So the waiting game begins. After the last weeks of frenetic activity as the hospitality sector lobbied hard for Government lifelines, most companies are locking themselves into survival mode.
Much of the support mechanisms for business, including the out-of-home sector, are now in place – even if they are far from working perfectly. Operators around the country will now be nervously watching the calendar trusting the promised cash starts to hit their stretched bank accounts on time.
The efforts of UK Hospitality and its indefatigable chief executive Kate Nicholls have been nothing short of heroic in helping to achieve that. Not everything has fallen into place as hoped – the latest news over whether tips can be used as part of salary calculations for furlough pay under the Job Retention Scheme is a big let down for parts of the industry.
But there is a framework in place. The challenge now is to maintain that lobbying pressure, whether around supporting our people, or the access to grants, bank support, insolvency cover or rent relief and a debt moratorium. Those issues, and many others, are developing on almost an hour-by-hour basis.
Property has become a major focus with Government being presented with ideas around the German approach of a six month rent freeze, with payments eventually being added onto the end of a lease, and the Danish model of a property furlough – not to mention easing the pressure on landlords by speeding up financial support to them.
The Government deserves credit for grasping the big picture, even if it hasn’t always thought through all the consequences. The value of UK Hospitality’s daily high-level access to Number 10 and other Whitehall, which allows the team to pick up on the detail and push the sector’s case, cannot be underestimated.
So, just as individual companies need continued financial support, so the sector’s trade association requires backing to carry on that work through what looks like being a long, uncomfortable summer. This is not special pleading, but a reminder that if there is one invoice that shouldn’t be shoved in a drawer it’s the one for UKH membership fees.
It also means that non-member companies benefiting should be gently encouraged to join the ranks too.
The access that the sector now has to the country’s leadership makes the decision to create UKH a little over two years ago out of the merger of ALMR, with its predominantly pub, bar and casual dining membership, and BHA, with its strength in hotels, contract catering and fine dining, look like a masterstroke. But it proves too that to get a seat at the top table and wield influence, size does matter.
But that’s not to say it can all be left to the UKH team. The industry also needs individuals to do their bit too. The harrying and campaigning of the likes of London Union’s Jonathan Downey, raising awkward questions, filling column inches, appearing on our TV screens to explain the industry’s plight, have been vital aspects of the same battle plan, providing further ammunition to present to ministers – if that’s not mixing too many military metaphors.
The market needs its agitators. So, even if it’s only writing to your MP about the issues gripping you, just do it. Although the sector has gained important initial political support, survival will require continued commitment, engagement and possibly more heroics. It’s going to be a long slog.
Being out there
Taking a political lead is not the only way that business leaders have been getting stuck in during the crisis, of course. For some just trying to secure the future of their businesses and their teams has been all consuming.
Others have been switching business focus, setting up delivery or grocery operations in their sites, creating an on-line presence with the likes of cookery demonstrations, or feeding or housing key workers or the vulnerable.
Some have already started to think about life after lock-down, and how the sector can be gradually rebooted once the lock-down is lifed. There are those on the other hand that consider that still premature, with too many market uncertainties.
But whatever operators do to survive in the immediate weeks and months, and make it through, will have a vital effect on what shape they do eventually emerge from the crisis and re-engage with their customers.
While the importance of keeping a trade association like UK Hospitality front-of-mind may seem more obvious, maintaining your own market presence will also reap benefits, no matter how tough on resources that might be. Survival does mean keeping your brand alive - and in public view.
Brewdog, Leon, Wagamama are just some of the obvious examples of bigger players putting themselves out there, but there are scores of smaller brands and operators, often local enterprises working in their communities, doing great work too – and in many different ways.
Costs are being cut across the board, but there is nonetheless plenty of hard evidence from past recessions, even the Great Depression of the 1920s, that not just maintaining but upping marketing and advertising spend during the dark days leads to increased long-term sales and market-share gains.
Not that anyone is expecting a quick recovery. It may be months before even before the lockdown is lifted, and then that is likely to be phased. The Government is now just beginning to ask sector bodies what that might look-like.
Then there’s the real prospect a full-blown post-crisis recession, with unemployment and Government debt at all time highs serious. There will be no quick fix, but companies and their leaders will still need to hold their nerve.
Companies that are able to reposition their businesses towards delivery or grocery or living online are already appreciating the need to connect and communicate efficiently and effectively with a new stay-at-home consumer. The same flexibility will be needed through the lockdown and as the recovery unfolds.
Maintaining a presence may be more low-key, and probably more inventive, but brands and companies need to protect their reputation and stay relevant. There are plenty of checklists out there to follow.
Survival is not going to be hibernation. Let’s all stay engaged and talking – and working together.
Peter Martin: If there’s one debt you do need to pay
So the waiting game begins. After the last weeks of frenetic activity as the hospitality sector lobbied hard for Government lifelines, most companies are locking themselves into survival mode. Much of the support mechanisms for business, including the out-of-home sector, are now in place – even if they are far from working perfectly. Operators around the country will now be nervously watching the calendar trusting the promised cash starts to hit their stretched bank accounts on time. The efforts of UK Hospitality and its indefatigable chief executive Kate Nicholls have been nothing short of heroic in helping to achieve that. Not everything has fallen into place as hoped.