Jubilee weekend ‘may not be the golden prize’

With the Queen's Diamond Jubilee coming up and the London 2012 Olympics hot on its heels, businesses in the hospitality sector will be rubbing their hands with glee at all the increased demand for goods and services.

But according to analysis by PricewaterhouseCoopers, the rising number of visitors to the capital will not necessarily translate into profit for hoteliers and restaurant owners.

Head of hospitality and leisure at PwC Liz Hall commented that bars, cafes and other eateries are most likely to benefit from the large crowds appearing for the Jubilee celebrations in the first weekend of June, which include a flotilla of boats on the Thames.

"It should be a good weekend for London hotels, but not the golden prize many expect," she warned. "The effect won't be as big as it could be if the economic situation was stronger and people had more disposable income."

She noted that those in hotel careers face the challenge of filling vacant rooms over the Jubilee period.

"Looking back to the royal wedding last year, it was mainly hotels along the route that benefited. If that is the case this time round, there are only about ten hotels along the river between Battersea and Tower Bridge – and not all of those hotels will have a river view."

Ms Hall added that Londoners could escape the city to avoid the crowds and to take advantage of the extra day off, which would impact on restaurant trade. The celebrations are also likely to deter the "lucrative corporate business clientele" who tend to spend the most on temporary accommodation.

"The issue for hoteliers is that they need to fill their rooms 365 nights a year at as high a price as possible – they can't store the product like other sectors – an empty room equals one night of lost revenue."

However, Christine Cross, chief retail advisor to PwC, said that the Jubilee weekend represents opportunity for profit on two fronts: the time off work allows more people to spend their money, and the 'feel good factor' may encourage individuals to splash out more than they usually would.

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