The Day I Closed the Gates
Peter Banks, Rudding Park Managing Director shares his account of the biggest leadership challenge of his 35 year career
I am a Hotelier. Sadly, it defines my existence. For 35 years I have worked in, or managed organisations that provide Hospitality and welcome guests 24 hours a day, 365 days a year. I am part of the industry that never sleeps. Until now. The “clang” when I closed the gates was both literal and metaphorical.
Suddenly we have no guests, no staff, no reason to get out of bed. To say I feel rootless is an understatement. Strange times indeed.
The view of the pandemic from the Hospitality industry took five very distinct periods.
The first was the week when Boris told everyone not to go to the pub and restaurants, but gave us no support. In that week it is estimated that 250,000 Hospitality jobs were lost. This was the worst five days in my career. We’ve built Rudding Park over 24 years, and in 24 hours it all came crashing down.
The second period was one of euphoria, when that wonderful Mr Rishi Sunak (I love him and want his babies!) announced the Furlough Scheme that saved so many hospitality jobs while the scheme lasts.
The third was one of acceptance and hard work, only a handful of us were not furloughed. We tried to understand how furlough worked, we closed the hotel, turned off all appliances, moved all the furniture, emptied freezers (how much vanilla ice cream does one operation need across five kitchens?) and dealt with a barrage of phone calls from guests who understandably were trying to process the impact to them on their plans. Whilst emotions were heightened particularly for couples whose weddings had to be postponed, one guest called wanting to know what had happened to the bottle of gin he had won as a prize and left at the Hotel in November (yes – really!)
The fourth was settling into the ‘new normal’, zoom meetings, moving bookings, remote working, and starting to understand the financial damage this has done to our industry. We sell serviced space, if we can’t sell that space it is exactly the same as a manufacturer having a warehouse fire and all of his stock going up in flames. Make no mistake, there will be many hospitality businesses (primarily stand-alone restaurants), that will not reopen. The high street will be changed for good.
The fifth was trying to reimagine the Hotel of the future, with social distancing. How welcome will guests feel with the team wearing face coverings, going up to a perspex screen reception, ordering on an App rather than to a person, less service staff in the restaurant, how do you socially distance in a kitchen, booking slots in the steam room, additional and visible cleaning, temperature checks on staff and guests when walking through the door, a cashless society, no flags on the golf course, and what will revenues be like ….. The list is never ending and some will come true and some won’t – but the hospitality world that I have known has been turned on its head.
For an industry which only exists to facilitate social interaction, discouraging social interaction is against the very core of our being. We thrive on providing ‘hands on’ personal service, and this will not be possible.
When this is all over, and we emerge from our caves, shaking our heads and wondering if it was all a bad dream, please go to your local restaurant, pub, hotel, golf course, spa or Holiday Park and give them your support. As Hoteliers and service professionals we need to look after people and make people feel happy. It’s why we do our job and it’s what we’ve missed dreadfully.
As we say in Hospitality before a particularly difficult service, “I’ll see you on the other side”.
Chapter 2 – The other side…
I opened my eyes and realised that it was all a dream. How many of us wrote a story that finished like that when we were at primary school? I know I did and I still remember with toe curling embarrassment how proud I was…..
When I look back it does feel ‘otherworldly’, I remember the first half of March when we weren’t affected at all, but we could feel the menace creeping towards us, China, Italy, France, London, then us. Even the weather behaved itself, a beautiful spring, it almost felt like the Golden Summer of 1914 – the last hurrah before the world we knew was changed forever.
Sadly, this isn’t a dream, it is, to quote that dreadful new cliché, the new normal. This is now reality and we need to understand and manage it as well as possible.
Every day brings new information and new challenges. If I can review a few of the most recent it will give you a feeling of a worms eye view from the sharp end of hospitality.
