Survey Finds Restaurants Under Pressure As Energy Prices Rise

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14th February 2014 11:21 - Food

Data from the latest Bookatable Dining Index suggests that nine in ten (90%) restaurants owners feel that, in the last six months, soaring energy prices have had the biggest negative impact of any factor affecting profits in the hospitality industry.

The index, based on interviews with 200 UK restaurants and supported by industry data, reveals that despite over two-thirds (68%) of restaurants adopting measures to cut their energy usage in the last year, the vast majority (90%) say that rising energy costs have made them re-assess menu prices in the last six months.

Food costs continue to cause concern. Bookatable’s 2013 Dining Index revealed that food prices had overtaken rent and rates in the list of overheads facing UK restaurants, coming in second only to staff wages, and the 2014 Dining Index now shows that the cost of food remains the biggest expenditure for one in five (20%).

When respondents were asked about the measure they have taken to reduce costs in the last six months, three fifths (60%) reported they have actively started to monitor food waste and almost a third (28%) have reduced portion sizes to avoid binning uneaten meals.

Data shows that almost three quarters (70%) of restaurants consider food wastage to be a huge concern for their business. A recent industry report estimated that the average annual cost of wasted food per outlet is £10,000.

Joe Steele, CEO of Bookatable, said:

“Bookatable’s Dining Index shows the pressures felt by the restaurant industry. Many restaurants operating today have worked hard to survive the economic decline, but now face similar challenges that consumers will recognise from their own households, as food and energy prices soar. This is a real concern for the restaurant industry as well as diners, as while profits and growth suffer, the cost of eating out is impacted.”

John Dyson, Food Adviser at the British Hospitality Association, commented:

“The latest Bookatable Dining Index highlights the issues restaurants have been tackling in the last six months. Higher energy bills and rising food costs have made it much tougher for restaurant owners to grow their business or remain profitable. During the recovery phase, restaurants will need to focus on the areas that can make a difference to their business – whether that’s hiring the right talent, being more marketing savvy or adopting new technology that delivers true ROI.”

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