Tourism & Leisure Business Survey shows half of businesses are reporting a fall in profits

The results of the 2024 Larking Gowen Tourism Business Survey showed mixed reviews about the future of the industry among business owners.

Leading Suffolk tourist attraction Jimmy’s Farm & Wildlife Park was the setting for the official launch of the results. Guest speaker Jimmy Doherty spoke about how he saw the tourist industry as massively important for the region beyond the £10bn of income it generates. “Tourism is not just another industry. It provides amazing jobs and makes the most of our landscape and wonderful towns and beaches. It provides a fantastic respite for a nation that needs it now more than ever, with everything we’ve been through in recent times. I think the tourism industry should be seen as a national tonic sometimes,” he said.

The survey revealed 83% of respondents reporting a change in spending habits among customers, which had a moderate or significant impact on their business, leading to 50% of businesses seeing a fall in profits in 2023. One-in-three businesses were anticipating falling profits in 2024. This resulted in 32% saying they planned to cut jobs, 10% said business activity may need to be reduced, and 10% said their businesses may have to close.

But there was also a degree of optimism, with 59% of respondents saying they had plans for site improvements and refurbishments, 11% were extending premises, one-in-three were looking to improve customer and employee experiences, and 36% were going to increase investment in marketing and PR.

When asked about confidence in the local tourism economy last year, 55% of businesses gave a strong score of seven or eight out of ten. That confidence has now dropped with only 24% scoring a seven or eight in the 2024 survey. In the survey, only 9% of respondents felt that central government provided enough support for the sector. Local support was also found wanting, with only 19% suggesting enough support was being given.

Chris Scargill who is the lead partner and a Tourism specialist for Larking Gowen said: “With the rising cost of living, the tourism sector in the eastern region is understandably feeling fatigued.”

Chris believes there’s a growing feeling in the industry that collaboration between businesses was important, especially in economically troubled times. Speaking at the event Chris said, “My belief remains that together you’re stronger. Businesses working together to create campaigns will add value outside the reach of any one business.”

He said it’s important for businesses to realise that they’re not alone in facing current challenges. “I hope people who work in this important sector will see positivity in the data and that you’ll grow your business and continue to provide the experiences that customers are looking for in this new era.”

Chris Scargill said that there were signs of light on the horizon. With inflation going down and a recent report showing the average household being £22 per week better off, there’s hope that this would begin to reverse the downturn in spending in the sector.

The results were discussed in detail at the annual results seminar, held the following day at ROARR! in Norwich. The event included a panel discussion with Andrew Hird Chair of Visit North Norfolk, Stevie Sheppard, Park Director at Jimmys Farm & Wildlife Park, and Iain Wilson, owner of Byfords, and cake makers Sponge. 

You can listen to their conversation on the Tourism Business Chat podcast, and you can download a copy of the results brochure from the Larking Gowen website which can be accessed at  larking-gowen.co.uk/tourism-insights. 

This article is designed for the information of readers. Whilst every effort is made to ensure accuracy, information contained in this article may not be comprehensive and recipients should not act upon it without seeking professional advice. “Larking Gowen” is the trading name of Larking Gowen LLP, which is a limited liability partnership registered in England and Wales (LLP number OC419486). Where we use the word partner it refers to a member of Larking Gowen LLP or a senior employee of equivalent standing. © Larking Gowen.