Businesses face ‘rocky road to recovery’
Welcoming the reopening of pubs and restaurants who have outside areas, the bodies warned there was still a long way to go for businesses to recover from the devastating impacts of the pandemic.
Whilst the public have embraced the relaxation of lock down rules, they warned that the majority of businesses are still in very real danger of failing.
Results from a recent survey of members by CGA from all three key trade bodies showed that only 40% of pubs have been able to welcome customers back to their outside spaces, with turnover only expected to be 29% of that achieved over the same period in 2019. This is despite the hundreds of millions of pounds invested in outdoor areas and safety measures, at an average of over £8,000 per site.
Even when Step 3 of the roadmap allows indoor drinking and dining for 6 people or 2 households, they are estimated to only reach 56% of turnover when compared to pre-pandemic figures.
Almost a quarter of those surveyed believe that their business will be unviable before the end of the year based on current trading estimates.
The trade bodies are calling for business rates to be cancelled completely in England for hospitality until October 2021, to allow businesses time to recover before yet another cost comes back online. This is an additional three months, with rates currently set to restart in July. In Scotland and Wales hospitality has a full year of business rates holiday.
In a joint statement, the trade bodies said there was clear demand for the return of the sector, but that it faced a “rocky road to recovery”.
It said: “After a year of closures and strangling restrictions, they are entering the summer, crippled with debt, having to employ more staff to manage the huge number of complexities surrounding Test & Trace data collection, enhanced cleaning regimes, table service and many more requirements placed on their businesses.
“It is clear based on this that reopening pubs fully, indoors and outdoors, without restrictions, is going to be key to their survival. It is therefore imperative the Government sticks to its roadmap.”
Even when restrictions are fully lifted in June, operators are only expected to achieve 80% of the turnover seen in 2019.
Many businesses have still not been paid Restart Grants, leaving then “teetering on the edge of survival” as business rates come back in.
The statement added: “For many, this will be the last straw, jeopardising the jobs that have been protected by the furlough scheme until this point. We need to see a full cancellation of business rates until at least October 2021 to allow them the breathing space to recover their businesses.”
