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What the Best-Run Hospitality Businesses Do First When Costs Rise

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When costs start creeping up, and, let’s be honest, creeping isn’t even the right word anymore I notice the same reaction time and time again.

Owners tighten their shoulders.
They work longer hours.
They start mentally cutting things before they’ve even looked at the bigger picture.

I’ve been there. I’ve sat at the table with operators who feel the squeeze from every direction, it’s wages, suppliers, energy, rates, legislation all rising at once. And I’ve learned something important over the years:

The best-run hospitality businesses don’t panic when costs rise. They pause, take stock, and act deliberately.

This post is about what I see strong operators do first, not later, not once things are already painful, but right at the moment pressure starts to build.

The First Instinct Is Often the Wrong One

When margins tighten, the instinct is usually to cut.

Cut hours.
Cut support.
Cut training.
Cut anything that doesn’t feel “essential”.

But in my experience, that knee-jerk reaction often creates more problems than it solves. I’ve watched businesses save a small amount in the short term, only to lose far more through poor retention, compliance issues, inconsistent service, or leadership burnout.

The operators who stay steady do something different.

They don’t start with cuts.
They start with clarity – easy to say right!?

They Get Honest About Where the Money Actually Goes

The first thing strong operators do is look properly at their operation. Not emotionally, not defensively, but honestly.

They ask questions like:

Where are we leaking money without realising it?
Which processes are inefficient or duplicated?
What’s costing us time, not just cash?
Where are we exposed if something goes wrong?

This isn’t about blame. It’s about visibility.

A PwC hospitality report showed that businesses who regularly review operational structure during cost increases are significantly more likely to maintain profitability than those who rely solely on cost-cutting measures.

Clarity always beats guesswork.

They Protect the Foundations First

Here’s something I’m very direct about with clients: cutting foundations is one of the most expensive mistakes you can make.

HR, compliance, leadership structure and operational process aren’t “nice to haves”. They are the framework that keeps a business steady when pressure rises.

The best-run businesses double-check:

that employment processes are compliant and fair
that managers are supported and not stretched beyond reason
that systems are doing their job, not creating friction
that responsibility is clear, not assumed

When those foundations are strong, everything else becomes easier to manage, even when money is tight.

They Ask for Support Before Things Break

This is the bit I respect the most.

Strong operators don’t see asking for help as weakness. They see it as good leadership.

They bring in support early, not just when things are already at crisis point but when they feel the pressure building and want to stay ahead of it.

That might mean:

sanity-checking compliance
reviewing HR structure
supporting management teams
streamlining operations
or simply having someone experienced to talk things through

This is exactly where The Fresh Group comes in.

How The Fresh Group Helps When Costs Rise

I work with hospitality businesses at every stage from new openings and long-established operators alike especially when rising costs and government decisions are making everything feel heavier than it should.

We help businesses:

protect themselves through solid compliance
build HR structures that support people without overcomplicating things
strengthen leadership and operational clarity
avoid costly mistakes that often come from being overstretched

And I’ll say this again because it matters:
we are not expensive.

What we do costs far less than firefighting problems later, dealing with tribunals, failing inspections, high turnover, or leadership burnout.

Support done properly pays for itself.

A Practical Monday Reset

If costs are rising in your business right now, here’s what I’d encourage you to do this week:

Before you cut anything, pause and ask:

What do we need to protect first?
Where would better structure save us money long-term?
Who is carrying too much right now?
What would feel easier if we weren’t doing it alone?

Those answers usually point in the right direction.

A Call to Action From One Operator to Another

If you’re feeling the pressure, whether you’re opening something new or running an established hospitality business you don’t have to navigate this phase on your own.

The Fresh Group is here for the journey. We support businesses at the start, through growth, and during tougher periods when external pressures are squeezing margins and confidence.

You’ll find more detail on the website and in the brochure.

If this post resonates, give me a shout, speak to me or one of my team… even if it’s just a conversation, sometimes that’s all it takes to move from reactive to steady again.