3 minute read
Eat Out to Help Out
In July, Chancellor Rishi Sunak announced the ‘Eat Out to Help Out’ scheme, where restaurants will cut their prices throughout the month of August in a bid to kick-start the hospitality industry again.
We have heard many positive reports off of the back of the scheme as millions of UK customers flock to take advantage of the initiative. One of the positive reports we have had is from Hugo Mahoney, CEO of the UK’s leading foodservice wholesaler, Brakes.
Below, we discuss Mahoney’s views on the scheme along with some of the successes and drawbacks of the initiative so far.
Gov.uk Eat Out to Help Out Scheme
What have been some of the positives of the Eat Out to Help Out scheme?
While the weekend continues to recover slowly, hospitality is celebrating the initial success of the Eat Out to Help Out scheme, which sees consumers save up to £10 per person, Monday to Wednesday during August.
More than 85,000 outlets have registered for the scheme, and HM Treasury figures show businesses have claimed over 35 million discounted Eat Out to Help Out meals. Brakes has seen Sunday for Monday orders rise by more than 150% when compared to the end of lock-down.
Hugo Mahoney, CEO at Brakes, said: “It seems that Monday has become the new Thursday for the hospitality sector and the Eat Out to Help Out scheme has been a real shot in the arm for many beleaguered businesses.
It looks like this could be one of the economic success stories of the Government’s efforts to get businesses back on their feet after the pandemic.
Brakes also notes some customers who didn’t initially reopen early in the week, racing to do so once they realised how ready consumers were to eat out to help out. The wholesaler has seen hundreds of pubs and restaurants take advantage of a ‘Get Back to Business’ package which has a mix of product, financial and operation support mechanisms as they gear up to reopen.
Concerns about the supply chain coping with the sudden surge in demand have proved to be unfounded as, working closely with suppliers, Brakes has also maintained very high product availability to ensure hospitality customers can offer the right dishes to appeal to those customers eating out to help out.
Alcoholic drink - unfortunately not included in the scheme
Have there been any drawbacks of the scheme?
Although the aim of the scheme was to promote food establishments and encourage customers to eat out, some restaurant owners still remain sceptical of the scheme.
The initiative only works if restaurants can afford to fund the 50% discount while they are waiting to be reimbursed from the government, and in the economic position that the UK is in right now, this has proved difficult for smaller restaurants and cafes.
Along with stricter hygiene requirements, social distancing measures and some businesses operating on skeleton staff, the additional paperwork to participate in the scheme has been too much for some establishments to handle.
A look into the future
Whilst the scheme has undoubtedly been fantastic for some, Mahoney states how important it is for us to look ahead to the future of the hospitality industry, once the scheme comes to an end.
He continues: “We would urge the Chancellor to extend the scheme into September as the sector continues to recover. We have been helped by good weather, but as schools go back and the sun disappears, we need to maintain the momentum and extending the scheme could really help.”
Hugo Mahoney concluded: “While there are undoubtedly some great success stories across the country, there is no doubt that many operators continue to struggle. We are grateful to the Chancellor for what he’s done so far, but unfortunately, more still needs to be done. We hope HM Treasury is considering extending both the Eat Out to Help Out scheme, and the VAT cut for hospitality businesses, currently set to expire in January 2021.
“Additionally, we have seen what a lifeline to hospitality businesses the Government’s Job Retention Scheme proved to be. As the scheme tapers down it will create new cashflow difficulties, making it increasingly difficult for hospitality businesses to retain their talented staff. In a sector representing 10% of UK employment and 5% of UK GDP, it is imperative hospitality businesses continue to receive help to get back on their feet after the unique way they’ve been impacted by the response to the Covid-19 pandemic.
“The hospitality industry holds a unique place in the hearts of British consumers, but the support we’ve seen must extend beyond the summer. Otherwise even more businesses will be at risk."
