Less Workforce Investment is Hurting Brand Equity – and How Drink Brands Can Limit Damage

Chair of UKHospitality, Kate Nicholls OBE, recently spoke to the BBC about the dramatic decline in job vacancies across the hospitality sector compared to last year. According to UKHospitality, summer job opportunities have fallen by 24,000, and the industry has shed 84,000 roles since the changes to employer National Insurance Contributions (NICs) announced in the 2024 Budget. These figures reflect the mounting staffing challenges and rising cost pressures facing businesses in the sector. But this staffing crisis isn’t breaking news. It’s been brewing for some time. 

CGA by NIQ’s Business Leaders Survey flagged the warning signs earlier this year. The data showed clear intent from hospitality operators to scale back investment in people, at precisely the time when the industry needs it most. 

The shift affects staffing levels on the frontline. But it also puts hard-earned brand equity at risk, causing a knock-on effect drinks brands and suppliers are keen to avert. 

Why are Workforce Cutbacks a Brand Risk? 

The latest research uncovers worrying trends: 

• Almost a third (30%) of hospitality leaders plan to reduce recruitment investment 

• A quarter (25%) intend to cut back on staff training 

• 1 in 5 are scaling down employee engagement programmes 

Cost savings are at heart. Yet the ripple effects adversely impact quality of service, brand presentation, and the overall customer experience. 

The thing is, it can take just one poor experience like a badly poured pint, a disappointing cocktail, or a disengaged server, for a guest not to return. But the impact can cut deeper, and a disgruntled customer might walk away from a brand besides the venue.  

The risk is a familiar one: 

• Reduced training =  

• Lower service standards =  

• Declining guest satisfaction = 

• Reduced footfall = 

• More cost-cutting =  

• Brand erosion 

It’s a downward spiral both operators and drinks brands can’t afford to ignore. 

Refocus On the Roots of Brand Equity 

Hospitality is a brand-building engine besides a mere distribution channel. 

Product is served at its best in the On Premise when: 

• Presented in the right glassware 

• At the right temperature 

• By someone who knows how to tell your brand story  

This is where emotional connections are made and loyalty is born. But the story gets tarnished and lost when hospitality teams are undertrained, overworked, or disengaged. 

Insights revealed in CGA by NIQ’s Global Bartender Report indicate drinks brands and suppliers might consider designing and implementing resonant training and advocacy programmes to empower venue staff to deliver premium experiences, no matter what venue tier they work in. 

Higher end venues are often the focus of attention. But efforts in all venue types can reap rich rewards in the experience-led hospitality sector. 

The Trickle-Down Effect on Retail Shouldn’t be Underestimated 

The value of a great On Premise experience outlasts the moment of consumption, with almost two thirds (63%) of consumers who enjoy a drink when out going on to buy the same brand for at home consumption. 

For this reason, broader retail performance is jeopardised when a customer has a subpar experience with a product in a bar, restaurant, or other venue type