Highland group starts the year strong

SLTN Award-winning Cru Holdings is in good shape as it looks to move past the pandemic

CRU Holdings managing director, Scott Murray, is optimistic about the hospitality market in the Highlands as the industry looks to move on from the pandemic.

Murray, who set up Cru Holdings in 2009, is expecting a “massive resurgence” in domestic tourism after what has been a strong start to the year for the business, which he runs with brother Grant and fellow director Ken Loades.

The company, which last November was named Independent Multiple Operator of the Year (4 to 7 outlets), sponsored by Smirnoff, at the 2021 SLTN Awards, started this year by taking on a seventh unit – Inverness bar and restaurant The White House – bolstering a group that already included venues such as Inverness properties Bar One, Scotch & Rye (which was named Craft Beer Bar of the Year, in association with Molson Coors, at the SLTN Awards), Prime Steak & Seafood, The Keg and Angel’s Share as well as Nairn venue The Classroom.

It followed a two-year period which, as for many in hospitality, presented serious challenges as well as an opportunity to reflect on and refine the business.

With premises forced to close during the first lockdown, Cru focused on strengthening its staff training and retention systems, a path that would eventually lead to Real Living Wage accreditation as well as the development of a staff app and incentives such as company-wide discounts and holiday allowances that increase with service.

As the pandemic wore on the directors also launched home delivery services for cocktails and food, branded as Myxd and Cru Kitchen, respectively.

And the company took the opportunity to refurbish The Classroom in Nairn, which the group had acquired in 2019.

Throughout the various lockdowns and restrictions, Cru also sold gift vouchers, which customers could redeem at any of the company’s venues at a later date.

Subsequently, said Murray, the business is in good shape as the sector hopes to leave the pandemic behind.

And he reckons the market in the Highlands this year should be healthy as well. Murray said the company’s revenue in January was 30% ahead of predictions, with some outlets having increased as much as 50%.

“I think February’s going to be a tough one, but I’d like to think we’re going to see a massive resurgence of domestic tourism, particularly in the Highlands,” Murray told SLTN last month. “And I think that’ll start quite early in the year. I’m looking at accommodation providers locally and looking at the rates they’re charging and they’re getting good rates. They’re not asking those rates because they’re empty. They’re asking those rates because they’re running out of beds to sell.

“So I think in the Highlands we should see a domestic tourism boom again this year.”

The Inverness market has also benefited from a shift in consumer behaviour, said Murray, with outlets now busier throughout the week as well as at the weekends.

He said: “Inverness used to be a very Saturday night town but now we’re seeing that it’s seven nights a week. Saturday is obviously still your busiest but certainly from a restaurant point of view we’re now seeing people that will come out for lunch on a Tuesday, whereas lunchtimes used to be almost non-existent.”

That’s not to say the city – and the Highlands in general – is not faced with challenges.

Scotch & Rye was named SLTN Craft Beer Bar of the Year, in association with Molson Coors, at the 2021 SLTN Awards.

Like elsewhere in Scotland – and across the UK – there are still staff shortages. And while Murray said the recruitment picture has improved somewhat since the UK Government’s furlough programme wound down, there is now more pressure than ever to provide an attractive proposition to potential recruits.

“I don’t think it’s just with hospitality, I think it’s across the whole employment landscape,” he said.

“I think if lockdown taught us anything it’s that work/life balance is very much a necessity. If an employer’s not willing to offer that they’re not really looking after their teams.

“Yes, it might cost a bit more. It takes a different way of thinking, but it’s going to have to happen at some point, so why not lead the charge?”

Things will get more complicated in April, when business rates bills resume (albeit at 50% for the first three months), VAT returns to 20% and the Minimum Wage increases to £9.50 an hour.

Murray said the cost increases are likely to be a “perfect storm” for the sector, with Cru anticipating its “biggest-ever price increase” as a result.

However, Murray reckoned the inevitable price increases may have a slightly gentler impact in the Highlands, where prices are generally lower than in the central belt.

“I think in the Highlands we can afford to [put prices up] because we’re so far behind the central belt in terms of our pricing structures,” he said.

“I think we can do a price rise and I don’t think it’ll have a hugely detrimental effect.”

The bigger challenge, said Murray, could well be the way the industry is perceived at Holyrood, with Murray describing the raft of trading restrictions imposed on the sector throughout the pandemic as “very much discriminative”.

“Without getting political, we’ve been kind of made out to be the bad guys all through this,” he said.

“But the standards in pubs are far superior to the standards in supermarkets. The level of attention in pubs and restaurants is far superior to supermarkets – you don’t see someone in a pub picking up an apple, putting it down and someone else picking it up and eating it. It’s been so disproportionate that it’s almost criminal.”

Moving forward, Murray said he’d like to see government ministers engaging with the hospitality industry “in a meaningful way”.

“They can’t keep making decisions based on what they feel in their water,” said Murray.

“They have to take some real advice and, whether they like what they hear or not, they have to realise that that’s the position.”

As for Cru Holdings, The Whitehouse is unlikely to be the last unit the company takes on. Murray said the directors are looking for other opportunities, “but they have to be right”.

And, with all three directors having young children, it’s likely the group will stick to the Highlands for the foreseeable future.

Murray said the experience of having briefly operated an outlet in Falkirk had taught the directors valuable lessons about the challenges of running a unit such a long way away from the rest of the business.

“We want to do what we can do, but we want to do it and maintain that family balance as well,” said Murray.

“Should we start opening units down in the central belt… I think that’s probably just a bridge too far, from where we want to be.

“We’ve done the whole piece on work/life balance with the staff and the team and we need to make sure that we get a bit of that as well.”