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Pubs and Restaurants scramble to create outdoor space

The UK government has allowed the reopening of al fresco dining in just three weeks’ time, on Monday April 12th. This has prompted a scramble for pubs and restaurants to create outdoor seating space, with restaurant and pub operators desperate to claw back revenues lost during lockdown.

Hospitality businesses up and down the country are planning to open terraces or expand on to pavement areas after ministers ruled that restaurants and pubs could serve customers ‘outside only’ in the first instance when they are allowed to open again on 12th April.

Last week pub company Punch said that it was investing an additional £1m in outdoor space, while landlord Cadogan, which owns large parts of Chelsea and Kensington, said that it was adding 500 seats to newly pedestrianised streets in the area. While some hospitality businesses are reporting higher demand for outdoor tables than when they reopened in July last year.

The River Cafe in London said it was almost fully booked for April with just a few weekday lunchtime slots available, while D&D, which runs 38 restaurants in London, Manchester and Leeds, said it planned to open the terraces at 20 of its sites amounting to around 1,100 places per sitting. It had already received 60,000 bookings up to the first week in May.

“We are well over double the number of bookings ahead of opening compared with when we opened last year, and last year we had the whole restaurant to book” said D&D chief executive Des Gunewardena. But, he added, the cost of reopening was in the “hundreds of thousands”.

The hospitality sector is versatile and creative, and many sites have already, or are currently erecting semi-permanent outdoor structures like awnings, canopies and marquees to cater for as many customers as possible when they finally reopen. The mood is positive and the sector should benefit from improved weather for the Spring re-openings, but all these changes come at an additional cost when the sector already has significant cashflow pressures.

Company Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

Written by Luke Harris

Manchester pubs contribute to Stonegate’s £746m losses

The UK’s largest pub company Stonegate has revealed that the enforced closure of its sites has yielded a £746m loss and forced it to go to investors and debt markets for £1.4bn of additional funding. The Financial Times (FT) has also warned a further lockdown would force it to consider more debt or selling assets.

The operator of more than 4,700 pubs under brands such as Slug and Lettuce, Craft Union, Proper Pubs, Yates and Classic Inns expects normal trading to return from July. Pubs suffering losses are understood to include The Lost Dene, Be At One and The Slug & Lettuce, all in Deansgate along with other Manchester city pubs including The Ark in Whitworth St. West and The Town Hall Tavern in Tibb Lane.

The group recorded the multi-million pound loss largely due to estate depreciation and costs stemming from its £1.27bn acquisition of Ei Group in March 2020 – which made Stonegate the largest pub operator in the UK. The pub company, which employs some 17,000 people, comprises an estate of 1,270 managed division sites and 3,200 leased and tenanted venues across the UK.

Stonegate’s published accounts on Companies House reveal the operator’s revenue fell by 17% to £707m in the year to the end of September 2020. The same period in which Britain’s pubs were shuttered between March and July, saw Stonegate slash costs and benefits from £70m in state support – comprising £62m from the furlough scheme, £4m from the government backed Eat Out to Help out initiative in August, and a £3m boost from business rates relief, according to the FT.

A pub company this size is better able to weather the covid financial storm than other smaller competitors. Many smaller pub-co chains and independent pubs may not reopen due to the dramatic financial impact of the Covid crisis.

If you run a small chain of pubs or are an independent publican and you’re struggling to pay rent, suppliers and the taxman we can usually help.

Company Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

Manchester Food and Drink Festival has been confirmed to make its big return in 2021

The Manchester Food and Drink festival has been confirmed to make its big return in 2021, after having been postponed twice. The huge celebration of the region’s food and drink will once again be returning to the city’s cathedral gardens this autumn.

This popular festival will be centred around the free-to-enter Festival Hub, where tables can be booked in advance. Although the exact line-up has yet to be announced, last year’s festival plans had included a ‘feasting quarter’ of street food, kitchen takeovers, a live music stage and bar.

The festival is placed over 12 days this year, with the event taking place from Thurs. 16th Sept to Mon. 27th Sept., culminating with the MFDF awards. These awards recognise the best in the region’s hospitality industry and will be handed out at a Gala Dinner on Monday September 27. The glittering ceremony will move to Manchester Hall for the first time, promising to be a ‘hospitality homecoming’.

