Hospitality industry voices economic concerns

By Emma Eversham

- Last updated on GMT

Related tags: Hospitality sector, American express, Hotel, Economics

A third of businesses in the hospitality sector say they are concerned about their economic prospects for the coming year according to a new survey

A third of businesses in the hospitality sector are concerned about their economic prospects for the coming year, with publicans and restaurateurs feeling less confident about the future than hoteliers.

The American Express Hospitality Monitor 2008 found that, unsurprisingly, overall confidence in the market has decreased in the last 12 months as the economy has slowed down.

The number of hoteliers feeling confident dropped to 34 per cent from 41 per cent a year ago while only 24 per cent of restaurateurs and 20 per cent of publicans said they were positive about the next year.

According to the 90 senior managers questioned for the report, restaurants have been reluctant to pass rising costs on to customers with prices rising on average 2 per cent. Instead, businesses are looking to save money by reducing the costs of goods and services (65 per cent).

“Like any other the hospitality sector is not immune to prevailing economic conditions, so it comes as no surprise that Britain’s hospitality industry feels more circumspect about business prospects than it did last year,” said Kathryn Pretzel-Shiels, Head of Hotels and Restaurants at American Express: "The economy is forcing the agenda to a certain extent but the industry is fighting back. There are still opportunities to make money by providing a quality product and memorable service, as consumers are still willing to dine out and are doing it more than ever before."

According to American Express, 40 per cent of businesses said they would be making extra effort to counteract the effect of a slow economy on trade.

Earlier today, The Indian Ocean Restaurant in Ashton announced it was calling a crisis meeting for Indian restaurant owners in the North West to discuss ways to boost trade and cope during the credit crunch.

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