As a leading foodservice agency, we never miss the Arena Savoy Lecture, which is a highlight of the foodservice calendar. This year was no exception as Kate Nicholls, OBE, CEO of UK Hospitality and Karl Atkins, CEO of Foodbuy Group and Alex Demetriou, CEO Foodbuy UK&I (the UK’s leading food procurement company) headlined the night as they shared their take on the market to the gathered foodservice professionals.

After the chance to network, it was into the stunning Lancaster Ballroom at The Savoy, where Kate Nicholls OBE took to the lectern to give her update on the market. With UK Hospitality representing its 750 members which account for over 150,000 outlets, Kate and her team lobby and campaign tirelessly for the hospitality industry as they promote, prevent and pioneer to support the sector.

With what feels like perpetual crisis impacting the sector (referred to by Kate as A-J crisis) currently operators are facing the massive challenge of margin erosion of around 40-50%, with 25% of hospitality businesses reporting in the first quarter of 2025 that they have less than two months’ cash reserves. All of which is having a huge impact on the industry. However, it was not all doom and gloom, in fact there were a number of reasons to be positive including:

  • Global tourism is coming back with 2024 at 96% of pre Covid levels. Driven by the Trump effect, we are seeing big spending Chinese & Gulf state tourists choosing the UK over America. Indeed, in-bound visitors to the UK were up 5% in 2024, to 40 million visits, with spend up 7% to £35 billion.
  • We have a tourism minister – Chris Bryant – with a strategy to harness the power of events, aiming to drive 50 million visitors by 2030. With events like the Taylor Swift tour driving not just ticket sales but stadium F&B sales, hotel, restaurant and travel bookings all boosting hospitality – events are a huge opportunity for hospitality.
  • The market might feel ‘flat, fierce and fickle’ (a quote from Peter Martin) and consumer confidence is fragile but looks to be recovering, with wages up and interest rates moving in the right direction. Once consumers feel more confident, they will have the cash to spend, and we know hospitality, including UK based holidays, is high on their agenda. Disposable income is increasing the same as ever with half of consumers eating out weekly, and 9/10 eating out at least once a month.
  • Hospitality is in the perfect position to help the government drive economic growth as it can deliver immediate results. A small change in policy can deliver big returns, and with tariffs on the horizon, retail and hospitality are looking a far stronger bet.
  • The government has a small business strategy focused on the high street which Kate is hopeful will look to address the regulatory burden on small businesses as well as business rates and rents.
  • Developments have also been made across staffing and training with the free four week digital training passport, talks around flexible working and cuts to National Insurance contributions for part time apprenticeships helping to get long term unemployed into jobs in hospitality in line with the government’s drive to get people back into work and off benefits.

In summary, Kate is on a mission to reposition the sector as a key solution for the government, one that reaches the whole country, not just pockets, and can make a huge difference with just a few changes from Westminster. As ever the speech was realistic yet hopeful and set the tone for the night perfectly.

Then it was on to hear from Karl Atkins, CEO of Foodbuy Group and Alex Demetriou, CEO Foodbuy UK&I. Foodbuy are part of the £2.4bn Compass Group UK & Ireland, who, along with a wide range of hospitality and foodservice businesses are their largest procurement client. With a team of 450 procurement professionals, they have acquired a collection of businesses which retain their identity and specialism, whilst sitting within the group and benefiting from the group buying power.

Karl kicked off with his passion for the industry which has in recent years sadly seen a perma-crisis, but he is optimistic and stressed the need for building relationships and partnerships to drive success, which are of course at the heart of this people business. It was clear both Karl and Alex have a real love of the industry with Alex citing the ability hospitality has to transcend socio-economic barriers.

As part of Compass, Karl is very proud to be helping to keep everything from the NHS to schools and the military benefiting from their procurement expertise, as well as supporting social enterprise businesses and looking to drive environmental change through ethical procurement with a goal to be net zero by 2030. With 40% of our food imported they are looking to domestic sourcing, supporting UK suppliers and ethical meat. Whilst by embracing AI they are also looking to improve procurement and supply chain management, with technology and data strategy.

Alex talked of his family restaurant which gives him a grass roots experience of the challenges faced by hospitality businesses, from business rates to NI and NLW which he knows from personal experience can wipe out 40% of profits, killing off businesses with a ‘death by a thousand cuts’. He would like to see more of a move from profit tax to turnover and people tax. As with a number of fingers in different business pies he can see how disproportionate the impact is on hospitality compared to say insurance, where these changes have not even made it onto the boardroom agenda.

He also touched on how hospitality can offer a vast array of transferable skills and although many businesses are struggling there are real winners out there particularly in desserts, competitive socialising and event spaces (Taylor Swift again!). Whilst with convenience being the biggest driver in today’s market, he stressed the need to focus on what is important to their customers and on solving their problems whether that is through tech or gut instinct.

With the talks for the night at end it was then time for a fabulous meal from the team at The Savoy and even some music to end the evening. As ever it was great to catchup with industry friends and contacts old and new and possibly the most glamourous Monday this year has seen so far! Well done to the team at Arena on another great event. To find out more visit arena.org.uk/

Susan Wickes
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