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The Caterer

Hospitality's year ahead

04 January 2007
Hospitality's year ahead

Always first with the big stories, the Caterer news team turns its attention to what 2007 might hold for the various sectors of our diverse industry

Hotels

The industry will finally discover in March whether the Lyons Inquiry recommends the Government impose a 5-10% bed tax levy, which has been vigorously opposed by Caterer, the British Hospitality Association and the Tourism Alliance, as well as hotel groups such as Travelodge and InterContinental.

On the ground, this year should see average room rates return to the high levels of 2000, as the hotel market continues to enjoy a boom period. The closure for refurbishment of London's Savoy and Connaught hotels will only increase demand for luxury accommodation in the capital.

However, investors will struggle to achieve as high a return on their investments as in recent years, experts have warned. This is because the increased flow around global money markets has not been matched by an increase in available property - a classic case of demand outstripping supply.

Nevertheless, there will be more scope for hotel investment this year with the introduction of real estate investment trusts, which exempt investors from paying corporation tax and will, therefore, encourage them to consider opportunities with lower returns.

The sector should expect some new arrivals this year, with Hilton tipped to introduce some of its eight international brands to the UK market. Meanwhile, the continuing boom of the boutique market will see new brands appear, perhaps even in association with fashion houses.

Emily Manson

Contract catering

The school meals debate is unlikely to run out of steam in 2007. As uptake struggles to return to pre-Jamie Oliver levels and a wider argument gathers pace about what we feed children there will be no shortage of opinions about what went wrong.

Drawing meaningful conclusions will take longer as school caterers continue to tackle the reality of indifferent teenagers, ever-shortening lunch hours and the nagging feeling that the cash is still not enough.

Optimism will return if successive waves of primary pupils can be weaned off high-fat lunches and isolated beacons of good practice, where headteachers put food high enough up the agenda, are replicated.

Compass has seized the initiative in the business and industry sector by bringing in outside expertise, and 2007 will be a year of reckoning for these new faces. Although eyebrows were raised initially, many now say it was a shake-up waiting to happen in what is an increasingly retail-driven market.

Meanwhile, many will be waiting for some inspiration from Sodexho and Aramark in 2007. With chief executives who have been gazing inwardly for two years, the market is keen to be let in on the bigger picture.

Observers also expect more clients to entrust smaller caterers with prestigious contracts.

Tom Bill

Restaurants

The past 12 months have seen a number of high-profile restaurant openings, including Theo Randall at the InterContinental hotel, Chris Corbin and Jeremy King's St Alban in London and Gordon Ramsay in New York, to name but a few.

This year is set to be another prolific year in the sector, with Ramsay planning to launch another two eateries in the USA, Richard Corrigan understood to be joining London's Grosvenor House hotel and Alain Ducasse rumoured to be heading to the capital's Dorchester hotel.

Michelin star predictions for the coming year include newcomers such as Arbutus, Galvin at Windows and L'Atelier de Jo‘l Robuchon in London, with the Vineyard at Stockcross and London's Greenhouse and Pétrus tipped to collect their second stars. While there have been rumours that no additional three-star ratings will be awarded in the UK in 2007, our money is on Le Champignon Sauvage in Cheltenham to be named the country's fourth three-Michelin-starred restaurant.

Tronc was one of the most contentious issues for restaurants in 2006 and that shows no sign of changing this year. Close to 150 politicians recently put their names to an Early Day Motion in Parliament protesting against HM Revenue & Customs' latest advice on tips, which says employers can use them to make up the national minimum wage. While it remains to be seen whether the motion will bring about a change in the guidelines, the tronc saga continues and seems far from being resolved.

Kerstin Kühn

Pubs and bars

The Elton Panel report on England and Wales's licensing laws is expected to be published early this year. Operators are hoping for a simplification of the licensing process and adoption of an annual renewal date, but they fear the report's final recommendations will suggest a rise in fees.

Although it was lambasted by MPs over the botched introduction of new licensing legislation in 2005, the Government looks set to revisit its mistakes and create confusion around the implementation of smoking bans for England and Wales.

Despite start dates of April for Wales and July for England, neither the National Assembly nor the Department of Health have published definitive details. Wales intends to publish its final regulations soon, while England has so far managed to release only partial information, described by one industry leader as "too little, too late".

Aside from licensing and the smoking ban, expect lots of noise from the sector about supermarkets selling booze as a loss leader. Pre-empting an Early Day Motion in Parliament before Christmas, British Beer & Pub Association chairman John Dunsmore predicted that "supermarket pricing is the issue that will dominate 2007 for our industry".

Don't expect 2007 to be any quieter on the pub deals front, either: although there are likely to be fewer candidates, the acquisitions should be bigger.

Chris Druce

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