Victoria’s hospitality industry faces serious challenges, says Jim Marinis, highlighting rising costs, regulatory pressures, and the need for tax relief
Victoria’s hospitality industry is facing mounting financial and regulatory pressures, with rising operating costs, heavy tax obligations and complex council requirements making it increasingly difficult for venues to remain profitable.
Speaking on State of Hospitality, hosted by Jeremy Koadlow, hospitality industry figure Jim Marinis outlined the challenges confronting venue operators, warning that the cost of establishing a new business can now exceed $1 million.
Regulatory pressures from local councils add to the burden, with high legal costs threatening operational viability.
The Victorian government is viewed as having stringent business conditions, exacerbated by a heavy tax load.
Rising operational costs are also a critical issue.
With electricity, gas, and wage expenses climbing, profit margins have dramatically decreased.
Where businesses once targeted 20% profit, achieving even 5% is now a rare success.
In the buying and selling market, potential purchasers are exercising caution.
They meticulously evaluate rent, wages, and energy costs before deciding to invest.
Additionally, predicted increases in food costs and regulatory expenses can escalate annual overheads significantly.
Despite these obstacles, Marinis stresses the importance of passion for long-term success in the hospitality sector.
He advocates for tax relief measures to support necessary wage increases, promoting the industry’s sustainability.
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