How Might Hospitality Change as We Emerge from Lockdown?
The hospitality industry understandably has many questions over what the future looks like, even as the Prime Minister announces he is ‘optimistic’ about the reopening of pubs and restaurants. As we look forward to restaurants, pubs and cafes hopefully being able to reopen fully on July 4th, it may be that places with outdoor space could open even sooner, with temporarily relaxed regulations on pavement seating for those without beer gardens.
COVID-19 forced many restaurants, bars, pubs, cafes, delis, sandwich shops, tea rooms, caterers and more to close their doors, and as premises now look to reopen, the industry will undoubtedly continue to bear its share of significant consequences.
The latest government advice is for workplaces to conduct a COVID-19 risk assessment and to put measures in place to do everything they can to make their premises covid-secure. All businesses are encouraged to publish the results of their risk assessment on their websites as a way of reassuring staff and customers that reasonable steps have been taken to mitigate the risk of COVID-19. The hospitality industry is no different here and they too should be taking steps to ensure premises are covid-secure, although this will be easier and more manageable for some businesses than others.
Below, we’ve aimed to answer some of the key questions faced by those in the industry.
As we emerge from lockdown and adjust to a new normal way of life, we can only speculate on what the future of hospitality will look like, and follow the rules and advice as we receive it. However, it’s important to consider these questions, as they will shape how we all think about the future of hospitality, and how it might change as we emerge from lockdown.
Is Hospitality Still Profitable?
As businesses consider the hows of reopening, the biggest question they face is how they are going to make money under the necessary restrictions. For many, they will have used this downtime as a chance to reassess their business model, to iron out any niggles or things they weren’t happy with. As they look to reopen in the coming months, some businesses will be prepared and excited at the opportunity to reinvent themselves and serve up their very best to their beloved customers.
When looking at profit, it is essential that businesses explore their options. Expanding streams of revenue will be a high-priority to some, as the soaring popularity of delivery during lockdown demonstrates alternative ways profit can be made. It may be that some customers don’t feel comfortable dining out anytime soon, and delivery and click and collect will become part of their new normal routine. Restaurants that can comfortably offer click and collect or delivery alongside open dining rooms may fare better.
Will Consumers Want to Dine Out?
Now more than ever, hospitality businesses must touch base with their customers. Many have been doing a great job of communicating during lockdown via social media, and the community support for local businesses has been astounding. As we come out of lockdown, businesses must keep this up and provide what their customers want.
A recent poll showed that an encouraging 73% of people would be keen to dine out once restrictions are lifted. Our own research found that 26% of Brits would make their first trip post-lockdown a visit to the pub, with 36% choosing a restaurant meal as their first trip out.
However, there is no way of telling what consumer attitudes will actually be. We can speculate and hope that people desire a return to an old way of life and will be desperate to go out and eat in a restaurant with friends and family once more, to spend money and enjoy the experience and freedom of choice. We can also speculate and expect that the economic downturn will be incredibly hard on many people, and a certain amount of agoraphobia – which means people worrying about being in situations where they are vulnerable – could play a part in people simply not being willing to risk mingling with members of the public. Finding the balance between consumer confidence and safety will be difficult.
To encourage customers back through their doors, some establishments may consider rewriting their menus to offer better value for money. In a YouGov poll, 61% of respondents said value for money was important to them as they look to dine out, 45% said they would be tempted back by deals. Some such solutions could be a continuation of takeaway meal kits. These have been incredibly popular during lockdown as people want restaurant quality food in their own homes. Continuing to meet this demand as places begin to reopen could be a way to tempt people back through the doors. For example businesses could offer carrot and stick deals – for example, when people buy 2 kits, they could receive a voucher for 50% off food when dining in.
How Can the Industry Promote Consumer and Sector Confidence?
To help with consumer confidence, restaurateurs will need to be ahead of the customer psyche and have enforcement measures in place before they reopen. Their risk assessment should further inform them of other steps they need to take, such as creating barriers between tables and at till points, installing hand wash and sanitiser stations within the premises and carrying out health checks on staff (and perhaps even on customers).
Furthermore, there is talk of social distancing measures being in place until the end of the year, and whilst there are discussions taking place to have it reduced to 1 metre, businesses should be prepared to enforce 2 metre gaps. This will mean rearranging tables, layout and flow of both customers and staff on site. Having tables 2 metres apart from one another is no doubt one of the biggest challenges to overcome. The question remains of how businesses can be commercially viable when they have been severely limited by the number of customers they can welcome in. For some, turning a profit in the face of overheads, wages, bills, rent and bank charges will be too much to achieve. There will be casualties and some businesses will be forced to take the decision to shut their doors for good.