- Track and Trace. The government has failed to create a system which tracks people’s movement. Therefore they have abdicated this responsibility to Hospitality operators. We have to record everyone who comes into a pub or restaurant. I have had to introduce a ‘no track and trace, no beer’ rule at our pub on the Holiday Park. Guests are very disgruntled at this invasion of their liberty, argue with us, abuse us and two guests even walked out as they “felt their rights were being threatened”. Please, it’s not our fault, we’re not being nosy, we are merely following the Government’s instructions and trying to help limit the spread of Covid.
- VAT reduction to 5% on accommodation and food in restaurants, cafes and pubs. On the surface a fantastic boost to the Hospitality industry as we will no longer be paying 20% tax on these items, just 5%. Why did Rishi take this sector specific action? Logically it can only have been for one of three reasons.
- He wanted to throw a financial lifeline to Hospitality operators in an attempt to get them through what I believe will be a dreadful autumn and winter by improving their profitability by 15%. To achieve this, prices would remain the same and the business would merely pay less tax.
- He wanted to generate additional demand for this industry, allowing us to reduce our prices by 15% and generate more business. However, what guarantee is there that the demand is there anyway, that the guest will choose to spend his 15% in Hospitality rather than on a new TV or that the guest will not just keep the money in his bank account?
- He wanted to give everyone a 15% saving on their hospitality spend to use in other sectors to stimulate the economy.
I believe he wanted to throw a lifeline to the Hospitality industry, however – how many people are going to expect to have the discount passed on to them? From a straw poll I have taken – the vast majority of my guests will want a discount. Therefore this 15% VAT reduction does not help the Hospitality industry at all, we will have the same level of demand (just because it’s cheaper doesn’t mean that nervous people will go to the Pub), and we will merely pass 5% of a lower price onto the government.
We will make exactly the same profit (or loss more likely!). So, a plea from me – if your local Chippy has not dropped their price by £1, or your Hotel has not decreased your room rate by 15%, please don’t give the owner or manager a hard time. Rishi deliberately made it sector specific to help that sector, not to put money in everyone’s pockets. If he’d wanted to do that he could merely have cut income tax or national insurance. I cannot state clearly enough, there will be many hospitality businesses that will not survive this winter. Please help them. You will still be paying the same price as before, It actually makes no difference to you. The Government is just trying to ensure that the Pub will still be open in April by allowing us to keep some more VAT.
- £1000 for every furloughed worker still in employment on January 31 2021. This is a wonderful gift for many Hospitality operators who will need every scrap of financial help they can get next winter. However, what Rishi is asking us to do is continue employing a member of staff for the next six months rather than making redundancies and receive £1000 for taking that risk. For a seriously damaged industry like Hospitality that equation doesn’t stack up. Right now every operator that I know is making “clear, reasoned decisions to save as many jobs as possible”. That is a euphemism for having to make redundancies otherwise the business will not survive. Some sectors have increased profitability in this crisis, supermarkets, logistics, some manufacturing, yet they will also receive this boon. A sector specific extension to the Furlough scheme would have been better, the money could then have gone towards helping Hospitality through to next Spring when the good times will return (I hope!).
These examples are not dreams, they look fantastical, but they are reality. Six months ago 5% VAT on accommodation was laughable. These keep me and my fellow Hospitality leaders awake at night, trying to unscramble meanings and the future from our very cloudy crystal balls. We re-opened Rudding Park Hotel (accommodation and Restaurant only) on Monday 13 July and I pray I have made the right decisions and chosen the correct path.
The great news is that we are open, we have taken advantage of all of the Government schemes, I have a fantastic team who have supported me through every challenge and we ware up fighting and plan to to winning next spring when the good times return.
We have to accept the rules and mores that we used to work to have changed absolutely, and only those businesses that change will survive. It doesn’t matter how big and powerful you are - if you do not change you will become extinct.
2020 has undoubtedly brought the biggest leadership challenge of my 35 year career. The world has been fundamentally changed, and in my darker moments I wonder if I will ever be the same leader as I was before. That innocence of early March feels like it happened to a different person.
To quote LP Hartley in “The Go-Between” – “The past is a foreign country; they do things differently there…”
We hope to welcome you back to Rudding Park soon and do what we enjoy - caring and looking after our guests.