How much has the pandemic cost hospitality businesses so far?
2-minute read
As many hospitality businesses reopen this week, we spoke to over 100 food and drink businesses in the UK to understand the financial impact of the pandemic on their livelihoods.
Our research reveals that Covid-19 has cost pub and restaurant owners more than £40,000 each.
Cost to pub and restaurant owners reaches £40,313 each
Our study of businesses in the food and drink industry – including pubs, restaurants and cafes – found that so far owners have lost £40,313 on average already in lost earnings.
As a result of restrictions, many businesses have been forced to close completely or struggled to access government support.
- 68 per cent of hospitality business owners have had to temporarily stop trading during the pandemic
- 45 per cent have been earning less money, despite government grants
- only 27 per cent have been eligible for furlough
Many owners expect losses to continue
While many hospitality businesses with outside space are now allowed to open their doors, the date for welcoming customers inside is still many weeks away.
Our report shows business owners expect financial challenges to continue, predicting losses to reach £45,470 in total. This is more than double the expected loss for the average small business, which was highlighted in our recent Covid-19: one year on report.
Yet owners remain confident about recovery
There are still reasons to be optimistic, with 89 per cent of food and drink business owners planning to continue or restart their current business.
And more than one in 10 started a new business in the last 12 months.
Additionally, positive developments and news of the vaccine have given a boost in confidence to hospitality business owners:
- 75 per cent say the vaccine rollout has made them more confident about the recovery of their business
- 63 per cent also say the government’s roadmap out of lockdown gave them sufficient reassurance to plan the future of their business
- 36 per cent remain optimistic about life after lockdown
Impact on the wellbeing of small business owners
More generally, we've researched how the pandemic has affected the mental health and wellbeing of the self-employed and small business owners across the country.
Did lockdown have any positives for businesses?
While there’s no underestimating the emotional and financial impact of the pandemic, food and drink business owners have shared some positives of lockdown.
Positive | % of businesses |
|---|---|
More time with family where they can | 60% |
Rest | 37% |
Focus on themselves | 30% |
Learn new skills | 20% |
Adopt a new technology into their business | 11% |
Behind each small business is a small business owner
Our UK CEO, Alan Thomas, said: “Few have been hit harder than the hospitality industry in this last year, and the scale of the impact on small businesses and the self-employed is abundantly clear in our latest research.
“More importantly beyond the economic hit, we should recognise that behind each of these small businesses is a small business owner – each with families, livelihoods, and dreams. The impact of the pandemic on so many of these individuals and their communities has been devastating, both financially and emotionally.”
He added: “as hospitality owners prepare to safely reopen their doors, there are reasons to be hopeful – as the country can enjoy a well-deserved meal or drink outdoors with friends and family.”
More useful guides for small businesses
Are you preparing to reopen? Let us know how you’re getting on in the comments.
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Written by
Catriona Smith
Catriona Smith is a content and marketing professional with 12 years’ experience across the financial services, higher education, and insurance sectors. She’s also a trained NCTJ Gold Standard journalist. As a Senior Copywriter at Simply Business, Catriona has in-depth knowledge of small business concerns and specialises in tax, marketing, and business operations. Catriona lives in the seaside city of Brighton where she’s also a freelance yoga teacher.
We create this content for general information purposes and it should not be taken as advice. Always take professional advice. Read our full disclaimer
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