Young catering companies in particular are having a hard time. After two years of being bitten by the corona crisis, rising energy prices and rising costs due to inflation are now coming into play. There are many young companies that are going to give up, says Ruud Bakker of the Eindhoven department of Koninklijke Horeca Nederland. Research shows that four out of ten catering entrepreneurs no longer have any reserves.
Ruud lets us look in his household book: the costs have risen considerably for him. “Oil and mayonnaise, for example, have become one hundred and thirty percent more expensive, butter has risen sixty percent and for gas and light I first paid around €2600 every month, which is now €3600. That is more than €12,000 more per year. In addition, I pay also ten percent more in personnel costs,” he calculates.
Eric van den Broele, from research agency Graydon Creditsafe, recognizes the problems in the hospitality industry. He has examined the financial situation of catering companies in Belgium, which, according to Van den Broele, is comparable to the situation in the Netherlands.
“During corona, entrepreneurs have addressed their reserves, now the stretch is gone.”
“Many catering entrepreneurs have drawn on their reserves during corona. Now that energy prices are rising and other costs are also rising, forty percent of catering entrepreneurs is out of the loop. A large number of them will stop, another part will keep the business open for fewer days,” predicts Van den Broele.
Bakker thinks we will soon have to pay more for a cup of coffee on the terrace or a beer in the pub. “All the price increases have to be absorbed, so prices in the catering industry are unfortunately going up.” When asked what the extra costs mean for the beer price, he reacts with a gloomy look. “I think it will go to 3.50 per glass. Four years ago we thought 2.50 was already a lot, but we will soon exceed that.”
Van den Broele also expects that entrepreneurs will not only raise prices, but will also look at the most profitable moment to keep their business open, in order to reduce costs. Bakker thinks so too: “There are already businesses that are only open five out of seven days due to the high costs,” he says. “Fortunately, we had a nice summer, but there are major concerns about the autumn.”
“People spend more money on energy and groceries and eat out less.”
Because meanwhile, less money is coming in at the catering businesses due to inflation, Eric van den Broele thinks. “People spend more money on energy and groceries, then they eat out less often. Last week I was in a restaurant myself and then only ordered a main course because the prices on the menu had risen considerably.”
Bakker hopes that the government will come up with a plan to support ailing entrepreneurs in addition to consumers. In the meantime, he does what he can. “We are in consultation with the landlord for solar panels and a heat pump, to make it all a bit more affordable,” says Bakker. “And when customers ask on the terrace whether the gas heater can be turned on, we ask whether that is really necessary.”
