UK venues are struggling hard with a 30% increase in costs since reopening
‘The situation is worsening day by day’ says NTIA’s CEO Michael Kill on the devastating impact of cost inflation on UK venues.
Inflation is the big word of the moment and the topic of many current conversations. It’s a buzzword that concerns not just economists but everyone, as cost inflation impacts on everyone’s cost of living, including the nightlife industry. The problem is pandemic and UK venues are on the list of victims of this huge bogeyman. Recently, the Night Time Industries Association (NTIA) showed in a survey the alarming figures for UK venues in this post-pandemic, inflation-ridden world.
Surveying over 200 businesses in the UK, this research yielded some clear, if rather bleak, indicators. Of these venues, 44.7% were uncertain about the future, claiming to be ‘unsure’ about the survival of their business in the next 12 months. Additionally, 20.8% were ‘not confident’ that they will last beyond next year. More than half of these businesses also responded that they are seeing a 30% increase in operating cost when compared to pre-pandemic levels. When asked if their business is still profitable, 48% responded that they ‘are barely breaking even’, a bleak picture that gets even darker for the 20.2% who said they are losing money every time they open the door. After two years of the pandemic, this is not the upturn that UK venues envisaged or needed. The big guilty party is undoubtedly the skyrocketing cost of living in the UK. Operating costs are higher as a result of the sharp rise in the price of energy, which, in addition to influencing them, is accompanied by increased costs in the supply chain, such as food and drink. A snowball effect that leads to a frightening spiral.
View this post on Instagram
The cost of living has risen for people who are now forced to manage their savings tightly, cutting back on what is possible, which has led to a decrease in the purchase of tickets for shows and nightlife. The decline in ticket sales is compounded by the shortage of trained staff. Extensive lockdowns and industry shutdowns have led many of the experienced workers to move away from the area, leaving little and mostly untrained labour. To help, many of the businesses are still dealing with the debts incurred in the pandemic. The problems with the UK venues’ supply chain have inevitably been accentuated by Brexit and the soaring insurance premiums brought on by the uncertainty.
Businesses, venues, suppliers, event promoters, and partygoers. A giant ecosystem and all affected by the current situation. Michael Kill, NTIA’s CEO, stated that:
‘These figures are extremely hard to ignore, the situation is worsening day by day, with operating costs becoming untenable. We are starting to see the impact on customers through slowing ticket sales, bookings and frequency of visits.
Our industry is still extremely fragile, many will struggle to survive another crisis. Time is running out, the Chancellor must act now, and answer the calls from the industry to reduce VAT back down to 12.5%, and [introduce] an energy cap for SME businesses.’
Image Credit: Printworks (via Twitter)