Coronavirus Impact - Insights - 23 July 2020 - Marketing Cheshire
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Coronavirus Impact – Insights 23 July 2020
1. Introduction Marketing Cheshire is the official Destination Management Organisation (DMO) for the region working with over 1,000 businesses. Alongside Cheshire & Warrington Local Enterprise Partnership (LEP), our DMO has direct line connections with Government Ministers, Cheshire East, Cheshire West & Chester and Warrington Local Authorities, local MP’s and all businesses across the county. Our connections with the LEP has enabled us to be an integral conduit, to cascade essential information to businesses regarding funding and support available to businesses across the region. It is hoped that this will ensure businesses are able to sustain this difficult period and remain trading following the crisis. 2. Consumer Insight Leisure Visits As at 3 June, Visit Britain reports that the inbound value of tourism to the United Kingdom from overseas visits, is expected to reflect a 59% decline in visits to 16.8million, equating to a 63% reduction in spend to £10.6bn. Compared to the pre-COVID forecast of 25.3m visits and £19.7bn spend. The outlook for England this year assumes a £39.2bn spend in domestic tourism, down 48% from 2019 figures. This is made up of £10bn from overnight tourism, down from £19.5bn in 2019 and £29.1bn from day trips, down from £56.5bn in 2019. Whilst the UK prime minister indicated last week that England should be able to move away from social distancing measures by November and return to ‘normality’ by Christmas, the UK survey ‘Tracking Consumer Sentiment on the Impact of COVID-19’ continues to demonstrate the nation’s caution; 85% anticipate a second wave of the virus and new lockdown in the future. The graph below shows for the 5th consecutive week that UK adults believe that the worst of the virus is yet to come.
As more sectors of the economy begin to open with new measures in place in a post COVID world, just one in four believe life will be close to ‘normal’ by the end of 2020. In order to segment the market, BVA BDRC have introduced attitudinal market segmentation for the visitor economy. This will guide businesses on who to target and how to access them. The next stage is how to attract and retain them, whilst maximising spend. For intricate detail on the traits of each segment, please see pages 15-19 of the report. Looking at holidays and travel, whilst numbers remain low, all segments are active in the holiday and travel sector, with the COVID cautious showing as most likely to travel.
As visitor attractions have been permitted to be open for a few weeks, the growing confidence to visit peaked last week. With increased leisure time options becoming available now, we are starting to see a slight decline in those that intend to visit attractions before the end of the current year. Encouragingly, the average lead times for intending to go to a visitor attraction, these have fallen, showing a direct correlation between planning and actually visiting.
Although the proportion of people looking to book a UK holiday peaked at the end of June, the outlook still remains positive for the remainder of the year, with a quarter hoping to book a domestic break before the end of August, a third by the end of September and over 40% by the end of the year. This converts into almost mirrored figures for when the holiday is actually going to take place.
