The Resilience of the Hospitality Industry During Covid-19

When Boris Johnson called for the temporary closure of hospitality and leisure venues on March 20th and announced a public lockdown on the 23rd, my first thought was how the hospitality industry would fair with so little notice and no official support plan. There were immediate questions on how businesses would weather the storm & what the sector might look like once the lockdown was lifted, however, despite the confusion and uncertainty, the hospitality industry has once again shown just how resilient and adaptable it can be!

Changes in consumer purchasing and social behaviours have forced operators to re-think their business models and find new ways to continue trading. Many started or ramped up their delivery operation and moved orders to cashless and contact-free, which has been positive as it has forced previously dubious operators to embrace delivery and explore its capabilities in increasing revenues.

Even the biggest brands in the industry have completely restyled their marketing strategies, finding new ways to communicate and engage with customers who were now unable to visit their venues. One of my favourite viral campaigns was by KFC who asked people at home to try and recreate their famous fried chicken recipe and submit images under the hashtag #RateMyKFC – only to receive a savage, yet comedic critique by the restaurant.

Of course, there has been more hardship than humour during this incredibly difficult time as many businesses have experienced enormous financial pressure to stay afloat, juggling overheads, in particular rents, whilst trying to retain their staff. From my experience, the support given so far by the government has been better than expected; their pledge to furlough staff teams seems to have been a success, and local authority grants have been easy to apply for. However, it hasn’t all been plain sailing, payment lead times of the local authority grants seem to of been a bit of a postcode lottery, and the Business Interruption Scheme Loans (CBILS) have been a disaster, with most applications being rejected by the banks. Hopefully, the new Bounce Back Loan Scheme (BBLS) will be a success and bridge the gap.

With no definitive end in sight for the lockdown and so much uncertainty surrounding reopening hospitality and leisure businesses, it’s tough to forecast for the future. It’s equally difficult to start making plans for enticing customers back, when many will undoubtedly be unsure about the safety of heading back to busy venues.

There’s so much to think about, from the suggested 3-4 week period breweries will need to produce enough beer to restock the nation’s pubs & bars, the recruitment of new workers to replace foreign team members who have had to move back home with family, to training teams on venue specific COVID-19 health and safety procedures, such as social distancing in both back of house and public areas, using PPE, and implementing strict new cleaning procedures.

From a marketing perspective, the need to attract and reattract customers back to venues will be a challenge, not only to regain crucial sales, but to reassure consumers that they can relax whilst the venue and staff team are doing everything possible to ensure their safety. One likely problem hospitality operators will face will be balancing the number of guests allowed in their dining rooms due to social distancing, against the amount of sales required to break even.

When looking at how hospitality businesses will return to normal post lockdown, it’s really important that we don’t focus solely on when we can re-open doors, but what our requirements will be based around a drop in sales, consumer confidence and reduced measures remaining in place.

One movement which I believe will be vital when reopening is Jonathan Downey’s #NationalTimeOut – which is calling for the government to defer rent payments for a 9-month period, extend the furlough scheme, and reduce VAT for hospitality businesses.

The phrase ‘unprecedented times’ has become a bit of a bugbear, however, it’s completely true, we have never experienced a situation with the same level of repercussions as COVID-19, and while we are sure to experience knock-on effects for the foreseeable future, it’s great to see our industry’s resilience. I hope we receive a sensible reopening strategy over the coming weeks to support operators and workers, providing enough time until we successfully overcome COVID-19.

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Tim Coulston (TC) is the Managing Director of Nibble, a hospitality company focused on building food & beverage brands, specialising in Strategic Communications, Business Management & Commercial Interiors.

For further information please contact:
Sophie Chadwick, Communications Manager, Nibble.

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