April Re-Opening Forecast

April Re-Opening Forecast

Hospitality industry forecasts 70% of normal revenue to return when outdoor service resumes on the 12th of April.

 

Analysis from S4labour indicates that hospitality operators are forecasting 70% of revenue compared to the same week in 2019 (not 2020). The figure of 70% is somewhat remarkable considering that the vast majority of capacity, i.e. inside, will be unavailable. The research is also encouraging as the sector prepares to re-open with over a week left to secure even more bookings. 

 

The figures represent only sites that are preparing to re-open on the 12th of April and it is important to note that a large number of operators either have no outside space or not enough outdoor space to make opening feasible.

 

S4labour’s Chief Customer Officer Sam Wignell, commented “the figure of 70% of revenue compared with 2019 is in line with anecdotal evidence from conversations across the sector. There has been a scramble and huge investment to prepare outside spaces for the 12th of April, however, it comes with a large dose of caution as much of the pent-up demand could quickly be washed away with poor weather.” 

 

Alastair Scott, MD of S4labour and owner of Malvern Inns who operate 3 pubs, added “we have seen an unprecedented amount of bookings in all of our sites with customers showing a clear desire to meet up and start enjoying hospitality once more”.

Covid Hits Hospitality Sales for £89 billion 

Covid Hits Hospitality Sales for £89 billion 

Covid Hits Hospitality for £89 billion 

As the grim anniversary of the beginning of the first lockdown approaches, analysis from S4labour shows that the hospitality industry lost just over £89 billion in revenue through the full year since March 23rd 2020, when the hospitality industry was first instructed to close. This is equivalent to 68.9% of annual revenue, representing an average decline of half a £million per site across the U.K. 

The data shows that while there were huge declines for both wet and dry led sites, it was drink led sites that were particularly hard hit, slipping 78.6% in like-for-like revenue compared to food-led venues where the decline was limited to 62.1%.

There was a less marked difference between London and non-London sites, however, it was noticeable that wet-led venues in the capital suffered an 84.4% decline in sales, with little opportunity to offer takeaway or delivery during almost all variation of restrictions.

Scotland fared worse than England, with a 77% loss in revenue, and wet-led pubs in Scotland were the most affected category with an 88% decline like-for-like revenue.

Chief Customer Officer Sam Wignell added, during the last year, hospitality has had its ups but the downs have been significant and scarring for most operators. The figures are starkly clear, we cannot expect the industry to simply emerge on the other side of that loss still afloat and recover, even with pent-up demand.

Hospitality suffers 540,000 jobs in 2020

Hospitality suffers 540,000 jobs in 2020

Hospitality Suffers 540,000 job losses in 2020 and is on the verge of losing a significant amount more.

There are many industries that have suffered throughout 2020, but hospitality has been near uniquely placed at the forefront of every conceivable damage the pandemic and social restrictions could throw at it. That’s not to say that other sectors have not had it hard, but few will have to had to navigate the never ending variations of restrictions and closure hospitality has.

Analysis from S4labour shows that the result has been 539,000 job losses; circa 20% of total hospitality employees, during the full calendar year. By contrast, every other year (we looked back to 2010) has had positive growth of hospitality employees.

Hospitality employment has always had peaks and troughs, however, last year, we can quite clearly see figures align, not with the usual seasonal trends, but with government policy announcements. The first spike in job losses occurs in weeks 11-13, in March 2020 where 91,000 employees were let off in a three-week period, just as the crisis hit and hospitality was shut; government support was not foreseen at this point. There was another spike of job losses that occurred of 42,000 in one week just as the government announced the November restrictions and all but cancelled Christmas.

The only occurrence of a positive new starter rate since March 2020 occurs in the week 3rd August; the start of the EOTHO scheme. However, this was just after two spikes of job losses in July, likely to have been caused by the end of fully supported Furlough, covering NI, holiday pay and pensions.

Trends identified in this research shows clear lack of foresight by the government, as has followed for the whole of this crisis; a lack of clear communication with the industry that accounts for 5% of UK GDP and 10% of UK employment. S4labour demands that hospitality is provided with a roadmap, a clear and concise mission aimed at the opening of hospitality, to prevent another huge round of job losses in the next few weeks, following the announcements on Monday. The lack of foresight and the suggestion of just outside pubs and bars opening, will bring yet another round of job losses to those pubs and bars with no option to serve outside. It simply isn’t enough to say that pubs and bars can only open with very aggressive restrictions, as this does not bring profit that is desperately needed at a time where the industry is run to the ground. Pent up demand and the knowledge that it is safe to go to a socially distances pub cries for pubs to be given a clear opening date on the 22nd Feb when we are to hear whether we sink or swim in the next few months.

