing further restrictions in the near future is increasing client confidence and enabling them to plan ahead. But staff testing positive for COVID is a huge ongoing issue for a sector already struggling with acute labour shortages – the knock-on effect is reduced opening times and covers, temporary closures and reduced menus.
Despite this and the media’s tendency to only talk about the negative things, the overall sentiment seems to be more positive than negative and the feeling that the end is in sight. With that in mind, many clients we speak to are still going ahead with their plans for new openings, refurbishments and expansions – there seems to be no mention of things being put on hold like this time last year.
Pre-Christmas and omicron, companies were reporting like-for-like sales which were better than pre-COVID and we were even seeing improvements to the staffing challenges. Clients were definitely filling their vacancies, but it was just taking some time. Employers are just having to adjust to a slower and longer process than they’ve previously been used to. The supply chain was certainly still a challenge for many hospitality venues, but hopefully this will ease up now we’re into the new year and there is not so much pressure on it.
With the market tending to drop off in January as everyone waits to be paid at the end of the month, this is an important time of the year. Hospitality companies will be using January to plan for the next 12 months and take stock of things and placing orders for the year ahead. Annual trends dictate that the market usually picks up again around February half-term, and then the focus will be on Easter just around the corner.
After the last topsy turvy two years, it’s anyone’s guess if the usual seasonal trends will come to pass or if COVID will have other plans. But one thing is for sure: clients are now much better prepared for whatever challenges they face. Whether it’s the staffing crisis, opening/closing all the time, putting in place extra hygiene measures, everyone is in a much better place now, whatever the new year holds.
Hospitality operators are highly resilient and have demonstrated an incredible ability to adapt. With all the positive sentiment from clients we’re speaking to, we might even be quietly optimistic that 2022 will be a better year for everyone in the industry. Wishing you all a successful year ahead.