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Fri 20th Nov 2020 - Friday Opinion
Subjects: We should have sympathy for students, key differences between the first and second lockdowns, stuck in the middle of the cycle
Authors: Glynn Davis, Ann Elliott, Nick Popovici
 

We should have sympathy for students by Glynn Davis

One particular evening a couple of years ago remains very clear in my memory. I was sat in a bar with my then nine-year son who told me he didn’t like pubs. When his mother joined us a short time later she consoled me with the opinion that I’d dragged him out, away from his beloved iPad, and this was the most hurtful comment he could throw at me. It worked.
 
What he’d fully recognised from a very young age was my love of the pub and the fact I not only spent far too much time in them, but also incessantly talked about them, and wrote about them at every opportunity.
 
My guess is that they won’t be quite so fundamental to his (and his teenage sister’s) lives because there are so many other things to be distracted by today (and who knows what new things are around the corner). They are also acutely aware that alcohol has its dark side and that health and fitness have much value. It seems to me there is a much more sensible – dare I say adult – relationship between younger people and alcohol than has been the case with their parents and my generation. 
 
It’s been interesting, therefore, to see younger people get such a bad rap recently – especially those entering university for the first time. Thinking back to the start of my time studying away from home, I have great sympathy for all those people struggling to fit in when they are trapped in their rooms under lock-ins, self-isolations and oddly defined bubbles. Lectures have also been largely confined to online for many young people. 
 
The mental health of many of these isolated youngsters in this formative period of their lives is of great concern. My own mental survival was dependent on very frequent visits to the student union bar and various other pubs. It’s where I met many of the people who became good friends. They made those very early days bearable and the period beyond extremely enjoyable.
 
On the back of confusing and often questionable lockdowns and imposed rules, today’s students have been unable to venture out and frequent the bars and restaurants of their adopted towns and cities with any great freedom. The knock-on effects on some of these locations and the hospitality businesses within them have been massive. Often these places lay almost dormant out of term time and then become buzzing trading areas when the students are back in town.
 
Under any circumstances, venues with a clientele that includes a younger audience invariably benefits from the buzz and vibrancy they inject. I’d suggest nobody, especially many older people, wants to be stuck in a place full of people with more miles on the clock than themselves. We should welcome the younger grouping’s presence and not banish them as demonic virus spreaders. 
 
To make matters worse, students have to pay full tuition fees, which is very different to back in my day when it was a free ride. This has led to even more students seeking work outside of their studying time. The obvious industry for them to target is hospitality. Under normal circumstances there would be abundant night shift and weekend working opportunities but this avenue has been cut off.
 
This grouping has, historically, not only been crucial in ensuring the hospitality industry can function operationally but also the money they earn has, to a large extent, been thrown straight back into the sector. This is an example of the circular economy if ever I’ve seen one.
 
We’ve all likely read about the number of positive covid-19 tests in locations containing universities increase considerably compared with other towns. There was sadly an element of inevitability about this but some of the ham-fisted restrictions imposed, including the pointless 10pm curfew, have undoubtedly fuelled things. Placing the blame for the flare-ups in numbers solely on the shoulders of this grouping is misconceived. 
 
Yes, there have been some examples of drunken behaviour on the streets of some city centres, which the media have feasted on and which has rather coincidentally all occurred around 10pm, but this has been very much the exception. It has, however, been used to castigate the hospitality industry for its irresponsibility and covid-19-spreading activity.
 
Far from being irresponsible, the industry just like that of the much-maligned younger generation is very much the opposite. To castigate either camp is very much misplaced and they should instead be given a break before they do actually break.
Glynn Davis is a leading commentator on retail trends
 

Key differences between the first and second lockdowns by Ann Elliott

Over the past few weeks, I have spoken to a number of operators about their thoughts and feelings on lockdown this time versus March. Some key themes have emerged during these conversations.

There are massive levels of frustration, disappointment and anger about the behaviour and attitude of the government towards the sector.

