Friday, 19 June 2020

Will They Won't They?

The trade is in crisis. As UK lockdown and with it the closure of our pubs, now into its 11th week, continues, things are getting seriously bad. The trade press and commentators now have everything pinned on a limited re-opening on the 4th July, but will this save many of our pubs? The answer is likely a resounding "no".

The Government continues to dither, but already preparations are being made. Pub cellars are being emptied of old and rancid beer, lines are being cleaned and renovated, breweries are slowly resuming production on the assumption that the green light will soon be given. Let's hope they are right, but even if they are, success for brewers and publicans and the secure future of jobs will very much depend on what sort of re-opening we get. But of course, above all, we have to get that elusive nod.

There has to be preparation time too as the trade makes very clear. Breweries need to gear up production, cellar teams need to sort out their wares. And then there is front of house staff. Most are on furlough and if there isn't to be a huge loss of jobs soon - and there likely will be anyway - they need to be recalled and retrained in how social distancing is to work in their particular environment. And here's the problem. We don't know how it will be envisaged. Will it be regulated?  If not how will it all operate? The Government, though under great pressure to reduce distancing requirement from two to one metre, is saying that it will be decided by the 4th of July - so no preparation time and the resulting "hoping for the best" that sees brewing re-commence and preparations being made.

The stakes are high. The Publican's Post says "Without certainty by the end of this week, it is claimed that hundreds of thousands of jobs could be lost throughout the industry, and result in many permanent pub closures – with upcoming changes to the government’s furlough scheme estimated to cost an additional £120m according to the British Beer & Pub Association (BBPA)." 

Which pubs will open and how will they feel and look? We have an idea from two decent sources: Greene King and JD Wetherspoon are spending £15m and £11m respectively on very similar measures. These involve widespread use of perspex screening barriers, staff wearing masks, goggles and gloves, as well as enhancing cleaning of common surfaces, door handles, toilets etc. There will be separate in and out arrangements in every case where it is possible to do so, as well as table service, no standing at the bar and more.  In both cases there will be additional staff dedicated to ensuring adherence to measures. I'd imagine too, that door operatives may well be employed in some cases.  It really doesn't  sound too conducive to enjoyment when you add it all up, but then again, probably better that than not at all.  I have no doubt too, that other pub owning companies will be working out what they must do to safely re-open, but it really is all a bit uncertain, both in what is needed and wise and what (if anything) will be mandated and enforced.

For JDW, it may well work - and maybe in some GK pubs too - but what about smaller venues? The sort of place that might be described better as a traditional pub, rather than a large drinking barn. Or small bars and micro pubs where being cheek to jowl and close conviviality is the very attraction? There is no obvious answer. Will the opening of smaller pubs be on the same basis as smaller shops? That is using common sense and maintaining social distancing? I'm guessing not. Either way, they really must make their minds up pronto, whether the benefit outweighs the risk. Do they transfer it, partially at least, to the individual? The risk then is that there will be a widespread "Bollocks to that" from many local venues who will just carry on as if nothing is amiss. I can think of a few myself where that would quite possibly be the case. For a Government that has so much trouble reading the room and prefers vacillation to action, this is a particularly unwelcome problem.

Overall will pubs largely be allowed to open on a  "follow the guidelines basis and beyond that, best endeavours?"  Hard questions, because at the end of the day, businesses can't open without profit. Too heavy a hand on the tiller, and they won't open at all, as they will almost certainly lose money.

Customer confidence is still very weak. The virus casts a long shadow and many customers, enjoying cheap drinks at home and beer deliveries to their doorstep, might well be tempted to stay doing so until the all clear. The threat of the virus is still very real. There are uncertain times ahead. Looking forward, the all clear - meaning a return to "as you were" - may never come.

Forecast: Quite a few marginal pubs will never re-open. There will be a cull of breweries too, if not now, eventually. Government measures can't replace the certainty of employment forever and if the money isn't there, the result will be closure and job losses.

My remark about the Government isn't a political one. It is through simple observation of what has happened so far. And pubs opening without Government sanction is fanciful nonsense. They'd be uninsured and put licences at risk.

Photo credit: Greene King


ShadowHider said...

Sadly, Brigantes in York has already announced that they will not reopen. This is a large, award winning pub, regular in the GBG and a favourite haunt. It's a Market Town Taverns (Okells) pub. If they can't get it to work with all their experience and goodwill from their customers, I fear for the rest.

