Preparation the key to success

Although situation remains volatile, hospitality operators should get ready for a busy season, writes Wylie & Bisset partner Catherine Livingstone

Catherine Livingstone

Despite the India variant of the coronavirus delaying plans for a fall in restriction levels in Glasgow, most of mainland Scotland moved to level two of restrictions last month while the islands moved down to level one.

While the situation remains volatile, the fact remains that hospitality sector operators should ensure they are ready for a bumper summer season.

Licensed premises can now sell alcohol indoors. Indoor areas can remain open until 10.30pm. Up to six people from a maximum of three households can sit together indoors, with a maximum of eight people from up to eight households allowed in outdoor areas.

In the island communities (excepting Skye), level one permits premises to remain open until 11pm and serve groups of eight from up to three households. Outdoors, a maximum of 12 people from 12 households can sit together.

Hospitality operators will be busy preparing for reopening and there are various urgent operational and financial matters they should bear in mind. For example, if they have been operating a desktop or manual-based accounting system, now might be the time to consider switching to a digital cloud accounting system, such as Xero. Providing real-time insight into an operation’s financial figures, with live data hosted in the cloud, Xero gives operators access to their cash flows, transactions and account details from any location at any time with all bank transactions imported and coded automatically.

Staffing is a pressing issue with operators needing to ensure they have adequate staff in place to meet the anticipated demand – whether through recruiting additional staff or bringing back staff from furlough.

The remaining restrictions will still limit the number of customers outlets are able to cater for, so careful consideration of staffing requirements is needed to ensure operators have flexibility to cope with demand.

Operators should also take steps to ensure they are receiving the best financial advice. Do they have cashflow projections in place to make sure they can buy in the stock needed to meet the short-term demand that is forecast?

It’s also worth considering the longer-term goals in terms of building up cash reserves to pay for any liabilities that may have accrued throughout lockdown with regard to bounce back loans and VAT deferment.

That’s why I would advise licensees to plan now, have budgets and cash flow forecasts in place to plan for any liabilities accrued during lockdown to be met.

  • Catherine Livingstone is a partner and head of the food & drink team at Wylie & Bisset.