The hospitality sector could increase revenues by £6.75billion in a year – equal to £619m for the East of England- by meeting increased demand for more flexible opening hours to reflect changing working patterns, says a report from Barclays.
It says nearly nearly one in four of East of England workers support calls for food, drink, hotel and gym businesses to change opening hours as around one in six now work extended hours, part-time, flexibly or in shifts.
But the report Open All Hours? from Barclays corporate banking hospitality and leisure, says that although over a quarter of hospitality and leisure businesses recognise this growing demand, opening hours are not keeping up with changes to modern working lives. It suggests many workers would like to visit museums, films and late night diners outside normal opening hours. Gen-Z workers (18-24 year olds) is the age group most frustrated that it cannot access hospitality services when it wants.
Tim Seeley(photo, right), head of corporate banking, East Anglia at Barclays, said: “Adapting to the changing consumer demand presents a substantial opportunity for businesses. Our research has shown that leisure operators across the country could access a staggering £6.75bn per annum by accommodating their customers’ evolving needs which have been brought on by changing working patterns. While that may be a challenge for some providers, understanding the value of the opportunity makes the prize more tangible.”
“The current leisure environment does present a number of challenges for the sector’s businesses; the labour supply is challenged by Brexit, rent increases and food inflation are all set within the context of an incredibly competitive market which is already heavily discounting. However, those that don’t adapt to this type of newly developing consumer demand risk being left behind and in this ever-competitive environment, businesses need to weigh up the value of the long-term opportunity over the cost of the short-term investment.”
Missing takeaway
Whilst consumer demand isn’t always being met, satisfaction with the availability of hospitality services varies across the sector. As Britain becomes more health conscious, gyms and sports clubs have been quick to adapt, with almost one in five (18%) hospitality and leisure business leaders surveyed already changing their opening hours.
Takeaway services, on the other hand, have left a third (30%) of East of England workers hungry for more, having been unable to order a takeaway as the business was closed. While digital food delivery services such as Deliveroo, JustEat and Uber Eats, have provided customers and restaurants with an easy to use platform for home delivery, a third (30%) have been unable to get a takeaway.
What’s holding businesses back?
Although the research reveals that seven in ten (69%) businesses surveyed have received requests in the last 12 months to extend their standard opening hours, only one in ten (12%) has adapted to meet changing customer demand.
But it’s not as simple as just re-setting the alarm clock. British businesses cite increased overheads (19%) as the most common barrier to opening at different times, with large operators particularly seeing this as a threat (23%). Against a backdrop of looming challenges and fierce competition, businesses that are facing these challenges on a national scale, face an even bigger threat.
With all this pressure, changing demand for opening hours may seem like a lower priority for businesses. But in such a competitive market, evolution is crucial in order to stay profitable. There are also a number of solutions that can help businesses extend their opening hours without an overwhelming increase in overheads.
Embracing opportunity
There are several options for British hospitality and leisure businesses looking to overcome these challenges. Technology can reduce the need for a 24/7 workforce and make hospitality services more accessible. Recognising this, just over a quarter (27%) of businesses have invested in new tech in the past year in an effort to appeal to customers in the future.
