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Morning Briefing Strap Line
Fri 4th Dec 2020 - Friday Opinion
Subjects: The future of hospitality – we are part of the solution and not the problem, food supply after Brexit, is safety the new hospitality?, the financial impact of a positive test
Authors: Alastair Scott, David Read, Gary Goodman, Ann Elliott

The future of hospitality – we are part of the solution and not the problem by Alastair Scott

I am surprised the quote from Mark Twain of: “There are three kinds of lies: lies, damned lies and statistics” has not been used more over the past nine months during the covid-19 pandemic. Theresa May made a similar point when she said that policy should follow the evidence rather than the evidence be found to justify the policy. We all feel, at the moment, the hospitality industry is suffering from some combination of these two factors to try to either severely wound us or kill us off from a health lobby that likes to blame society’s problems on us. But with adversity there is always opportunity and I would like to suggest that, as an industry, we have two opportunities. The first is to consistently use evidence-based arguments with whatever we do and whomever we see. The second is to use the statistical richness of the past nine months to really test and prove wrong many of the negatives about the hospitality industry.
 
The immense value of statistics
It is amazing what you can do through statistics. The whole of my final year at university was spent modelling the spread of Aids, in which my tutor was an expert when Aids was a real danger to lives. Interestingly, from my college, we also had a lot of people progress to be decent journalists – all the ones I know studied English literature. I think this is why I see the world perhaps a little differently to others (some would argue not just a little) – where others seek the headlines, I seek facts and want to come to my own conclusions about the implications. But in a world of Twitter and mass competition for the headlines, the operating practice of too many journalists has become to exaggerate and to rush out the headlines without the necessary due diligence.
 
Closures continue
But the headlines are affecting us. The general population is starting to believe transmission does take place in our venues rather than understanding the greater risk in their own homes for the same activity. Not only is this affecting the cities where millions of people have changed their working and socialising practices but also in the towns and villages I frequent, in which I have seen hospitality venues close at an unprecedented rate. While, in theory, the market should have grown, operators have not survived because of the combination of forced closures and social distancing rules. And with Christmas in hospitality just about cancelled, VAT payments and loan repayments due from April onwards, and rates and VAT kicking back up, the future still looks bleak. But how do we make the best of the situation?
 
The use of science is the new norm
As an industry, I feel we have to move to a new way, and that is to produce more credible and better science than anyone else. In the past 12 months, we have had the best, controlled experiment we could have ever had. In the first lockdown, hospitality was completely closed, which allowed us to do lots of work on the effects of removing hospitality from society. We are now entering a phase where you can’t just drink in a pub, but only eat AND drink, and so we will be able to gather even more evidence. And the statistics might be easier in this phase now the rest of our society is running more normally. We can also, of course, even now get our own scientists to present the evidence on Test and Trace and the positive effects of a covid-safe hospitality industry on the spread of the virus. We should all ask our industry bodies to walk around armed with a scientist at every meeting because this is now becoming the new norm – giving that scientist a wealth of evidence to support the cases they make.
 
My hypotheses
I think there are several hypotheses we need to test to see what the mass of evidence says about them:
1. That the transmission of coronavirus is lower when people meet in hospitality than it is in the home because of the better adherence to rules and the ventilation in hospitality
2. That alcohol consumption goes up if you close pubs, as evidenced by the alcohol studies in the first lockdown
3. That obesity levels rise when hospitality closes, as again evidenced by the first lockdown
4. That hospitality, as part of web of social contact, plays a much bigger role in improving mental health than anyone previously understood and, in particular, in young people
5. That government rules are being broken on an increasingly frequent basis and the only way to manage this pandemic is to protect the vulnerable and let the rest of the population make their own risk assessments and get on with their lives
 
Of course, these hypotheses need testing to a greater degree than my limited search for evidence. There have clearly been other events that need to be carefully eliminated and their individual impacts understood. But this will only help to corroborate the evidence and give greater credibility to the end result, and some of the goals could transform our industry.
 
The goal
While hospitality has been treated shoddily over the past three months since the glory days of Eat Out To Help Out, our focus has to be on the long term for our industry as well as the immediate impact to try and rescue what has now become the most parlous state the industry has been in during my lifetime. This will be founded on changing entrenched government attitudes towards hospitality and developing a greater understanding of the total societal benefits. I, for one, am still hopeful the chancellor will understand the damage done and roll forward the VAT cut and the rates relief for at least another 12 months. While this will not save the many businesses that are now set to fail, it will breathe new life into hospitality, and I hope create a new wave of people in hospitality that recognises how talking, laughing, debating and just sitting near other people is something to be cherished and appreciated by society as a whole and not just us.
Alastair Scott is chief executive of S4labour and runs Malvern Inns
S4labour is a Propel BeatTheVirus campaign member

Food supply after Brexit by David Read

The government says huge advances have been made in its preparations for the end of the Brexit transition period later this month, but many importers and exporters of food and drink remain extremely concerned, as evidenced by a recent quote from Duncan Buchanan, the policy director of the Road Haulage Association, who says he is expecting something “between shocking and a catastrophe”.
 
