Covid in Scotland: 'Devastating' December for hospitality
- Published
Most hospitality businesses are not viable following a "devastating" December, an industry body has warned.
The Scottish Hospitality Group (SHG) said its members took only 20% of last year's earnings during the crucial Christmas trading period.
It estimated members lost on average £12,000 in revenue per week, per premises.
SHG represents several well-known bar and restaurant businesses, including DRG Group, Signature Pubs and G1 Group.
In a statement, the group said the "massive" cut in revenue would impact payments for property and equipment rent and utilities until at least the summer, affecting suppliers and investors among others.
It also maintained that revenue losses would throw into doubt existing plans for £30m of investment in 27 premises which would create hundreds of new jobs, as well as protect existing ones.
SHG spokesman Stephen Montgomery said: "Without Christmas, when we earn around 30% of our entire annual income, most hospitality businesses just aren't viable.
"We've had the worst December's trading in living memory and we're facing the worst start to a year ever."
'Completely inadequate support'
SHG also described the financial support available during the coronavirus pandemic as "completely inadequate", and claimed that much of it had yet to come through.
It also argued that it was "unclear even what businesses are entitled to due to conflicts between the Holyrood and Westminster governments".
SHG said: "Instead of helping, our political leaders are squabbling with each other. It's like arguing about who throws the lifebelt when someone's already under water."
The group also said that during lockdown, businesses spend on average of nearly £6,000 per week per premises on fixed costs and contributions to the furlough scheme.
It called on the Scottish and Westminster governments to work together to support the sector.
Mr Montgomery said: "We will soon be proposing specific, realistic measures that both governments can introduce so we've got a fighting chance of getting back on our feet by next year.
"First of all though, we need them to grow up and start working together so that the hospitality sector still exists to drive our economic recovery once the virus is under better control."
'Horrendous December'
First Minister Nicola Sturgeon acknowledged at a media briefing on Thursday that December had been "horrendous" for hospitality businesses.
Most were shuttered in the central belt of Scotland throughout the month, while others elsewhere had strict opening times imposed on them.
When asked if she believed support had arrived quickly enough, Ms Sturgeon said: "I always want things to happen more quickly.
"I want to see the money, the substantial amounts of money we are rightly making available to businesses that are impacted, get to those businesses as soon as possible.
"There's more than £2bn gone to businesses already and with hospitality in particular, where businesses are closed for a lengthy period, the money is paid every few weeks, so it's an ongoing support."
Ms Sturgeon also pointed to "top-up" payments announced before Christmas for hospitality to help recoup some losses from the festive trading period.
'Swift action'
A spokesman for the Treasury said: "We've taken swift action throughout the pandemic to protect lives and livelihoods, and this week's cash injection will ensure we continue to support businesses and jobs through to the spring.
"We've already extended the furlough scheme until April, providing certainty for businesses as they navigate the months ahead.
"And we'll have a Budget in early March to take stock of our wider support, and set out the next stage in our economic response."
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