The confidence levels of independent hoteliers about their businesses has improved with three in 10 (30%) expecting their business to perform well and overcome challenges in the future, according to a new report by global financial technology firm SumUp.
From the 750 small hoteliers who took part in the survey, a further 26% said that they are very confident about their future, expecting to experience significant growth over the next 12 months.
Whilst the majority of respondents are optimistic about their future, a third (33%) of independent hoteliers said that they are uncertain about their future and neither expect their business to grow or decline significantly over the next year.
Additionally, 7% of respondents said that they generally feel positive however, expect there to be challenges to overcome, whilst only 3.5% said that they are worried about their future in business and predict there to be various obstacles to tackle.
When independent hoteliers and B&B owners were asked about their current challenges, over half (54%) said that the cost of bills and necessary investments including rent, energy, and stock being one of the main factors influencing their business confidence.
Similarly, 35% of respondents said that the current economy and inflation rates were impacting their confidence, despite the UK economy exiting the technical recession it entered in 2023.
Furthermore, it appears that the independent hotel industry is facing tough competition, with over two-fifths (42%) saying that rivals are offering cheaper alternatives and in turn, 14% are finding it tougher to stay on top of competitors.
Other challenges include employee retention (17.5%), smaller profit margins (12%), and customer retention (10.5%). Only 5% of respondents said that they were not facing any challenges that are impacting their business confidence.
However, the survey revealed that in order to stay on top of these challenges, over two-fifths (44%) of respondents said that they are working on a cost-saving plan regarding supply chain and professional services.
Some 31% are working on a cost-saving plan including a change of their service providers including their energy, gas, and Wi-Fi.
An additional key change that two in five (40%) hoteliers are making is lowering their prices in order to help with customer retention, along with 20% expanding their product offering in order to appeal to new consumer groups such as offering food services or the option for an early check-in and late check-out.
Other steps include investing in technology and digital transformation to support growth (20%), increasing pricing structure in order to protect profit margins (16%), along with their business model so it’s more eco-friendly resulting in lower energy costs (13%).
Corin Camenisch, Product Marketing lead at SumUp, said: “As champions for small merchants, we conducted this survey to discover the confidence levels of small business owners and decision makers in the UK to better understand the challenges they face, gauge their optimism about their future, and identify areas where support for SMEs might be needed.
“Overall, confidence levels of small business owners and decision makers across the UK are high. This positive outlook suggests that small merchants are prepared to navigate potential uncertainties and continue to thrive.”