A common misconception is that a trade deal with the EU will be done and that, as a result, things will continue pretty much as they do today. But there will be large-scale changes at UK borders, whether or not a post-Brexit trade deal is agreed with the EU. 
 
A trade deal would likely remove the need for tariffs (or taxes) to be paid on goods crossing borders, but from 1 January, goods entering the EU from Great Britain (England, Scotland and Wales – Northern Ireland is a different category) will face large amounts of new paperwork and checks. 
 
In the summer, the government decided not to seek an extension to the transition period, despite fears of disruption. But it did decide to delay (by six months) the introduction of full controls on goods entering Great Britain from the EU. There will be checks from 1 January on controlled substances such as alcohol and tobacco, but the introduction of most checks will be delayed.
 
As a risk mitigation strategy, this is likely to prove (at least to some degree) inadequate. As flyers on budget airlines can only too readily attest, delays in one direction of travel will not leave the other direction of travel unaffected. 
 
It is also worth noting that 85% of the volume of trade between the EU and Great Britain is carried by EU hauliers, who are often paid not by the hour, but by the kilometre. If they think there will be too many delays, many in the industry wonder whether they will simply not come. 
 
The current government’s track record in the pandemic has generally been one of underestimating the difficulties that lie ahead, yet it is already saying that the readiness of traders to deal with the new system remains its biggest concern. 
 
“The sheer scale of the overall operation means there are literally many millions of moving parts,” permanent secretary of the cabinet office Alex Chisholm told MPs last week. “Inevitably, there are going to be some difficulties for some individual people as they adjust to the new regime.”
 
For food importers, the timing of the end of the transition period makes matters more difficult because, in January and February, the UK grows relatively small amounts of fruit and vegetables. The dead of winter is when we are most dependent on supplies from Europe. Delays will almost certainly lead to some shortages of product, particularly in fresh categories where stockpiling cannot occur.
 
This is particularly true for Northern Ireland. Tariffs may have to be paid on certain goods moving within the UK from Great Britain to Northern Ireland if they are deemed to be “at risk” of moving on to the Republic of Ireland in the EU. 
 
A significant proportion of food for Northern Ireland moves through Britain, and the rules and procedures under which trade will be conducted are not yet fully defined, even though we are less than a month away from their introduction.
 
The Food & Drink Federation (F&DF), alongside the major supermarket chains, have already been playing down the risks of food shortages in the UK for fear that consumers will switch their panic-buying focus from toilet roll to food. Though even the F&DF is admitting that in the event of a “no-deal Brexit”, “things will become difficult for a while”.
 
What does seem certain is that there will be some disruption to supply in the early months of 2021, probably emerging slowly during the first few weeks. Where it occurs, this will cause instability of both product availability and probably price. The level of that disruption remains, just like so many other factors in this strange pandemic world, distinctly uncertain, so flexibility of menus may well be an important capability in the months ahead.
David Read is founder and chairman of Prestige Purchasing
Prestige Purchasing is a Propel BeatTheVirus campaign member

Is safety the new hospitality? By Gary Goodman

Danny Meyer, renowned global restaurateur and author of pioneering book Setting The Table, made the statement that “safety is the new hospitality” when speaking at this year’s virtual Peach 2020 event. It’s a bold statement, and was at odds with Hawksmoor’s founder Will Beckett who argued, at the same event, restaurants (and hospitality) have always been littered with risks, and the reason people choose it is because they trust operators implicitly and take their safety as a given. The reason they choose a venue is not because it is safe, but, instead, because it allows them a brief escape and transports them to a happier place, where they can enjoy the intangible thing that makes our industry so fantastic – great service. 
 
These are two outstanding operators with serious pedigree. So, who’s right? In my mind, they both are and the question raises an interesting point about operators’ approach during the covid-19 pandemic. One of the biggest challenges presented, in my opinion, has been the way it has divided the way the nation behaves. Humans are traditionally creatures of habit and, by and large, brands can roughly anticipate how certain consumer groups are going to behave.
 
However, covid-19 has ripped up the playbook. Consumer sentiment and confidence varies greatly across all the traditional marketing groups. Mitigating personal factors, such as underlying health conditions, contact with elderly relatives, or previously having covid-19, all muddy the waters considerably and make it incredibly hard for operators to understand what the best course of action is to cater for their target consumer. Throw into this mix the newly implemented tier restrictions, which are, frankly, as clear as mud, then our industry can expect further erratic fluctuations in consumer confidence and behaviour. 
 
This isn’t altogether new. We’ve been talking about the increasingly fast changes to the wants and needs of guests for some years now. We’re an industry that has adapted swiftly to seismic shifts in consumer demands. Whether that’s an almost overnight need to remove all plastic straws from operations or the need to develop meaningful vegetarian and vegan offerings. The industry has adapted gainfully but the pandemic has changed the game.
 
The speed and dynamism of evolving consumer sentiment is a daunting prospect. The release of new scientific data, the specific angle a news report takes or changes to the government guidelines can impact confidence in a matter of hours. In this climate, it’s more important than ever operators are doing all in their power to understand how their guests are feeling in real time. 
 
