The report from foodservice consultancy Horizons stated the eating out market is on the up despite consumer confidence remaining fragile. Last year saw the sector grow nominally by just under 1% to £44.9bn and managing director Peter Backman said 2014 is expected to see it return to 2006 levels with growth of 1.8% for a real inflation-inclusive growth of 3.8%.
"It’s been a long time since I have been confident enough to predict real growth in the foodservice market," he said. "In the recent past the margin squeeze that operators have experienced has eased and for the last couple of months we have been moving into positive territory – this is good news for businesses in the sector.
"However, there are inherent risks in believing the market is now in recovery," Backman warned. He outlined the importance of developing a loyal band of customers who can accept price increases more easily. "Winning in the market is not just about being the lowest cost operator, it’s about creating an experience that consumers want."
Recruitment and retaining of good staff
Several panellists at the annual briefing raised concerns that as the UK’s productivity improved, real wages would rise as well, which would make it more difficult for the hospitality industry to recruit and retain good staff.
The recovery was criticised for being consumer-led rather than led by business investment as growing employment means the UK’s productivity has gone down not up.
Mitchells & Butlers’ chief executive Alistair Darby agreed that staffing is an issue. "The challenge is trying to recruit good people. We have to change our mindset on training, working hours and salaries in this sector," he said.