on trade article  180x180 - Turning the tables on the UK on-trade

The on-trade in England gets to re-open its doors this weekend. What happens next will determine the fortunes of thousands of business owners — and the wine businesses that supply them.

“Apprehensive” … “it’s like we’re starting for the first time” … “I feel I’m stood on a motorway facing a thousand cars coming at 90 miles an hour”.

Just a few of the words used by a cross-section of experienced restaurant owners preparing to re-open their hospitality operations in England with one metre-plus social distancing. I was interviewing them about how drinks and especially wine will work post-Covid, and how wine suppliers can best help businesses like these re-establish the viability and success they had attained pre-Covid.

Encouragingly, the business owners we interviewed generally do expect to be busy – though only as busy as the detailed 43-page Government briefing paper for the hospitality sector will allow. Capacity has had to be cut, in many cases by 50% or more. “We can manage 26 covers in what was a 70-cover restaurant, and that’s with one metre social distancing” was one of many laments about the new space restrictions.

Wine service poses two post-lockdown challenges for these operations: how to serve it, and how best to start depleting the stock that’s been on site since before lockdown. While several of these owners will be reopening with adapted or reduced food offers, they all plan to retain their pre-lockdown wine lists. Some will be promoting seasonal favourites, and Rosé was mentioned several times (the interviews were conducted during a recent heatwave). The post-Covid enthusiasm for local produce is being supported by some of these restaurant’s food offers and some drinks (“our Gin is distilled down the road in Chiswick”), but it was conspicuously absent when it came to the wine offer. While the interviews were mostly conducted during English Wine Week, none of the respondents mentioned English wines unless prompted.

Serving wine will be dictated by Government guidance, but most of these operators will retain the same mix of serving options – by the glass, the bottle and, for some, the carafe. These owners are each defining how they will replicate the traditional customer wine-tasting opportunity for bottles delivered to the table, but always reflecting the restaurant’s specific physical circumstances and complying with social distancing protocols. Several mentioned that, of all drinks categories, wine is the most difficult to manage in a post-Covid world. By contrast, “we can pre-mix some of our House cocktails and serve on demand”.

Predicted levels of wine spend were generally encouraging, with expectations that customers will want to fully enjoy the going-out experience. While most customers are not expected to indulge in a spending binge, neither are they expected to reduce per-bottle spend. The respondents tended to agree with the Wine Intelligence analysis that the first customers through the door will be a mix of “Moderators” and “Hedonists”, not “Reducers” or “Halters”. There was, however, also mention that some consumers may have reset their value coordinates during the last few months of dining and drinking at home with time to find interesting premium wines themselves. For some therefore, restaurant prices may be an unwelcome reminder of pre-Covid behaviour which is not appropriate, needed, or affordable in a post-Covid world. As one respondent observed: “we just don’t know what the post-Covid pocket will look like”.

Respondents were quite forthcoming on how wine suppliers can best help re-boot their businesses. The most consistent theme, inevitably, was the challenge of stock and payments. All these businesses will be reopening with stock delivered in March or earlier, at least some of which may not yet be paid for. The first priority will be to sell this stock, generating cash and enabling supplier payments to restart. None expected to be placing big wine orders in the run-up to reopening or within the first couple of weeks thereafter. But all will steadily and increasingly need new stock. Each respondent therefore wants to establish workable arrangements with suppliers covering payments, credit, new stock delivery, smaller quantities. There were also mentions that free bottles will be beneficial to fund welcome-back glasses of wine/sparkling wine, “help with the House Champagne would work well”. Initiatives to re-generate customer focus on wine were also highlighted: “promoting wine together (restaurant plus supplier) with suitable table cards (provided by the supplier) is the way forward”.

All these restaurant owners agreed that re-establishing viable businesses with such severe operating constraints is a profound challenge organisationally and financially, even for these experienced operators. The list of priorities is long and daunting: dealing with physically re-setting their premises, re-engaging and training staff in new Covid protocols, sorting out kitchens and food stock, maximising marketing reach to existing and prospective customers, ordering and ensuring timely delivery of essential re-start supplies Within this whirlwind, wine suppliers can best help by talking to each business, understanding the dynamics and pressure points specific to that business, and aligning their supplier support plans specifically for each business. Some respondents reported that they had already had such supportive conversations with their wine suppliers.

Based on a limited qualitative sample, the overall message seemed to be one of positive determination. None suggested, at least in these interviews, that NOT reopening is being considered. Re-attracting customers and securing the financial future is largely the individual challenge for each business; pro-actively supporting the return to new-normality and long-term viability is where wine suppliers can definitely contribute.


Brian 180x180 - Turning the tables on the UK on-tradeAuthor: Brian Howard

Email: Brian@wineintelligence.com

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