HOTELS & HOSPITALITY


A LIFELINE FOR HOSPITALITY


Virtual brands appear to be one of the best tools in the arsenals of hospitality business owners argues, Sam Martin, COO and Co-Founder of Peckwater Brands.


Anyone who has spent time working in the hospitality industry understands that uncertainty is part of the job, from supply and staff shortages, to shifting demands and trends. Risk is a fact of life in hospitality, where an estimated 90% of new ventures will close down in their first year.


When the pandemic hit, the hospitality sector was among those most severely impacted – in the first year alone, the UK, and even by December 2021 spending had not returned to pre-pandemic levels. In fact, gross sales in December 2021 for the wider hospitality sector fell by 40% compared to the same period in 2019, with sales falling 60% on Christmas Day, 31% on Boxing Day and 27% on New Year’s Eve.


This has been an astonishingly difficult two years for hospitality, but the resilience shown by owners has shone through as businesses have adapted to the new normal and found ways to maintain operations throughout the pandemic.


Beating a new path Consumer demand changed significantly over the pandemic, with the lockdown-enforced demand for


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delivery services persisting even as restrictions were stripped back. According to Peckwater’s own research, 75% of hospitality owners surveyed said that their business relied on takeaway services to survive.


And whilst the UK foodservice delivery market declined from £11.4bn in 2022 to £10.5bn in 2021, it is forecast to grow to £12.6bn by 2024. Evidently, demand for takeaways is likely to remain prevalent. As such, food service businesses would be wise to continue incorporating delivery services into their operations, every as social distancing restrictions have been eased.


Growing in tandem with the delivery market are virtual brands, a food delivery concept that can exist solely on third-party delivery platforms without the need for its own physical restaurants. They operate from the kitchens of other businesses, and in doing so can increase the overall output of a kitchen by allowing it to offer multiple brands – and different styles of food and drink – at once.


Capacity for change The evidence certainly suggests that many kitchens would be capable of taking on virtual brands. Indeed, Peckwater’s research found that 66% of hospitality


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