IrishseaDave said...

I do think your forecast is correct,and there will be significant adjustment. But I also feel that many will find a way forward,many will innovate. There will still be a very big market out there and plenty will capitalise & thrive,especially as the events will inevitably cause a shakeout. This is undoubtedly a dreadful & worrying time,but we'll get through it. In relation measures for the virus on reopening,we'll get through & reorganise in the same way we've had to adapt supply chains & supermarket shopping etc. over this last period- massive turbulence at first,then a steady regrouping. Punters also will on the whole be adaptable themselves as well,as the bulk of people have generally been throughout. It's a dark hour in summary, but we'll collectively get through,many better than they originally feared.

Stretton Ale House said...

There will be an enormous cull of micropubs.
I have a micropub in South Shropshire, no outside area and a capacity when full of about 35. The landlord has refused to make any rent concessions. We had paid rent up to mid May but will pay no more. Social distancing, even at 1 metre, means capacity will be about a dozen people .
We shall not be reopening, are stripping out our F&F and will be returning the keys.

Curmudgeon said...

Can't see it working in GK pubs like the Free Press in Cambridge and the Nutshell in Bury St. Edmunds.

Paul Bailey said...

It’s all very difficult to call. The downgrading of the virus threat level from 4 to 3 should, in theory, ease the case for re-opening and there are other factors which may come into play, such as reducing so-called social-distancing down from two metres to one.

There is also research that shows that Coronavirus is not as contagious as we’ve been led to believe, plus studies that estimate 50-80% of the population are immune to it anyway (I think this means this group do not display any symptoms). Better treatments for those unfortunate individuals who are unlucky to develop full-blown Covid-19, have recently come to light, all of which help the situation.

On the downside, the opportunity of completely eradicating this virus has long gone, as it’s now endemic within human populations. The best estimates are it will become like another seasonal flu, that we will have to live with and manage, as best we can. Vaccines are also only likely to offer protection for a 12 month period, meaning we’ll all be queueing up for our yearly Corona shot!

This may eventually lead to an “as you were” situation, but in the meantime the damage to thousands of small businesses has already been done.

We await the 4th July with baited breath!

John Lamb said...

Many pubs will re open and then close again when it is found that trading is uneconomic. People all over the world will learn to live with coronavirus and methods of treatment are developing rapidly,consumer confidence will steadily increase and there will be opportunities to develop new pub businesses as people will tire of sitting at home drinking cheap booze.Life will be tough but it will improve.

IrishseaDave said...

I think you are right on treatments & confidence. Vaccines aside,once all the data worldwide is analysed much much smarter treatment approaches will emerge & we'll be much better equipped and organised to deal with things. New business will emerge as you say.

retiredmartin said...

Good analysis, Tand, and sensible responses.

Mudgie makes good point about the Greene King pubs rarely being as easy to convert to ensure safe customer flow as their video from that large Hungry Horse.

As ever, I await the Sam Smiths announcement about their approach!

Tandleman said...

Agreed. Very sensible comments as you'd expect from my followers! I agree that business in generally will suffer, but others will create opportunities.

Curmudgeon said...

Humph will put up a hectoring notice that is ignored by all the staff and customers.

Huish Hugh said...

Checking though the twenty places drink in most regularly: (a) eight are owned by large national/regional breweries or pubcos; (b) four are independent mini-chains (around ten outlets or fewer); and (c) eight are various freehouses/micro pubs/a micro-brewery tap. Considering aspects such as size, internal structural lay-outs, available out-door space, I'd guesstimate ten will struggle to be viable under imposition of any significant restrictions - 2/8 from (a), 2/4 from (b) and 6/8 from (c).

Anonymous said...

As others have said, the short term will see many business fold as it is just not economical to operate in the current environment. Bad news for landlords and pub owners. I particularly feel for the owners of all the new micropubs which have opened up recently.

On the plus side, the assets (property) themselves will remain as will the demand for socialisation so in the medium to longer term we should get back to a new normal.

Anonymous said...

The government has no intention of letting things get back to anything like normality. Clearly the intention has been to create headline news that pubs will be reopening, but the fine print will render this an impossibility for very many small pub businesses.

If enterprising landlords find ways round these purposely destructive restrictions, then no doubt government will move to close the loopholes that allow deviation from what is meant to be a very sad "new normal".