Restaurant survey: Gozo restaurants doing better, Valletta restaurants struggle due to oversupply
Restaurants in Valletta surveyed by the Deloitte – MIA Restaurants Performance survey registered a loss in revenue trends of 1.6%, while restaurants in the sister island of Gozo registered an increase of 3.2%.
A total of 89 restaurants were surveyed for the survey: 17 from Valletta, 16 from the North, 12 from Sliema, 12 from St Julian’s, 11 from the central part of Malta, 11 from the South and 10 from Gozo.
Reasons for possible loss of revenue trends in the capital city of Malta could be attributed to the increase of restaurants setting up not being in line with an increase of people dining at the capital.
National Statistics Office data shows that for the second quarter of this year (April-June) there was a 7% increase in ferry-trips to Gozo, therefore the increase in revenue trends could be attributable to this.
On average, customers of the restaurants surveyed were made up of 53% locals and 47% tourists. On the employee mix, it was found that 66% were made up of locals and 34% foreigners.
Sticking with the overall results, it was found that 39% of the 89 restaurants surveyed registered an increase in revenue trends, 33% said there was a decline, while 28% found that there was no change.
The survey takes a snapshot of the restaurant situation between the months of April and September, traditionally a period of time with increased tourist activity.
Interestingly, the restaurants found that there was an overall cost increase of payrolls by 2.7%, slightly above inflation. David Bonnet, from the financial advisory team of Deloitte who also conducted the survey said that general feedback from restaurants was that there is a big challenge to find and retain quality staff. He said that because of this problem, restaurants have been forced to increase wages to entice people to work in the industry.
Out of the 12 restaurants surveyed in St Julian’s, six registered a 1.5% decrease in sales trends, five said there was no change and just one registered a marginal increase in sales trends – indicating that the St Julian’s region has not performed as well as in the past.
Sliema restaurants registered an overall marginal increase in sales trends of 0.8%. Three restaurants registered a slight loss, five found there was no change, three registered a marginal increase of 1.5% while one restaurant found an increase of sales trends of 6-10%.
Valletta, the region faring the worst hit, is the region with the most even customer split, 51% locals and 49% tourists. Two restaurants found a decrease in sales trends by a whopping 10%, two found no change, and five registered an increase between two and 10%.
When comparing the business sentiment between spring 2015/16 and spring 2014/15, 69% found no difference, 21% found an improvement and 10% believe they are worse off currently.
Out of those who believe that there is an improved business climate between this year and last, 18% came from the North, 13% from Valletta, 12% from St Julian’s, 12% from the Central area, 11% from the South and 11% from Gozo.
Closing off the conference, Malta Hotels and Restaurants Association President Tony Zahra said that when it comes to restaurants “we really need to up our game.”
He spoke of the different mix of tourists and their demands, as well as foreigners coming to Malta and opening up restaurants which syphon off business from the traditional Maltese restaurants.