The only thing that seems certain about the COVID-19 pandemic is that it is very difficult, if not almost impossible to predict how the situation will work out. Up to now, the UK government has been using a definite peak to illustrate the number of cases of the virus. As we know widespread social distancing principles and self-isolation for vulnerable groups has been introduced with the aim of spreading and flattening the peak in order to save lives and reduce pressure on the NHS. This has resulted in all but essential businesses being closed.
Business owners, especially those in the leisure and tourism sector, need to start planning for recovery but this is very difficult as we are working off complete guesswork.
Current predictions expect the UK to reach a peak between mid-April and mid-May. The UK lockdown regulations are scheduled to be reviewed every three weeks as this allows any changes to take effect, which can take up to two weeks and a week of data to understand the trend.
The next review is planned for the 13th of April. The UK probably won’t have reached a peak at this point and I doubt there will be enough data to confirm this. So I think we can count on with some certainty that the restrictions will be in place for at least 3 more weeks, until 4th May. Even if the data on the 4th May looks positive with the number of COVID-19 cases and fatalities falling, I still doubt the government will lift the restrictions at this point.
It is not expected that the number of daily cases will reduce after the peak as quickly as they increased before the peak. So by the 4th May, the number of cases may still be considerably high. The earliest I can see any restriction being lifted is the 25th of May if the pandemic peak is within a week or so of Easter.
On the 16th March, the UK government asked the elderly population and those with underlying health conditions to self-isolate for a period of 12 weeks. This would be until 8th June. I would also expect this to be reviewed.
So considering this and using a conservative guess I would be planning for a re-opening in early to mid-June. Obviously, with so much unknown at this stage, it’s important you keep these plans flexible.
What challenges can businesses expect?
Even after tourism and leisure businesses are allowed to re-open we are going to have to work around restrictions on how businesses operate and challenging economic situation. The restriction and challenges that are likely to continue after the lockdown ends:
Social distancing principles
People and businesses will continue to be asked to avoid crowded situations for some time to come. This could involve limiting the number of people in a certain space to ensure crowd density is kept low. This could affect the number of customers permitted into a restaurant or the number of people allowed into a shop etc. Restrictions on public gatherings may prevent events from taking place for some time after lockdown has been lifted.
Businesses will need to ensure they are promoting hygiene routines. Regularly cleaning hard surfaces and high contact areas as well as hand hygiene.
Continued restrictions to reduce the risk for the elderly and those with underlying health conditions
This will probably include advising against all non-essential travel for some time after restrictions for the majority of the population have been lifted.
Regular working from home and reduce non-essential business travel
This will reduce the demand for business travel as video conferencing and virtual meetings, which have become common practice during the lockdown, will be encouraged by the government for some time after restrictions are lifted. Some businesses will also find a financial benefit in continuing this practice. This lower number of business travellers will impact midweek occupancy at city hotels.
Slower UK economy
The UK’s job retention scheme will save many jobs in the UK, reducing the impact on the UK economy. We should still expect to see higher levels of unemployment as a result of the pandemic. Given that companies across many sectors have not been able to trade effectively for a number of weeks during the pandemic they are likely to make savings on future investments and wage rises and bonuses are likely to be reduced. Overall we should expect the nation to have less disposable income.
Slower worldwide economy
Other countries have had a varied amount of support for their populations. The USA has seen dramatic increases in unemployment and we are still at a relatively early stage of the pandemic there. Again we will see a reduction in growth and company investment. I would expect to see international tourism significantly more reduced than domestic travel.
Reduction of international flights
While the UK may lift the restriction on travel, international flights will be dependent on restrictions imposed by other countries. Slower economies and apprehension about travel, especially long haul, may also impact the demand for flights. Airlines have been severely impacted by the pandemic and will be looking to cut costs in the short term.
So what can leisure and tourism businesses do to help recovery?
Costs, costs, costs!
I’m sure all businesses have been looking at costs over the enforced closure. This will need to be continued during the recovery period. Now is the time to be looking at and recosting your menus, offerings, opening times, staffing, marketing and any other costs you may be able to cut, reduce or delay during the few months after reopening. When making changes, I would recommend making these flexible so you can to respond to the demand.
Keep up to date
The government will be issuing lots of advice and restriction updates. These will normally be detailed on the gov.uk website. Adapt your business to make sure you are complying with this advice and your business is being run safely. Remember you may need to consider your processes and you may need to consider the costs of implementing these.
Know your market
The first few months after reopening will not follow typical trends. Schools calendars are disrupted, seasonal events will be affected, there are going to be lower levels of business and international travellers. However, I anticipate there will be an eager population of domestic travellers who may have missed an annual holiday; international travel may not be as accessible as it was previously.
As business levels over the next few months are going to be a bit unknown, your promotion strategies and pricing are going to need to be flexible and responsive. Fewer travellers are expected and your business levels could be restricted by the government advice. (For example, limiting the number of customers in a restaurant area). Maximising your revenue from each customer will become a priority rather than chasing down prices in order to drive the number of customers to your business.
Reducing the financial risk to the customer when booking
If you run a travel, hotel or tour company which requires advance booking it will be important that the customer has the option of booking with no penalty on cancellation (until a certain point). This can be sold as an alternative/ upgrade to non-refundable options but will need to be competitively priced to be effective.
Review your booking conditions
Make sure they are really clear. This is especially relevant to bookings which are non-refundable or become non-refundable at any point. It may be beneficial to include what the expectation is during exceptional situations (due to circumstances outside of the control of the business), when you are unable to provide the booked service.
Work with your area and community
It will be increasingly important for business communities to work together, support each other, sharing key information and success stories during the recovery. This will enable a more cohesive and stronger recovery for the area.
Hopefully, over the next few weeks, the situation will become clearer and firm plans can be put in place to help with the recovery of your business after the closedown.
If you require any more specific advice please don’t hesitate to get in touch. I am offering free short consultations and for more detailed work, such as website and system configurations, I am offering plans to defer the cost and offer monthly payment to help with your cashflow right now.