Chief Customer Officer Sam Wignell added “It is crystal clear, it is not the viability of these hospitality jobs that is the issue, it is the lack of reasonable communication and clarity. If the government is serious about keeping jobs, when we are on the verge of losing a significant amount more, a clear road map and a stimulus package similar to EOTHO is required.”

A heavy decline in sales, and a 50% discount for S4labour customers for January.

Following a heavy decline in sales, S4labour writes to all customers promising 50% discount in wake of new low point for the industry. 

Analysis from S4labour shows that total hospitality industry sales were down 73.7% on last year for December. Food was down 63.7%, Drink was down 81.7% and Accommodation was down 71.4%. Given that December is usually hospitality’s busiest month, this is a hard blow for the industry.

To exacerbate the problem, New Year’s Eve sales were down by 97.8%, as all pubs and restaurants moved into Tier 3 or above prior to the 31st. The few takeaway sales that were left do not compensate for eating in sales.

In a communication issued today, S4labour has reassured all customers that they are “prepared to stand with them” shouldering some of the financial burden as new restrictions hit. All customers have been given a 50% discount on January’s invoices.

S4labour has offered the same discount to all customers during previous lockdowns and has always made available to those whose tiers had made it impossible to trade. However, as the vast majority of operators will have moved into tier 4, very few will be trading and almost none profitably.    

Sam Wignell, S4labour’s Chief Customer Officer commented: “As we enter the New Year, this is a dire time for our industry and it is the responsible thing to share some of the pain and to help our customers get to the other side of this crisis.”

Dec 2020 sales to date

Dec 2020 sales to date

 Analysis from S4labour shows that sales are down 64.3% year on year for Tier 2 venues, for December to date. As a result of the restrictions places on hospitality, food is down 55.3% and drink is down a significant 72.5%. Given that Tier 1 is a tiny percentage of the country, these Tier 2 figures are the best case scenario for the majority of the hospitality industry, most of which is now in Tier 3 or 4, and down over 90% year on year.

 

London has fared worse, down 71.1% year on year, while the rest of the country is down 61.9%. These figures in the capital are due to drop even further to full lockdown levels, given the recent announcements regarding further restrictions.

 

Richard Hartley, Chief Product Officer commented: “the everchanging covid restrictions continue to have a damaging effect on the industry as expected, and Christmas this year is now set to look even more uncertain than previously expected.”

Tenzo & S4labour – covid sales effect

Tenzo & S4labour – covid sales effect

Joint Research Between S4labour and Tenzo identifies 98% rise in takeaway sales, but has little impact on overall decline of hospitality like for likes. 

15.12.2020

Joint research from hospitality software providers S4labour and Tenzo the business intelligence specialists, reveals that despite a 98% year on year increase in takeaway sales during the first full week of trading since lockdown 2.0, eat in sales slumped 50% over the same period, resulting in a 46.7% overall decline in year on year sales, comparing last week with the same week in 2019.  The research by S4labour and Tenzo was done in conjunction with each other to highlight the plight of the industry and help forecast trends for 2021.

Taking a look at the whole Covid period between March the 20th to the 21st of December, the hospitality industry has suffered a sales decline of 56.5% on the same period in 2019, the majority of this driven by lockdowns and the Tier system. During the periods of the year with the least restrictions, between July and September, sales were down just 7.5% year on year.

Christian Mouysset, CEO at Tenzo, the business intelligence and forecasting platform for hospitality, commented that “Unfortunately, restaurateurs can no longer rely on eat-in sales. With changes to restrictions happening so often and at such short notice, the only way for restaurants to recoup revenue is to focus on diversifying their offering by focusing on the delivery and takeaway channels.’

Alastair Scott, MD of S4labour and Malvern Inns added “Covid-19 and the various restrictions on hospitality have been devastating. The innovation in take-away and the speed at which operators have adapted has been remarkable. While take-away will have helped some operators keep their heads above water, the model doesn’t work for many. News that London is going in to tier 3 this week will be devastating, for those who would not have been able to plan for such an abrupt end of trading. “