Price hikes forecasted as the cost of living crisis hits
Customers are being warned to brace themselves for price hikes as nearly half of firms in the hospitality sector look set to raise their prices in July. This is due to higher energy costs and the ongoing cost-of-living crisis.
According to new figures from the Office for National Statistics (ONS), a raft of industries has been impacted by factors including rising energy, labour and raw material costs, which are set to affect the price of goods they offer and turnover rates. And as the crisis continues to deepen, customers will need to make some tough choices regarding how they spend their hard-earned money.
Thirty percent of all businesses say they plan to raise their prices this month. The main reason cited is the increasing cost of energy. However, this is especially true for companies in the hospitality sector, with nearly half (46%) planning to raise prices. The figures also revealed that in May, 15% of all businesses said domestic demand reduced from the previous month, with 21.8% in the hospitality sector reporting a decrease.
The bad news doesn't stop there. Although the hot summer weather typically sees an increase in demand, spending is expected to decline as consumers have to dig even deeper into their pockets to socialise. In fact, a quarter of hospitality businesses are forecasting that July will bring a downturn in turnover.
These figures come after vacancies in the hospitality sector reached a new high last month, with data released by the ONS last week revealing there were 174,000 job vacancies in the industry between March and May. With businesses already under pressure, the added cost burden will likely exacerbate the sector's post-pandemic recovery. This perfect storm of challenges reinforces how important it is for hospitality businesses to focus on efficiency and cost-saving measures where possible.
At Beacon, we know that times are tough and that everyone is feeling the pinch. We also know that it can be hard to find the time to sit down and look at your existing arrangements to ensure you're still receiving maximum value. That's why we're here to help. Our team of experts will work with you to identify areas where you can save money and make your business more efficient. We'll also help you to stabilise your spending to support you in getting through this challenging period.
So, drop us a line via Live Chat, and we'll put you in touch with your Procurement Services Manager. They're the backbone of your relationship with Beacon, and it's their role to get an in-depth understanding of you and your business to identify potential supply chain improvement opportunities. Recommended solutions might include the introduction of new suppliers, renegotiation of existing contracts or the development of innovative bespoke procurement solutions that you may not have even considered. If you haven't spoken to your Procurement Services Manager recently, you're not getting the most out of your Beacon membership – so get in touch now and let us drive additional value for your business.