Financial expert analyzes: Hospitality industry in Germany with strong sales growth despite rising prices

Financial expert analyzes: Hospitality industry in Germany with strong sales growth despite rising prices

According to a report by www.zeit.de, the hospitality industry in Germany recorded a 9.6 percent increase in sales last year. Adjusted for inflation, this results in an increase of 2.6 percent. Hotels, restaurants and catering companies are included in these statistics. The statistics show that strong sales growth was recorded, particularly at the beginning of 2023, which weakened as the year progressed.

Rising prices in the hospitality industry have dampened sales growth, the statisticians said. The increase in food prices, personnel costs and energy prices have contributed to a significant increase in price levels. The inflation rate in the hospitality industry was 8.1 percent. However, when taken into account unadjusted, sales last year were still 9.9 percent lower than in the year before the pandemic.

Another important factor that has influenced prices in the hospitality sector is the expiry of the reduced VAT on food at the end of December. As a result of the Corona crisis and rising energy prices, VAT was reduced to seven percent before being increased again to 19 percent. Three quarters of restaurateurs have already increased their prices, while a further 11 percent plan to do so during the first quarter and 6.2 percent over the course of the year.

As a financial expert, you can analyze these numbers that the increased prices and the increased VAT have a direct impact on profit margins and sales in the hospitality industry. As a result, restaurateurs had to increase prices to compensate for the increased costs. This could lead to lower demand in the long term, especially if prices become unaffordable for consumers. The rising costs could also lead to a reduction in investment and job cuts in the industry. It is important to keep an eye on the financial impact of these developments as they can also impact the entire financial market.