It’s true (but sad nevertheless) what Danny says – that some guests will gauge the quality of their eating and drinking experience out of home in December by how safe they feel. Front of house has always been a window to what is happening behind closed doors in the kitchen, so consumers will take comfort from seeing front-of-house team members wearing masks, giving guests space and diligently adhering to health and safety protocols and track and trace systems.
 
In the same venue, possibly sat on adjacent tables, will be customers who are much more relaxed when it comes to eating and drinking out of home. They’ve bought finish-at-home restaurant boxes, tried to replicate their favourite cocktails in their kitchen, but found themselves pining to get out and enjoy being made to feel special. 
 
Understanding the needs of both of these customers in real time, ensuring that you’re not forfeiting everything that’s great about your guest experience for increased safety measures, is more important than ever. One of our partners, Jon Townsend, strategic planning manager at The New World Trading Company, also spoke at the Peach 2020 event. He highlighted how he is able to harness Yumpingo technology to get real-time feedback on dishes being served in-venue and actually head into the kitchen if a trend appears around a fall in the average score of a specific dish. When catering for a dynamic consumer, the ability to adapt and impact the experience in the moment is invaluable. 
 
It’s not just The New World Trading Company that is adapting. In July, we founded a campaign called We Hear You with CGA and UKHospitality to reflect and understand the needs of guests. The data gathered revealed safety had become a hygiene factor, clearly highlighting operators’ nimble ability to adapt swiftly to meet the needs of consumers. 
 
In a world of uncertainty, adopting this flexible, diligent and data-led approach, delivering operators certainty around their guests’ happiness, will be a crucial tool over the coming weeks, as we negotiate the draconian and non-sensical restrictions implemented by government. Equally important is remembering what makes our industry so great – hospitality and service. Customers should enjoy a feeling of escapism, complemented by safety and, achieving these two goals, against a tide of changing wants and needs, should not be seen as mutually exclusive. 
Gary Goodman is chief executive and founder of Yumpingo
Yumpingo is a Propel BeatTheVirus campaign member

The financial impact of a positive test by Ann Elliott

My daughter saved like mad for two years in order to travel to South Africa to study for, and eventually take, her stage one safari guide exams. She lived in particularly insalubrious accommodation during that time, earning £64 a day working for a doggy day care business – picking up and dropping off 15 to 17 dogs a time at a cost to the owner of £40 per day (that’s a good business to be in). She ate and drank just enough to keep body and soul together. Although, at times, I think even that was in doubt.
 
She flew to South Africa almost two years ago – to study for six months and then work in a game reserve for the second half of the year. After three weeks, she posted on social media that she felt she belonged in Africa. It was her dream come true. She came home last Christmas with a boyfriend (I’ll call him Chris), a life experience and the determination to go back as soon as she could, study for her stage two exams and work in the Kruger.
 
Well, of course, we know what happened. They are both still here – again saving madly, again living in insalubrious accommodation but now earning the minimum wage with my daughter working night shifts at Amazon and her boyfriend working for a chicken producer. Both companies have stories of their own and I could easily digress but I won’t. Tales to be told over a glass of wine sometime in the not-too-distant future.
 
Then, about ten days ago, Chris came home to say a colleague had been at work for a full week after finding out that his wife had covid. Whole teams then had to be sent home. Many took their own tests. Chris tested positive.
 
So here we all are. Our whole family has tested negative. Chris is the only one who hasn’t. We are all self-isolating, which isn’t too bad having spent much of the year in some sort of lockdown and limitations. I can easily work from home, though I am desperate to see how our sector is coping post-lockdown with the new tier system. Like everyone else I am ordering a pint of “substantial meal” and a Scotch egg as soon as I can.
 
My point though is that neither my daughter nor Chris will be paid for this two-week period. Neither will the teams that have been asked to isolate. Neither will the person who transmitted the disease from his wife to those who sat in the packed and unventilated canteen. That’s a loss of £2,000 to Becky and Chris. Just prior to Christmas. They can try to apply for the one-off £500 payment but that’s really for people in true hardship (which I understand totally) and not easy to obtain from what I’ve heard.
 
The company has to take its share of responsibility as do the individuals concerned but it’s easy to see why people don’t say they have covid-19, don’t test for it and don’t take time off. They simply cannot afford it.
 
There are huge numbers of people just like this – agency contractors, those on zero hours contracts, the self-employed for less than three years, freelancers, start-ups that pay themselves in dividends not salary, the recently made unemployed. They have no safety net. Of course, not all of them are “workhouse” poor but, for many, a diagnosis of covid-19 or a self-isolating order will be financially devastating.
 
It’s one of the reasons why we have to keep fighting to save our sector – every single part of our sector. Not just the operators but the whole of the supply chain too. We cannot be left to cope on our own until Easter and the promise of a vaccine for everyone. We want to protect the NHS, the vulnerable and the sick but our people need protecting too.
Ann Elliott is a hospitality strategist, connector and adviser    

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