The Shout Magazine (New Zealand)

New Zealand’s hospitality sector grows

New Zealand’s hospitality sector experienced encouraging growth as rebounding consumer and business confidence played a major part in the (almost) tripling of the sector’s annual growth rate. That’s according to the 2014 Hospitality Report just released by the New Zealand Restaurant Association.

Charley Noble's, Wellington.

Charley Noble Eatery & Bar, Wellington.

CEO, Marisa Bidois, says that 2014 “has been a good year for hospitality. It’s pleasing to see what looks like the beginning of a strong growth trend. A large number of new restaurants have opened and members are saying that trading, while still competitive, is better than it has been for some time.”

Highlights for the industry include nationwide sales for 2014 (year to March 31), increased by 6.3 per cent to $7.6 billion; café and restaurant sales experienced strong growth, up by nearly 10 per cent;  revenue growth in Auckland, Manawatu-Wanganui, Canterbury and Otago outlets outstripped the national average growth rate of 6.3 per cent; the number of outlets is projected (as at 31 March 2014) to increase by 251 to 14,991, from 14,740 in 2013; the number of  employees is projected to increase by 2,300 to 107,000 (2013 104,7400); and sales for 2015 are forecast to reach $7.9 billion, up 4.1 per cent.

Among all hospitality outlet types, the strongest performers were cafes and restaurants, with an annual revenue increase of $345.4 million, up nearly 10 per cent on the year before.   Managing labour costs remains the top challenge for hospitality operators, says Bidois. Other challenges include building and maintaining sales volume, continued lack of skilled employees, competition and food costs.  

Top trends include the casualisation of dining, with consumers dining more frequently, but spending less; no reservations except for groups; the gastro bar; new cuisine styles such as Asian, Southern American and South American; lower price points with shared plates and small plates; healthy food – raw and Paleo diet; locally grown produce; rise in hospitality groups; pop ups and craft beer.  

Expectations are for another good 12 months ahead, says Bidois, although at a slightly reduced rate of growth compared to 2014. “While consumer confidence is rebounding, we know interest rate rises are on the horizon and house prices and household debt remain of concern to many New Zealanders.”