Top restaurateurs argue re-opening early could be ‘counterproductive’
A letter addressed to cabinet ministers and signed by some of the UK’s top restaurateurs has warned that opening restaurants too early may be “counterproductive” and cause many businesses to fail.
The letter, which was seen by Sky News, is reported to have been signed by figures including celebrity chefs Rick Stein and Tom Kerridge, as well as Harvey Smyth, chairman of ASK Italian and Coco di Mama-owner Azzurri Group, and Rooney Anand, chairman of the Las Iguanas and Café Rouge parent company, the Casual Dining Group.
Addressed to business secretary Alok Sharma and Cabinet Office minister Michael Gove, the letter warns that re-opening restaurants too early “could lead to a substantial number of businesses failing, given the discrepancy between the costs they will incur and the revenues they will be able to achieve”.
It warned that this would have an impact on long-term employment in hospitality, as well as cause wider economic damage.
“We strongly believe that a removal of the lockdown as soon as it safe to do is crucial for the restaurant sector, but we would point out that an early, partial reopening of restaurant businesses as the government starts to lift lockdown restrictions may be counterproductive,” the letter is reported to state.
“Unfortunately, it will not be possible for most restaurants to open in an economical way until we can ensure a critical mass of customer visits.
“Should we be asked to re-open too early, and pay full staff costs, rent and all of our supply costs, it will be impossible for most restaurants to operate sustainably until we are also able to return to serving customers at our normal capacity.”
A number of UK restaurateurs, including Russell Norman of the Polpo Group, Gary Usher of Elite Bistros and Will Beckett of Hawksmoor have already expressed concern over financial viability if required to reopen with social distancing measures. They argued that measures including table spacing of two-metres would result in a dramatic fall in revenue.
Gove has previously stated that pubs, bars and restaurants would be “among the last” to re-open when lockdown restrictions are relaxed.
Kate Nicholls, the chief executive of trade body UK Hospitality, told the government that a number of matters need to be addressed before restaurants can be allowed to reopen. These included an extension of the rent holiday, a way of helping those not covered by the Job Retention Scheme, issues with the grants scheme, frustration with the Coronavirus Business Interruption Loan Scheme (CBILS), and the fact that 71% of hospitality businesses had insurance claims rejected.
A recent survey by the trade body found fewer than 1% of UK hospitality businesses have received payouts for business interruption insurance, while only a quarter of eligible companies have received grants.
While in lockdown, restaurant chains including Wahaca and Byron have asked advisors to examine their finances. Italian chain Carluccio’s and Mexican chain Chiquito have both fallen into administration.