While there is a very strong feeling that we couldn’t have been better represented in terms of our trade body with the government (and that Kate Nicholls should be on her way to the House of Lords and Ladies), an understanding that we are just one body talking to them among many and an appreciation that no one really knows how to “handle” the pandemic- the criticism of the government is fierce.

Incompetent, chaotic, ignorant, shambolic, uncommunicative, ill-disciplined, clueless, totally lacking in any understanding of how our sector works, bumbling, useless, leaderless, knee-jerking, prevaricating, rumour-mongering, absolutely no appreciation of business, overwhelmed… the comments were excoriating. 

Our sector appreciates certainty and consistency. Operators know this pandemic erodes both but believe the government is making this situation considerably worse than it needs to be. This is not helped by the different approaches of the devolved nations and the variations in the requirements of the tier system in each nation.

Hospitality is not to blame
No one is listening and “we are banging our heads against the walls of Whitehall”. Our sector is felt to have been the scapegoat when the government doesn’t want to close schools, universities, grocery retail or care homes. We are the last sector standing. There is huge frustration the government has not recognised how well the sector has regulated itself and is safer now than ever before.

Their biggest concerns, apart from the impact of more lockdowns, are around the end of the rent moratorium, the reintroduction of normal rates of VAT and the introduction of Crown preference.

Oh, and the fact the government has just reneged on its promise of the £1,000 furlough bonus in January which has had a massive impact on their cash flow forecasts.

Leaders feel more in control this time
While no one, commercially, actually wants or likes a lockdown, there is a much more positive feeling this time versus last time. Most operators feel more in control and less reactive than before. They have dusted down the successful processes they had in place for their chain supply, their teams and their customer communications and have learnt from any mistakes they may have made.

Some have launched brand new initiatives they didn’t implement last time but with perhaps more time to prepare and think, believing that a second lockdown was likely. Some have taken the time to think and to not repeat initiatives that were not commercially viable. A third lockdown in January/February is seen as a very distinct possibility.
 
People and teams came first in the considerations of every leader
Without exception, those I spoke to were most concerned about their teams in all of this. They have worked really hard to ensure they are transparent and honest in their team communications – not giving false hope but trying to paint as positive a picture as they can. They all talked with pride about their people. How they have worked above and beyond, have stuck with them, have adapted to change and coped with effects of covid-19 on themselves and those around them. Their teams are ready for the future and what it might bring – and this is a real source of positivity, gratitude and optimism for a world post-lockdown.

Proactivity, a positive approach to change, creativity and innovation have been essential 
Many operators were incredibly innovative in the first lockdown, simply refusing to be on the back foot, let events just take control or to allow previous ways of doing things hold them back – particularly those with sites in heavy office or heavy tourist traffic areas. They understood their businesses were never going to be the same again. They were pleased with how they, and their teams, reacted to the first lockdown – their creativity, speed of reaction, innovation, digital progress, quicker and leaner processes – and have a belief they have done much of the heavy lifting that will see them through the second lockdown. 

There is a feeling of positivity about consumers returning to eating and drinking out
They feel positive about the return of customer demand post-lockdown though not necessarily their ability to be able to fulfil this demand due to capacity restrictions, table service-only rules and pre-booking requirements. Most were pleased with their trade between lockdowns and can’t wait to get back to business. 

They are resigned to, but not happy about, a poor Christmas versus last year, largely due to lack of corporate bookings at the moment (though any continuation of “bubble only” bookings and the curfew will impact sales even further). One chief executive said their Christmas bookings were currently 0.03% of last year’s level. 

They are going for it though – and are determined, throughout this, to make the best of a very bad job and to come out the other side stronger than ever before.
Ann Elliott is a hospitality strategist, connector and adviser

Stuck in the middle of the cycle by Nick Popovici

In the early stages of the pandemic, I shared a four-stage model that predicted the phases this crisis would take us through as the year went on: shock adjustment, temporary “normal”, reboot, and the new “normal”. Unfortunately, we have found ourselves stuck somewhere between stages two and three of that model – operating under a lockdown scenario, desperately hoping to transition (again) to a period where the sector can trade in a sustainable way, with any kind of normality still far off.

