Cashflow pressure is cumulative, so visibility has to be continuous

Hospitality's cashflow challenge is rarely caused by one isolated cost. Labour, National Insurance contributions, food inflation, energy, business rates and changing customer behaviour can all arrive together. The operation then has to absorb those pressures while continuing to buy stock and pay people every week.

Zempler Bank's Feeling the Heat report surveyed 101 micro and small food and drink operators in England during March and April 2026, alongside expert interviews. Hops contributed operational perspective through Aaron Resch.

VAT is predictable, but the cash still has to be there

Aaron described the practical problem:

“Money is constantly going out. Then the three-month VAT return lands and suddenly it's, 'Oh my gosh, I need £75,000.' The good operators ring-fence that money as they go. The ones who don't end up scrambling.”

The exact amount varies, but the discipline is consistent. VAT needs to be treated as money owed rather than available operating cash. A weekly provision or a live estimate makes the liability visible before the return arrives.

Margin expectations have changed

The report also quoted Aaron on the profitability operators once considered normal:

“When I started in the industry 15 years ago, what does good look like? Good looks like a 20% EBITDA. I don't think that's what good looks like anymore. I think 5 to 10% max is what good looks like.”

That observation belongs to the report and Aaron's experience, not a universal benchmark. It does illustrate why delayed operational information is particularly costly when the available margin for error is smaller.

Technology should narrow the investigation

Aaron also described asking a general manager to investigate several variances and waiting days to learn that a box had been smashed. Operational analysis is useful when it directs attention to the unusual items and preserves the data behind each flag. It should support human judgement, not approve or alter the operation on its own.

Read the full Zempler Bank report or explore how Hops Finance brings operational and financial evidence into a controlled daily workflow.

Hops covered the report on LinkedIn on 9 June, 19 June, 26 June and 3 July 2026.