Voices of Hospitality

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Voices of Hospitality

Voices of Hospitality

Mark Harper, Non Executive Director at Hubbox, is an accomplished Board Director with extensive experience in leisure, hospitality and holiday parks.

HGEM had the pleasure of interviewing Mark to explore his vision and predictions for what 2021 is going to be like for hospitality, and the unique opportunities and challenges that the year will bring.

What do you think 2021 is going to be like for hospitality?

It will be a roller coaster year for certain. The first big challenge will be liquidity and the extent to which hospitality businesses will survive close down. Those that will be under most pressure will be those with significant debt (often PE backed) and leasehold businesses. The end of the rent moratorium in March could be a car crash for restaurant and pubs, with many carrying more than a year of unpaid rent. They will have no choice other than to CVA in order to survive. Those quality businesses with decent balance sheets and comparatively little debt, will survive lockdown and should see a tremendous uplift in revenue as the year progresses and the restrictions are lifted. Demand will be through the roof and supply will have contracted. The second half of the year should be record breaking. For holiday parks, demand will be high when restrictions are lifted, but supply of caravans will be an issue as will the debate about site fee refunds.

What are the opportunities?

There will be opportunities in terms of acquisitions of pubs and restaurants with quality businesses and PE funds able to acquire distressed groups/sites at knock down prices. The other opportunity will be for businesses to adapt to a new customer profile – delivery and take out will be ever more important as will maximising table service, payment apps and outside areas. At the same time all day trading will be key as restrictions may still limit capacity. Holiday accommodation businesses will be a sweet spot, but the opportunity is probably more in price than volume. The other opportunity in the holiday park space will be an influx of customers who have not holidayed in the UK for years – a great opportunity for operators to impress and secure a new loyal customer base.

What kind of foundation can companies start laying now, ready for when the country starts opening up again, to maximise the opportunities?

Probably two-fold. Firstly, fixing their balance sheets. Secondly, planning for the opportunities highlighted above. Restaurants and pubs should be exploring all day trading, table service capability, delivery options, and outside areas. Holiday parks and accommodation providers should be brave and invest capital to grow accommodation provision.

What are the key innovations you see happening this year?

In restaurants, more simplified menus, all day trading, increased delivery only brands, and increased focus on no and low alcohol drinks ranges. In holiday parks, increased provision of outdoor entertainment, and a move away from the traditional arcade/showbar provision.

How important do you think digital transformation is for hospitality and what have you implemented or are planning to implement in the near future?

It will be critical. Order and pay apps in restaurants will be essential and we will see a move towards cashless operations. In holiday parks, the provision of Wi-Fi will be ever more important with less emphasis on indoor entertainment and an increased tendency towards streaming.

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