Hospo still getting to its feet after rolling maul of issues: Shamubeel Eaqub

Wednesday, 11 June 2025

Hospitality leaders spoke at Tākina Wellington Convention and Exhibition Centre on Tuesday about what was coming for the industry. (file)

Amid reports of hospitality closures in Wellington and elsewhere, industry pros are stressing that positive change will eventually come.

The spotlight has been on the hospitality industry’s current woes ‒ with the capital having lost a large number of eateries over the past several years.

However, the Restaurant Association's Hospitality Industry Report for the first three months of the year shows total sales up 1% at $4 billion from a year earlier, with sales in the capital up 4.1%, and there have been openings as well as closures.

Economist Shamubeel Eaqub, speaking at the Hospitality New Zealand Conference and Trade Show at Tākina on Tuesday, said the current state of the industry was far more complicated and nuanced than the media was suggesting.

The data was showing a “pause in spending”, he said, one that had been long in the making.

With the pandemic, then inflation, then higher interest rates, then the recession, owners were most likely feeling there had been a rolling maul of oncoming issues, he said. Cost of supply was also affecting providers.

However, there were many indicators that things were improving, with the number of hospitality operators increasing and by a large number, he said.

“When you only look at one side of the ledger, of only the closures, what you don't see is all births that are taking place. Those are almost uncelebrated, right?”

He said the biggest New Zealand hospo customers were local households, who were still “feeling a little bit raw”.

While interest rates and mortgage rates were falling, the cost of food and utilities was still up, meaning households were still being cautious with their spending, he said.

Economist Shamubeel Eaqub says data predicts a possible upturn for the hospitality sector within the coming months. (file)

“Until people have more money in their back pocket, they're not going to go out and spend.”

While some parts of New Zealand were doing very well - Eaqub used Queenstown as an example - others were less fortunate, meaning the current hospo environment was very uneven around the country, he said.

There were very few job listings being posted at the moment but when they rose, he believed that the industry would start seeing positive trends again.

While the retail, accommodation, and hospitality industries had stabilised over the past six months, it would take a few more months before people started seeing an upturn, he said.

“I was really hoping that I could come today and tell you things are looking better … But I feel like there's still probably a few months when people are going to be cautious.”

Hospitality NZ chief executive Steve Armitage ‒ who opened the industry event ‒ said the negative headlines were “barking at cars” and not helping the current situation.

“Quite naturally, we feel the decisions that lead to a business shutting up shop. And yet, if we dig beneath the headlines, there are new venues opening every week up and down the country.”

Tourism and Hospitality Minister Louise Upston also spoke at the event, saying she had been working closely with Armitage and the Restaurant Association to “get things up and running again”.

Minister Louise Upston says she is determined to support the hospitality and tourism sector through its current challenges. (file)

She said hospitality had always been a “powerhouse” of New Zealand.

The minister said she wasn’t ignorant about the challenges the industry was facing, saying she was determined to support the sector through them, and make sure it was ready for when growth came.

“I find it always such terrible news when you read of another outlet that closes … What is really clear to me that there is a level of grit and determination in your sector that is unparalleled, and there's no way you could have got through the last few years without that.”

She urged business owners to continue showing visitors amazing experiences, saying her personal goal was to get international visitor numbers back to where they were in 2019 by 2026, and to double the value of 2023 tourism exports by 2034.

Currently, the country was sitting at 86% of its 2019 number, she said.

Alcohol sales in the hospitality sector

The balance between public health and safety, versus the hospitality sector’s ability to function with a thriving nightlife has long been a contentious issue.

Minister Nicole McKee spoke about the issues alcohol providers face on balancing safety with functionality. (file)

Business owners along Courtenay Place have reported prolonged battles with regulatory agencies regarding their alcohol licences, with Saint Diablo owner Greig Wilson fighting for three years to extend his trading hours to 4am.

Associate Minister of Justice Nicole McKee said that, while most Kiwis drank responsibly, it was important to keep people safe.

She spoke about finding the balance between regulation and allowing hospitality providers to do business.

A key theme that had emerged from the ongoing dialogue between the sector and the Government was a desire for more consistency, she said.

When applying for event-related special alcohol licences, McKee acknowledged dealing with multiple local councils could be complex and time-consuming.

She said the hospitality industry was about people, and making sure people were welcome and safe was a big part of what the industry provided.

“I know that the safety of your patrons and your staff is paramount. If it wasn't, your businesses would fail.”

McKee took questions from the audience, with attendee Jamie Freeman speaking about the difficulty that established businesses faced going “head to head” with anti alcohol units.

He said people could object about a bar’s licence from anywhere in New Zealand, even if they hadn’t seen the place, saying occasionally people had even spelled the name of the bar wrong.

Another speaker said people could go to supermarkets and get alcohol at a far cheaper cost than any bar could offer, and asked for increased off-licence regulation.

McKee said she had been told 54% of alcohol harm was happening at home, which was an area that needed to be worked on.

“We now need to figure out how we can support you, stop [alcohol-related harm] and allow businesses to be able to breathe and keep going, and that includes the supermarkets.”

Correction: An earlier version of this story said it was the Government’s goal to return international visitor numbers to 2019 levels by 2034. That date should be 2026.