Following the news that the Resolution Foundation think tank revealed that rising UK salaries will not be enough due to rising costs of living;
Ramsey Baghdadi, Consumer Analyst at GlobalData, a leading data and analytics company, offers his view:
“If wages continue to fall behind the rising cost of living, there will be serious consequences for the foodservice industry.
“UK customers are sensitive to changes in price. According to the latest survey from GlobalData, nearly two in five (38%*) UK consumers are concerned about their personal financial situation. The survey also shows that a notable proportion of UK consumers (28%) choose restaurants based on menu affordability, as well as promotions and discounts. Price sensitivity currently plays an essential role in the ‘dining-out dilemma’ due to a double hit of rising inflation and ongoing Omicron fears.
“In response to this challenging environment, restaurant operators are going to find a tough audience as many price-sensitive consumers tighten their purses. While January restaurant sales will help to relieve these concerns temporarily, regular promotions and discounts or even introducing a range of lower-priced items will be necessary in the long-term. Foodservice businesses in the UK will suffer losses if they decide to not lower prices as living wages takes its toll on consumer expenditure.”