UK hospitality: nearly half don’t expect to survive 2025
A survey has found that 44% of hospitality business owners in the UK believe they could cease trading this year.
The survey was created by Bionic and polled 500 small- to medium-sized enterprises in the UK.
It has released the results ahead of the spring budget, which will take place this week (26 March). Many of the survey questions focused on the announcements from the autumn statement, which saw a reduction in business rates relief, a hike in employers’ National Insurance contributions (NICs) and an increase in the minimum wage.
When asked about which policy from the statement had worried them the most, 43% of hospitality and tourism businesses said the increase in employer NICs, followed by the minimum wage increase (30%) and ending of rates relief (30%).
In terms of 2025 challenges, 78% said they were concerned about inflation and rising costs. Another 74% were worried about reduced consumer spending, while 39% said hiring and retaining talent was an issue.
To cut costs in 2024, 52% of businesses increased their prices and 30% reduced the size of their workforce.
When asked if they think their business will cease trading in 2025, a shocking 44% said yes. Only 52% believed they would survive.
Laura Court-Jones, Bionic’s small business editor, said: “It’s saddening but not surprising that 44% of hospitality businesses think they’ll cease trading in the next 12 months.
“Hospitality businesses have had it tough for years since the pandemic and with reduced business rates relief and the employers’ National Insurance hike kicking in from 6 April, these businesses are going to feel the squeeze even more.
“Are we heading into the collapse of our independent restaurant economy? In 12 months, we may see very different UK high streets – we really don’t need any more Costas.”
Other issues affecting the industry include late payments, with 48% saying they had been impacted by these in the past 12 months.
A worrying 78% of respondents said they had felt burnout while running their business in the past year. Of these, 13% said they were ‘extremely’ burnt out, and an additional 22% were ‘very’.
Hiring and retaining talent was described as ‘extremely difficult’ by 4% of hospitality respondents, while another 30% said it was ‘very difficult’. Only 9% said it was ‘not at all difficult’, with most respondents (57%) describing it as ‘moderately difficult’.
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