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East Midlands Chamber News

Focus feature: How will hospitality and tourism bounce back?

While bars, restaurants and cafes are able to serve outdoors, 17 May is the big date for many as venues can finally welcome customers indoors. Dan Robinson finds out what the future holds for hospitality, travel and tourism – some of the industries hit hardest by the pandemic.

Food takeaway services, village shops and car park markets are just some of the ways the 168 pubs in the Everards Brewery stable pivoted their offer during lockdown.

There’s also been tales of pub owners delivering Christmas dinners to the elderly and making donations to the NHS.

One of those was Sam Hagger, who runs three Leicestershire venues under the Beautiful Pubs Collective banner, which leases from Everards.

“We’ve been the hardest-hit sector and yet we were the people who stepped up,” he says.

“There will be a lot of pubs that have made new friends in their communities. A lot of what we’ve done during the pandemic has been about staying in people’s hearts and minds.”


Read this article and more in Business Network magazine


Sam, who has been in the pub trade for 22 years and set up his company in 2008, has often spoken about needing to prepare for the “Black Swan” surprise moments in business, but even he was taken aback at how quickly everything unravelled in March last year.

His usual £4m turnover was cut to £1.6m, although he admits the Job Retention Scheme, which protected the majority of his 70 employees with an estimated furlough bill of about £780,000, has helped him survive.

So has the decision to diversify his offer at The Forge Inn, Knight + Garter and The Rutland & Derby pubs, which between them have launched themed supper and brunch clubs, virtual cabaret nights and a delicatessen.

They were business ideas he’d never have contemplated 14 months ago but now he thinks it will be a crucial part of the post-Covid pub.

“A lot of pub operators, including ourselves, have realised we can do so much more with our properties,” says Sam, who admits there are still tough times ahead for hospitality.

“People have created new habits – they’re going for morning walks and will grab a coffee – and we’ve realised there’s so much we hadn’t considered. Going back to what we previously did would feel boring.”

Everards Brewery feels the pain of lockdown - but major new site offers promise

“What a year it’s been,” says Emma Roderick, operations director for pubs at Everards. The family-run brewery’s two main income streams – rent and trade from its 168 pubs, which are run by “business owners” – was cut off overnight in March last year.

Furlough has been a saving grace for its 70 head office staff, but with its commercial health intrinsically linked to its pubs, the company cancelled 73% of its rent roll.

Yet no pubs were permanently shut, with only a small number sold, and about two-thirds were able to reopen to outdoor customers from 12 April this year.

Emma Roderick

Emma says: “Since we had the roadmap out of lockdown, there’s been a surge of positivity as we can see the light at the end of the tunnel.

“When we reopened last time, there was the pressure of going back into another lockdown, but this time we’re cautiously optimistic and we’re seeing customers who haven’t been to the pub for over a year returning after having their first or second jabs.”

This spring will mark a double celebration for Everards as its new state-of-the-art brewery, beer hall and shop is primed for opening.

The Everards Meadows site, next to Fosse Park in Leicester, will become a destination for customers to meet, eat and drink while taking in all the action of the brewery and its spectacular views. It will look to attract regulars and a new type of customer.

Emma adds: “Consumer behaviours have changed and the bar for their expectations has probably also risen. There’s a lot of opportunities for our industry if we adopt the right mindset to embrace them.”

Covid puts temporary pause on 200 Degrees growth

When 200 Degrees opened its doors in a 17th century coaching inn just off Nottingham’s Old Market Square in 2014, to many passers-by it was probably just another coffee shop – named after the Fahrenheit temperature its beans are roasted at – at a time when cities were full of them.

It didn’t take long for this one to stand out from the crowd, backed by a burgeoning reputation for some of the best brews in the business and an ambitious vision, with a second later arriving in Nottingham and followed by outlets in cities including Leeds, Birmingham, Leicester, Cardiff, Lincoln and Liverpool over the next five years.

The 200 Degrees coffee shop in Carrington Street, Nottingham

Its 11th shop opened at the McArthurGlen East Midlands Designer Outlet shopping centre in November 2019 but then the brakes were pressed.

