Tackling tough times

“A ‘value for money’ purchase is not a price-based decision but the purchaser’s perception of the value they’re getting for the money spent,” says Severn Valley Railway managing director Helen Smith.

AFTER a lot of hard work to reduce costs this year, and success in increasing income in some areas, the Severn Valley Railway’s (SVR) contribution

(or surplus) is anticipated to be slightly better than originally expected, depending on the success of the Christmas events.

Increased grants and donations, together with decreased expenditure have enabled the line to offset a lower budgeted income for

2022. However, the railway believes 2023 will be more challenging than this year.

Naturally, the SVR has been affected by both national and global events, including the cost-of-living crisis and soaring inflation, which have caused rapid rises in the cost of fuel, utilities and supplies, as well as staff shortages.

“We have had to be as agile as possible, reviewing and replanning all aspects of the business, as we react to a fast-changing environment,” explained Helen Smith, managing director, SVR (Holdings) plc.

“This year we have seen a drop in visitor numbers and rising costs for staff, food and supplies. Profit from food and beverage has dropped by 65% compared with what we expected at the start of the year. We have seen a drop of almost 22% in traffic numbers on normal operating days – and we have had to absorb an extra £363,000 on top of what we had budgeted for utilities, coal, oil, water and insurance.”

Passenger numbers

However, better than budgeted income has been achieved from events. Despite falling on a weekend of planned rail strikes, during a national period of mourning, and with the cost-ofliving crisis looming, more than 5500 people turned out for the line’s premier steam event of the year, the September 15-18 Autumn Steam Gala – described as ‘a significant increase’ on the figures from 2021.

Ms Smith said: “We were pleased with the attendance. The numbers show a very significant uplift on 2021’s figures, and of course in 2020 we were unable to hold the event because of the Covid-19 lockdown. It is true that we have a little way to go to get back up to pre-pandemic levels, but we are not overly worried.”

An ambitious and innovative timetable, together with attractive visiting locomotives, proved to be a winning formula for the September 29-October 2

Autumn Diesel Bash event. Despite a rail strike taking place on Saturday, October 1, passenger numbers were 2806 plus significant numbers of shareholders travelling on passes and complimentary tickets. This figure comfortably beat the event’s budget and the number of attendees for the last comparable Autumn Diesel event in 2019.

The SVR obtained a £500k Cultural Recovery Fund grant and the ring-fenced Bridgnorth shed roof and crane donation of £475k – all of which was missing from the original budget as the management did not know if they were going to happen. Considerable amounts have been saved on staff salaries and loco hire costs. Plans are afoot to bring in more contract work to cover some engineering staff.

“Looking to our budgets for 2023, it is difficult to know what to plan. Everything is so uncertain with the cost-ofliving crisis, and nationally visitor numbers are down by 30%,” said Ms Smith.

“Visitors are continuing to purchase on a ‘value for money’ basis – this is evident in the fact that event traffic has continued to be strong. A ‘value for money’ purchase is not a price-based decision but the purchaser’s perception of the value they’re getting for the money spent. Giving free 2023 tickets for all children coming to our Christmas events is a good example of how this works and will encourage whole families to come back.

Focus

“Events will be important to drive visitor numbers in 2023 and we will see the welcome return of the Step Back to the 1940s events, as well as other themed weekends.”

Ms Smith concluded: “Concerns over the supply, cost and quality of coal will continue. We cannot keep putting up entry prices so the answer lies in having sustainable timetables, while maintaining steam working as far as possible. We are still experiencing unprecedented and very tough times. I have given just a snapshot of what we are doing to get through this.

“The SVR is fortunate to have some of the most talented people in the heritage world working with us at every level of the organisation and I am confident that we will all pull together to get through this.”

“We cannot keep putting up entry prices so the answer lies in having sustainable timetables, while maintaining steam working as far as possible”