The rate of hospitality business closures slowed down over the first months of 2024 as businesses saw some rampant cost inflation ease back.
However, one in 40 pubs, restaurants, bars and hotels have still shut their doors for good over the past 12 months, according to industry data.
Fresh figures from CGA by NIQ and AlixPartners showed that 368 hospitality sites, or the equivalent of four a day, closed in the first quarter of the year.
The data meant that there were 98,745 hospitality firms across the UK at the end of March, dropping by more than 2,000 since the same time a year earlier.
Nevertheless, the figures pointed towards a slowdown in the rate of decline in the face of easing inflation for firms and their customers.
It also showed strong demand from customers wanting to eat out, with the number of food-led venues increasing by 0.1% over the quarter.
Meanwhile, drink-led venues and accommodation businesses saw decreases of 0.7% and 0.4% respectively.
Karl Chessell, a director at CGA by NIQ said: “After a very challenging few years, these numbers give grounds for tentative optimism that hospitality closures will slow as 2024 goes on.
“While thousands of businesses remain fragile, a downward trend in inflation should hopefully raise the confidence of operators, consumers and investors alike, and protect more venues from closing the doors.
“It is particularly encouraging to see a marginal return to new openings for both casual dining and independent restaurants, though sustained growth is likely to be some way off.”
Graeme Smith, AlixPartners’ managing director, and head of leisure, corporate finance, said: “While the number of venues continues to tick down overall, the rate has slowed significantly, and hopefully this a further sign of the easing of some of these big market pressures.
“Operating conditions are clearly not easy, but the volatility of recent years has calmed.”