MFDF 2021 hopes to be able to support the recovery of the region’s dining and drinking economies by showcasing and celebrating as many businesses as it can as possible, however, only a limited number of bookable tables are available, with a reservation free of £5.

Alexa Stratton-Powell, festival director commented: “This year’s festival is about celebration, reflection and recovery. It has been an extraordinarily difficult time for the hospitality industry, and so too for the festival and all the events companies and professionals around the country.

“Postponing last year’s MFDF was a very difficult decision, but the right one.

“This year we’ll come together to do what Manchester does best – support each other and our city.

Andrew Kenny, UK MD of Just Eat, headline sponsor of the event, said: “We’re delighted that the plans for MFDF have been finalised and we can share the good news. We are really looking forward to celebrating with our customers, our local restaurant partners and the whole of Manchester at MFDF this September.”

Sadly, many hospitality businesses are unlikely to be at the event as the sector continues to suffer because of Covid lockdown restrictions. Premises with outdoor facilities can hopefully reopen on 12th April but many are still having to address legacy debts, unpaid rent and HMRC tax arrears.

Company Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. Our newly appointed regional manager for Manchester, Adrian Ohio is ready and waiting to assist. If your business is experiencing problems, contact us FREE on 08009700539. Chat to one of our experienced advisers and we will see how we can help you!

UK ‘Staycation’ boom predicted!

After recent news that British residents arriving in England from COVID hotspots will have to quarantine in hotels, many would-be holiday makers are thinking of opting for UK holiday destinations this summer. Understandable in the circumstances, as many people don’t want to undergo the ‘managed isolation process’ that requires you to spend 10 days in an isolation hotel upon your return to the UK.

However, there may be a huge shortage of the kind of UK accommodation Brits are looking for, say providers of holiday lets from cottages to campsites. Demand is on the increase and even the UK’s luxury hotels are expecting the move to give them a boost.

Sarah and Steve Jarvis, who run the independent cottages website listing more than 1,800 properties, say inquiries during the current lockdown in England are 300% up on the first lockdown in March to July 2020.

However, they also point out that many properties still need to honour bookings that were rolled over from 2020 because of earlier virus curbs, restricting availability for new requests.

“People started the year with bookings already in the calendar”, Sarah told the BBC. “We’re going to end up in a situation where we have demand outstripping supply again.”

“It’s almost like the perfect storm,” adds Steve. “People will be hesitant about going abroad with the new travel restrictions and the UK is looking like a very good option. People have got confidence in UK self-catering holidays, because the bookings are coming in thick and fast.”

All in all, this increase in demand will undoubtedly boost the UK’s hospitality sector one of the hardest hit during the Coronavirus pandemic. Meaning an even bigger increase in the usage of pubs and restaurants in surrounding areas of these holiday destinations that are hoping to be fully open after the 17th May just in time for the summer season to begin.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

No plans for another ‘Eat Out To Help Out’ scheme.

Recent reports suggested that Rishi Sunak was considering a reintroduction of the popular ‘Eat Out To Help Out’ scheme to the hospitality sector when pubs and restaurants are able to re-open, hopefully from 12th April. The scheme which ran through August last year gave diners 50% off their food bill up to £10 on certain weekdays. Food and non-alcoholic drinks were included but the scheme excluded alcohol.

However, it appears the Chancellor has had a change of heart. Speaking at a recent treasury select committee meeting he said that there were currently no plans to bring back the scheme because high streets will “spring back” after lockdown. He continued that he felt that families were keen to go on a spending spree having saved an estimated £180bn during lockdown and that discount enticements would not be necessary.

He told MP’s there was a huge pent-up demand ready to explode once lockdown restrictions ease and that consumers would be more confident to spend this time round saying “there was an enormous worry when things reopened last year that people wouldn’t have the confidence to spend even though they had the income to”.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

Over 150 London pubs, bars and restaurants closed in 2020

The latest figures show that the coronavirus pandemic continues to wreak havoc on the hospitality sector as more than 150 pubs, bars and restaurants in London closed permanently last year with the number of licensed premises in the capital shrinking 4.5 percent in December compared to 2019. That represented a drop from 3,460 venues down to 3,303, meaning 157 sites closed their doors for good between Christmas 2019 and the end of last year. 

