Insights from the nighttime industry on COVID-19

These are incredible times. With such times, there are understandably many vital questions. As many in government, the media and commentators have put forward, rather than there being ‘the answer’ currently, there are lots of urgent and essential questions.

That is why the NTIA thought it would be useful to bring together a number of people who are thinking deeply about the various issues currently and how they are impacting us generally and specifically. From scientists to sociologists, business owners to CEO’s, operators to lawyers and more. Have a read on what they’re saying:

Sacha Lord – Nightlife Advisor to Greater Manchester
Quite clearly, we are living in unprecedented times. However, from what I am seeing across Greater Manchester, some businesses are diversifying and adapting to the current climate.

It’s not a time for party politics and I do think some of what the Government has done e.g. Furlough, Rates, VAT has been great, but they have certainly not gone far enough, especially when it comes to the Self Employed.

The initial speech a few weeks ago, on the Monday, “advising” people not to go to bars, restaurants, clubs decimated our industry and I think this once again shows a lack of understanding of how important the night time economy is.

In Greater Manchester, we have launched to entertain and raise funds for those within our sector, who need the most help at the moment. We have had 2 million views in the first week and raised into six figures worth of aid.

It also helped Greater Manchester Police re-enforce the Stay Home Campaign. Sadly, I do think all of us, not just those within the NTE, will be paying for this for the rest of our lives, whether that’s in taxes, VAT etc.
What has been completely obvious to me throughout this whole thing, is our industry stick together, we help each other out. I’m seeing restaurants making free meals for the NHS, hotels giving free rooms to the frontline services…there are too many to mention.

When to are allowed to see openings and I do think we aren’t too far off, it will be interesting to see how the government to it. My thoughts are a slow release working with smaller capacities and slowly building up to large scale events.

Dr Stuart Derbyshire – Associate Director of Psychology, National University of Singapore
The current outbreak of Covid-19 has brought much of our social and work lives to a sudden halt. The economic costs look likely to be eye watering: parts of the hospitality industry – hotels, restaurants, bars – will lose millions of jobs; some airlines are likely to entirely disappear; consumer spending, especially on discretionary goods, is likely to fall to levels not seen in decades. Those economic costs translate into human costs. We are social creatures, who depend on other people.

On our own, we are pretty miserable. There’s not much you can achieve alone. No matter how accomplished, talented, or industrious you might be, you couldn’t create the conditions of your life all by yourself. You likely couldn’t build the device your reading this from, or the printer you printed it from, or harvest the beans for the coffee your enjoying, farm and process the food you will eat later, provide your own medical care, or build your own shelter. And you certainly couldn’t have a conversation about how to do those things better.

Stopping all the activity that makes your life possible might be okay for a short while. It might even be nice. The pace will slow down, we can rest more, avoid conflicts. But the downside is huge. Stopping and isolating is inhuman. Think of all the first kisses that won’t happen, all the final farewells that will be missed, all the first, and last, trips that won’t be taken. Stopping and isolating is destructive. Think of the hospital services that will have to be cut, the research that won’t be done, the new breakthroughs in technology that won’t appear, the new cure that won’t be discovered. Stopping and isolating might be a near term solution to Covid-19 but stopping and isolating is a problem that festers with time. The quicker we move and get out, the better.

Josie Appleton – Director, Manifesto Club
“The lockdown has suspended all civil liberties and is having a devastating effect on social and economic life. It may be necessary for a period but should be relaxed as soon as possible so that people can resume their lives. Lost jobs, lost income and confinement also lead to mental health problems and even deaths, just as surely as can infectious disease. We should not allow the response to the virus to leave as heavy a toll as the virus itself. If these devastating lockdown measures continue for too long, there will be no money in the public coffers to deal with the sick from this or any other disease. Lockdown and confinement should not be pursued except with the greatest reluctance and as a temporary condition, not a permanent solution. Lockdown is antithetical to our society and economy, and to free life, and we need an exit strategy as soon as possible.”

Professor Simon Winlow – Professor of Criminology Northumbria University
‘I think that we can expect an immediate bounce back as soon as the lockdown is lifted. The principal attraction of the NTE for most consumers is the promise of social interaction. People missing seeing friends and family, and a night in the pub, or eating a restaurant-quality meal, will be top of many people’s list when we begin to emerge from the crisis.
That said, I am sure that many will continue to avoid those places that attract large crowds. It seems likely that the lockdown will be lifted long before the virus has been defeated. Responses will reflect perceived threat. Younger people are likely to be less concerned and so are likely to resume established consumer practices. Older patrons, or at least some older patrons, will continue to feel vulnerable and will approach leisure venues with a degree of caution. The more that venues can do to reassure prospective customers the better. An overt concern with cleanliness will help, but there are probably other things that can be done in this regard.

