The start of a new year is traditionally a time for renewed optimism but hoteliers in Bristol say they fear some very tough times in 2025.
Members of the Bristol Hoteliers Association (BHA) say the hospitality sector is facing further financial challenges as decisions made in last October’s budget begin to be implemented.
BHA Chair Raphael Herzog said:
“The post-Christmas period is traditionally always a quiet one for our sector but then, when we would expect business to start picking up, we will be hit in April by rising taxes and increasing costs.
“We’ve got above-inflation increases in employer National Insurance contributions, the minimum wage and property rates, all coming at the same time and after what is our slowest period of the year for business.
“Energy costs are rising, too, and with our suppliers facing challenges of their own, many of them are being forced to increase their costs.
“The NI contribution and wage increases present a double-edged sword, because we are still struggling to recruit the levels of staff we need, but at the same time the costs of employing staff are significantly rising.
“The cost of living crisis continues to have an impact on consumer confidence which, in turn, has an impact on our businesses.
“The 2024 festive period was not as busy as in some previous years as both private and corporate customers are being forced to keep a much tighter hold on their own purse strings.
“We saw a drop in the number of parties this past season, fewer companies paying for their teams to have a celebration, and in general people are not spending as much as they used to, and not drinking as much.
“Younger people are generally more health conscious and there is evidence to show that more and more people are turning to low and non-alcohol drinks which, in turn, is seeing them seek a different type of ‘team celebration’ over the festive season.
“Figures from the British Beer and Pub Association say more than 120 million pints of no and low-alcohol beers were drunk across the UK in 2023 and that is expected to rise by a further 20 million by the time the figures for 2024 are analysed.
“Today’s teams are less inclined to centre their get-togethers around alcohol, as they have done in the past.”
“Added to all that, here in Bristol, there has been talk of introducing a workplace parking levy in the city centre, which could also have a huge impact on our sector.
“We know there is a general requirement to reduce the use of cars, particularly in congested city centres, and to encourage people to use public transport, but in order for that to be an attractive option, the public transport systems need to be reliable and efficient – and we’ve got staff who would need to travel at times when public transport options are very limited.
“And there is still the ongoing issues with Airbnb, which don’t have any of the regulations upon them – and associated costs – that we do, which means they can offer accommodation at lower rates.
“We still say there should be limits on how many days properties can be let for, and for homes to be licensed.
“It’s just our businesses that are affected by Airbnb; there’s a massive shortage of properties to rent in Bristol and Airbnb is one of the reasons for this.”
He said plans for a new arena on the former Filton airfield, in the north of the city, as well as a multi-million pound ‘sporting quarter’ development in the south of the city, offer exciting opportunities for Bristol’s accommodation providers – as long as their businesses can survive long enough to benefit from these projects which are still years from completion.
He added: “In the budget last October, the Chancellor did announce that Labour intends to introduce two permanently lower tax rates for retail, hospitality and leisure properties.
“We don’t yet know any more about what this might look like and, in any event, these new rates are not expected to be introduced until 2026/27, so it will be some time before we get any kind of benefit from that.
“In March, we host our annual Night of the Stars event, where we celebrate and recognise the hospitality heroes who work to hard in support of our exciting sector.
“After several challenging years, it’s commendable that there are still many people with the motivation, desire and commitment to want to go above and beyond to deliver top-class hospitality, and it’s these people, more than anything else, that gives us hope for the future.
“But more tangible support is needed – and sooner, rather than later – if we are going to be able to continue to motivate the next generation of hospitality providers.”