Birmingham and Leeds were the only other major British cities to suffer a larger percentage drop than the capital. With Birmingham losing 8.5 percent while Leeds losing 5.6 percent of sites, respectively.

In total 5,975 licensed premises closed their doors last year across Britain according to the latest research by data analysts CGA and consulting firm AlixPartners. Closures are close to triple the 2,171 recorded in 2019, highlighting the massive impact the pandemic and restrictions have had on trading within the hospitality sector.

Experts had warned that the restrictions put in place throughout December will “undoubtedly have caused more business failures” (in early 2021). The question many are asking is  “Yes, but how many?”.

“Businesses, their funders, landlords and other stakeholders urgently need certainty and a roadmap to reopening” AlixPartners director Graeme Smith said. He added “the rapid rollout of the vaccine offers hope, but with restrictions unlikely to be lifted until Easter at the earliest, the coming months will likely see more sites lost for good”.

Emma McClarkin, chief executive of the British Beer and Pub Association, urged the government to back the industry. She said, “Given this latest evidence showing how the Covid crisis and lockdown is ripping pubs away from their communities for good, it is more important than ever that the government backs our local pubs and brewers”.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

Hotels wait patiently for recovery.

hotel

Like many others, the UK hotel industry has been impacted significantly by the Covid pandemic. In 2019, official figures (published by market data provider Statista) showed an average 75.4% occupancy rate in UK hotels (excluding London). Occupancy rates in 2020 were down more than a half to 37.6%. Predictions for 2021 show an average occupancy rate (excluding London) of c59%, an increase of nearly 60% on 2020 but still well down on 2019.

London hotel occupancy increased slightly in February compared to January, but coronavirus restrictions continued to bite. Figures from research agency STR show that London occupancy levels are currently at 23.3% down by 69.5% on February 2020. Average overnight rates in London were at £57.52 during February, down 57% on last year. RevPAR (revenue per available room) levels show January as the lowest on record.

Many hotel operators are facing substantial cashflow pressures and have been for some time. With the significant drop in revenue resulting from travel restrictions previously profitable businesses are struggling to stay afloat. As a result, many supply and contract companies who provide goods and services to the hotel sector continue to suffer too.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

Anger over Track and Trace lack of data use

Hospitality sector trade body UKHospitality is furious after a new report revealed check-in data from millions of people who visited pubs and restaurants before lockdown, was barely used by NHS Test and Trace.

The report obtained by Sky News, has admitted the failure of the £22bn service of the use of data alerts or the use of contact tracing which meant “thousands of people” were not warned that they might have been at risk of infection with COVID-19, “potentially leading to the spread of the virus”.

However, to make matters even worse, when the acquired data from hospitality venues was used, public health officials encouraged pubs and restaurants to contact customers directly which is a breach of data protection law, therefore potentially leaving businesses open to possible legal action. With the report suggesting lack of guidance from Test and Trace for local public health teams on how to use the data left businesses “being asked to, or volunteering, to contact customers and visitors themselves”.

UKHospitality chief executive Kate Nicholls said: “It is incredibly frustrating. Our teams worked really hard to capture that data on the understanding it was going to be used should there be problems. To hear it wasn’t used, and the fact we had further restrictions without really any clear evidence that there was a problem with hospitality, is a major cause for concern”.

NHS Test and Trace not only failed to use covid-19 data collected by venues, but it also failed to employ the QR code alert system built into the £40 million contact tracing app. According to the most recent Test and Trace figures, there were over 100m ‘check-ins’ to venues around the UK with the app, but analysis showed that the software instigated just 284 alerts from 276 venues.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you

Red tape must not get in the way of hospitality recovery!

The Government continues to offer whatever support it can to hospitality in order that it can slowly recover from the impact of the Coronavirus pandemic.

