Ely restaurant owner shares the struggles hitting hospitality hard
A new study's found more than 2,200 restaurant firms have gone under
A restaurant owner believes other hospitality firms in Cambridgeshire will continue to face an uncertain time if nothing is done to help.
Research from accounting group Mazars found the number of restaurants going under has jumped by 46 per cent in the last year.
The study found the number of restaurants heading into insolvency reached more than 2,200 between 2022 and this year, rising from 1,517 in the previous 12 months.
Steve Haslam runs several eateries including in Ely:
"I think the important thing is to find that balance between offering quality and a great guest experience but still being price-conscious," he said.
"With hospitality, you're always in a precarious position.
"We've had the food service inflation but energy costs have quadrupled; for our company, that meant a £400,000 increase.
"(You've also) got business rates, rising wages, so it is the perfect storm."
Inflation plays vital part in changing customer habits
Paul Maloney, associate director at Mazars, said people were still being hit by rate rises and inflation meaning they were cutting back on spending, such as dining out.
He said many restaurant groups have relied on debt finance to fund expansion and renovation.
And the hospitality sector was also being affected by a continued shortage of staff which has driven up wages.
Quality must come first, says restaurant owner
Steve, who runs the likes of South American restaurant Urban Fresh and The Cutter Inn on Ely riverside, has opted to put quality over cutting prices on food and drink to try and attract more customers.
He's seen that people are dining out less, and it's a trend he's had to adapt to.
"We found it was important to home in on the guest experience; that's become more prevalent over the last 12 months because the consumer is cutting back," he added.
"We've seen good levels of tourism in Ely and we've been there for many years so we do have core support from the local community, but margins remain challenged."
The Government says its 'Energy Bills Discount Scheme' is providing support to businesses and tax changes will be unveiled in the Autumn statement.