With the UK entering the sixth week of its third national lockdown, as many as four in ten owners of hospitality businesses fear they could fail by the middle of the year, according to their industry group.
Hopes that the country would start to unlock were dashed when the British government said it was no longer considering reopening this month, despite the pandemic’s daily death toll falling.
Now many people in the industry are wondering how much longer they can survive.
Luke Garnsworthy, owner of Hertfordshire restaurant, ‘Crockers’ says the recipe for survival is ” dogged determination and deep pockets.”
“Our company costs about 20 grand (22,800 euros ) a month just to stay shut. I think we get maybe 5 grand (5700 euros) a month in grants in total. That’s a 15 grand (17,100 euros) shortfall.
Unlike the first lockdown, he says, state support is no longer as generous.
“The government paid everything. We just shut the door and everything was taken care of. This time it’s a lot harder. The government will pay the actual salary element but we still have to pay national insurance and pensions. So that’s 10 grand (11,400 euros) a month just to keep the team on and earning some money.”
When the third lockdown began, hopes were raised that it could be over by now. But the government is following advice from health experts not to make any estimates of when businesses can reopen.
“Nobody can plan. You can’t go to the bank to get extra cash. You can’t go to your landlord to ask for help on your rent because nobody knows when this will come to an end,” says Kate Nicholls, chief executive of UK Hospitality.
“I can understand the health experts wanting to make that decision later on but nobody is expecting the government to set an exact date and stick to it,” she says.
“But (at least) an indication of when we might be able to reopen, the phasing, the sequencing of reopening to end the uncertainty in order to give businesses a fighting chance to survive.
Many in this industry say they will do everything they can to keep their business alive.
Garnsworthy, who set up his business with his wife six years ago wants to “keep fighting” and has plans to open in April through to September. But he admits saving this might be out of his control:
“Anyone that we owe money to could come knocking at any point. We borrowed substantially to open up our Henley restaurant last year, right at the beginning of the pandemic. It never really got going. And we should be paying them back now. They’ve been good so far but it could all change.”