The poll indicates that 41% of leaders feel confident about prospects for their business over the next 12 months — a dip of eight percentage points from August’s figure of 49%.
Only 20% of leaders feel optimistic about the future of hospitality in general over the next year — a near-halving from 36% just three months ago.
Close to half (46%) say they are pessimistic about the next 12 months, which is double the number (21%) in August.
Growing negative segment follows tough trading conditions in the third quarter of this year.
The proportion of leaders reporting a year-on-year increase in revenue has fallen from 64% to 41% — driven by moves by many consumers to cut their spending.
Two thirds (65%) said their guest footfall has decreased year-on-year, while two in five (41%) have seen total spend drop. Just over half (54%) say visitors are buying fewer drinks, with only 10% observing an increase in purchases.
“These numbers highlight the increasing polarisation of hospitality this year — between both consumers spending more or less, and leaders feeling optimistic or pessimistic,” says Karl Chessell, CGA by NIQ’s director – hospitality operators and food, EMEA.
“Our research elsewhere shows some managed restaurant, pub and bar groups continue to grow sales and open new sites, but for many others this has been another challenging year.”
Notably, this latest confidence survey was conducted ahead of last month’s Budget, where businesses found out they face rising employment tax measures, as well as a hike in business rates.
Chancellor Rachel Reeves confirmed during her fiscal statement that National Insurance contributions for employers will go up from 13.8% to 15% in April next year, with the threshold at which businesses start paying National Insurance on a workers’ earnings lowered from £9,100 to £5,000.
Additionally, hospitality businesses will face higher wage costs, with the National Living Wage set to increase by 6.7% to £12.21 per hour; and reduced business rates support, after the Chancellor confirmed the discount for hospitality would be reduced from 75% to 40%, capped at £110,000.
“The Budget has fallen some way short of the support that business leaders were hoping for, and the increase in National Insurance contributions will put even more operators at risk of failure,” Chessell continues.
“Christmas trading may bring some relief, but longer-term optimism is likely to stay very restrained well into 2025.”