Following the government announcement of the reduction of VAT from 20% down to 5% for tourist attractions and hospitality businesses, consumers were asked what impact this would have on their likelihood of: Looking at the demographic split, pre nesters (16-34 with no children) and younger adults and families with children at home, showed the greater likelihood of making the most of these VAT changes. Eating Out Visiting paid for attractions Taking a holiday in the UK
3. Business Insight Just over half of businesses are spending more time thinking about the future of their business, coming out of ‘crisis mode’. When asked what the future will bring, 4 in 10 businesses can see more opportunities than threats in the future. A third of working consumers lack confidence, or are unsure if their job is safe for the foreseeable future:
4. Summary of Industry Updates Businesses closed on 20 March 2020 and on 10 May, the Prime Minister confirmed the initial steps of an exit strategy to come out of lockdown. By the end of May, the first outdoor visitor attractions started re-opening, which included Arley Gardens and Tatton Park in Cheshire and from 4 July most catering and hospitality businesses, accommodation providers and visitor attractions across the region have started to phase re-opening. VisitBritain has launched ‘We’re Good to Go’ Industry Standard and consumer mark to reassure customers that businesses are adhering to Government and public health guidance. What’s more, the Visit Cheshire website is showcasing the Cheshire businesses who have signed up. As at 8 July, 151 business across Cheshire had already been accredited with over 5,000 applications in total received since its launch. The UK Housekeeping Association have launched their new COVID 19 Secure Toolkit, though this can only be accessed by subscribing to their membership, which is available from £35 per year. There has been feedback from several Hotels that have put new systems and processes in place, including smartphone digital food and drink menus and ordering, outdoor dining and drink areas, digital room keys and self-check-in and check-out via mobile phone apps. Whilst leisure tourism businesses are reopening, the clarity for business visits and events has been somewhat slower. On 17 July there was finally been some clarity for the events industry, with the prime minister announcing that business events for up to 30 will be permitted from 1 August and conferences and exhibitions are permitted in England from 1 October 2020. The Meetings Industry Association (MIA) have launched a Roadmap to re-opening and operating safely, specifically for the meetings and events industry. In addition the MIA have produced an extremely useful COVID-19 Contract Guidance document – which gives you suggestions on amends that you may need to consider making to your terms and conditions, to protect both the venue and clients in case of a future lockdown. AIM Secure is managed by the MIA and Hire Space have also released a White paper for venues: Managing the risk of COVID-19 in organised meetings and events – both are worth reviewing to take into account necessary planning for welcoming delegates back to your venue. The MIA have also released an extremely useful COVID-19 Contract Guidance document – which gives you suggestions on amends that you may need to consider making to your terms and conditions, to protect both the venue and clients in case of a future lockdown. The BVA-BDRC insights, details that a report launched this week indicates 31% of office- based businesses are looking to reduce their office space (more than half of these, significantly so). This could present an opportunity for business visits and events. As more teams migrate to home working, there will be an increased need to have regular meetings at venues – if there is not sufficient office space available.
5. Summary of Government Updates The government made an announcement on 8 July, allowing VAT registered businesses to apply a temporary 5% reduced rate of VAT to certain supplies relating to hospitality, hotel and holiday accommodation and admissions to certain attractions. This will apply to supplies that are made between 15 July 2020 and 12 January 2021 to help get the industry back up and running again. Another initiative, the Eat Out to Help Out Scheme launched on 9 July, offers diners a 50% discount, up to a maximum of £10 per person, for food or non-alcoholic drinks to eat or drink in, and businesses to claim back money from the government. A further £10million has been pledged by government for small businesses to kickstart tourism in communities that depend on tourism. Grants of up to £5,000 will be given to help businesses to adapt and implement necessary measures following the COVID-19 pandemic. Funding can be used to pay for specialist professional advice such as HR, legal or financial and this is wholly funded from government with no obligation for businesses to match fund. Find out if your business is eligible here The Government’s Coronavirus Job Retention Scheme has been extended until October 2020, and also allows employers to bring back full time employees on a part time basis, and receive grant payments from the furlough scheme for hours not worked. Note, from 1 August, employer national insurance and pension contributions will not be covered by the scheme and will need to be paid by the employer. A step by step guide for employers has been set up advising of the process for businesses to follow. The Self Employment Income Support Scheme is open for applications to claim a second and final grant from 17 August, you can check eligibility here and find out how to make your claim here Applications for Bounce Back Loans were made available on 4 May, specifically for small and micro businesses (including B&B’s). The Government has released guidance for employers to get British people back to work safely, along with a frequently asked questions document, to clarify what you can and cannot do. Finally, there is a working safely during coronavirus document, that has been released, detailing how to make work places COVID-secure.
6. Regional Summary
See below a summary on how opening on the 4th July went, most businesses are happy to
be open and seeing customers once again, however we need to sustain the level of business
throughout the summer into next year.
Attractions
- Slower than usual but profitable
- Encouraging, as busy as capacity allows
- Repurposed theatre into a cinema and doing well
Hotels
- Happy customers, high praise for efforts hotels are making – keeping customers safe
but also still welcoming
- Breakfasts more difficult, not working yet
- Not as busy as usual but not able to quantify yet
Self-Catering (city)
- Concern around lack of international guests
- Feel they have to allow 72 hours between guests to allow for cleaning
- Groups such as Sykes Cottages have dropped prices – difficult to compete
Self-Catering (rural)
- Busy, almost full for summer, domestic audiences from across the country.
