Record three in ten sector businesses have no cash reserves left as trade bodies warn ‘urgent action’ needed at next week’s Budget: A record three in ten (29%) sector businesses have revealed they have no cash reserves left as industry trade bodies warned “urgent action” is needed at next week’s Budget. More than half (58%) of businesses said they will have to reduce the number of staff they employ and/or increase prices if the Budget does not deliver necessary support. The position was highlighted in a survey of members of UKHospitality, the British Institute of Innkeeping, the British Beer & Pub Association and Hospitality Ulster, at a time the trade bodies said the industry was “under intense financial pressure, with jobs, livelihoods and communities already hit hard by the impact from last year’s Budget”. The survey also revealed almost three-quarters (73%) of businesses have less than six months of cash reserves. Meanwhile, half of businesses said they have been forced to cut staff and 60% have reduced staff hours. On average, the number of hours available to staff has decreased by 8%, compared with this time last year. A total of 70% of respondents have already increased prices since April, when £3.4bn of additional annual cost hit hospitality. On average, prices have increased 5% since April. Members citied the maximum possible business rates discount (61%), amending April’s changes to employers’ national insurance contributions (54%) and a cut in VAT (84%), as the government actions that can help their business. In a joint statement, the trade bodies said: “The situation facing our local pubs, neighbourhood restaurants and other hospitality venues is becoming increasingly perilous. Economic pressures are mounting at every turn, and businesses have been forced to make tough decisions to cut jobs, reduce staff hours and put up prices. Many have already had to close. For those surviving, the situation is becoming more worrying. Cash flow is becoming a serious issue. This is an urgent situation that demands urgent action at the Budget. Lower business rates, amendments to employers’ national insurance contributions and a cut to VAT are the measures that will deliver the relief and stability that hospitality desperately needs.”

Pubs lead the way again as sector’s run of flat trading extended in October: Britain’s leading managed restaurant, pub and bar groups extended a run of flat trading with like-for-like sales growth of just 0.1% in October, the latest CGA RSM Hospitality Business Tracker reveals. It is a third successive month of fractional increases and means growth has been above 1% for only one month of 2025 so far. The tracker – produced by CGA by NIQ in association with RSM – reveals fluctuating trends across hospitality’s different channels in October. Like-for-like sales in managed pubs were 1.9% up from October 2024, thanks to reasonable weather and a flurry of Halloween trading on the final day of the month. By contrast, sales in managed restaurants were down by 1.4% year-on-year – the seventh negative number in the last eight months. Pubs have outperformed both restaurants and hospitality as a whole in every month of 2025 so far. Pressure on people’s spending has also hit sales in managed bars, which slipped 5.9% year-on-year in October. This downward trend also reflects a steady shift towards earlier visits for drinking-out occasions, which has curtailed footfall in late-opening bars. While sector-wide sales have been broadly flat, new site openings helped managed groups to achieve solid growth on a total sales basis in October. Including at venues opened by groups in the last 12 months, sales were 3.0% ahead of last October, a figure that is only marginally below the UK’s current rate of inflation. This suggests that underlying demand for hospitality is stable, and operators and investors remain optimistic enough to launch new restaurants, pubs and bars. For the third month in four, London provided slightly better growth than the rest of the country. Like-for-like sales within the M25 were 0.5% ahead year-on-year, while they were exactly flat outside the M25. Karl Chessell, director – hospitality operators and food, EMEA at CGA by NIQ, said: “October’s dull weather was well matched to the subdued mood of hospitality. These latest figures show hard it is for businesses to achieve real-terms growth at the moment, and with footfall well below the levels of last year they will be pinning hopes on strong festive trading to replenish reserves. The sector is now looking to the Budget for support to stimulate consumer spending and ease its very heavy burden of costs. This support can help build a strong sector that drives long-term economic growth and job creation.”