One in five restaurants forced to shut early because of supply chain and staffing issues

In a survey of small and independent restaurants on its delivery platform, Deliveroo found that supply chain difficulties are causing widespread problems across restaurant operations. Of those polled, more than half (54%) have had to remove items from their menus due to lack of availability, while nearly half have had to increase prices. 

For core ingredients, 89% of restaurants have seen wholesale costs increase and the majority (55%) agree that managing their supply chain has become more difficult over the past six months. 

At the same time, nearly two thirds of partner restaurants report being understaffed, says Deliveroo, with 30% of respondents saying they have fewer staff than six months ago. The majority of businesses (79%) have described recruiting more staff over the past three months as ‘challenging’.  

As a result of staff shortages, 18% of partners have had to shut their business when they’d otherwise be open, while two in five have been forced to change their operations such as rejecting bookings or limiting opening hours.

Chef and restaurateur Budgie Montoya’s Brixton-based Filipino restaurant Sarap BAon is one such business, with the chef announcing today (7 December) that it would be closed due to a shortage of staff. “It’s crazy how through the pandemic we were able to pivot, create and survive only to be crippled again by another crisis,” Montoya wrote in an Instagram post.

Restaurants are also having to increase salaries across a range of jobs to attract staff, with 90% raising the wage levels of chefs, according to the survey. 

“While the economy has opened up and restaurants can welcome back dine-in guests, they’re facing the twin pressures of rising prices and staff shortages,” says Carlo Mocci, chief business officer UK&I at Deliveroo.

“We are pleased to be able to provide a lifeline through our delivery network. Restaurants are a vibrant part of our local communities and critical to the economic recovery, so no-one wants to see them forced to turn away dine-in customers.”

UKHospitality CEO Kate Nicholls has renewed her calls for the Government to keep VAT a 12.5% for hospitality to help businesses struggling with falling trade as a result of the new Omicron variant.

“With fragile consumer confidence further damaged by the impact of the new Omicron variant, at the start of what should have been a key trading period for the sector, on top of ever-rising costs, chronic staff shortages and ongoing supply chain issues, the Government needs to act to support hospitality businesses,” she says.

“The best option for the Government would be to retain the 12.5% VAT rate for hospitality and tourism, to allow businesses to invest in staff and skills, keep trading back to prosperity, helping the wider national recovery and keep prices affordable for consumers.”

Deliveroo reports that in Q3 it saw a year-on-year order volume increase of 59%.