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Hospitality faces more anxiety
Hospitality – already hit by massive cancellations of pre-Christmas hotel and restaurant bookings – is holding its breath as national and regional government ponders both further restrictions and possible support packages.
Across the UK, businesses which were relying on December takings to see them through the first months of 2022, are struggling and fearful of measures being introduced like Ireland’s 8pm hospitality curfew or lockdowns and other severe restrictions being imposed across much of mainland Europe.
In any case, the first heavy battering has already landed, as UK politicians and health officials advised the public to be careful with their festive period choices, leading to the cancellation of many business functions and gatherings of friends and family as the festive season began. This has hit everyone from small often independent restaurants and boutique hotels and B&Bs to the larger city offerings which had already borne such a brunt through lost tourism.
Kate Nicholls, CEO of UKHospitality, and the team there have made the most of getting on UK-wide TV screens and radio interviews in recent days, but the frustration is clear. Nicholls, noting a Sunday Times feature on what happens to uneaten food following the wave of restaurant cancellations, tweeted on Monday morning: “Have to say I’m more concerned about the millions of jobs and thousands of businesses at risk – hospitality throughout this pandemic has fed the homeless, the frontline workers, the vulnerable in our society. They will continue to do so and they deserve our support.”
Nicholls also noted the first regional support: “So Scottish and Welsh businesses have support from Treasury – we look forward to announcements on how that will be used and to help for English hospitality.”
Regardless of whether an actual lockdown is imposed in the coming weeks, much damage has already been done.
On Monday Nicholls said: “Trading has already been hugely damaged by the steady stream of pessimistic news following the discovery of the Omicron variant, at a time when hospitality would normally expect to be making a quarter of its annual profits.”
She pointed out that for most venues it costs around £10,000 to close the site, with a further £10,000 per month on overheads, even with full furlough and rate relief.
“The damage that closure wreaks on consumer confidence would also increase recovery time considerably, not least because it would be coming early in the year, at the slowest period of trading,” she said. “Hospitality venues have invested huge amounts of money and resources to ensure a safe environment for customers and staff alike. Throughout the pandemic, businesses have always wanted to trade their way through to recovery and that sentiment is stronger now than ever.
“However, trading levels are so poor that the need for proportionate Government support is already acute, and urgently necessary if businesses, jobs and livelihoods are to be secured.
“An extension to business rates relief and the lower VAT rate will help longer term planning and budgeting but speedily delivered grants will be vital to short-term business survival. To minimise
further damage, it is also crucial that the Government gives as early a signal as possible about whether measures are to be imposed and what they might be, in order to allow businesses to salvage something from Christmas and the New Year.”