Future Shock Maps Hospitality’s Rollercoaster Ride Into 2021

The UK’s hospitality sector has suffered lost sales of more than £53bn in 2020, with more losses to come from a collapse of Christmas trading—but a COVID-19 vaccine rollout provides grounds for cautious optimism in 2021.

Those are among the messages from ‘Survival to Revival’, the eighth edition of the Future Shock series of reports from CGA and UKHospitality. It provides the definitive picture of hospitality’s rollercoaster 2020, and sets out the challenges and opportunities facing the industry in 2021.

Research for the report, drawing on CGA’s market-leading suite of business and consumer sources, shows the seismic impacts of the pandemic and lockdown on UK hospitality, including:

  • A £53.3bn year-on-year drop in sales between the start of April and the end of September
  • Falling consumer confidence, with 78% of British adults concerned about the long-term financial implications of the pandemic
  • Hesitant business confidence, with 27% of leaders of multi-site groups predicting they will be unviable by mid-2021 with current levels of support
  • Bleak prospects for Christmas trading while 98% of England’s licensed premises remain in severely restricted Tier 2 and 3 areas.

But the Future Shock report also celebrates the hard work and achievements of operators and suppliers in 2020—especially on keeping people safe. It shows that 95% of consumers have been satisfied with the level of hygiene they have found in venues this year, and 55% now say they feel safer in hospitality venues than in shops and supermarkets.

The report sets out major trends and developments for businesses to track in 2021, including:

  • An acceleration in consumer use of technology in restaurants, pubs and bars
  • A further increase in delivery sales—of alcoholic drinks as well as food
  • A continuation of the lockdown trend of eating and drinking close to home rather than travelling to city centres
  • Increased availability and affordability of property in the wake of business failures.

As well as exclusive research from CGA and views from UKHospitality, Future Shock features insights from report partners Independent Clinical Services, Molson Coors, OrderPay and Sector Associates, who explore ways for operators to engage with issues including technology, COVID-19 testing, insurance and drinks ranging for new consumer behaviour.

Karl Chessell, Business Unit Director, Retail and Food at CGA, says: “This has been the most difficult year in hospitality that most of us have ever known, and our report is a chance to reflect on the havoc it has wrought—but just as importantly to look forward to what we all hope will be a happier 2021. Sadly there have already been many business casualties in our sector, and more will inevitably follow as a result of the onerous limits on trading and socialising at what should be the busiest time of the year.

But among businesses that have been able to sustain themselves, the pandemic has instilled a resilience and innovation that will stand them in good stead for years to come. The road to recovery clearly has a long way to run yet but there is light at the end of the tunnel, and at some point in 2021 we can hope for a release in the pent-up demand for all the experiences that people love in hospitality.”

Kate Nicholls, Chief Executive at UKHospitality, says: “Undoubtedly, 2020 has been a disaster for the sector. Every aspect of hospitality in every corner of the UK has come under enormous pressure and we are by no means out of the woods. There is, though, every chance that with the right support businesses can begin to trade their way out of danger and towards some degree of prosperity next year. The roll-out of a vaccine should give us all confidence that the next year will be dramatically better than this one.”