Peter Heath, founder, Venue Performance, enjoys a strong-than-anticipated second quarter and hopes of more sober booking habits.
The sector is currently performing very well, better than had been expected, with the Coronation not hitting trading as much as had been anticipated. The quarter to June was strong, setting the scene for a good second half of the year.
The summer will follow the usual seasonal pattern, with a weak end to July and a dead August, but September through to Christmas look likely to ensure that everyone will have plenty to celebrate by the end of the year.
September in particular will be a good month, as it always is; whether it's people rushing to spend their money before the end of the year or before the general election. There remain the issues of debt and refinancing, which is weighing heavily on assets, and raising the pressure on hotels and events venues to deliver.
Christmas is also showing signs of returning, after a couple of weak years. This is encouraging for the industry because that’s where it makes a lot of its money, but also because it will be a good bellwether in terms of how comfortable people are being in close confines with each other, which bodes well for the rest of the year in events.
We are likely to see an increased focus on flow through as businesses continue to recover. The pandemic taught hotels and venues to strip their overheads back to zero and take a closer look at all their costs and to weigh those variable costs against profitability. It might be that the cost of taking on an additional event - and hiring the additional staff to run it and manage the variable food and energy costs - means that the event is not profitable, so not worth holding.
This may not look positive, but it may bring to an end the short booking windows which have made it so hard to for venues to plan and budget. If suppliers continue to say yes when they are asked to deliver events on short notice, then bookers will continue to book them. But if they can be weaned off always shopping at the last-minute sales because of a lack of availability, we may see booking windows extend again.
Profitability remains an issue, but in terms of the market in general it's looking very strong and because 2023 has been a better year than expected, I suspect 2024 will also be a good year, if possibly impacted by the headwinds caused by interest rates, inflation and the general election.
And hopefully one where the search for profit will help to create a more sane booking environment.