Brexit confirmed: Hospitality reacts with uncertainty and mixed views

By Hannah Thompson contact

- Last updated on GMT

Brexit confirmed: Hospitality reacts with uncertainty and mixed views

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Reduced sales, rising costs, and uncertainty across hospitality and tourism: that’s the general view from hospitality commentators this morning, as the UK has voted for Brexit.

The high-profile exceptions are Tim Martin of J.D. Wetherspoon, and John Brennan, chief executive of Amaris Hospitality, who said that Britain is 'well-placed to remain robust' during the Brexit transition period, and that 'anxiety about the economic effects of independence…was misplaced'.

Just before 5am this morning (Friday 24 June), the vote counting reached the point at which Brexit was confirmed, by 52 per cent to 48 per cent, with the whole of Scotland voting to Remain, and all but six London boroughs choosing the same.

Prime Minister David Cameron has also announced that he will stand down from his position as PM and leader of the Conservative party by October, with the sterling dropping to its lowest level since 1985.

Eating out sector 'under threat'

The British Hospitality Association is set to hold its 'Being Connected' Hospitality and Tourism Summit on Monday, which will consider the sector's views going further.

Peter Backman, managing director of hospitality consultancy Horizons, warned that the eating out sector could face slower growth following the result.

He said: “The UK economy will now face a period of uncertainty which is likely to be intense over the next few days and weeks, but will be ongoing for five years or so as Britain finds its new way in the world.

"Sectors that could benefit include tourism-related business including hotels and leisure, while restaurants, QSR and pubs could lose out. However, profitability, and therefore investment in the sector, is now under threat…the eating out market now faces less growth than we predicted for this year and next.”

He added that there would likely be uncertainty over employment because of the industry's 'reliance on European labour', with the sector becoming 'less buoyant than it would otherwise have been'.

Similarly, Brandon Bravo, the UK managing director of travel deals site Travelzoo, said: “With so many variables in play it’s difficult to predict the exact impact the Leave vote will have on the tourism industry, but research suggests it will be a negative one.”

He also cited the worry that Brexit would lead to damage to the UK tourism industry and reduced competition.

'Misplaced' anxiety

Tim Martin at J.D. Wetherspoon, an outspoken supporter of Brexit, was a rare positive voice.

This morning he said: “The referendum result will enhance freedom and security. Some people will now be anxious, but concentrating on these immensely important factors will provide reassurance.

"Anxiety about the economic effects of independence during the campaign was misplaced. The UK will thrive as an independent country, making its own laws, and we will work with our good friends and neighbours in Europe and elsewhere to ensure a positive outcome for all parties...the UK is in an immensely strong position.”

There were also voices of collaboration even where the response was less certain.

John Brennan, chief executive of Amaris Hospitality, urged the government to offer 'clarity' on the exit process and its impact on businesses.

He said: "While the negotiation period could have an effect on the markets overall in the short-term, the hospitality sector is well-placed to remain robust during this period."

Scottish split

The Scottish Tourism Alliance also highlighted the uncertainty but said working together would be the most important way forward.

It said that despite 'remaining neutral' throughout the campaign, it  'acknowledged that the views of our members differ on this issue'.

"We have publicised concerns of the hospitality, leisure and transport industries…we must now look ahead to collaborating with our industry partners and working with the Scottish Government and Westminster to secure the best possible trading and economic environment to protect the future," the group said in a statement.

Food and drink exports

Miles Beale, chief executive of the Wine and Spirit Trade Association (WSTA), said that protecting trade would be paramount.

He said: “While our members felt that the wine and spirit industry was stronger in the EU, we will work to assist government in preserving our access to the Single Market, supporting British drinks exports and agreeing the best possible international free trade agreements. The WSTA will do everything it can to ensure that the UK’s wine and spirit industry has a powerful voice.”

Looking forward

Chief executive of tech company Epos Now, Jacyn Heavens, offered cautious hope.

He said: “The leave vote raises many questions for businesses across the UK…How will this be impacted going forward? I’m confident that innovative, entrepreneurial businesses can continue to thrive in what are now unpredictable times.”

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