40-50% of Hungarian restaurants will fail and close

Up to half of the Hungarian restaurants could go out of business in the near future. According to Zoltán Barabás, there is a real chance that 40-50% of restaurants will close.

As we can read in dehir.hu’s article, according to press reports, market players expect a price increase of 15-20% for restaurants, but some estimates suggest that even a 50% increase is possible.

Zoltán Barabás, a restaurant owner in Debrecen and general vice-president of the Hungarian National Gastronomic Association, said on Debrecen Television’s Esti Közelkép programme,

“Restaurants are also affected by labour shortages, rising wages, rising raw material prices and rising energy costs.”

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On top of that, as Barabás added, restaurant workers leaving their workplaces is also a big problem. However, now, workers in rural restaurants no longer go abroad, but are being lured to Budapest and the Transdanubian region.

Zoltán Barabás in Esti Közelkép. Screencap from the video on Dehir.hu

As it was mentioned in the TV-programme, a good chef now asks for double or even triple his pre-pandemic salary. According to the expert, salary demands are becoming unrealistic and are no longer affordable for restaurants.

He added that it is understandable that workers in the catering industry are asking for pay rise, as the expectations in the industry are extremely high and workers should be paid accordingly.

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“We’re talking about net wages of between HUF 500,000 and a million (EUR 1400-2800), which would require a horrendous amount of sales. We also have to add that if the head chef earns that much, the chefs behind him have to be paid at least 50%.”

As dehir.hu reported, Barabás also complained about the disappearing loyalty in the sector: while 80-90 out of 100 employees used to be loyal to their company, now it is only 10 or 20 at most.

“There is a huge morale issue in the catering industry. I have been in the industry for 44 years and I have never encountered such morale problems as I am facing now,” he said.

He also said that there is no problem with the quality of the raw materials, but prices have increased by 20-25 percent. They have to pay five times as much as last year for the natural gas they use and the price of electricity has also doubled.

Zoltán Barabás says that talking to restaurant workers and reading posts on professional Facebook groups, it is not an exaggeration to expect a 50% price increase in some restaurants, and he does not think the market will be able to cope with that.

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Source: dehir.hu