Olympics boosted UK tourism but came at a cost for hospitality businesses

By Luke Nicholls

- Last updated on GMT

Related tags: Average spend, Olympic games, Summer olympic games, United kingdom

IOC President Jacques Rogge told businesses 'You have shown the world the best of British hospitality' in the closing ceremony of the London 2012 Olympics
IOC President Jacques Rogge told businesses 'You have shown the world the best of British hospitality' in the closing ceremony of the London 2012 Olympics
Tourism figures released this week indicate that Britain is well-placed to build on encouraging inbound Olympic visitors, but a post-Games review by foodservice consultancy Horizons shows that the event actually came at a big cost for hotels, restaurants and pubs.

September’s International Passenger Survey issued by the Office for National Statistics reveals that visitor numbers were up by 1 per cent (2.63m) and that visitor spending reached a record £1.9bn (an increase of 17 per cent); overseas visitor spend in the UK is now 5 per cent higher than in the first nine months of 2011.

For July to September, the average spend by people attending or involved in the Games was £1,350 -​ more than double all other visitors and another record for average spend.

“These figures offer us an ideal platform to create a golden tourism legacy going into 2013 and beyond,” said Sandie Dawe, chief executive of national tourist board VisitBritain.

"It means that visitors are on track to spend more in the UK than we initially forecast – a good result for the economy. It’s quite clear that Olympic visitors generally spent a lot more, often visiting for longer, as well as buying tickets for various events and staying in hotels.

F&B Business compared with what it would have been without the Olympics and Paralympics

Outside the fence

 

Restaurants    

-£26 million

QSR    

-£27 million

Pubs

-£11 million

Hotels

-£14 million

Staff Feeding

Small decline

Sub Total

-£78 million

 

Inside the fence

£23 million

 

 

TOTAL

-£55m

“We’ve worked hard and fast to make sure we capitalise on the Olympic interest and positive buzz across the world," added Dawe. "As soon as the Games came to an end we launched the next stage of our GREAT Britain campaign;​a £15m phase inviting the world to ‘make their own memories’." 

It is estimated that 680,000 visits from overseas to the UK in July, August and September were primarily due to the London 2012 Olympics or involved attending an official ticketed event. For July to September, the average spend by people attending or involved in the Games was £1,350 -​ more than double all other visitors and another record for average spend.

The losers

Despite the Olympics coming in at about £380m under budget for the Government, restaurants and pubs saw a net loss of £55m in takings over the period of the Games compared with what would otherwise have been expected.

Notable losers included restaurants in the West End,​wholesalers that were geared up to serve these restaurants, food kiosks in Oxford Street, food-led pubs around the country, and their various suppliers hotels which sat back and waited for the Olympics bonanza.

But, according to Horizons, this £55m decline was in fact lower than the £75m loss initially expected when London won the Olympics seven years ago.

Managing director Peter Backman said: “It is important to keep all this in perspective because, while the impact may have been significant for some companies, the overall impact was equivalent to less than 0.1 per cent of total UK eating out expenditure this year.

The winners

“Overall, London itself was an enormous winner demonstrating its friendliness and ability to put on a really great show. Hospitality also put on a great show​with thousands of volunteer games-makers trained and there with a smile to help all.  The range and quality of British restaurant and pub food was a strong feature – and one, no doubt, that will attract more visitors in the years to come.

“The foodservice trade also showed how well and quickly it could rise  to the challenge of change – with night time deliveries, additional security checks and an array of foreign languages to contend with just a few of the additional challenges.”

After the Olympics, Ufi Ibrahim, chief executive of the British Hospitality Association, told BigHospitality the Olympics would leave a lasting legacy​for the nation’s hospitality and tourism industries.

“Britain’s hospitality industry has done itself proud and the Olympic Games have shown off Britain as a feel-good destination that will leave a lasting legacy for the UK economy,” she said.

The London 2012 Olympics Legacy: In numbers...

  • £55m - The amount of lost revenue for restaurants, hotels and pubs due to the Olympics 
  • £75m - The inital prediction by Horizons on the reduction in food and beverage sales because of the Games
  • 680,000 - The estimated number of overseas visitors to the UK in July, August and September
  • £1,350 - The average spend by people attending or involved in the Games
  • 55,000 - The number of customers McDonalds served on its busiest day in its two Olympic restaurants
  • £90k - The cost of the bill that Neleen Strauss sent to Boris Johnson due to the drop in turnover at her restaurant (read that full story here​)

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