Almost 50 food businesses closed this month as costs rise and demand falls
RAI president Paul Lenehan said: “Contrary to popular belief, the restaurant industry is not flourishing and the closure of 48 establishments in November alone goes to show this." File picture
Nearly 50 restaurants, cafés and other food-led businesses were forced to close in November, according to the Restaurants Association of Ireland (RAI).
The RAI said the food services industry continues to grapple with a “perfect storm” of increased costs and reduced consumer demand as 188 businesses have now closed their doors since July.
“Operational costs for small, local restaurants, cafés and food-serving pubs—which include food costs, energy costs, insurance costs and Vat, the rate of which rose from 9% to 13.5% in September—have skyrocketed,” a spokesperson said.
The RAI also noted a recent Bord Bia report which found that consumers are cutting out spontaneous dining in favour of other activities and choosing to eat out just for special occasions like birthdays and reunions.
Some 140 food-led hospitality businesses had ceased trading between July and the end of October of this year, according to the RAI’s closure lists.
Chief executive Adrian Cummins said costs will only rise next year as a result of measures announced in Budget 2024 including the minimum wage increase and the increase in paid sick leave entitlement days.
“What we are being told by restaurant and café owners is that this year’s busy Christmas season will not be enough to keep the doors of many food-led businesses open through 2024,” he said.
Mr Cummins said thousands of jobs and businesses are at stake and called for a hospitality-specific support package as well as the return of the 9% Vat rate for food-led businesses.
“If large multinationals in Ireland were grappling with the current crisis affecting restaurants, cafés and gastropubs across the country, a task force would be established in the morning,” he said.
Mr Cummins said the level of closures seen this month will only be the tip of the iceberg if the Government fails to take swift action, including the return of the 9% Vat rate.
RAI president Paul Lenehan said food business owners are usually full of positivity at this time of year, “but this year it is the complete opposite.” “Contrary to popular belief, the restaurant industry is not flourishing and the closure of 48 establishments in November alone goes to show this," Mr Lenehan said
“I’m over 20 years in business and employ 155 people across four locations. Things have never been as hard as they are now,” he said.
