Falling sales and rising costs have created the perfect storm which is tearing through the industry. 

With inflation affecting the spending habits of customers, the hospitality industry faces rising utility costs, higher labour expenditure and increased supplier prices. Previously profitable businesses are facing extreme financial pressure with closures on the increase.

The Hospitality Market Monitor from AlixPartners and CGA by NielsenIQ for January 2023 reports that over 4,800 hospitality businesses were closed in 2022. In the final quarter of 2022, there were 18 closures every day. These numbers are expected to continue to increase into 2023.

Can your hospitality business weather this storm?

With no clear end in sight to the “cost of living crisis” and cost inflation, the pressures upon P&Ls across the industry are set to continue. In order to survive this storm, every business within the industry must understand and monitor their costs, measure their performance and act quickly to changes.

Below is a simple example of a food led pub with weekly gross sales of £12,000, making a modest profit.

Weekly takings = £12,000
– VAT 20% = £10,000
– Food / Wet costs (37.5%)
– Staff / NI / Holiday Pay / Pensions (30%)
– Rent, Rates, Insurance (£1,000)
– Utilities (£1,000)
– Till, card machines, banks, bins, pest control, cleaning (£500)
– Entertainment (£250)
= £500 net profit

Whilst it may not directly reflect your business, it illustrates just how precarious the financial health of hospitality can be in 2023. A fall in sales or a rise in costs is likely to push a profitable business into a loss making business. If not monitored and measured, these changes can occur imperceptibly and before it’s too late.

Hepl is at Hand

At Hepl, we have created the systems to enable hospitality businesses to control your costs and monitor your performance. We train you to use these tools to identify inefficiencies and to reduce costs. We have the tools to help you:

• Take control of your P&L
• Monitor your sales patterns
• Understand and reduce your labour costs
• Schedule staff effectively
• Understand and improve bar & food GPs
• Cost your menus
• Manage your stock
• Increase yields
• Reduce utility costs

SOUNDS SIMPLE…

… and it is.

By controlling costs, setting standards and driving sales your hospitality business will be profitable.

SOUNDS EXPENSIVE…

… but it isn’t.

Our systems have been developed over 25 years experience of working for large multinational hospitality giants, independent pub chains and individual businesses. Many of them are spreadsheet based, some are simple task based checklists. All can be adapted to apply to every business from cafe to corporate.