The hospitality industry in Germany is only slowly recovering from the Corona shock. Sales increased in 2023 compared to the previous year, both in price-adjusted terms (real) and in nominal terms, as the Federal Statistical Office has calculated. However, in an initial estimate, the Wiesbaden statisticians assumed higher rates of increase.
According to the figures published on Tuesday, real sales rose by 1.1 percent compared to the previous year instead of 2.6 percent as initially calculated. In nominal terms, hoteliers and innkeepers had 8.5 percent higher revenue in their cash registers; the first estimate was based on an increase of 9.6 percent.
The still positive balance of 2023 for hotels and restaurants was mainly due to the particularly high real growth at the beginning of the year, as the statisticians explained. As the year progressed, rising prices for food, personnel and energy slowed the industry.
Pre-Corona level not yet reached
However, sales have not reached the level of the pre-Corona period, at least in real terms: adjusted for prices, sales last year were 11.3 percent lower than in 2019, the year before the pandemic broke out in Germany. Price increases, meanwhile, resulted in nominal sales that were 8.8 percent higher than in 2019.
According to preliminary results from the Federal Office, in December with the important Christmas business, nominal sales rose by 5.0 percent compared to the same month last year due to the sharply increased prices, but adjusted for prices there was a decline of 0.2 percent.
According to the industry association Dehoga, the current year started with a decline in sales. According to a current survey by the association, sales in January were nominally 10.2 percent lower than in the same month last year. “It is becoming increasingly difficult for companies to work economically,” said the President of the German Hotel and Restaurant Association (Dehoga), Guido Zöllick. “Fears about the future are increasing in the industry. The outlook is bleak.”
Demand for reduced VAT
Because the regular VAT rate of 19 percent has applied again to food in the catering industry since January 1, 2024, resulting in higher prices for customers, industry observers are expecting more bankruptcies in the industry, which has already been hit by the Corona downturn.
At the end of November, the financial information service Crif reported that more than 15,000 restaurants, pubs, snack bars and cafés in Germany were at risk of insolvency. “The increase in VAT will further aggravate the situation, especially for catering establishments that are already financially struggling,” explained Crif managing director Frank Schlein at the time. The federal government reduced the tax rate on meals in restaurants to 7 percent in mid-2020 during the corona pandemic. The traffic light coalition later extended the tax break several times, among other things to cushion the energy crisis and high inflation.
Dehoga President Zöllick reiterated the demand for a uniform seven percent VAT on food: “We continue to fight for the seven percent. The unequal treatment of food in restaurants and cafés compared to delivery services and food to go must be eliminated.”
