Hungarian restaurants struggle to survive: what does the future hold?

Due to high energy prices and the lack of tourists, Hungarian restaurants are still struggling to survive. Home delivery might show a growing tendency. People spend more money, not because of increased purchases but as a result of the crippling inflation eating into customers’ budgets. The restaurants’ monthly turnover appears to be hugely dependent on pay dates.

Fewer tourists, also felt in restaurants

As Portfolio has reported, Hungarian restaurants are experiencing a drop in sales. This would not be such a big issue, but customers are turning increasingly price-conscious due to inflation. For instance, people pick cheaper wines off the menu and order only two courses instead of three. According to Rudolf Semsei, restaurant owner and vice-president of the Hungarian Foodservice Trade Association, restaurants with terraces have an advantage during the summertime. The number of foreign customers is still significant, although some ethnicities have completely disappeared. Russian tourists are not present this season, and there has been a considerable decrease in Chinese visitors since the Covid pandemic.

Skyrocketing energy prices

Many restaurant owners signed 1-2 years of fixed-rate contracts with their energy providers at the end of last year, as they did not have any better option. Now, these business owners are testing new possible marketing strategies to stay afloat and attract customers. However, the best “marketing ploy” out there is still based on providing high-quality service and aiming for customer satisfaction. The market situation is still not very favourable for restaurant owners facing an energy price trap. The Hungarian Foodservice Trade Association is not aware of any restaurant where the utility company has reduced the rates despite the fixed contract.