Hospitality’s independent sector hit hardest by lockdowns with 5,000 outlets lost forever
Independent bars, pubs and restaurants have been hit hardest by UK lockdowns with 5,000 now gone for good, representing more than 65% of closures in the hospitality sector during the past year.
In a report released on Friday, figures from CGA and AlixPartners’ forthcoming Market Recovery Monitor have revealed that the majority of business failures in the hospitality sector have been independents, representing 5000 of the 7,592 closed licensed premises since this month last year.
It’s a tragic statistic highlighting the fact that shuttering bars, pubs and restaurants for extended times and over key trading periods has disproportionately affected family-owned operators, who don’t have the backing to survive either no or restricted trade for what is now approaching one year.
And it’s been the current lockdown in the UK that has been the most damaging, with a rapid acceleration in closures since the start of 2021, meaning that, as noted above, the nation now has 7,592 fewer licensed premises than it did before restrictions on trading were begun, justified by the Government on the grounds that bars, pubs and restaurants were key sources of Covid infection – something later proved not to be the case.
In terms of the current lockdown for the hospitality sector, CGA data has shown that Britain’s total licensed premises fell by 2,713 over January and February, which is equivalent to 46 closures a day, or one every 31 minutes.
In total, Britain had 107,516 sites at the end of February 2021, down by 7,592 or 6.6% from 115,108 in March 2020.
The Market Recovery Monitor shows that independent businesses have borne the brunt of closures, with a total of 5,112 lost since March 2020, including 1,971 in January and February alone.
This reflects the vulnerability of small and family-run businesses by comparison to well-invested restaurant and pub groups, which have recorded 1,229 closures – fewer than a quarter of the independent sector’s number.
Such news is particularly painful for those working in the hospitality when a report published last week from the Health Advisory and Recovery Team (HART) suggested that shuttering businesses was doing more harm than good.
HART, which comprises a group of more than 40 scientists, psychologists, statisticians and health practitioners, concluded that lockdowns “must never be repeated”, and “serve no useful purpose and cause catastrophic societal and economic harms”.
Meanwhile, Karl Chessell, CGA’s business unit director for hospitality operators and food, EMEA, said: “While hospitality finally has a roadmap out of lockdown, these figures show that dozens more businesses are being pushed to collapse every day.”
He continued, “Losing Christmas sales had a shattering impact on many entrepreneurial restaurants, pubs and bars, who add so much colour to our high streets and enrich communities up and down Britain.
He concluded, “Hospitality is a vibrant sector that can help to kickstart the UK’s economic recovery this summer, but in the meantime support is desperately needed to avoid thousands more business failures.”
Meanwhile, Graeme Smith, AlixPartners’ managing director, said: “The pandemic has reshaped the market for many years to come and unfortunately there are likely to be further casualties before businesses are permitted to trade without restrictions this summer.”
He added, “With many businesses unable to trade before 17 May, further support is needed for the industry, which is creaking at the seams.”
The March edition of the Market Recovery Monitor from CGA and AlixPartners, published next week, will have in-depth analysis of closure trends and a look ahead to the reopening of hospitality, including the scope for licensed premises to trade outdoors from 12 April.
The table below shows Britain’s total number of licensed premises between March 2020 and February 2021
- March 2020: 115,108
- June 2020: 115,004
- August 2020: 113,025
- October 2020: 111,914
- December 2020: 110,229
- February 2021: 107,516
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