According to UK Hospitality's (UKH) chief executive Kate Nicholls, in a webinar organised by the Textile Services Association (TSA) last week, before Tier 4 was announced, hospitality – and hospitality laundries – must brace themselves for a slow recovery from the ravages of Covid-19 on the industry.
Kicking off the webinar, TSA CEO David Stevens said the laundries serving the frontline hospitality industry are desperate for recovery and asked Nicholls for her thoughts on recovery and how best to deal with the Government. Nicholls, welcoming the opportunity to work together with TSA, commented that hospitality is a holistic industry and a ‘fragile eco system’ of independent businesses and the supporting supply chain.
“The best way [to recovery] is to get frontline businesses open. If you accelerate growth in the frontline it all follows,” she said, adding that recovery is going to be slow without any major improvement until well into 2022. Even with two vaccines now on stream she doesn’t see the industry starting to move forwards until the Easter period and she believes that any recovery will realistically start from 1 April 2021.
Pointing out that hospitality and tourism tend to be SMEs – and larger businesses – dealing with a supply chain made up from a very similar base, she acknowledged the supply chain, including laundry businesses in the sector, also needs to be supported. Nicholls believes the Government understands this and that it took note over the summer how hospitality quickly picked up when it had a chance, showing that accelerating growth in frontline hospitality gets the supply moving and how stop/start with lockdowns puts on the brakes when hospitality closes. “There is a terrible cost in stop/start.”
Stevens said that when we get into the recovery phase, de-furloughing will be a cost. At this time, he said, cash will be key, pointing out that cash flow from hotels will be vital for restarting. “There is no cash coming in now. Is it the same for the hospitality sector? Is there any help for supporting viable businesses?” he asked.
Nicholls said UKH is having those conversation with the Government but they are not progressing as fast as she would like. “Businesses have had small scale grants. All the devolved administrations have released funds for the sector but they are small and discretionary. Businesses [including laundry operations] must apply to local authorities for these.but it is worth having a go.” Some local authorities have told UKH they have the money waiting to be claimed, she added.
Nicholls also advised laundry businesses which, by their very nature have to provide services up front before money comes, in to consider looking at supply chain insurance. Small businesses may be seen as risk to lenders so this insurance could be invaluable for re-starting. She added: “Bounce back loans continue to be available for recovery and maybe in the New Year in the Budget there may be new measures for restarting the economy.
Stevens asked Nicholls if she could please help her members understand the plight of laundries. She agreed, replying: “By joint messaging we can help each other through this crisis. If we don’t have clean linen customers won’t be happy and there won’t be any return visits. Hoteliers understand that.”
Winding up the proceedings, Stevens queried whether hospitality will survive in the form it was in pre-Covid-19. Nicholls believes that a leaner hospitality industry will re-emerge from the pandemic. “The hotel sector won’t be operating at full capacity. In the summer we saw our business bounce back with short breaks and staycation...that is hopeful. Business and conference stays and bookings will be a lot slower. Those hospitality venues dependent on that will struggle to survive. We will lose some,” she said.
Finally, is there any silver lining from the past year? Stevens wondered. “There is a better appreciation by politicians of the importance of hospitality and the supply chain behind that,” said Nicholls pointing to job opportunities, as an example. “We are more coordinated with better messaging, lobbying ourselves and our coalition of suppliers. The public now appreciates the warmth hospitality brings to its lives. And there are better career structures. Jobs in the sector were seen as low value, low skilled and this has changed.” She also commented that post Brexit there is the opportunity for a re-set. “We can tackle structural issues such as business rates, landlord/tenant issues, planning, the High Street. Hospitality will stand in good stead,” she said. “Merry Christmas. 2021 can only be better than 2020.”