As many as 50,000 licensed premises could reportedly keep their doors closed as lockdown restrictions lift and a new tiered system comes into effect in England.
The findings come from the latest Market Recovery Monitor report from CGA and AlixPartners, which revealed the challenges facing restaurants, pubs, bars and other venues in December.
The report indicated that following the new tiered system, 2,227 licensed premises are located in Tier 1 and a total of 36,648 premises are in Tier 3 areas. The remaining 55,502 locations are in the middle ground of Tier 2 and subject to “strict limits”, including a ban on selling alcoholic drinks unless they are served alongside substantial meals.
CGA’s research has suggested that at least a third of operators in Tier 2 could be unable to trade while subject to these regulations. It also found that only one in 16 licensed premises were trading at the end of November.
Karl Chessell, business unit director for food and retail at CGA, said: “After a steady recovery over the summer, these new figures illustrate the catastrophic impact of the government’s restrictions on hospitality’s ability to trade.
“The experiences of Scotland and Wales show that a release from lockdown is no guarantee that businesses can reopen. Despite the end of England’s shutdown, the harsh tiered arrangements means tens of thousands of England’s premises are simply unviable in their most important trading month of the year.”
Graeme Smith, managing director for AlixPartners, said: “After what has undoubtedly been an ‘annus horribilis’ for the hospitality sector, in normal times we would now be entering the most important four trading weeks of the year.
“However, the overwhelming majority of businesses in this sector are operating under crippling conditions and the Government’s latest offer of additional financial support for wet-led pubs appears unlikely to be sufficient to enable these businesses to survive.”
Whilst England’s hospitality sector was closed except for deliveries and takeaways, CGA reported that 6,890 licensed premises in Scotland and Wales were open to guests resulting in 6.2% of Britain’s pre-lockdown total.
Some regions in Scotland remained subject to closures, meaning that only two in five (40.4%) of sites were open. Wales reported that 42.2% of licensed premises remained open despite some restrictions being eased after its 17-day “firebreak”.