‘We are at a precipice for the industry, which, without further help, could crumble’ Taste Cheshire chief says survey shows huge need for more support for food and drink sector
ASURVEY of Cheshire pubs, bars, cafes and restaurants found a staggering 40% fear they will not be able to reopen unless there is more Government assistance.
Taste Cheshire, who represent members of the food and drink sector across the county, carried out the exercise involving 100 venues.
Worryingly, just over half those surveyed said they may be able to open if the Government lifted restrictions on June 20 – following three months of lockdown – but were uncertain what would happen after that time. Only 2.5% were confident of re-opening at all.
Taste Cheshire CEO Stephen Wundke, who has been involved in the industry for more than 30 years, believes the coronavirus crisis is the toughest challenge it has ever faced.
He said: “Reading through both the figures and comments from our survey was incredibly sad. Cheshire has about 1,500 establishments that employ 25,000 people, representing a huge part of Cheshire’s success as a destination and this sector has been hit, disproportionately, incredibly hard.
“Our figures show that 65% have already reached agreements with their suppliers not to pay them until they are able to reopen and a staggering 87.5% needed to get their landlords to agree a payment holiday on their rent, just to survive.”
There was both good and bad news regarding government intervention.
The survey showed 82.5% had been able to furlough their staff, 12.5% are still paying full wages and thankfully only 7.5% have needed to make people redundant at this stage.
Sadly, less than half had managed to get one of the Government grants and not one of the businesses who had applied for a Government-backed loan had been successful.
The banks didn’t come out of this survey well either with all of those who had been successful in increasing their borrowings to support their business having to provide extra directors’ guarantees.
Mr Wundke is most concerned about what happens when the lockdown is lifted after the survey showed 64.5% would have less than half their normal stock remaining.
He added: “This is a huge issue. When we reopen, everyone will be trying to get stock from suppliers and producers at the same time and many people are already at the limit of what they can pay for. Suppliers will be understandably reluctant to offer more credit when they too have seen no income.
“Most staff will also want to return to work which is not as big a problem, but cash-starved businesses must find a way to pay wages after furlough finishes.
“In the weeks after bringing staff back and before reopening, they will have to train them to follow new operating procedures and how will they fund that training period? I fear this will just be too much for some.
“We are at a precipice for the industry, which, without further and direct help, could crumble.“
Backed by the survey data, Taste Cheshire has presented a proposal through the Cheshire & Warrington Local Enterprise Partnership and Marketing Cheshire to get the Industry back on its feet.
The proposal includes a restocking and re-staffing grant, based on a typical business that turns over £400,000 a year getting, on average, about £12,000.
Most businesses surveyed believe they could get things going again with this sort of sum as a grant.
Across Cheshire and Warrington Taste Cheshire estimate this would cost central Government about £18 million and if adopted across the whole of England that would be in the region of £2 billion.
To save three million jobs and all the businesses that sit behind them, Taste Cheshire argues it is ‘a small price to pay’.
Taste Cheshire has also recommended re-opening plans with social distancing in mind that include table service only, all tables to be two metres apart, a door person to ensure safe access and egress from the premises and toilet monitors to ensure there is no unsafe practice in this area.
The Taste Cheshire survey also revealed that a mere 17.5% of businesses had found a way to deliver or provide takeaway food but the remaining 82.5% had no income at all since the lockdown in March.
For more information, visit: www.tastecheshire. com