Housing & Communities Secretary Robert Jenrick has written to local authority council leaders around the country urging them to extend planning exemptions to those pubs, bars and restaurants wishing to set up al fresco dining areas.

Previously, hospitality owners needed to formally apply to their local councils if they wished to set up outside eating and drinking areas on pavements and areas around their premises. The process could be complicated and take weeks to be approved (or declined).

12th April is currently the target date for hospitality to reopen, but outdoors only. There will not be a requirement for customers to order a ‘substantial meal’ and no early closing, but customers must order, eat and drink outside, whilst seated. It wont be until 17th May, at the earliest, that indoor hospitality reopens. Many hospitality businesses, particularly in town or city centres are exploring ways of utilizing space outside their premises to enable them to reopen.

Robert Jenrick has told council leaders that local authority planning rules for al fresco dining and temporary shelters a must be waived (unless there are exceptional circumstances) until September 2022.

Writing in a Sunday newspaper the MP said “The planning changes we put in place last year have been a lifeline to many businesses and they’re here to stay for this summer”. He added “We will be extending pavement licenses for a further 12 months making it easier and cheaper for pubs, restaurants and cafes to continue to make al fresco dining a reality…”

Sunak throws lifeline to the hospitality sector.

After waiting over a week from the PM’s announcement on 22nd Feb, Chancellor Rishi Sunak yesterday finally revealed his annual Budget that many business owners across the country have been waiting for, detailing the extended help that they need.

Here are the bullet points that relate to the hospitality sector …

  • Furlough scheme extended until 30th September with the government paying 80% until the 30th of June, then reduced to 70% in July the 60% in August and September
  • Business rates holiday for eligible hospitality and leisure businesses extended until 30th June and then discounted by two thirds for the remaining 9 months of the year
  • 5% reduced VAT rate for businesses in the hospitality and tourism industry extended for another 6 months until 30th September, followed by an increase to 12.5% for a further 6 months. With the standard rate of 20% VAT not returning till April 2022
  • ‘Restart Grants’- Hospitality and leisure businesses will get additional grants of up to £18,000
  • All alcohol duty frozen for a further 12 months
  • Corporation tax remains at 19% until April 2023 when it will increase to 25% (on an incremental scale) but companies with profits of less than £50,000 will still only pay 19%

Many business owners will be happy today after confirmation of these measures. Here are just some of their thoughts on the news today.

British Institute of Innkeeping chief executive Steven Alton said: “With the package of support from government laid out, our pubs can begin to look to the future of their businesses once more. The support announced gives our sector an opportunity to rebuild as it reopens in line with the government roadmap, however, any changes to the plan will need to be matched with appropriate support measures. I have no doubt customers will return to their local pubs at the earliest opportunity and once again, be given a fantastic hospitality experience.”

Philip Inzani, founder of Polo 24 Hour Bar in London, said: “It’s generally a good Budget. The further extension to the furlough scheme is a huge help and will keep people employed for longer. However, the question arises that when employers have to contribute 20% in July, will sales have recovered enough in order to sustain this increase? This pandemic has shown the fragility of the hospitality industry and how we are reliant on very tight margins. This needs to change for our sector to fully recover. We need a long-term plan.”

Rishi Sunak said: “I said I will do whatever it takes. I have done and will continue to do so.”

The economy is expected to return to pre-covid levels by the middle of next year, but Sunak said repairing the damage will “take time”. He said the economy will be 3% smaller in five years than it would have been. He added: “The Office of Budget Responsibility forecasts our economy growing this year by 4%, by 7.3% in 2022, then 1.7%, 1.6% and 1.7% in the last three years of the forecast.”

Whilst this is all positive news many hospitality businesses will now be focusing on reopening and that brings its own problems. Many have rent arrears, supplier debts, tax liabilities and bounce back loan repayments to address and the combination of all these issues means more financial pain for the sector.

Hospitality Rescue has been helping struggling business owners for over 20 years with sensible FREE advice. If your hospitality business is experiencing problems, contact us FREE on 0800 9700539. Chat to one of our experienced advisers and we will see how we can help you!

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