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A third of UK hospitality businesses at risk of closure, despite record 2022 sales

London-based hospitality advocate UKHospitality says inflation is outstripping rising sales for hospitality businesses across the UK 

32% of hospitality businesses across the UK could face closure in the next 12 months – UKHospitality | Photo credit: Tim Mossholder


Up to a third of UK hospitality businesses are at risk of closure despite achieving record sales in 2022, according to a report by UKHospitality. 

The London-based membership association said revenues across the UK’s hospitality industry were 4% higher last year than in 2019, but 13% lower in real terms when taking inflation into account. 

Increasing cost pressures, labour shortages and debt incurred during the pandemic, mean 32% of hospitality businesses across the UK are could face closure in the next 12 months, UKHospitality warned.  

The trade advocate is urging UK Chancellor Jeremy Hunt to address the root causes of inflation in his budget on 15 March 2023, including government intervention in the energy market and reforms to the Apprenticeship Levy – a form of taxation designed to help companies offer more apprenticeships. 

“These figures show the challenging position the sector is in. The demand from the public is quite clearly there, with revenue exceeding pre-Covid levels, but there is no way venues can take advantage of this demand as they drown amidst price rise after price rise. Without action, we can see just how stark the year ahead could be with a third of businesses at risk of failure. Venues are simply unable to pass prices onto the consumer at the same rate they are experiencing their own costs rise,” said Kate Nicholls, CEO, UKHospitality. 

World Coffee Portal research shows increasing pessimism among industry leaders concerning the current trading environment for coffee shops across the UK. 

Project Café UK 2023 found only 37% of industry leaders surveyed consider trading conditions to be positive, down from 56% last year when some trading restrictions remained in place due to the rise of the Omicron Covid-19 variant.  

Additionally, 38% report conditions to be difficult, up from 27% last year. 

UKHospitality represents more than 740 companies operating approximately 100,000 cafés, pubs, restaurants, hotels, leisure attractions and contract catering businesses. 

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