What can the hospitality sector expect in 2017?
Audit, tax and consulting services company RSM has compiled a list of seven predictions for the year ahead:
1. A renaissance of ‘Best of British' and seasonal menus
British ingredients will become more prominent on menus and bar lists in 2017. The popularity of English wines is on the rise and will continue to grow, alongside craft British beer.
2. Homogenisation of prime rental areas
Rent in London is being pushed up in prime areas and usually the operators that are able to compete for new sites are well established larger groups. Independent operators will be phased out and 2017 will see the homogenisation of brands.
3. The return of vouchers (but not as we know them)
Operators will drive up loyalty and repeat business by introducing discounts. As paper vouchers have become old hat, discounts will be offered through social media events or geo targeting customers that are within walking distance.
4. Operators fight back against delivery
Larger chains will take back control from delivery companies. They will set up their own delivery options in order to instil confidence in their customers and build up a loyal customer base.
5. More failures and restructurings
With costs on the rise and competition intensifying, banks may force businesses that can no longer support the debt raised to rebase.
6. A cut in VAT
In 2017 customer confidence will stutter as Trump takes up his role as president, interest rates begin to rise and Brexit negotiations kick off. Theresa May will want to retain the UK's status as one of the G7's fastest growing economies and so the government will be forced to cut VAT in order to generate short term demand.
7. Less PE investment, more consolidation
Next year will see an increase in private equity scepticism of underlying market growth in the UK. It is likely that US private equity will begin to increase investment into the UK food and drink sector following the fall in the value of sterling.
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