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One week into the Olympics, mixed results for the hospitality industry


August 3, 2012

It is now almost a week since the Olympic Games began and fans of Team GB will no doubt be pleased with a recent rush of gold, particularly following a shaky start which saw the country having to wait until Wednesday (August 1st) for the first British athlete to make it to the top of the podium.

And much like the country's athletes, the UK's hospitality industry has also seen mixed fortunes since the Games began.

For much of the run up to the Olympics, those in the hospitality sector were hoping the massive event and the visitors it brings would mean a boost for profits and the possibility of a rise in hospitality employment opportunities.

But a week into the Games and while some sectors of the sector seem to be doing well, others appear to be suffering as a result of the Olympics.

Reports suggest that restaurants in the traditional tourist hotspot of London's West End have seen a significant fall in trade, as Olympic tourists opt to stay close to the action in the east of London and the usual summer clientele cut down on going out for fear of disruption on the transport network and overcrowding as a result of additional visitors for the Games.

According to figures from the British Hospitality Association (BHA), some operators have seen a decline in customers of up to 60 per cent.

"There is very little corporate demand and demand by leisure travellers to London, outside the Olympic Games, is very weak. It is apparent that visitors to the games are not acting like normal tourists, where visiting restaurants, attractions and shopping is a typical activity," said the organisation.

However, things could still improve, with the BHA winning a number of concessions for the industry following a meeting with mayor of London Boris Johnson, including the opening of some Olympic Lanes for normal traffic and the possibility of free weekend on-street parking on the weekends in Westminster.

The news is slightly more positive for the hotel sector however, with figures from STR Global hotel occupancy in London during the first weekend of the Olympics reached 84.4 per cent.

And while concerns that occupancy rates could drop following the end of the Games, London is currently performing well compared to previous Olympic host cities.

"There is room in the inn, but overall hotels are in a good position," said Elizabeth Randall, managing director of STR Global.

"Reviewing hotel performance over the past four summer games, back to 1996 in Atlanta, none of the host cities' occupancies surpassed 90 per cent for the months in which the Olympics occurred."

Perhaps the biggest boost for the hospitality sector during the Games so far has been within the catering industry, particularly those operating within the Olympic Park.

In fact, the problem for these businesses seems to be keeping up with higher than expected demand, with it reported earlier this week that a number of caterers within the Olympic Park have run out of supplies at certain peak times.

In a statement, Locog said it was increasing food supplies at the Park.

"Following high levels of demand in the first days of competition we have increased provisions and also introduced roaming concession sellers at venues," it said.

The real test for the hospitality industry, however, could come after the Games, with the hope that the extra publicity the event has brought for Britain will lead to a long-term rise in visitor numbers.

"In the long term, the aim is to attract more visitors to experience the capital in 2013 and beyond – to harness the additional long-term tourism benefits that we estimated to be in the region of over £950m million over the next five years," a spokesperson for London told the BBC.

Find bar work with Berkeley Scott, the specialist hotel, hospitality and catering recruitment agency