The sector may reopen amid casualties in the supply chain too. When restaurants closed their doors, there was a knock on effect to the restaurant supply chain, and whilst many tried their best to look after their suppliers, there will no doubt be some who couldn’t survive. As the restaurant trade picks back up, will those suppliers have the confidence and ability to serve them once again? There will be moves to safeguard supply chains, such as taking steps to buy local, seasonal, British food. Think about the environmental impact, what airmiles ingredients have and ask whether it is necessary? We can see how consumers are becoming more ethically minded and health conscious, and these things will all impact on the future of restaurants.
Will Tech Transform the Eating-out Experience?
Other areas we might see changes in is the increased use of restaurant technology. People have become more familiar with tech during lockdown, and not just by using apps to order takeaway. All our social interactions have been technology based – whether it’s Zoom calls, online quizzes or facetiming friends and relatives – and we’ve also become familiar with online retail shopping and ordering food for delivery. This could translate to dining rooms as customers could be encouraged to use apps and iPads to order their food and drink, as well as to pay their bill. Such measures would work to reduce the potential contact with other customers and staff.
How Will a Constricting Market Affect Jobs?
Before the emergence of a worldwide pandemic, hospitality was facing a serious shortage of skilled staff. With a third of businesses now predicting that they will never reopen their doors, there is an influx of experienced workers hitting the job market. The question will be, will a career in hospitality be attractive enough? As 800 staff from catering supplier Nisbets were recently made redundant, we saw an industry come together and offer support. But will the coronavirus – on top of an already difficult career facing a future of Brexit challenges – simply be too much for people to bear?
To attract and retain top talent, businesses will have to work even harder to secure the people it needs in order to survive the pandemic. Without talented individuals in place in businesses, there could be a huge missed opportunity. Recruiters and industry need to come together to make sure the hospitality sector doesn’t let this huge wealth of experience and knowledge slip through the cracks.
Will Our Favourite Restaurants Disappear?
One thing we can be sure of is that those who have used lockdown to assess and consider their role in the industry – those who have come back hungry to improve on where they were before – are the ones who will do everything they possibly can to reignite their restaurants and provide for their staff and customers in these uncertain times. Yet they need help.
Financial support is essential. Hospitality businesses need the pausing of business rate payments, they need access to business grants and help bringing furloughed staff back to work, and the dialogue to reduce rents with landlords must continue.
Reopening will be expensive for businesses. Upon closing their doors back in March, many gave their food away to charities and they’ll have to refill their stocks again. According to the latest poll by MCA Insight/HIM, 31% believe each site will cost £1,000 to reopen, 23% believe costs will be between £2,000 – £3,000 and 15% believe it will be even more than this. Premises will need thorough cleaning – pests may have snuck in, lack of use may have caused heating or ventilation to break, water systems may have become stagnant – posing a potential threat of legionella – equipment will need restarting and easing back in, all of which could cause potential issues that will need fixing before they can reopen. Having the breathing space that financial support provides will enable restaurants to put in place all the other things they’ll be required to do.
They will also need local community support. Many high street chains have hinted that the first sites to reopen won’t necessarily be in the big cities, but more likely in towns where there are car parks and larger sites. Small chains and independents will also rely on local level support as they take steps to reopen.
Several key figures in the industry have expressed concern over what a ‘socially distant dining experience’ would mean for the ambience and enjoyment of dining out. It is likely that no customer would enjoy being served by facemask wearing staff, or sitting at tables barricaded from one another, actively avoiding human contact and in a hurry to get out and home. Having customers who are uneasy at being in your premises makes you feel like a bad host, and is the antithesis of what hospitality is here to do. These sentiments were echoed by Jeremy King, of Corbin and King, who said he felt social distancing in restaurants was both ‘impossible and implausible’. Therefore government support to boost consumer confidence is needed.
If it is safe to do so, reducing the currently advised 2 metre distance to a 1 metre distancing, in line with much of Europe and the World Health Organisation, will make it much easier for more premises to reopen, with 40% saying they could safely operate with 1 metre distancing in place. Similarly, coining the phrase physical distancing instead of social distancing would be beneficial to the mentality of nervous consumers. We are sociable creatures and we want to go out, but we need to be confident we can do so safely.
One of the things that make the hospitality industry so exciting is the diversity of its offering. No two establishments are the same – they are made unique by their employees, by their menu, by their ambience, the interior design, and by their customers. It is clear then, as restaurants look to reopen, they must do everything in their power to reach their customers now, to make them feel engaged, valued and above anything else, make them safe in their restaurant.
There is an opportunity here for the industry to improve. Pre COVID-19 it already faced challenges, now is a chance to make it what we want it to be. As an industry, we need to improve the work-life balance, make hospitality a worthwhile career, pay better instead of relying on tips to make up staff wages, promote equality and protect quality.
The industry has come together to help one another during this time and its resilient nature shines through in the way some businesses have adapted their offering. The challenges faced now are not insurmountable, but must be met with creativity and a willing ability to be agile.
- Reopening Your Restaurant After Covid-19: A Checklist
- Covid-19 Resources for Hospitality
- Covid-19 Essentials: Working Safely in Hospitality