“As with all businesses, we’ve had to re-evaluate the new way of the world,” says commercial director Will Kenney.

For a business with premises in the busiest city centres, the impact of the pandemic has clearly been huge.

A significant chunk of its 100-strong workforce has been furloughed as its coffee shops were forced to close – or at best serve only takeaway food and drink – over the past year or so.

Its wholesale business, which has commercial contracts to supply offices from a roastery next to Notts County’s Meadow Lane stadium, fell to 20% of pre-Covid levels.

The consensus among office-based businesses points towards a hybrid future of remote and on-premise-based work, but Will is confident city centres will emerge strongly from the pandemic.

Will Kenney

“We know our offer is well received by people who frequent city centres and we can appeal to everyone,” he says. “The great strength of a 200 Degrees coffee shop is you can find businesspeople in suits sat next to someone who’s taking a break from shopping.

“I’m confident people will want to come back to city centres. Sometimes coffee shops are doubling up as the ‘third place’ where people meet and spend time, after the home and workplace.

“But no matter what you’re doing, businesses in the city centre – particularly in hospitality and retail – will have to work harder to make sure our customers have a great experience when they walk through our doors.”

Perhaps surprisingly, given the times we’re in, 200 Degrees has announced it will finally open its 12th shop – an 80-seat venue in Manchester’s Mosley Street – in May, with plans for number 13 in the near future.

Will says it’s been a “target city” for a while and is particularly excited given the long lead time to its latest venue.

“We’ve now got a roadmap out of lockdown and, if we can stick to that, we think there’s a huge appetite among consumers who want to get back out on the high street, and see friends and family again,” he adds.

Shining a light on the importance of hospitality

In the days after pubs were allowed to reopen, Sam Hagger recalls speaking to a widower whose wife had succumbed to coronavirus.

“He said he was excited about his son coming to visit him that weekend so he could share the experiences he’d had with his wife in that pub,” says Sam.

“It just showed to me that we can build as many garden sheds serving beer as we like, but there’s no replacement for a pub and the sense of community it brings.

“Good hospitality isn’t just built on great food and drink – it’s built on great people too.”


Domestic tourism set for busy year

On Saturday 21 March 2020, after the usual three-month closure for conservation and maintenance, the 105-acre Chatsworth Garden in the Derbyshire Dales reopened to the public. The next day, on the eve of Boris Johnson’s announcement that the UK would enter national lockdown for the first time, it shut again.

“We were geared up for a normal year so were as shocked as anyone at the speed at which things evolved,” says marketing manager Jonathan Fish.

Chatsworth House

The 14 months since have been plagued by a stop-start approach for tourism attractions like Chatsworth, which is run by a charitable trust, making a huge dent in its ability to generate an income.

About 600,000 annual visitors usually pour into the 17th century house, as well as its garden, park and farmyard, but lockdown restrictions have wiped out just over half of those. It typically employs between 400 and 500 people at peak times but a huge chunk have either not been contracted during the usual seasonal period or placed on furlough.

The impact was compounded by the cancellation of key events, including the international horse trials and Chatsworth Country Fair – which together welcome in the region of another 85,000 people – and the Christmas at Chatsworth festivities, which have been built up over recent years to make November and December the attraction’s busiest period of the year.

Jonathan says: “Our team had been ploughing ahead with the preparations for Christmas because there had been little reason during the summer and early autumn to believe it wouldn’t be able to go ahead, albeit with a limited capacity.

“But the second lockdown meant all the wonderful Christmas displays in the house were never seen by a single visitor.

“Our team had done an incredible amount of work and we’d sold every available time slot, so that was soul-destroying.”

But there is light on the horizon for Chatsworth, which fully reopens on 18 May. The garden has been a “saving grace” as it remained accessible throughout much of the pandemic and, along with an outdoor festive lights display, brought a new, younger demographic as people have looked for things to do without being able to travel far.

And with holidays abroad shrouded in uncertainty, it could offer opportunities for domestic tourism.