As Mike Tyson once said: “Everyone has a plan until they get punched in the mouth” and 2020 has certainly swung us all a few. For some, covid-19 has delivered a knockout blow, while many are still reeling on the ropes. Has any good come out of this year so far? It might be hard to answer “yes”, but the reality is that even before covid-19, the sector was not in a great place. Bloated with same-same businesses that were inefficiently managed, poorly differentiated, and too stuck in the day-to-day to make meaningful change. In fact, it’s been the bizarre and painful circumstances of the pandemic that have given many brands the capacity and impetus to really address these issues. For many, this has meant rethinking the fundamentals of their business and embracing digital transformation for the first time.

At Vita Mojo, we’ve been fortunate enough to partner with a host of innovative operators who have taken 2020 as an opportunity to adapt, change and come out the other side with a stronger, more resilient business model. Our role in these journeys has been more than just providing the technology. After five years operating our own fully digital restaurants, and enabling digital change for smaller brands, we were ideally positioned at the start of lockdown to support the likes of Nando’s, Leon and YO! Sushi in their digital transformation projects which had gone from “maybe in the next five years” to “definitely in the next five months” overnight. With intimate support from our product and customer success teams, these brands achieved drastic shifts in their operations and customer experience, often in a matter of weeks. Now, having successfully used the pandemic as a catalyst for those leaps forward, these same brands will find themselves with a whole new range of possibilities in 2021.

So, what can you take away from all this? Here are four key lessons learned from our work with Brewhouse & Kitchen, Leon, YO! Boston Tea Party and Nando’s over the past six months:

1. Customers spend more if you let them
One of the often, unexpected, benefits of digital ordering is that customers actually order more. We see this consistently, first in our own restaurants and now those of our clients. A good digital menu must be simple to navigate and designed to help drive greater spend.

2. Different customer, different channels 
Offering the right variety of order channels ensures your business can be both accessible to new customers and convenient for your regulars. For example, staff at Leon find digital kiosks are a convenient “gateway” route for encouraging customers to try self-service ordering for the first time.

3. Data is lifeblood
Efficient businesses need data and constant feedback to make the right strategic decisions. Data gives you visibility of your operations to help identify which items on your menu are working hardest for you and which are turning customers off. Understand your customers across multiple channels and segment them for more strategic marketing and special offers.

4. Connected ecosystem
True happiness lies in an integrated data ecosystem where data flows seamlessly. Connected platforms drive operational efficiency on a level that a stand-alone bit of tech never will. Like trying to have a conversation in two different languages without a translator, restaurant tech without integrations is more effort than it’s worth. 

While the supply side of the market will shrink next year, there will be a great deal of pent-up consumer demand for eating and drinking out. However, the concentration of this demand will change as remote working becomes normal, leading to markedly reduced footfall in city centre locations. To a greater or lesser extent, pandemic-learned habits will likely stick, and where consumers have become comfortable with mobile ordering and QR codes, they will continue to expect those new channels and conveniences to be available.

Hopefully, the news of a vaccine on the horizon means that we arrive at stage four of our model – as close to normality as possible – at some point next year. Some predict the UK will return to as close to a pre-covid normality by July 2021, but the widespread eagerness to make merry this festive period may, unfortunately, lead to a third lockdown in January.

This period will not be without casualties but, ultimately, the hospitality sector is sure to emerge leaner and more agile, with a fresh approach to operations that better serves customers, operators and staff alike. The operators that continue to tackle the challenges of this pandemic with a forward-thinking mindset, determination and a willingness to collaborate, will be those best placed to take advantage of the growth opportunities that will inevitably arise on the other side of this pandemic.
Nick Popovici is chief executive and co-founder of Vita Mojo

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