During the recent financial webinar presented by Natwest, we heard from Jayne Hickson, Relationship Director for Leisure, who shared her advice to overcome the impact Covid-19 has had on the leisure sector. Read the summary and watch Jayne's presentation here.
This week Business Lincolnshire and Team Lincolnshire hosted a financial webinar presented by NatWest which included an excellent presentation by Jayne Hickson, Relationship Director for Leisure at NatWest.
Jayne has been working with clients involved in the leisure sector for over 20 years, and has a wealth of experience. Here, Jayne shares her valuable advice and comments for Visit Lincoln partners who were unable to listen in to the webinar, which we have summarised below.
Overview of the Leisure Market – Jayne Hickson
‘For those linked to the leisure industry I am sure you will agree that the Coronavirus impact to the sector could not come at a worst possible time; the reasons being influenced by the extreme events of the two previous years:
Business had to some extent already taken a hit. 2018 was impacted by an extreme heat wave, combined with the Euro’s football tournament which resulted in reduced foot fall. Followed by 2019 which triggered a wave of uncertainty around Brexit resulting in reluctance to spend.
Therefore the majority of us within the leisure industry had high hopes for 2020; this was meant to be the year of promise! However it was not to be; extreme weather with storms galore rained chaos on many businesses as early as February. Many were forced to close due to flood damage. Even as far back as January Coronavirus was already beginning to make its mark on the leisure industry; with early coverage on the news causing many of the over 55’s to stay at home as a precaution. So the mild winter, or ‘shoulder season’ which often sees many businesses through this quieter time had already been compromised. The first cracks in the industry were starting to emerge and clients needed assistance.
For these reasons I agreed with most of my clients the option of a 12m capital repayment holiday on their term debt; covering the seasonal low but recognising the missed seasonal high cash generation which provides the support to get through the closure period in early 2021.
Feedback I have received suggests that most have taken advantage of the Furloughed scheme, rent free periods, HMRC support Business Rate moratorium and associated grants if they are rateable value permitted.
If you have not already done so, I can only encourage you to speak with your suppliers as a matter of priority! It is in their interests to support you; many want to help and want to know that you are going to be around to work with them again when reopening comes. The brewers and food wholesalers I have spoken to are looking for compromise and understanding. It enables both operators and suppliers to work together and plan cash flows to present to their respective funders to support their working capital request when your doors finally open.
The ‘New Norm’ is the phrase of the day with several industry bodies and professionals looking at what this means in reality. One thing for certain is that this will involve substantially reduced capacity for most. Those who have been ‘fleet of foot’ to bring in changes where possible will help an earlier survival business model, but digitalisation will also feature heavily.
With regards to seasonality the Greater Lincolnshire LEP are working with industry experts, local and central Government to campaign for change. For example if we can remove the seasonal restrictions on campsites, licensing external area’s not currently permitted, this would significantly help with minimising the impact and extend the shoulder months of our key trading period.
These changes will cover issues such as:
- Seasonality – and how can we minimise this.
- Customer Sentiment – understanding and using this as the core of your future focus and strategy.
- Consumer confidence – how we can instil this
There are daily policy updates on Consumer sentiment – just this week we heard that WHO is looking at reducing social distancing from 2m to 1/1.5m! Current public views are that they are keen to meet with family and friends; but not necessarily in your pubs, restaurants or hotels. However, the sector is well known for its resilience, recovering quickly from SARS in 2001, recession 2007/8 (where it was the first to enter the downturn but the first to come back as the public go in need of social gatherings). However, with this Global Pandemic, it is expected thus far to see a return to past levels of trade by Q4 2021 and for some Qtr. 1 2022.
COVID-19: An Overview of the Leisure Market
What is available to help businesses reopen with confidence?
UK Hospitality has presented a 73 page document to the Government which provides proactive guidance on procedures, and processes for reopening safely. It not only covers food and beverage, but accommodation, visitor attractions and retail. This is expected to be published soon and Visit Lincoln will post the document on this website when it is available.
Visit Britain is launching a Kite Mark accreditation in June with a brand new Portal being launched that businesses can display ‘Covid Secure’ posters and stickers. It cannot state that you are ‘Covid Safe’, as this has all sorts of legal implications. It will, however, provide you with detailed guidance and notes on how to demonstrate and communicate to your clients. This includes the precautions you are taking as a business operating in the sector to minimise risk and transmission. The timeline for this is sometime this week and again will be linked on the Visit Lincoln website.
What are your customers looking for as we enter this ‘New Norm’?
Recent research suggests the following:
1) Quality assurance – both in terms of cleanliness and traceability. Visit Lincoln is now working on display packs that could help with this which will be available shortly.
2) The Green Agenda – we need to acknowledge that this comes at a price to our businesses but make the most of working with others in the area to promote green in our cities and coastlines
3) Marketing – supporting the above agenda of working with everyone to promote what we have that will encourage the ‘Staycation’. Please use the fantastic video that Visit Lincoln and the NHS have produced and share this on your own websites to promote our beautiful county!
New Local Authority Grants are now available, with the application portal open for applications on Monday 8th June. This Grant is aimed at helping those businesses that have yet to receive support and were precluded from £10/25k grants available in the early days.
It is aimed at operations that have been adversely impacted and will support work and products required that will enable you to re- open safely such as screens, PPE etc. I would urge you to apply as this could make the difference to your opening cash flow.
Finally, digital products and services are set to rocket now – the market is flooded with new products that will help minimise contact; from booking systems right through to enabling ‘tips’ to be collected digitally to minimise cash handling! My advice is to embrace this new technology as it will be fundamental to us moving forward responsibly as well as ensuring our businesses begin to flourish once more.’