Restaurants
- 25% of normal trade – where there is outdoor space this increases % significantly
Retail
- Footfall in Chester about 55% usual
The latest figures are shown below from 13 July, confirming government funding that has
been provided to businesses across the three Local Authority regions in Cheshire:
Funding Businesses Businesses Total paid
Cheshire Council
allocated eligible paid
Cheshire West & Chester £71million 5,843 5,559 £67.3million
Cheshire East £95.5million 7,483 6,872 £83.1million
Warrington £36.5million 3,049 2,822 £35.8millionTOTAL £203million 16,375 15,253 £186.2million The Growth Hub webinars offering guidance on how businesses can work safely following the upcoming relaxation of lockdown rules can be viewed again. There is also practical guidance on local suppliers who can provide specialist equipment to support your business with social distancing, protective screens and hygiene supplies. 7. Sources & Useful Links Tracking Consumer Sentiment on the Impact of COVID-19 Weekly update – 23 July 2020 http://www.bva-bdrc.com/wp-content/uploads/2020/07/BVA-BDRC-Covid-19-Week-17- final-23072020.pdf Update on Grants funding released by region Published on 22 July 2020 https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_ data/file/902376/200720-local-authority-grant-payments.csv/preview VAT: reduced rate for hospitality, accommodation and attractions Updated 21 July 2020 https://www.gov.uk/guidance/vat-reduced-rate-for-hospitality-holiday-accommodation- and-attractions Prime minister confirms events industry restart date 17 July 2020 https://www.conference-news.co.uk/coronavirus-updates-news/prime-minister-confirms-events- industry-restart-date Working safely during coronavirus Updated 17 July 2020 https://www.gov.uk/guidance/working-safely-during-coronavirus-covid- 19?utm_source=94aa2153-1067-4821-b5a1- 56fca266ff21&utm_medium=email&utm_campaign=govuk- notifications&utm_content=immediate Tracking Consumer Sentiment on the Impact of COVID-19 Weekly update – 15 July 2020 http://www.bva-bdrc.com/wp-content/uploads/2020/07/BVA-BDRC-Covid-19-Week-16- FINAL.pdf Register your establishment for the Eat out to help out scheme
Updated 15 July 2020 https://www.gov.uk/guidance/register-your-establishment-for-the-eat-out-to-help-out- scheme Claim a grant through the Self-Employment Income Support Scheme Updated 14 July 2020 https://www.gov.uk/guidance/claim-a-grant-through-the-self-employment-income- support-scheme Government announces £10million for small businesses to kickstart tourism Updated 3 July 2020 https://www.gov.uk/government/news/government-announces-10-million-for-small- businesses-to-kickstart-tourism Changes to the Coronavirus Job Retention Scheme Updated on 1 July 2020 https://www.gov.uk/government/publications/changes-to-the-coronavirus-job-retention- scheme/changes-to-the-coronavirus-job-retention-scheme 2020 Tourism Forecast: Revised inbound outlook for the UK in 2020 Updated on 3 June 2020 https://www.visitbritain.org/2020-tourism-forecast Bounce Back Loan Scheme Launched on 4 May 2020 https://www.british-business-bank.co.uk/ourpartners/coronavirus-business-interruption- loan-schemes/bounce-back-loans/ MIA AIM Secure https://www.mia-uk.org/AIM MIA COVID-19 Risk assessment template https://www.mia-uk.org/Safety-Resources MIA Guidelines for Contracts https://www.mia-uk.org/COVID-19-Contract-Guidance MIA your roadmap to reopening and operating safely https://www.mia-uk.org/Safety-Resources Hire Space white paper: Managing the risk of COVID-19 in organised meetings and events https://hirespace.com/c/safer-events/white-paper-download UK Hospitality Association Support & Information
https://www.ukha.co.uk/covid-19
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