The hospitality industry can expect lower than anticipated customer spending this Christmas, as staying in becomes the new going out for consumers feel the squeeze.

According to the latest 'Christmas Retail Survey' by business advisory firm Deloitte, drinking out and out-of-home entertainment are set to be the hardest hit – compared to gifts and food – with planned spending down 12 per cent to £126 per head. The survey also found significant differences in spend around the UK. Londoners plan on spending the most this year at £158, followed by those living in Northern Ireland (£155) and people in the North East England are expected to spend the least – just £90 each.

Glyn Bunting, partner in the hospitality & leisure team at Deloitte said: “While consumers do not seem to be spending less when they go out, they are going out less frequently. This in turn is driving people to branded outlets where there is a guarantee of consistency in the value and quality of food. Additionally, consumers are taking advantage of the many promotions that the big brand restaurants are offering. "Accordingly, the pubs and restaurants sector has a renewed focus on value for money and quality of food offering. Wet-led pubs are suffering at the moment, following the poor weather over the summer with the absence of a food offering over the festive period.”

Despite this, 57 per cent of Britions still plan to spend the same as they did last year and the 16-to-24-year-old demographic, which accounts for 19 per cent of the population, plan to spend more compared to 2007. The report added: "As consumers plan to cut back on discretionary spend in an attempt to save money, but more importantly, still celebrate Christmas. Consumers don't want to cancel christmas, and while eating turkey with all the trimmings is more or less essential over Christmas, dinning and drinking out is not; consumers will still enjoy parties but at home instead of in restaurants and pubs."