‘We need to declare a hospitality emergency’

Hangovers from Covid combined with Brexit and the cost of living crisis has created a perfect storm for our independent restaurants, pubs, bars and food and drink producers.

These last few months we have had to say many sad farewells to some of Bristol’s best and brightest hospitality businesses. It is time to declare a hospitality emergency.

Hoba, which only opened their first permanent premises in March, recently released a statement saying that they “have been hit hard by the energy crisis. Despite all the advice, negotiations and battles we’ve fought, we cannot find a way to move past our current situation and absorb these costs.” Their last service will be on Friday.

Hoba’s permanent premises only opened in March this year – photo: Martin Booth

Last week, it was Newtown Park announcing they had stopped production. In the last few weeks and months, Bombolini, Falafel King, Bakers & Co, Shake Wrap & Roll, Seitan’s Corner, Woky Ko and Casamia have all closed their doors for a number of different reasons.

But why is this happening now?

The cost of living crisis is by far the biggest culprit. In the summer, I spoke to Dom Borel of Bianchi’s Group where the energy bill had quadrupled even before the price hike.

For Newtown Park brewery in St Philip’s, it was a 500 per cent increase on their energy bill quote that sealed the deal following a few months of difficult trading conditions.

Jan Ostle from Wilson’s on Chandos Road in Redland said his energy bill for the Bread Shop a few doors down has gone from £250 to £3,000 a month.

Inside Wilson’s Bread Shop – photo: Martin Booth

The government has offered an energy bill relief scheme which automatically applies a discount for non-domestic customers, similar to the support scheme on offer for domestic households. However, it is clear by the rate of closures that it is not nearly enough.

It’s not just the price increase either, but also the lack of communication around the help available which has made it nearly impossible for businesses to plan.

Newtown Park co-founder Lara Light-McKelvaney said that she spoke to EDF to ask what the government support was “and they didn’t actually know”.

“They said we’re really sorry, we would tell you if we could but we haven’t been told. Even if we could get it, it would only be until March. The energy use for brewing is pretty much the same all year round.”

The Hospo Demo took place outside the Houses of Parliament in November – photo: Hospo Demo

Rachel Harty is a freelance PR and marketing consultant for hospitality businesses, and the organiser of Hospo Demo. Hospo Demo is a protest that most recently took place in November to urge the government to increase their support of the hospitality industry.

Rachel said: “They’ve admitted that hospitality is classed as a vulnerable industry, but they’re not doing anything.

“The government have been really inconsistent with their messaging. They didn’t even seem to know what support was available themselves for a while, they were too busy with political infighting.”

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The energy hike is affecting all stages of the supply chain. Jan from Wilson’s said that he believes one of the reasons that his restaurant and bread shop are still doing well is because growing their own produce in their market garden has insulated them from cost increases.

Michael McKelvaney of Newtown Park added: “All our supply costs and going up and overall, our customers are seeking more value because they are being squeezed as well. People want good prices from us but our costs are going up, so we’re finding it impossible to absorb that cost.”

It’s not just the businesses themselves that are struggling with the cost of living, but staff too. Staff costs have also risen hugely and in April there is due to be a rise in the minimum wage in April looms on the horizon.

That’s if businesses can find the staff in the first place. Staff shortages in hospitality are becoming a more and more frequent occurrence, meaning that for some of the businesses that can afford to open they often don’t have the staff to do so.

One of the three requests of Hospo Demo is a visa scheme for overseas workers. Rachel said: “we need a visa scheme for overseas workers to be able to come and work in hospitality. It is the case that there are some businesses that can afford to keep going but they’re struggling for staff so much that they have to close for certain services, they can’t open and keep running their staff into the ground.”

Big Hospitality reported last week that a third of hospitality businesses have been forced to reduce opening hours over the Christmas period as a result of ongoing staff shortages.

The cost of living crisis is affecting customers too.

While Jan from Wilson’s said they have mostly been okay, he recognises that it’s not the same story for many of his peers. “December has been a disaster, from what I hear. Basically the month of December, you want every single day to be like a Saturday. It hasn’t been like that, because people don’t have any money.”

Rachel Harty from Hospo Demo agrees. “With the cost of living crisis, hospitality is one of the first things to go because it’s a discretionary spend, so they’re not getting as many customers through the door.”

Newtown Park had been seeing a steady decline in trade since the summer and cited the uncertainty of whether there would be government support over the winter as a key reason.

The icing on the cake is the recent rail strikes.

Lara Light-McKelvaney feels they have been hung out to dry. “Even looking at the rail strikes, the impact that has on hospitality is massive. People can’t get to work, people can’t get to places to go out for dinner.

“That’s not a statement against striking staff at all. It’s the government’s inaction against so many different industries and the ripple effect that has.”

Hart’s Bakery – who recently celebrated a decade at Temple Meads – wrote on Instagram last week: “The bakery team is in full Christmas mode but we’re missing our regular commuters and train travellers this week so much quieter than we’d like!”

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It makes me furious that the government is willingly allowing energy companies to seal the fate of our independent restaurants, pubs and bars while they hoard money.

These are the fates of people who have put everything on the line to open a business that they believe in. These businesses are often their only livelihoods.

It also doesn’t make financial sense to let these businesses go under.

Hospitality creates £130bn in economic activity and generates £39bn of tax for the exchequer. It also represents ten per cent of UK employment, six per cent of businesses and five per cent of GDP.

It is the third largest private sector employer in the UK; double the size of financial services and bigger than automotive, pharmaceuticals and aerospace combined.

“The thing that’s so stupid from the government is that all those business interruption and Covid loans they gave out then won’t be paid back,” Rachel added. “They’ll be losing all the VAT and duty that would have been paid.”

Jan is angry at the government’s failure to act: “You feel like there is no understanding from the government, considering how much revenue is generated from hospitality and how many people it employs. It’s an important part of what makes up England. I don’t think it’s malicious, I just think it’s naïve.”

The government failed hospitality during the pandemic, with poorly made and badly communicated decisions. Now they are doing it again, only it seems to me that it’s not getting nearly the same attention as it did previously.

We’ve had it so good in Bristol. We are a city known for our fierce independence and for our food scene. We have one of the highest number of restaurants compared to our population of anywhere in the UK. But we are at serious risk of losing all of that.

Falafel King is a Bristol institution that closed its doors this month – photo: Martin Booth

Rachel thinks that January 2023 will sadly see a mass closures. “Lots of businesses that are on the brink are thinking let’s see it through to the end of the month, get as much cash in as we can and then cut our losses.”

It is now a case of ‘use it or lose it’ for your favourite local businesses.

Rachel added: “Please be as nice as possible when going out. Reports from hospitality are saying that people are being nastier than ever. Please tip generously, support your local independents. Just be nice.

“Use them as your special occasion place. If the shit hits the fan and things get worse they won’t exist anymore. Then when times are better for you and you want to go out and celebrate your birthday or wedding anniversary, those places won’t be there anymore.”

Ultimately, however, it is the government that needs to wake up and take quick, decisive and well-communicated action to save our hospitality industry. A decision on further energy bill support for businesses has been delayed until the new year.

So many times those in power fail to understand the nature of emergency. With small businesses up and down the country closing their doors permanently every single day, we need action now. This is an emergency.

Meg Houghton-Gilmour is Bristol24/7’s Community & Membership Manager

Main photo: Meg Houghton-Gilmour

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