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British pubs are at the crossroads - which way to turn?

Even if you didn’t frequent the Queen Vic or The Rovers Return as much as the residents of Walford or Wetherfield you knew what a pub was and what they were for.    They were as much a part of the local community as the library, church or community centre and gave everybody the opportunity […]

British pubs
Even if you didn’t frequent the Queen Vic or The Rovers Return as much as the residents of Walford or Wetherfield you knew what a pub was and what they were for. 
 
They were as much a part of the local community as the library, church or community centre and gave everybody the opportunity to find what they were looking for. 
 
Whether it's a convivial company to share and celebrate good news, space and silence to consider bad, or the chance to sample drinks and food from around the world or just down the road - the pub is an integral reflection and representation of the people of these isles. 
 
So it’s staggering given the dire straits that the hospitality industry and specifically pubs and bars find themselves in that there is still a widespread ignorance or apathy to the fate starring many of them in the face. 
 
A new study from pub industry data specialists CGA found that nearly a third of licensed premises had already closed their doors before the second UK lockdown was announced and implemented. 
 
69.9% of respondents were trading at the end of October 2020, a fall of more than 10% on the previous month or the equivalent of nearly 12,000 pubs shutting up shop. 
 
It’s still unclear how many of these closures are temporary or permanent but a sobering assessment from three of the leading beverage trade groups expected that 43% of closed outlets would never reopen. 
 
The research found that many of the closures were triggered by the three-tier system of restrictions which forced pubs and bars in “very high” or level three alert areas to close unless they were serving substantial meals along with drinks. 
 
While the numbers of pubs and bars open in level one and two areas respectively were over 80%, just over half (52.8%) of licensed premises in level three areas were reported open at the end of October.
 
The study also highlighted the dramatic impact the 10pm curfew had had on a struggling sector. 
 
Only 63.1% drink-led businesses remained open at the end of October compared to 79.9% of food-led businesses and 81.3% of casual dining restaurants including chains.  
 
Well-capitalised pub and restaurant groups will be better placed and resourced to survive the second lockdown intact with 81.8% of their managed venues remaining in operation. This is compared to the 63% of independent sites that were still open and relying on a dwindling combination of savings, loans and overdrafts to make it through to December 3rd when the current lockdown is scheduled to be lifted. 
 
Karl Chessell, head of Food and Retail research at CGA said: “It’s very clear from this report that every new restriction damages businesses’ ability to trade. 
 
“With Englad entering a second lockdown, we are unlikely to see Britain’s licensed premises return to the levels seen in the summer, let alone pre-pandemic, for a long time.”
 
He added that the extension of the Coronavirus Job Retention Scheme (CJRS) furlough would help but urged even more government support to “prevent a wave of permanent closures over the winter.”
 
The industry took heart from some good news that would allow some establishments to sell takeaway alcohol under certain restrictions. 
 
Selling a few gallons of beer to customers instead of having to dispose of it down the drain will be a small comfort to the bars and pubs that can do it but it’s still a drop in a pint glass compared to the hundreds of thousands of pounds of lost revenue that won’t recouped by the industry even if they are all allowed to open their doors again without restriction next month. 
 
Every good landlord has to have the instinct and nerve of a poker professional - when to stick with what they’ve got; when to gamble based on their instinct and evidence that things will improve and also when to fold. 
 
Circumstances mean that not every otherwise profitable pub will be able to reopen when Covid-19 is nothing more than a quiz answer and a sad memory.
 
This doesn’t mean that they have to wait for the inevitable - they can take the initiative and get in touch with somebody who can help right now.
 
We’ll provide a free initial consultation where they can set out what the situation their business is facing and we can let them know what steps they can take - today - to change it. 
 
Depending on a lot of factors, they could consider a CVA or administration to buy them time to work out a rescue and restructure which will give the company every chance of being able to come good again.   
 
They might even decide that if they are having to close then they could do it properly and allow themselves to begin again later with a clean slate.
 
What has happened to hundreds of pubs and bars across the country this year has been a tragedy but it’s equally tragic to consider closing down without exploring all the help and advice that’s still here for you - whenever you want it.

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Business Rescue Expert is part of Robson Scott Associates Limited, a limited company registered in England and Wales No. 05331812, a leading independent insolvency practice, specialising in business rescue advice. The company holds professional indemnity insurance and complies with the EU Services Directive. Christopher Horner (IP no 16150) is licenced by the Insolvency Practitioners Association

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