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Budget: What do food start-ups have to do to survive?

Budget: What do food start-ups have to do to survive?

Video caption,

“My biggest problem with pizza, it’s so overpriced,” says Joshua Steer

Crowd-funding to expand and delivering takeaway by foot – food businesses do not look like they used to.

But UK Hospitality Cymru says Wales has lost 17% of its licensed hospitality venues since the start of the Covid pandemic, compared to 14% in England and 13% in Scotland.

Food businesses will be eager to hear how Wednesday’s Budget will affect them and how they need to adapt.

But the ability to be creative is what will keep businesses going amid a “crisis in hospitality”, said Zoe Brackler, a former business owner and now lecturer at Cardiff Metropolitan University.

She said side hustles had made business much more accessible, adding that younger people were taking much more flexible and sustainable approaches.

So how are businesses adapting during difficult times?

‘Crowd-funding over a business loan’

Image caption,

Laura and Rhys owned a restaurant for eight years but say they knew they needed to adapt

Rhys and Laura Keogh, the owners of Dirty Gnocchi in Cardiff Market, owned an Italian restaurant for eight years but said they had noticed a change in spending habits accelerated by Covid.

“That’s when we decided to pivot really into street food to take advantage of the outdoor dining scene,” said Rhys.

“So we launched Dirty Gnocchi in our back garden of our restaurant and that went from strength to strength.”

He said they “jumped at the chance” to open a stall in Cardiff Market.

Image source, Dirty Gnocchi

Image caption,

Rhys and Laura started a pop up in response to changing spending habits

And the couple aren’t just adapting to the changing needs of their customers – they’re offering their customers incentives to invest.

“For instance we are doing a £20 pledge that gives them £25 worth of food,” Rhys explained.

“So we really want to give a little back to our customers and let them help us as well and avoid having to take a high interest loan from the bank.”

He said he would like to see the VAT in the hospitality industry discussed in the Budget but wanted to encourage other businesses to think creatively.

‘Thinking outside the pizza box’

Image caption,

Josh says he has faced barriers and wants to help other young people in business

Joshua, 17, from Cardiff, runs Pizzaboy alongside a full-time job.

While social media and delivery platforms have revolutionised the industry, Joshua said young business people needed more support and confidence.

“Obviously I am 17 so I don’t have a lot of money but I wanted to find a way to make it happen,” he said.

“It’s been a great adventure setting up, but financially it’s been hard.

“You can’t set up a bank account but you can be a director of a company so I spent a month-and-a-half just trying to sort that.”

Another unexpected challenge has been the stigma about not going into further education, but he has also been encouraged by the support he has received.

“It really is a lovely community,” Joshua said.

“All I need to do is ask or say I need help and people are there. I really do think because I am younger people have helped me a lot more.”

He said support from governments “could be a lot more accessible”.

“Young people have so much more energy,” Joshua said.

“If more people had the opportunity to do what they wanted with businesses and they weren’t so scared to take the leap and act, we would have so many more unique, fun and cool businesses.”

‘I walk my meals to people’s homes’

Image caption,

Mary Kukua Anderson struggled to find a job after having her son so has catered her food business around him

For Mary Kukua Anderson, 25, building a business from her home became necessary when she struggled to find work after having her son.

“I thought why not register for a food business,” she said, using her Ghanaian and Nigerian heritage to make the food she grew up with.

“My grandmother taught me to cook. While I’m back home, she never [eats other people’s food] unless I’m cooking.”

She delivers the food herself by foot in Pontypridd, Rhondda Cynon Taf, around caring for her 11-month-old son.

Image caption,

Mary says students from Ghana and Nigeria are her biggest customers

“On a weekly basis I have university students coming back just to keep some in their fridge,” she said.

“It’s not just Ghanaians and Nigerians but people who want to try, or who have partners from the countries they want to surprise with the food.”

Mary was studying business before having her son and previously worked as an accountant, both of which had given her a good idea of how to start Ronen’s African Kitchen.

“So far I’ve not had a bad review so it shows it’s working,” she said.

Ms Brackler said start-ups and side hustles had the potential to enhance the economy if supported correctly.

“It’s been really sad to see some thriving businesses that have not been able to continue,” she said.

“Non-traditional methods of funding and start-up are important and small business is the backbone of our local economy.

“I’d love to see more support in the Budget for start-ups as opposed to just purely scale-up.”

A Welsh government spokesperson said its young person’s start up grant offered up to £2,000 per business, and Big Ideas Wales supported young people to start a business.

“Nurturing an entrepreneurial culture to create more start-ups is a key part of our commitment to help everyone in Wales realise their potential, and to make Wales a place where more young people feel confident in planning their future,” they said.

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