Dutch hospitality sector struggling; Fewer restaurants, cafes for first time in 8 years

High personnel, energy, and rent costs put a massive damper on the Dutch hospitality sector’s first full year with no lockdowns after the coronavirus pandemic. Hospitality companies made less profit in 2023, and the number of catering establishments fell for the first time in eight years, trade association KHN said, NU.nl reports.

There are currently just over 45,000 hotels, cafes, and restaurants in the Netherlands. Last year's decline was fairly limited, but the KHN is still very worried. “Profit margins fell by an average of 2 percent compared to 2022. That is no surprise given the enormously increased costs of energy, personnel, purchasing, and rent. These are costs that catering entrepreneurs cannot or hardly pass on to their guests,” the association said.

Revenues in the sector rose 14 percent last year to 31 billion euros. The number of orders increased by 6.7 percent. The growth mainly occurred in the first quarter because the first quarter of 2022 still had the Netherlands in a lockdown. “The second and third quarters of 2023 showed a different picture, with even a contraction in volume at cafes and fast food companies,” KHN said.

The KHN doesn’t expect much improvement in 2024. The economy is expected to grow barely, while people struggling with inflation may be more frugal with their spending. Staff shortages will also continue to plague the sector this year.