Optimism about market prospects in the bar, pub and restaurant sector after the EU referendum has fallen among business leaders, according to new research by CGA Peach.
In January, 75% of board-level directors said they were upbeat about the next six months but this has dropped to only 15% after the June 23 vote to leave the EU.
The most upbeat are London-based operators where 26% are optimistic for the short term and 48% are confident about the coming two years compared to 29% nationally.
CGA Peach found that 48% of London-based business leaders thought there would be an increase in tourism thanks to the EU referendum, driven by the falling pound, with 39% predicting a positive long-term benefit in the form of a decrease in property and rental costs.
Charlie Mitchell, head of consumer research at CGA Peach’s parent company, CGA Strategy, added: “When it comes to their own business predictions, 34% are optimistic in the short term, while 48% are optimistic in the longer term – figures which are higher than the 28% and 36% respectively for the market nationally.”
For the market as a whole, the most cited concerns for the out-of-home market among the 80 board-level directors surveyed were:
· Increase in the cost of raw materials/ingredients (76% agreeing)
· Drop in consumer confidence (74%)
· Decreased staff availability (73%)
· Falling of the pound (71%)
· A skills shortage in the out of home market (69%)
Charlie said: “The availability of people is the number-one long-term worry, but perhaps surprisingly London operators, who might be expected to be most affected by uncertainty around EU nationals working in hospitality, are no more concerned than the country as a whole.
“Nevertheless it remains a major worry and the area the market will be looking for reassurances on from the Government.”
Part of the UK’s leading on-trade research specialist CGA Strategy, CGA Peach is a research and insight business focused on delivering data and insight to bar, pub and restaurant operators.