2022 State of the Australian Hospitality Industry Report: Looking Ahead to 2023

Lightspeed surveyed over 8,000 restaurant owners, operators, managers and guests around the world to understand how the past year has changed their views on the industry, for better or worse, and how they plan to adjust and adapt.

Read on to learn more about:

1. How hospitality operators plan to use technology to streamline their business
2. How conscious consumption is growing in Australia
3. New ways operators are handling inflation and staff retention and sustainability
4. How inflation may impact guest behaviour and the Aussie support local sentiment
5. How the cash v cashless debate is evolving

Digital adoption: a key lifeline for Australian businesses

As Australian restaurateurs grappled with rising inflation, staff shortages, and overall economic uncertainty in 2022, technology became a key lifeline. The ability for hospitality operators to do more with less is essential, with survey results noting a majority of industry respondents credit the adoption of a POS or restaurant management software to streamline shifts, including new or expanded online ordering systems or the use of new technology to automate tasks. 

Findings include: 

• Over two-thirds of Australian restaurant operators noted that technology adoption over the last two years has been critical for their business
• More businesses are using automation technology to streamline operations and run their businesses with less staff
• The most widely adapted tools this year include new or expanded online ordering, contactless payments, QR code ordering and new POS and restaurant management systems
• Online ordering technology has improved business more than any other tech adoption for food service hospitality businesses
• For hotels, adopting technology to automate more tasks was credited for most improving business operations 

Conscious consumption is growing in Australia

Climate change and sustainability are becoming two of the defining issues for our generation, and we’re seeing this in both business practices and consumer consumption.

• Nearly half (48%) of hospitality owners say that implementing environmentally friendly initiatives will attract more customers 
• To ramp up sustainability, two-thirds of Multi-Location venues (67%) are adopting food waste policies while more than half of Fine Dining restaurants (54%) are now offering more vegan options
• Australian venues across Bars & Pubs (50%), Cafes & Bakeries (43%) and Fast Casual (37%) categories were most likely to integrate more local, farm-fresh foods to their menu compared to their global counterparts

Industry challenges: inflation and staffing

While lockdowns and social distancing are a thing of the past, the medium- to long-term impacts of the pandemic set in for Australian venues in 2022. Chief among them are economic pressures and staff shortages.

• The rising cost of food and supplies is among the top obstacles that hospitality businesses are facing, with 35% of Australian hospitality businesses indicating it is their biggest challenge
• In response, many venues are increasing menu prices – particularly Cafes & Bakeries (79%) and Bars & Pubs (70%)
• Hiring new staff and retaining existing team members was another pressing concern facing many businesses
• Almost two thirds of venues are working with a smaller workforce than they’d like, with 70% increasing wages to attract and retain employees, half adopting new technology to streamline shifts and many more limiting the number of days and/or hours of operation

Strong support local sentiment to be tested by economic pressures 

In 2023, it’s going to be crucial for Aussie restaurants to not only tap into their loyal customer base, but also make sure that every new guest that comes through the door has an exceptional experience that will keep them coming back.

• Aussies love to dine out with 75% of respondents surveyed stating they are most likely to socialise with family and friends in a restaurant
• However, while many Aussies (40%) want to support venues during this tough economic period, inflation is putting a strain on spending for some
• Almost a third feel they are unable to show any support to the industry as a result

Payments trend: contactless payments are still on the rise

Australia has long been renowned as an early adopter of trends and technology. That’s certainly the case in how we’re paying for our favourite drinks and dishes. 

Cash was already being supplanted by digital payments pre-pandemic, but the trend has surged in recent years; both to limit contact and cater to the speed and convenience consumers demand today. 

Cash is no longer king, with the most popular payment choice among Australians being debit cards (40%) while only 13% pay with cash.

As we move into 2023, the key lessons to keep in mind when running a hospitality business include using automation technology to do more with less, getting creative when it comes to combating inflation and keeping up with guest expectations and demands.

Looking for a technology partner to help take your automation to the next level? Talk to one of our experts today to find out how Lightspeed can help.