Hospitality suffers £3bn sales hit over festive period: The hospitality market suffered devastating sales falls in the last week of the year, new figures have revealed. Sales were a massive 60% down on Christmas Day as customers opted not to dine out, while Boxing Day sales fell by a third (31%) and takings on New Year’s Eve – one of the biggest individual trading days in the calendar for many venues – were down by more than a quarter (27%). The figures captured by UKHospitality and CGA represent a “lost Christmas” and cap off a devastating December. Based on a separate industry survey, the wider hospitality sector will have seen a 40% drop in sales overall for the month versus the same period in 2019 – the last “normal” Christmas before the onset of the covid-19 pandemic. The festive figures represent a £3bn hit to the industry, versus 2019. Venues in Scotland and Wales were hit even worse in the week leading up to new year, where more stringent restrictions were in place. The sector in Wales performed twice as badly as England, and in Scotland 2.5 times worse, in the week ending 1 January 2022. Overall, the findings demonstrate how the industry’s fight to recover from the pandemic has been severely hampered by Omicron. In the weeks prior to the new variant emerging, average sales had been recovering steadily through the autumn and were close to pre-pandemic levels (98%). UKHospitality chief executive Kate Nicholls, said: “December is a vital period for hospitality businesses, equal to three months’ worth of trading for many. These new figures are crippling for an industry already struggling but also spell disaster for the wider UK economic recovery, as Office for National Statistics (ONS) figures showed overall growth in the third quarter was driven by hospitality. These sales drops versus 2019, and also against our members’ projections before the onset of the new Omicron variant, will have taken most businesses from healthy trading for the month to painful losses, delaying the sector’s recovery and extending hospitality’s long covid. Cash reserves are severely depleted, and some businesses will struggle to survive the first quarter of 2022. This dreadfully disappointing December has further stymied our ability to deliver jobs, growth and investment at pace, which we all know is so crucial to the recovery of our economy overall.” Companies operating groups of pubs or restaurants fared slightly better than independents, according to the data. These venues, which are typically larger and better invested, saw sales fall a third in the week up to Christmas and by around a fifth in the week up to new year. Nicholls added: “A pivotal moment for the recovery is approaching. As recent quarterly GDP figures show, the hospitality sector can play a leading role in driving the recovery. Crucial to this is the right support and keeping VAT at 12.5% will enable the sector to safeguard jobs and crucially, it will help keep down costs for our guests amid some very strong inflationary pressures. Reducing rates bills in 2022-23 will also be important in enabling businesses to recover again.” It comes as ONS figures showed the seven-day average estimate of UK seated diners fell by 48 percentage points in the week to 10 January 2022, to 88% of the level in the equivalent week of 2020. In London and Manchester, seated diners fell by 23 and 57 percentage points over the same period, respectively. In the week to 8 January 2022, overall retail footfall in the UK decreased by 6% and was 78% of the level seen in the equivalent week of 2019, according to Springboard. Just over one-fifth (21%) of businesses have reported increased cancellations from customers in the last month, with almost half (44%) of businesses in the accommodation and foodservice industry reporting an increase. Following an expected seasonal nationwide decrease in transactions at Pret A Manger stores over the Christmas period, transactions at stores in suburban London increased the most in the latest week (when compared with January 2020); transactions increased by 29 percentage points in the week to 6 January 2022, to 88% of the January 2020 average.