Businesses in the South East food and drink sector see rising costs and changing consumer spending patterns as the two biggest areas impacting them, according to the results of new research carried out by law firm Thomson Snell & Passmore.
Thomas Snell & Passmore surveyed businesses from across the region that operate in the sector, including restaurants, bars, hotels and wholesalers. When asked ‘what do you see as the main areas impacting your business?’
- 52% cited rising costs
- 26% said consumer spending patterns
- 17% mentioned labour shortages
- 4% blamed sustainability targets
- Businesses also voiced concerns about the cost of employing staff and that rising costs are, in turn, impacting pricing and reducing footfall
Alisa Sweeney, head of the food & drink sector at Thomson Snell & Passmore, said: “The food and drink sector is a really vibrant industry and central to the UK’s economy, but it is also facing unprecedented challenges.
“Clearly, many businesses in the industry across the South East are continuing to struggle with the impact of rising costs and reduced consumer spending.
“The recent Budget gave with one hand while taking with the other. While many welcomed the news of 40% relief on their business rates liability and support up to a cash cap of £110,000 per business, as well as the small business multiplier in England being frozen at 49.9p for 2025-26, there will be dismay over tax increases for employers, which will hit the industry hard.
“Rises in the national minimum wage and a 1.2% increase in employers’ National Insurance contributions will add significant costs to employing staff for food, drink and hospitality businesses.”
