The Face of Uncertainty: The Cautious Comeback of the Hospitality Sector After COVID-19
By: Fatmir, redwigwam
The UK Hospitality Industry is one of the sectors that has been hardest hit by COVID-19. The sector has been impacted in every way, including trading restrictions, fixed costs, staff layoffs, and accumulated debt.
Hospitality includes industries related to food and accommodation services, like restaurants, bars, clubs, hotels, and pubs.
What do the statistics show from COVID-19 moving forward?
- Before COVID, the hospitality sector accounted for 10% of UK employment, 6% of total business and 5% of GDP.
- In the last 12 months, sales have dropped £80.8bn, according to the UK Hospitality Quarterly Tracker.
- UK Hospitality dropped 90% from February to April 2020 alone.
- GDP figures show the UK economy shrank by 9.9% overall in 2020, with the hospitality sector 51% lower than 2019.
- Some recovery occurred during the summer, but it was still below pre-pandemic levels.
“UK Hospitality 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. ”
Kate Nicholls, UK Hospitality Chief Executive
The UK’s ‘roadmap’ to removing COVID-19 restrictions centres round the key date of 21st June, when all remaining restrictions on social contact are due to be lifted.
While at the time of writing this date appears to be in debate due to the rise in cases and the emergence of the Delta variant, it is key for the hospitality industry as remaining hospitality locations will reopen, including nightclubs and large events.
It is also assumed that hospitality venues will be able to operate at full capacity, which will make a huge difference to businesses.
5 Hopeful Signs for the UK Hospitality Industry
Challenges still exist. Hospitality leaders are concerned about how their businesses will be affected and what steps can be taken. Using models from around the world, there are lessons that can be applied to hospitality businesses as they reopen to respond, recover, and thrive. But responses must be calculated.
Here are some recommendations:
Stay engaged with customers.
Emphasise the need for customer safety as a continual health policy. This will help show empathy and keep you in touch with customers.
- Strengthen Digital Capabilities.
Push pickup and delivery options as alternatives while COVID-19 remains a threat. Build your websites and mobile apps to be more responsive and user-friendly. Make sure all your service offerings and basic information are current.
- Support talent strategy.
Hire local and keep in touch with employees. Keep talent in mind as potential new employees or rehires.
- Review your supply chain.
Now is the time to assess alternate expense and sourcing methods and new inventory management controls that will be more cost effective.
- Push for business continuity and financing.
Make certain your company is still solvent. Review cash revenues. Apply for job grants and tax options, as necessary. The UK has offered several grants for businesses affected by COVID-19. This includes the Restart Grant, available beginning 1 April 2021, that offers up to £18,000 for hospitality businesses, per premises.
As UK Hospitality prepares to reopen, there are even more challenges to consider. Make sure “Open for Business” includes these considerations:
Brexit has meant shortfall of 60,000 hospitality workers per year, due to tough immigration policies and a weaker pound. This recruitment gap is cumulative year over year. It’s already clear that this is causing acute staffing shortages across the industry, meaning some businesses are forced to limit their hours or close on specific days. Hospitality management should review staffing levels and providers before it gets critical.
The hospitality industry has lost significant staffing due to minimal staffing and closures. Hotel occupancy dropped to less than 10 percent, forcing hotels to lay off workers. This forced displaced workers to pick employment in different industries. As many as 1 million workers left the UK in 2020, many of them in the hospitality industry. The restaurants, hotels, and pubs will reopen, but with enough staffing? UK Hospitality must be prepared to ensure quality staffing needs.
Staff shortages can be overcome by digital modernization. Remove processes that are menial and repetitive and automate those processes instead. This will alleviate unnecessary man hours and allow employees to be trained and upskilled. This includes customer service, administrative and HR tasks, financial planning jobs, and anything currently done on paper. Review ways to maximise productivity by automating labour processes, like administrative Upgrade to software that speeds up everything, including table assignments, finance tools, and food and beverage purchasing.
Hire Local Labour rather than Outsourcing.
A recent trend for hotel management is to outsource certain tasks to other countries, such as India, for jobs like customer service. COVID-19 has shown how decisions like these can be precarious due to telework and security restrictions. Hire your local labour force instead to accomplish these tasks. The reality of vaccine passports and health certificates may also necessitate the hiring of local workers.