Week of Reality Checks Offers London’s Restaurants Glimmer of Clarity

A complex seven days for the industry, digested and explained

by James Hansen@jameskhansen Apr 24, 2020, 2:43pm BST

The U.K. government ordered restaurants to shut down on 20 March, with a sizeable number having closed prior to that as uncertainty over novel coronavirus’ impact on the restaurant world grew. This is the first week in 35 sobering days that feels at least a little clarifying for the restaurant industry, even if that clarity also exacerbates and confirming long held fears about the ensuing months. A lot has happened, and it can be hard to see the wood for the trees, so here’s a digest of what has happened, and what it could mean.

On Monday, 20 April, one month after the government shut restaurants down, cabinet minister Michael Gove confirmed what social distancing restrictions and their longevity long implied: pubs and restaurants will be some of the last businesses to exit novel coronavirus lockdown measures. The Friday prior, chief executive of trade body U.K. Hospitality Kate Nicholls formalised a growing feeling in the industry: having previously focussed on when they might reopen, London’s restaurants were now focussing on how. Forget about when the future is; what does it look like and how is it survivable?

Visions of that future to date coalesce around one keystone: to survive coronavirus, restaurants can never go back to “normal.” They now face twin challenges, existential and practical. Adaptations to waxing and waning lockdowns and softer restrictions will have to respond to communities whose minds are wary, movements are restricted, and finances are tightened; whether or not those succeed, they pull back the veil on a fundamental truth: COVID-19 is going to transform what it means to be a restaurant.

But how do restaurants get there? A growing consensus — led, it must be caveated, by established, media-facing restaurant groups and large chains — is that only a nine-month rent holiday for restaurants and pubs and an equivalent deferment plan for landlords will see the sector avoid a “bloodbath.”

That won’t be enough by itself. Midweek, Nicholls presented the House of Commons Treasury Committee with five areas in which government intervention will remain essential through social restrictions. These include the rent holiday; an extension to the furlough scheme; an extension to business grants; acceleration of business loans; an expansion of insurance to indemnify businesses against future COVID-19 interruptions.

So: perhaps, with a package of sustained, genuine government protection and support, restaurants can think about reopening when lockdown measures are relaxed with some social distancing and epidemiologically validated practices in place. This assumes that diners will immediately want to come back. According to an initial YouGov poll, many won’t — and are wary, even scared — which is another ballast to the theory that restaurants need to place all their emphasis on meeting their customers where they are. Early evidence from Hong Kong and China suggests that restaurateurs cannot take this concern lightly.

They can’t take it quickly, either, as the U.K.’s chief medical officer confirmed what many people already felt was inevitable: social distancing measures will be in place through the end of the year. The restaurant industry first responded with a clear, stark message: this will be catastrophic.

It next responded with its most detailed, direct plan for the government yet: a plan designed to mitigate the expected yo-yoing between full lockdowns and softer restrictions; the vicissitudes of corona-time. Furlough scheme extension; rent suspended; improved access to grants and loans; a financial package to stimulate the market during periods of reopening; business rate reform; insurance guarantees.

As further data around coronavirus’ impact on the restaurant and food retail industries emerges, those vicissitudes of corona-time and its annihilation of restaurants’ former norm will become even clearer; there will be more pain for businesses, but also more clarity on what they can functionally do.

More soon.

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