Peter Heath, founder, Venue Performance, assesses the market to see whether misery really does love company
Thomas Pugh from RSM gave a brilliant talk at HOSPACE at the end of last year which encapsulated the position we are currently in. He used a ‘misery index’ to talk about the correlation between what you feel and what you do, which showed that, although the general mood amongst consumers was pretty grumpy - they were worried about interest rates, inflation, the cost of living - they were still eating out. They felt miserable, so they did things which made them feel better, which is what our sector delivers.
Pugh said that the correlation between sentiment and actions was out of whack, which he’d never seen before. Of course, we’ve never had a post-pandemic global slump, so there is a lot left to be learned and a lot to play out. It will be interesting to see if that correlation returns.
The meetings sector is looking pretty good for 2024, even though there are challenges ahead. We've got a number of wars going on, we’ve got inflation, we've got other economics issues and something like a third of the world is going to be voting on its leadership. So it’s not going to be plain sailing, but the tide is definitely lifting.
We reported that 2023 was good and we forecast that 2024 is going to be better. Last year saw a little drift towards audiences getting smaller, but we are seeing signs of change; audiences are getting coming back up again, it’s all looking quite positive.
The only downside is that lead times are still short, so you can't predict the future with any great deal of certainty, because you don't have the business on the books. It used to be that you had plenty of business booked in and organisations were merely trying to top that up, but that’s been turned on its head. But that said, there are early signs that it’s getting better and venues need to have faith and focus on holding their nerve and doing more yield management;
Going into what looks likely to be an interesting year economically and politically in the UK, we have a few things to keep an eye on. Cost control is going to be key for profitability flow, F&B and yield management are issues, so as ever, there will be plenty to keep us up at night. But plenty of hope to keep us going.