Being Fully Booked – Simply Isn’t Enough!!!
The Great British August Bank Holiday seems the ideal time to comment on the wind of change we’ve witnessed within the Hospitality sector. The Coronavirus pandemic swept its way through our industry leaving few stones unturned. There was no regard for location, star rating, size or branding – all were affected.
How does an industry, the foundations of which are to host with generous reception, the services of food, drink, entertainment and accommodation, recover when there are simply no paying-guests to welcome?
Move the clock forward to this Bank Holiday weekend and the headlines paint a remarkable turnaround, ‘Staycationers warned that Cornwall is FULL as traffic grinds to a halt’, ‘Bumper Bank Holiday for Beauty Spots’, ‘No Let Up as Fully Booked Eat Out to Help Out Restaurants prepare for busiest weekend yet as customers return’.
Hospitality businesses have been resilient, they’ve been resourceful, adaptable and they’ve shown the courage and determination that binds the people who choose hospitality as a way of life; early starts, late finishes, working whilst all those around them are out having fun and all with a smile on their face.
But, is being fully booked now going to be enough?
Many in the tourism industry have lost around half of their annual income during the lockdown period. This cannot and will not be regained by one exceptional six-week summer holiday period. A holiday period when, yes, many were fully booked, but bear in mind they were fully booked with sensible Covid restrictions in place and social distancing limiting restaurants/bars to now operate at only around 60/70% of previous occupancy levels, whilst accommodation providers faced increased staffing and housekeeping costs to meet recommended best practice guidance and safeguard the wellbeing of their customers/employees alike. Additionally, it is important to note that whilst many chose to staycation this year, they have done so with a backdrop of economic uncertainty. Secondary holiday spend will have been cautiously budgeted and purse strings tightened. That extra bottle of wine with dinner or a treat trip to the spa may for this year have been put on hold and won’t be adding to a hotel or restaurants bottom line.
Hospitality businesses need to carefully consider their financial position. As the shoulder periods move us from summer into winter, forecasts need to be revisited and budgets tested for sensitivity of a potential second wave of Covid-19, the removal of government intervention schemes, a continued shrinking in the economy and a reduction in customer spending. All these factors need to be countered in order to ensure your café, gastro pub, restaurant or hotel are ready and able to enjoy a 2021 holiday season strengthened by a growing staycation economy and hopefully many repeat customers who have reconnected with Britain’s great Cities, Coasts and Countryside during our strangest of summers.
Savants has a team of specialist Hospitality and Tourism consultants located throughout the UK available to offer a wealth of knowledge and experience to operators seeking advice on Turnaround, Refinancing, Restructuring and Insolvency. For further details or to arrange an introduction to your local consultant visit www.savants.co.uk or call us now on 0207 504 1339.
Written by Stephen Norfolk MIH