New figures have been released showing the extent to which the hospitality sector plays an important part in the UK’s economy. Statistics published by the ONS (Office of National Statistics) shows that the UK economy shrank by 9.9% in 2020 with the output of the accommodation and food services sector now down 51.8% on the previous year.

In addition, analysis from hospitality data analysts CGA, showed a 54% drop in sales across hospitality in 2020, which is the equivalent to a drop of nearly £72bn, making the hospitality sector responsible for one-third of the UK economy’s annual £215bn contraction. This demonstrates how important it is to get the hospitality industry back open again as quickly as possible and pumping money into the British economy. However, after the PM’s latest announcements on the roadmap for recovery, it is now clear the earliest signs of this industry being able reopen will be mid-April/late May, which may be too late for many hospitality businesses.

UKHospitality Chief Executive Kate Nicholls said “these figures make for bleak reading, but also serve to drive home the point about the importance of hospitality as an economic force. When hospitality struggles, the entire UK economy struggles”. She has emphasised continuously, time and time again, the importance the food and drink industry has on the UK economy.

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!

With many of us questioning when pubs and restaurants will be opening again, there is finally some light at the end of the tunnel. The government has released a new roadmap for recovery introducing step by step details on what will open and when bringing optimism for the people of the UK.

The Daily Mail states that a ‘blueprint’ is being discussed by ministers and industry leaders that would allow the current restrictions to be gradually eased at four-weekly intervals however, some believe that this four-week interval could be cut down to three weeks, as this is the time it takes for the data to demonstrate the effect of the loosening lockdown measures.

The Mail says that pubs, bars and restaurants will have to wait until early May before they can open their doors again to the public although, rules will be put in place to ensure the safety of the customers. Plans to have a maximum of two households being allowed to sit together indoors have emerged (an increase from the previous one family/household rule prior to the lockdown) and plans suggest a continuation of the ‘Rule of Six’ outside. Is this the future of pubs and restaurants? Hopefully not, with the next stage of the blueprint rolling out in early June we can hopefully see an easing of the ‘Rule of Six’ maybe indoors. The sector is desperate to get confirmation of these proposals so it can plan for a vital busy summer trading period.

Although this is a positive step for many businesses, can they really afford to wait another 8-10 weeks to open? Many owners of pubs are calling for an earlier reopening launch after businesses warned that they would go under unless they were given the green light to get going from the Easter weekend.

The Hospitality Rescue team has been helping owners save their businesses for 20 years with sensible free advice and a range of survival strategies. So, don’t hesitate to contact us now if you’re hospitality business is facing problems. Give us a free call on 0800 9700539 to chat to one of our advisors.

Written by Luke Harris

Late last year the hospitality industry was targeted as being responsible for an increase in COVID-19 cases. However, a new report argues that businesses in this sector should be prioritised for reopening, as research shows that they are NOT a significant area for COVID transmissions. A study, commissioned by trade body UKHospitality, from analysts CGA, asserts that hospitality should be central to early reopening plans in 2021 as it continues to be “a safe and well-regulated environment for customers to visit”.

After constant arguments over the July 2020 reopening of hospitality, the ‘Eat Out To Help’ out scheme and the so called correlation of a rapid rise in cases in autumn 2020, reports from public health directors and Public Health England’s weekly surveillance reports, both conclude that hospitality was linked to a low number of cases and is not a leading environment of transmissions that was previously thought. In fact, data suggests that, the rapid rise in cases from early to mid-September was mostly likely driven by the forced reopening of schools.

With data covering the period from 9th July to 19th September 2020, the busiest period for hospitality by far since the pandemic began, shows an average of only 5.2% of infection could be linked to “food and drink“ industry settings, therefore pubs and restaurants should not be held back from reopening. The report urges that consideration of the current reopening roadmap that is understood to prioritise the reopening of non-essential retail before hospitality should be reviewed.

So it’s clear, the hospitality sector is in fact not as much at fault for the increase in cases but actually safer than critics felt.  The report says that far more needs to be done to save this industry which has left many businesses barely surviving and the sector most definitely cannot afford another year with restrictions on the scale of 2020.

The Hospitality Rescue team has been helping business owners for 20 years with sensible free advice. If you are in the hospitality sector and are, like so many others, suffering financially, don’t hesitate to contact us now.  Give us a free call on 0800 9700539 to discuss how we can help.

Written by Luke Harris 

Sales have continued to decline following the 10pm curfew with like-for-likes down 21.2% compared with the week before it was introduced,

According to S4labour, the online labour-scheduling management system from Catton Hospitality, like for like sales are down 21.2% on trade before curfews were put in place for the hospitality sector.  Food sales fell 19.1% and drink by 23.2% on the fortnight before. London has been the worse hit with a 38.4% decrease in sales when compared with last year, whereas there has only been a 5.2% decrease in the rest of the country. S4labour also said it was worth noting roughly 10% of sites are still yet to open after lock-down measures were introduced. Chief product officer Richard Hartley said: “This level of decline is unprecedented and worrying for the industry, although the weather may have played a part. As the curfew has been introduced, diners and drinkers will start to head out earlier, as a closer look at sales shows a larger proportion of sales came in earlier.”

Not surprisingly more than 50% of late-night businesses, such as night clubs and bars have seen a further 60% drop in revenue since the curfew was implemented, The Night Time Industries Association (NTIA) said that 60% of businesses have started to make people redundant.

The Winter Economy Plan is not enough to support the sector according to the research with just under 50% of businesses saying that they will be making more than 60% of their workforce redundant due to reduced support and the current restrictions. NTIA chief executive Michael Kill said: “Our sector must not be under-valued, we need to challenge the government when restrictions result in the systematic closure of an entire Industry. In the coming weeks, without further support, we are facing a catastrophic collapse, which will see thousands of businesses and jobs lost.”

If your business finds itself between a rock and a hard place of needing to make redundancies but can’t afford to do it then a CVA may well be the solution.

Once a proposal is made and the creditors agree to have some of their debt paid back over time then the mechanism can allow big costs to be cut. 

• Employees can be made redundant at no cost to the company
• Expensive premises can be vacated at no cost
• Onerous contracts can be terminated
• There can be no legal action against debts bound into the agreement.

In addition, the directors have full control of the company, unlike in administration, which almost always results in less return to creditors and a much smaller business if it is sold.