Businesses

Social distancing policies will inevitably have a massive effect on many businesses even once lockdown has ended.

My simple take looking at some sectors.

Let’s start with the incredibly popular sector, our once thriving coffee chains such as Pret A Manger, Costa, Starbucks and Nero will have to lose around 70% of their seating capacity to conform, the same will apply to the independents too. That may not equate exactly to a 70% loss of turnover because not all seats are taken at all times but it will be a significant reduction. Outside seating will have to be reduced too to comply with the new rules. Now these coffee shops were all booming before lockdown and it is a high mark-up sector, but no question these places will be hit significantly.

Retail stores will have to seriously limit customer numbers who can be in the stores at any time. Once again 70% of what was previously allowed has been suggested. Now let us remember High Street retail was already suffering badly over the past decade so it will be unsustainable for many stores to keep trading at all.

The airline industry has all but been ended for the time being. Social distancing will not be feasible if aircraft are to make profits. Ideas like leaving a middle seat empty still only leaves about 2 feet of space, not the required 2 meters.

Hotel chains or even independent b&b’s are going to struggle. The room capacity will be the same but it will not be possible to have a shared space to accommodate breakfasts for guests or evening meals for those staying. To keep with social distancing at a 14 room b&b for example, a proprietor said they would possibly be able to manage to accommodate no more than 30% of the guests in the dining space they use. They can offer room only but again this means a reduced rate to their business.

Huge numbers of people will eventually come off furlough and immediately made redundant because the previous demand from customers is no longer there so consequently the same workforce is naturally not needed anymore.

I can already see that other ‘new’ jobs have been created as a result of covid-19 so hopefully many can simply move into new lines of work and perhaps even enjoy a brand new career path from the one they had before.

In all these sectors common sense equates that with significantly reduced footfall then significantly reduced staff has to be the outcome. Less money coming in means wage bills have to be cut to remain profitable.

The country and the UK government have made unprecedented financial efforts for us all, the likes no other country have matched. The chancellor has done amazingly well with his furlough scheme but the expense is clearly unsustainable and the cash to re-balance the books in future will have to be recouped from us all eventually (unless he can get it back from China). I’d prefer that!