Jonathan Fish

“We’re gearing up for a very busy year,” adds Jonathan, who is hoping for a gradual easing of social distancing rules in the months to come.

“With the vaccine rollout meaning people are more relaxed about going out, combined with the restrictions on international travel, we expect there could be huge demand, which poses new challenges when we must limit capacity to about 30% of normal levels in the house to ensure colleague and visitor safety.

“Usually, annual outbound tourism in the UK is about double the numbers we see of inbound tourists, so the ongoing international travel restrictions could provide a big boost for the UK tourism industry.

“Like many organisations, the Chatsworth House Trust suffered massively in 2020 but we’re feeling much more positive about 2021.”

The Loughborough guesthouse that's upgrading facilities despite pandemic

Another person keeping a watchful eye on the return of events and the evolving international travel situation is Nisha Pahuja.

She owns the 18-bedroom Charnwood Regency Guest House, in Loughborough, which relies on not just the nearby university’s graduation ceremonies but major gatherings like Download Festival, in nearby Castle Donington, for demand.

Nisha, who also works full-time as an occupational therapist, says: “We’re all hopeful of getting back towards normality within the next 12 to 18 months, and I know our sector will bounce back strongly.

“We have some amazing places in the UK to visit and I’m a strong believer in pumping into your own economy, so I think there will be lots of domestic tourism this year that we can benefit from.”

Charnwood has been one of the few guesthouses to remain open during the pandemic as larger chain hotels and other smaller accommodation have opted to close, enabling it to take on their business and support key workers in the area while being Covid-secure.

A reasonable occupancy level has not only allowed all six staff to remain employed, but it’s given Nisha the confidence and funds to invest in an ambitious £250,000 renovation project that aims to turn the venue into a boutique hotel.

Charnwood Regency Guesthouse

“We decided that while we were relatively quiet but lucky enough to still have people staying here, it would be a good time to give the guesthouse an update because it was a little dated,” says Nisha, who also plans to eventually host networking events for business groups in the area.

“Before the pandemic, I went to see some boutique hotels – which aren’t like typical guesthouses but also not similar to big chain hotels, where every room is the same – and it got me thinking about creating something that’s luxurious without the price point.  

“Lockdown has caused challenges with suppliers and contractors, but I’ve completed six rooms so far, along with some other work in common areas, and the idea is to make sure every single one is unique, including our disability-friendly rooms.

“I haven’t been able to find any boutique hotels in Loughborough so I’m excited about what this could do for our business.”


Opportunity for Peak District to attract new businesses

The tourism industry remains vitally important to the Peak District – but the national park has a great opportunity to attract new types of businesses after the pandemic.

That’s the view of Robin Eyre, chairman of the Business Peak District representative body, who believes an appetite for people to live near nature and increased remote working could lead to interest from small businesses looking to relocate to the area.

“Part of our economic recovery is going to involve attracting businesses – particularly in creative sectors like web designers and architects, which can be based anywhere – to the Peak District,” says Robin, who runs his own business Trailblazer360 Marketing from an office space at Cromford Creative, near Matlock.

“We have some great office space, including Cromford Creative, Hathersage Business Centre, Glossop Gas Works and Via Gelia Mills.

“But to take advantage, we need better public transport and housing supply for those people.”

Each year, the Peak District and Derbyshire’s tourism industry generates £2.5bn for the local economy, supporting 31,000 jobs and attracting 45 million visitors, according to the STEAM tourism economic impact model.

This spans a range of sectors, including accommodation, hospitality, attractions, leisure and retail.

Robin Eyre

“Those businesses have all closed so the effect has been very significant as the towns and villages would usually thrive on the visitor economy,” adds Robin, who like many people in the Peaks owns a holiday home he’s been unable to rent out for much of the past 14 months.

“This year, staycations could offer a big opportunity to increase profits from the higher demand but if social distancing continues to limit capacity in venues, it could take a couple of seasons until we get back to the profitability they had a few years ago.”

 

This article appears in the May issue of Business Network magazine. Read the online edition here

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