Industry to face ‘cautious’ return, says CGA

Hospitality operators are feeling both “cautious optimism and anxiety” about trading levels ahead of the sector’s reopening this weekend, the Business Confidence Survey from CGA and Fourth has found.

The latest survey revealed that 59% of businesses in England plan to reopen some sites this Saturday (4 July),  while a further 18% have planned to reopen the following week. 

On average, however, operators plan to open only three in five sites during the first week back, while just 25% plan to open all their sites initially.

When asked about reopening, consumer demand was the “primary concern” of respondents, with 84% listing it as their “biggest or major worry”. In addition, 75% of respondents from cities or town centres were worried that customers would be reluctant to visit them post-lockdown.

The survey also revealed the “scale of concern” across the sector regarding site closures and job losses, with 67% of bosses believing they will have to lay off staff. On average, they anticipate cutting a 21% of their workforce.

While fears of widespread site closures still remain in the sector, this figure has eased since mid-lockdown, with 43% of leaders now expecting to not permanently close any sites, up from 37% in April. 

On average, the data suggested that one in 12 sites may “remain closed for good”.

Signs of recovery were recorded in the survey, however, with optimism rising from the “record low” of 15% recorded in April. Reported optimism has now doubled to 32%, while the proportion of those feeling optimistic about the market in general has risen from 5% to 16%. 

Nonetheless, both figures are “still barely half” the level reported 12 months ago, which were at 58% and 30% respectively.

CGA group chief executive Phil Tate, said:  “After more than three months in lockdown, operators will be looking forward to welcoming customers back from this weekend, and the government’s reduction of required physical distancing to one metre has provided a significant boost.

“But excitement has to be tempered by huge uncertainty about consumer attitudes and trading, and it’s little surprise to see concerns about redundancies, closures and profits.” 

He added: “While it’s pleasing that confidence is seeping back into the market, businesses will be anxiously waiting for the ‘new normal’ of eating and drinking out to emerge.”