By Marisa Bidois

CEO, Restaurant Association of New Zealand

As we move into the winter months, the hospitality industry once again braces for what is traditionally a tough trading period. While there are some positive signs on the horizon, the broader outlook remains one of cautious optimism, underpinned by the realities of a still-fragile economy and ongoing pressures on business owners.

The economic climate continues to present headwinds. Yes, interest rates are beginning to soften, which may ease some pressure on households and consumer spending. But economic uncertainty persists—both locally and globally. With ongoing geopolitical tensions, shifting trade dynamics, and an unpredictable global outlook, New Zealand is not immune to the ripple effects. Trade tariffs and disrupted supply chains continue to add complexity to the operating environment for many hospitality businesses, especially those relying on imported products or equipment.

Winter 2024 was undeniably tough. Official data shows that the hospitality sector saw a minimal 1.4% year-on-year revenue sales increase in Q2, followed by a decline in Q3—both of which fall squarely within the winter trading season. For an industry already grappling with tight margins, the impact of this hits hard. This year, we’re not forecasting further contraction, but conditions remain fragile. The mood is cautious, and business confidence is still rebuilding.

Attracting visitors to our shores—whether through tourism campaigns, international events, or visa pathways—needs to remain a key priority. Every visitor is a potential diner, and winter tourism initiatives can help fill the tables that otherwise sit empty on chilly midweek evenings.

Tourism New Zealand’s strategy of focusing on growing off-peak visitation numbers is one we wholeheartedly support. This goal will help to create a more sustainable hospitality sector that doesn’t need to rely on a booming summer season that gets businesses through a tough winter, while creating a more sustainable and predictable operating environment that enables our industry to showcase hospitality as the viable, long-term career option we know it to be—rather than being seen as just a part time job over the summer break.

The government’s recent action in supporting this strategy has been a ray of hope for our industry, with close to $31.5 million being invested over the past three months to promote New Zealand as an international destination of choice, boost regional tourism and attract international business events. This targeted and focused investment is a welcome move, especially as we head into a season where domestic and international visitor numbers can make or break regional hospitality businesses. Supporting tourism across the motu not only brings much-needed foot traffic into local eateries and cafes, it also spreads economic benefit to communities that rely heavily on seasonal peaks.

But even with more visitors, we continue to face major challenges behind the scenes. Staffing remains one of the most pressing. Delays in immigration processes are slowing down the ability of businesses to fill essential roles, and while we’ve made progress in our dialogue with the government, more needs to be done to ensure the system is responsive to our industry’s needs.

The recent Hospitality Summit, co-hosted by the Restaurant Association and attended by key ministers and officials, laid the foundation for stronger industry-government collaboration. We’re working hard to ensure our sector’s voice is heard—particularly when it comes to streamlining immigration and supporting training pipelines that grow and retain local talent.

Costs are another unrelenting pressure. Food prices remain high, as do labour costs. While wage increases are essential for attracting and retaining talent, they must be balanced against rising operating expenses and the already razor-thin margins in hospitality. The truth is, the cost of dining out needs to reflect the reality of doing business in this environment. For too long, margins have been unsustainably low. We’re now starting to see some operators adjust their pricing strategies accordingly—but it’s a nerve-wracking move in a highly competitive landscape.

This is where boldness matters. Success this winter will favour those who are willing to back themselves—those investing in their customer experience, marketing effectively, building loyalty, and innovating in their offerings. Whether it’s creating cozy, off-peak dining experiences to entice locals, leveraging digital tools to streamline service, or partnering with local events and initiatives, the businesses that continue to adapt and stay visible are the ones more likely to ride out the tougher months.

We’re seeing encouraging examples of this across the country—from neighbourhood bistros tailoring special menus around local produce, to cafes offering value-driven meal bundles, to restaurants deepening relationships with their regulars through loyalty programmes and storytelling on social media. These aren’t just survival tactics—they’re long-term strategies for resilience.

In many ways, winter reveals the underlying health of a hospitality business. It’s a time when strong leadership, tight operations, and community connection really count. As an Association, we’ll continue to advocate for the structural support needed—whether that’s immigration reform, more sustainable cost structures, or investment in skills and training. But we also know that much of what drives success lies in the hands of operators themselves.

So while the outlook remains challenging, there are also glimmers of opportunity—especially for those willing to adapt, innovate, and keep delivering great experiences.

If there’s one thing we’ve learned over the past few years, it’s that this industry is incredibly resilient. Winter may test us, but with the right support and the right mindset, we can weather the season—and come out stronger on the other side.

The Restaurant Association of New Zealand is the industry body representing over 2,500 hospitality businesses nationwide. For more information on our policy work, industry support, and upcoming events, visit www.restaurantnz.co.nz