It’s no surprise that the past three years have been some of the hardest in living memory for businesses across the UK. Following two years of uncertainty during the pandemic, the rising cost of living, inflation soaring and energy prices hitting an all-time high, it’s safe to say times are tough for small businesses across the country, and things aren’t set to get any easier as we face a long, cold and costly winter.
In a new study, Bionic has revealed the sectors of the small business community that really need a bit of extra support from the British public this winter. The business experts analysed industry revenues over a ten-year period across a variety of sectors to determine the areas of the UK economy that have seen the greatest fall in their incomes.
The Top 5 Businesses Most at Risk this winter are:
Cafés
Internal data shows that for the past few years over the Christmas period, cafés saw a drop in revenue at an average rate of 8.64%. We can broadly predict, based on the last five years of Q4 data, that the cafe and pubs sector will see a drop in revenue of £3.2 billion in the winter of 2022!
Pubs
Between the fourth quarters of 2020 and 2021, sales of Wine, Cider, and Beer fell by 12.88%. However, this didn’t recover as we entered 2022, as revenue continued to fall by another 15% in the first half of the year. Alongside the annual sector revenue drop of 8.64% over, this winter is likely to ensure a tricky time for independent pubs.
Hotels
Over a ten-year period between 2012 and 2021, the hotel and restaurant industry saw an average drop in revenue of 9.24%, equating to £3.2 billion, in Q4. Of course, due to the pandemic between 2020 and 2021, this fall reached 19.9% and 16.3% respectively. Excluding these two years, there is still a drop in revenue across the Q4 period, averaging 7%.
Restaurants
For licensed restaurants, turnover fell by an astonishing 29.75% between 2022 and 2021, which was significantly different from the 3% increase in revenue from 2020 to 2021. For unlicensed restaurants, the pattern was the same. Between 2020 and 2021 there was a turnover increase of 9.77%, whereas between 2021 and 2022, revenue fell by a massive 21%.
Beauty Services
The cost of living crisis means the general public has lower disposable incomes and putting money aside for “luxury” treatments can be tough. Over the last five years, there has been an average 7% fall in revenue over the winter months, so it’s likely we will see this trend continue in 2022.
Les Roberts, Content manager at Bionic comments on the findings, and offers tips on how to support small businesses even on a tight budget:
“Small businesses across these sectors really make up the bread and butter of our society but are often the most at risk when we head into tricky times; which is exactly what we’re expecting this winter. Income for this sector frequently drops in the last three months of each year. This year, owners are likely to see an unprecedented increase in running costs, which is not only going to impact their staff and other suppliers up the chain.”
Here are some ways you can support small businesses throughout a tough winter:
- Share their posts on social media.
- Use small businesses and services as gifts, such as a nice meal at a local independent restaurant for your parents.
- You can treat your loved ones to a gift card, like for your mum to get her nails done as a treat.
- If you are heading out for dinner or drinks, choose a local independent establishment over a chain.
- Recommend your favourite independent brands to your friends and family.
- Post positive reviews online.
