Getting back to business – your guide to reopening safely
We spoke to Michelin Starred Chef and hospitality business consultant John Wood to get his advice on the factors to consider before reopening your business. These factors will help you to build a structured “Back to business plan” that will drive revenue whilst keeping your staff and customers safe.
As hospitality business start reopening, different regions may move in and and out of lockdown. A reactive approach is not good for any business, particularly one that’s been out of operation for more than 3 months. It’s imperative to start making plans for various different scenarios. Now, more than ever, operators and owners have the time to do this and can be using this time wisely.
Getting back to business: what we do know…
There are number of things we can assume will be the case when hospitality businesses are allowed to reopen:
- Openings will be staggered and tested over a number of weeks/ months.
- There will be restrictions on covers/ customers as a result of social distancing.
- Revenue will be considerably less than normal; predictions are a drop of between 30-45% for the first 6-9 months.
- Customers are likely to be nervous about going out, with a vaccine yet to be developed.
- There will be an increase in payroll costs, when government funded furloughing gets reduced.
- You will have to make customers and staff feel safe at all times.
- You will have to consider other revenue opportunities to generate cash flow.
Any plan or strategy that you make must factor these elements in order for you to move forward successfully.
Communicate with your suppliers now
Many suppliers and vendors may have gone out of business during this time. Keep close contact with suppliers so that you’re aware of any changes. Operators have frozen payments to suppliers, which has put huge pressure on them. See how you can help and support them, so they are still trading when restrictions are lifted.
We’ve spoken to many suppliers/ vendors who are considering introducing new payment terms, settlement with faster payment policies as well as the settlement of any outstanding funds owed before supplying and more products or services. Look at how these changes could impact your business.
Re-evaluate your team structure
Funded furloughing will be reduced and possibly stopped for many people over the next 5 months as the government cannot sustain that level of cost. You will have spent a huge amount of time, effort and money on getting your great staff to their current skill level. Unfortunately there is a chance you will not be able to retain them all if you are operating at a reduced business level.
Planning who you will bring back, when and in what capacity is essential. Get creative and consider the possibility of employees carrying out job functions that they would not normally do. Start to plan what your team may look like with reduced hours, job sharing and flexible hours. Many employees will appreciate you doing what you can to keep them employed even on a reduced basis, especially if you explain that this is part of a long term strategy.
Physical preparation for reopening
When lockdown was announced, many businesses turned off the lights, emptied or secured stock and locked the doors with some periodic checks on the property.
You need to make a plan for re-commissioning your operating equipment both back and front of house. Check that all IT and financial hardware and software is working (computers, management systems, reservation systems, EPOS, CRM and guest management systems). If you’ve requested a payment holiday, you’ll need to ensure that you still have access to all of your online systems. It’s also a good idea to check that the support companies that supply these services are still operational and to what capacity.
This is also an excellent opportunity to ensure that all data on customers, prices from suppliers and contracts are all up to date.
Financial preparation for reopening
Apart from the supplier and staff financial implications mentioned above. You need to consider all policies regarding deposits and prepayments and the redeeming of any outstanding vouchers. Credit checking and history will no longer be reliable, which will include any corporate clients, third parties companies and agents that you have dealt with in the past.
Now is the time to start conversations with reservation companies, on-line ordering/ delivery companies for better rates and conditions.
Health and safety
The are 2 main concerns you need to be looking at:
- Your staff/ team/ suppliers/ contractors
- Your customers
Making sure you have have robust and clear new policies and procedures in place, based on government guidelines is fundamental. Both customers and staff will require physical and visible reassurance that you have drastically changed the way you operate, that all angles have been considered and that this is communicated to them.
You will need to consider new equipment and providing ample cleaning and sanitising processes and procedures. Reviewing and updating all of your cleaning schedules is highly recommended. It’s also a good idea to make this visible to customers, via a notice on your website and on the premises.
Ask yourself, is your current concept still relevant? Does it need enhancing/updating to reflect not only your previous customer demographics but looking at attracting new customers? Everyone is going to be fighting for a piece of that “smaller pie” of business. So don’t think that be selling what you did before will be enough. Get creative and look at other revenue streams, activities, promotions and ways to retain your existing audience but also to attract a new audience.
As many of you know cashflow is king to any business. Many operations are looking at offering a takeaway/delivery service for both their menu items and also retail items to keep some cash coming into the business.
There are 3 key benefits of doing this now:
- Drive cashflow into the business
- The opportunity to communicate with your customers, to remind them of the great food you serve. Your customers will appreciate the takeaway facility and and be more inclined to revisit when you reopen.
- You will have built an additional revenue stream for when you do re-open with a redued level of business, so you’ll be able to retain more staff and pay your bills.
Your reopening checklist you should consider the following points:
- Who do you need to involve in setting up plans and structure for the staggered re-opening programme?
- How frequently will you need to meet to review this plan.
- Who is controlling budgeting the costs of this programme?
Find out more
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