In terms of futureproofing, I think different sectors of the NTE will need to respond differently. Diversification can work in tandem with an awareness of brand and community. For example, much can be done virtually to ensure consumers – especially young consumers – remain attached to an NTE brand. Some music venues are already doing this. Many are now to using programmes that enable large groups to get together online. Everything from DJ sets to wine tasting classes can work to keep brands active during future periods of lockdown. Many restaurant owners will, I imagine, be ready to move into home delivery if a future lockdown arrives. Good, clear websites and reliable delivery will help. I imagine some restaurant owners will already be looking into moving into home delivery – it represents an opportunity to expand business even during the normal day to day business cycle. It’s quite easy to set up a website and a delivery service, but doing it well, perhaps with a few attractive extras added on, will no doubt set some apart. Establishing a strong virtual presence now seems increasingly important. In the future this will have to be more than a facebook page and a twitter feed – although these fora will remain important (but will have to do more in terms of engaging potential consumers than simply list menus or upcoming events etc). Some aspects of the NTE will need to respond differently to others. Virtual tours, virtual pub quizzes, virtual concerts, etc – much will depend upon the willingness of owners to get involved in these activities in the hope of securing brand loyalty and future revenues.

So, my conclusion is that the NTE is likely to remain one of the business sectors most effected by any future pandemics/lockdowns. The attractions of most aspects of the NTE are principally social – getting drunk, a good meal, etc are social activities. This won’t change. However, those involved in the NTE can take a few practical measures to ensure that the drop-in revenues in any future lockdown are less harmful and the bounce back is quicker. In any case, it makes sense for business owners to diversify income streams, put some effort into securing brand loyalty, and begin to explore what the virtual environment can do to make businesses viable in the long term.

Nick Morgan CEO – We are the Fair
Whilst the industry is on hold and many furloughed businesses shouldn’t be haemorrhaging money albeit it appears landlords are not engaging in any reduction discussions. Deferment is all well and good, but I refuse to saddle my business with a mountain of debt and then work the next 12 months to pay it off!

I didn’t realise until yesterday that the bank’s modelling for the CILBS is based on accounting for 20% of payroll during and after furlough. I have a fairly good relationship with our bank manager, and he is saying he can only account for 20% of payroll and 100% of other business fixed costs even when extending cash flow forecasts for 12 months to try and reach the maximum lending threshold.

This represents the top up during furlough however post I was shocked to hear no underwriting for a larger percentage of payroll.

This either uncovers the intention for Government to continue the furlough scheme for up to 12 months, however I am unsure how they can possibly underwrite unless every lending market is reset. Alternatively, it could be interpreted as a key indicator that they expect the economy and businesses to recover fairly quickly post furlough.

Unlike many other effected industries, if the outdoor industry misses its season(May-Oct) many suppliers won’t be into their normalised billing cycles until January/ February and based on a reduced lending threshold because of this new discovery means many simply cannot survive as they cannot draw upon the suggested max which was 25% of turnover

Most other industries can expect quicker recoveries, even indoor events as they can trade year-round (if sanctions are lifted). Even pubs and bars should in theory, upon reopening take reduced sales that same day. We have a fairly robust balance sheet so are maybe more fortunate, but many are less fortunate, and this sent alarm bells ringing with our FD and myself yesterday.

Paddy Whur CEO WoodsWhur
We have had a few weeks now to accept the “new normal” or at least what has to be normal for the immediate future.

Our general work has gone very quiet with current cases being adjourned and new applications being put on hold. I am pretty sure that whilst Local Authorities are being urged to start holding virtual hearings that most will be hoping to adjourn matters until face to face hearings can be heard. I undertake a large number of multi-party cases and do feel that these would be difficult to run properly. I certainly wouldn’t be looking forward to managing them. I had a video conference with four parties dialling in yesterday and unless all are very disciplined it becomes very clumsy.

Part of my specialism is festival and large event space licensing as I look after Printworks, Drumsheds, Field Day, Digbeth Arena, The Mill amongst others. The issues here are the time it takes to programme events and to go through detailed Safety Advisory Group meetings to ensure that events can run safely. I know that my clients will be champing at the bit to put on safe events as soon as the lock down is over. One thing is for sure, there will be no shortage of people looking for a good party.

Peter Marks CEO Deltic Group
The government have been working without experience and learning as they go to try and support businesses and support the health of the public at large. This is a terribly difficult task trying to balance the economy with the health of the nation particularly the vulnerable and of course public perception and politics in the mix. Overall, I think they have done a good job so far in trying circumstances. Furloughing, delaying VAT and no rates has saved us for now. I would have liked to have seen more for the self-employed too, but until there is help from the government and banks for landlords, to be able to pass that help on to us, then there is still a hole in the bucket. The answer is not to take a whole load of debt to pay the landlords to then kick the can down the road and run a zombie company for the next three years. I also think we are getting bogged down in the detail rather than seeing the big picture. We are spending too much time working out furlough questions Who is out? What happens with tronc? It is like rearranging the deckchairs on the titanic!

The next issue for the government though is that we need to get the return to social mixing right. Sure, it needs to be cautious, but we need it to be as fast as possible without pressurising the NHS, as the longer this goes on the more damage to the economy. And in case people forget, that pays for the NHS! And it won’t be the lack of government help that will put many businesses under, it will be the change in consumer behaviour. Whilst the night-time economy will, I believe, stand up quite well albeit I anticipate a cautious return of our customers, for the wider economy and climbing out of the recession/depression, just think how long it is going to take travel, tourism (particularly international) and airlines to return to anything like normal. They probably won’t ever. There is a new norm! Which means that we need to get the economy moving again as soon as possible.