Business owners across the hospitality industry say COVID rule changes are already having a “chilling” impact on bookings.
Many who have survived 20 months of lockdowns and restrictions as well as a “lost” Christmas last year, say a strong festive period this year is essential to their survival.
Data from reservations website OpenTable also suggests that diners became more cautious over the weekend after news of the Omicron variant came to light.
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The hospitality sector suffered a lost Christmas last year
New restrictions came into place at 4am on Tuesday morning, including mandatory mask wearing on public transport, in shops, museums and other locations.
While the hospitality sector is, thus far, exempt from these rules, many fear a nervousness setting in amongst customers.
Sacha Lord, the night-time economy adviser for Greater Manchester, is one voice already sounding the alarm.
“Every restaurant I’ve spoken to today, is now experiencing Xmas party cancellations.” he said on Twitter.
“Most of these businesses desperately needed a good December.
“The knock on effect will be catastrophic. Businesses, jobs, supply chain. A blow to a devastating year.”
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‘We don’t know enough about Omicron yet’
OpenTable’s figures suggest that the level of people opting to eat out did fall in relative terms this weekend compared to the previous weekend.
On Saturday 20 November the number of seated diners was up 31% on the level seen two years ago – but by Saturday 27 November this had fallen to 20%.
There is concern that a lack of clarity from the government and those who advise it is not helping.
On Tuesday Dr Jenny Harries, chief executive of the UK’s Health Security Agency, said that “not socialising when we don’t particularly need to” would “help keep the virus at bay”.
The inference seemed to be that people should reduce contacts over the festive period and potentially cancel Christmas parties.
This was rejected by Prime Minister Boris Johnson who insisted he has implemented a package of “balanced and proportionate measures”.
The health secretary Sajid Javid reiterated that stance by suggesting people do not need to cancel parties but should consider taking a test before attending.
But many in hospitality fear the damage is already done.
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“The chilling talk of Plan B is already being felt across hospitality as bookings are cancelled and plans changed,” said Kate Nicholls, chief executive of trade body UK Hospitality.
“There is no doubt that this will have a damaging effect on businesses, just as they head into their key trading period.
“This all comes at a critical time for the sector, as costs are rising across the board, supply chain issues continue, chronic labour shortages show no sign of easing and next year will see a return of 20% VAT rate.”
The importance of this period and customer confidence is being echoed by those in retail.
Many are very aware that real disposable income is falling due to the steep rises in petrol and energy costs as well as inflation more generally.
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Footfall has also struggled to recover to pre-pandemic levels.
While it has improved in recent months, last week it was still 17% lower than during the same week in 2019.
Shop owners such as Sam Haq, who owns SWAG in Reading, say they need customers to remain confident.
“I believe the most important thing is not to lose customers now,” he said.
“This is where a lot of the shopkeepers and owners are going to have a problem.
“Do they worry about customers wearing masks or do they say nothing and welcome the trade? And I think 90% of them will just welcome the trade because they need the sales.
“To be honest if we have another lockdown it could put a lot of businesses down to the bottom and close.”