“A lot of people have used the grant for the first time they go out again – it takes them once or twice to get out of their homes to feel comfortable,” says Will Beckett, co-founder of the Hawksmoor steakhouse chain . .
Six of its restaurants have received a total of 15,000 reservations for the 13-day “Eat to Help” program, while two locations remain closed.
“The most obvious way in my mind to help restaurants is to help people relearn how to go out,” Beckett told the BBC.
The government promotion, launched this week, offers people a reduction of up to 50% up to a maximum of £ 10 when they eat or drink soft drinks at a participating restaurant or other food establishment every Monday, Tuesdays and Wednesdays in August.
It’s the start, but there was an average increase in visits to retail destinations of 2.3% on Tuesday August 4 and Wednesday August 5, compared to the previous week, according to industry analysts. Springboard.
Meanwhile, restaurant reservation website Opentable found that the number of customers making reservations jumped 10% on August 3, compared to the same day in 2019.
“The attendance results for the three days Monday through Wednesday indicate that the ‘Eat Out to Help Out’ program benefited retail destinations after 6 pm, more than lunch time. In addition, smaller towns in the UK saw a larger increase in attendance than larger towns. centers, ”says Diane Wehrle, director of Springboard Insights.
“Over the three-day period, footfall to retail destinations across the UK increased 18.9% after 6 p.m., compared to a 9.6% increase at lunchtime (12 p.m. -14 hours).
“And in market towns across the UK, the 25% increase in footfall over the same three days the previous week was a third more than the 19.2% increase in regional towns.
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Despite the resumption of business, Hawksmoor ‘M. Beckett expects the program to cause a “slight shift” where “some of the demand shifts to Monday-Wednesday, Thursday-Sunday.”
The additional bookings have been helpful to the business, but only to a limited extent.
“We got 50% more coverage, but we didn’t realize 50% more revenue because our spend per coverage is high,” says Beckett.
“Even though people go out less often than before, even though they spend less than before, the bottom line is that they go out, and that must have a positive impact on the economy as a whole. ”
Other restaurant chains are more cautious about the overall impact of the program.
The Restaurant Group – which has a portfolio of restaurants and pubs including Wagamama, Frankie & Benny’s, Chiquito, Garfunkel’s Restaurant and Brunning & Price – remains cautious.
“We have seen a very strong customer response to the program, but we are not complacent and the real proof of the pudding will be when the program ends at the end of August,” said a spokesperson for The Restaurant. Group.
‘Too early to say’
UK Hospitality, an industry group representing the sector, said it was too early to say whether the program could cause consumers to change the days of the week when they prefer to dine out.
“Anecdotally, it looked like business was good Thursday night, so hopefully the demand, supported by the good weather, will continue to be strong this weekend,” said Managing Director Kate Nicholls.
Luke Davis is Managing Director of IW Capital, a UK venture capital firm that focuses on high growth companies, including the hospitality sector. He believes there is still a long way to go to help the hospitality industry survive.
“Whimsical projects like the ones we’re seeing right now aren’t going to stop the carnage,” says Davis, owner of Rockwater Bar and Restaurant in Hove, and a major shareholder of the Brewhouse and Cuisine pub and restaurant chain. .
“The sad truth is that people are still scared, the damage has already been done. People are always nervous [to go out to dine]. »
Barclaycard’s spending data suggests Mr Davis may be right. Although the total value of spending in UK restaurants between Monday and Wednesday increased 9.3% from the same period the week before, it is still 11.2% lower than the same period of the year last.
Mr Davis firmly believes that the only way to solve the problem is to inject more investment into the hospitality sector.
It is particularly critical of a change in legislation in March 2018 which made the government’s Enterprise Investment Program (EIS) no longer applicable to the hospitality industry “at large”.
“People were really annoyed about it, it meant the net investment in the industry went down,” Davis said.
“A real quick win and something that would give the industry longevity would be to encourage investment, to allow hotel companies to qualify for the EIA. ”
The EIS is a government program that offers tax breaks to individual investors who buy new shares in qualifying companies.
A spokesperson for HM Treasury said: “Since the start of this crisis, we have provided tremendous support to the hotel industry… [including] a 15% reduction in VAT, cash grants of up to £ 25,000 per commercial property, 100% reduction in commercial tariffs, eviction protection and tax deferrals. ”
Mr Davis said he was recently contacted by several people in the hospitality industry, asking him to raise funds to buy distressed assets.
“To bring the sector back to life, there will be a lot of investment. The government will not be able to stop the rot. You need people to come and buy those assets, people who are willing to do it. take the risk, ”he added.
“But that would still be a risk, because nobody knows what’s going to happen. There is no guarantee. “