Insights from a recent Crunch Live Q&A
Let’s be real, running a hospitality business in 2025 feels harder than ever. From rising wage costs to compliance curveballs and shifting consumer habits, the pressure is relentless. We totally get it, and you’re not alone.
In a recent Crunch Live Q&A, we sat down with Wes Lambert, CEO of the Australian Restaurants and Caterers Association, and James O’Connell, Business Coach at The Hospitality Company, to unpack what’s happening and where the opportunities are. Because yes, things are changing. But change doesn’t have to mean chaos — especially when you’ve got the right support.
Here’s a taste of what we discussed:
The average profit margins?
- 3.3% for cafes
- 3.8% for restaurants
- 6.7% for pubs
That’s before this year’s wage increases kick in. From July, junior pay rates will go up, with 18 to 20-year-olds seeing significant increases.
The margin pressure is real, but it’s not a dead end. It’s a signal to tighten up the way you operate.
So what should margins look like?
If you’re running a hospo business, 10% profit should be your starting point. That applies to any setup — café, restaurant, pub, you name it. The best in the game are hitting 15% and beyond, and though it might not seem like it, that kind of margin is totally within reach.
It’s not about doing more. It’s about doing things smarter — with the right tools, the right plan, and the right support behind you. (psst… that’s where Crunch comes in).
Habits Are Changing
Work-from-home isn’t a trend, it’s a reset. For many CBD venues, pre-COVID foot traffic might never return. Instead, suburban and fringe venues are seeing more growth, especially those with a strong takeaway or value-led offer.
Consumers are still spending, but they’re making different choices. Think quick, convenient, and cost-conscious.
If foot traffic isn’t what it used to be, it’s not a failure. It’s just a cue to pivot.
ATO Is Cranking Up the Heat
The ATO is stepping up its oversight. Late BAS lodgers can expect monthly reporting. From January 2026, super contributions will likely need to be paid as wages are paid.
None of this has to be stressful, but it does mean now’s the time to set up smart systems that give you visibility and control.
As Wes Lambert put it:
“A separate account for PAYG and BAS is one of the smartest ways to future-proof.”
What Do You Actually Do With All This?
You don’t need to overhaul everything. You just need a plan. And a place to start.
James O’Connell reminded us during the session:
“Control the controllables within the walls of your business.”
That could mean:
- Controlling your COGS!
- Reworking your menu or margins
- Improving team productivity
- Making smarter rostering decisions
With EOFY around the corner, there’s never been a better time to get your house in order. Whether it’s understanding your true profit margins, prepping for wage increases, or tightening up your numbers before tax time — our weekly Live Q&A sessions are the fastest way to get answers that actually make sense for hospo. Ask your questions, get straight-up advice, and walk away with a clear plan for what to do next.
Join the next Live Q&A inside the Crunch app
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No jargon. No fluff. Just hospo-specific advice, live and unfiltered.
