Up to 70% of South West hospitality businesses are in danger of closing for good if the coronavirus lockdown is not ended soon.
Amanda Lumley, a director and vice president of the Tourism Management Institute, said the majority of Devon and Cornwall’s tourism-dependent enterprises believe they will fail if they lose summer trade.
Mrs Lumley thinks the figure would be “slightly less” in Plymouth, as the city is slightly less seasonal, but could still mean more than 50% would be at risk.
But she revealed the city’s tourism and hospitality businesses have already lost a staggering £71million in income since the coronavirus lockdown began – and the worst could be yet to come.
Estimates reveal that unless the city’s bars, cafes, restaurants, hotels and attractions are able to open in some form on July 4, the financial deficit could deepen to £141million just by the end of that month
And Mrs Lumley, also chief executive of Destination Plymouth, said many South West businesses may not reopen even if the lockdown ends in July, because of the challenge of social distancing.
“Some are considering mothballing until next year,” she said. “That’s if they can’t make a profit working to the social distancing guidelines.”
She said that losing the vital summer months would be like “three winters in a row” for many of the businesses and added: “We are very worried. The lockdown has impacted the visitor economy more than any other.”
Most Read
Mrs Lumley said that if the unlock does come there may be a “bounce back” effect, with Devon and Cornwall being seen at the most desirable visitor destinations for people in other areas of the 海角视频.
But that could also be a challenge with many businesses not being able to open “to capacity” because of social distancing, and she explained: “If they have social distancing they won’t be able to get the same number of people inside, so it’s about trying to be able to benefit from people wanting to come here on holiday and at the same time having social distancing.”
However, there are hopes a staycation boost may mean visitors are attracted out of season, and she said; “Tourism is a great sector for bouncing back. After the Foot and Mouth outbreak (in 2001) we had a good recovery.
“So we will do our best to make sure out businesses are ready to open at the right time and welcome visitors safely to the city.”
Mrs Lumley is Devon and Somerset chair of a South West working group for tourism and has been instrumental in forming a recovery plan.
It is asking for grant support for businesses or a long-term extension to the furlough scheme for the tourism sector.
Across the two counties the visitor economy has 7,345 businesses and employs 65,000 people, and if the agricultural supply chain is added it leaps to 84,500.
Don’t miss
She said hospitality businesses many not have the finance to cover the employer contribution in the extended furlough scheme.
“If they can’t make any money over the summer they will need to be supported until next spring,” she said. “So we have pulled together a rescue plan which is now being reviewed by the Heart of the South West LEP, and will be submitted at the end of June.
“It will be asking for longer term support for the sector, particularly where businesses cannot open due to social distancing.
“A lot of our businesses are micro, if, for instance, British Aerospace failed, people would be up in arms.
“But our sector employs 65,000 people and a big proportion could be out of a job by the end of the year. It could have a massive impact.”
Mrs Lumley said Plymouth alone normally receives 5.4million visitors a year, of which 4.6million, that’s 85%, are day trippers, with 14% British people staying in the city and 1% being international or cruise tourists.
Combined, they spend £338million in the city each year, which supports 8,000 jobs, 7% of the city’s workforce.
When the supply chain is included – that’s industries such as food production – the worth to the Plymouth economy from tourism leaps to £476million.
By the end of May 2020, Plymouth will have lost 21% of this annual visitor spend, due to the Covid-19 restrictions. That equates to about £71million.
SW Covid-19 business stories
That will double to a £141million loss by the end of July – doubling in just two months.
That is because so many businesses in the hospitality sector make most of their income in June, July and August, Mrs Lumley explained.
And if the lockdown continues, then by the end of September it is estimated Plymouth will have lost 66% of its annual income from visitors.
This could be disastrous for the 1,600 Plymouth hospitality businesses, a mix of bars, hotels, B&Bs, restaurants, cafes, attractions, museums and galleries. Of these, 78% are very small, each employing fewer than nine staff.
How to contact William Telford and Business Live
Business Live's South West Business Reporter is William Telford. William has more than a decade's experience reporting on the business scene in Plymouth and the South West. He is based in Plymouth but covers the entire region.
To contact William: Email: william.telford@reachplc.com - Phone: 01752 293116 - Mob: 07584 594052 - Twitter: - LinkedIn: - Facebook:
Stay in touch: BusinessLive newsletters have been re-designed to make them even better. We send morning bulletins straight to your inbox on the latest news, views and opinion in the South West. Get our breaking news alerts and weekly sector reviews too. Sign up now - it's free and it only takes a minute. To sign up for Business Live's daily newsletters click .
And visit the Business Live South West LinkedIn page
She said the industry was relived when Prime Minister Boris Johnson said hospitality businesses may be able to unlock, in phase three of his lockdown exit roadmap, from July 4, and called this: “A light at the end of the tunnel for businesses”.
But, with this being dependent on the R rate, of infections, being sufficiently low, there is no certainty, and much depends on the behaviour of the public with regards to travelling and social distancing.
She said: “A lot have been asking us if they can definitely open then. But we are still very concerned. Covid-19 is a live virus and people are still dying. The community is still concerned. So we are waiting for Government guidance to say if we can reopen.
“We anticipate that will be with us in early June, so businesses can prepare, a lot of that will revolve around risk assessments.”
She said this will be critical because many small businesses are “really struggling”, and she added: “We really want our businesses to reopen, it’s crucial they have cash flow.”