Is There a Future for U.K. Cocktail Bars?
The COVID-19 closure of Britain’s bars has had devastating consequences. We talked to bar owners Mike Aikman, Monica Berg, and Ryan Chetiyawardana about the future of the industry.
Since March 23, bars and restaurants across the United Kingdom have been closed in attempt to fight the spread of the coronavirus.
According to the UK’s Wine & Spirit Trade Association, the country’s industry employs in excess of 385,000 people and sales in bars and restaurants is worth £10.6 billion.
Pubs and bars are an intrinsic part of British culture and daily life, and having them closed, to say the least, has been a major adjustment for the public and devastating to the industry. While it’s still unknown when it will be safe to reopen, the real question is will any establishments be able to?
To understand the situation, I recently checked in with three of the UK’s most accomplished bar owners, Mike Aikman of Bramble, Lucky Liquor and The Last Word in Edinburgh; Monica Berg, co-owner of London’s Tayēr & Elementary; and Ryan Chetiyawardana whose Mr. Lyan group operates Lyaness and Cub in London, Super Lyan in Amsterdam and Silver Lyan in Washington, D.C. All are internationally acclaimed, but coronavirus doesn’t pay any attention to awards or accolades and all of their establishments have been closed for months.
“We’re trying to cope as well as we can,” admits Berg. “We didn’t close until the last day before lockdown. That last week was the worst of my life. We had people coming in crying because they’d lost their job.”
And now? Her answer is immediate, and blunt. “We have no income. The bar is closed. In the first week after lockdown all the events for the rest of the year were cancelled. That’s £50k gone. Then the consulting and brand work all stopped.”
The timing for bar owners, according to Chetiyawardana, could not have been worse with disastrous consequences. “This is the time of the year when cash reserves are depleted. You normally wait for Easter to get the business back to usual. The whole industry works on tight margins. If we lose the resources to balance it out, many will close permanently.”
While government support has been offered, not all bars qualify. “We’ve finally received the funding that was promised to help us pay the staff,” says Aikman, “but we had six weeks of paying them out of our own pockets—as well as paying our suppliers. We’ve still not had any grants or any communication about whether we are even going to receive them. In any case, only two of our four businesses are eligible, due to their rateable values being slightly below the threshold. It’s very frustrating as we still have to pay rates and the difference between the businesses is so marginal it’s ridiculous.”
This mirrors Berg’s experience. “They announced grants for small businesses, but their definition of ‘small business’ is defined by rateable value and bars are considered high value,” she says. “Even though our bar is 2,000 square feet with 10 employees we’re apparently not a small business, so we don’t get a grant. Then, as hospitality is considered high risk, banks won’t lend to us.”
The situation is exacerbated by the fact that many landlords are still collecting rent even though the bars are closed.
“We have three different landlords,” says Aikman, “and they’ve been vastly different in their approach. One was extremely helpful and seems interested in helping us stay afloat, one took a bit of persuading to help us, but is now communicating with us; and one was not interested. I suspect his stance won’t change.”
The crisis over rent has prompted the creation of the #NationalTimeOut campaign by the Hospitality Union (HU), a group of more than 3,000 business owners launched by legendary cocktail pioneer Jonathan Downey.
The campaign proposes that rents for the next nine months be pushed back to the first quarter of 2021. To ensure landlords are not impacted, it also proposes that they get a nine-month debt repayment break, so that they won’t be repaying any loans on properties that they’re not getting rent from.
HU claims that by adopting the scheme, the government would save up to two million jobs without any cost to the taxpayer, and that the need for action is urgent after Cabinet Office Minister Michael Gove’s confirmation that “areas of hospitality” will be among the last to exit the lockdown. At the time of writing, however, there has been no comment from the authorities.
As the industry waits, bar owners are having to work out what a post-lockdown bar might entail. “What will this new normal be like?” asks Chetiyawardana quasi-rhetorically. “Staff in protective masks, social distancing? How can anyone operate on 50 percent capacity with existing margins?”
While larger outlets may be able to cling on, smaller independent bars—the very ones which have established the UK as a leader in global bartending—will suffer and potentially close.
“Our bars are all very small and intimate,” says Aikman. “A huge concern is the physical spacing that might be enforced. Realistically, it could kill the businesses. I think we will see a lot go to the wall. Anyone who was struggling before is going to be really up against it.”
Berg has a similar fear. “There’s no point in us reopening if costs are the same, pricing is the same, but capacity is cut,” she says. “There’s just no way we can continue. Bars and restaurants can’t be the only ones to bear the loss.”
Even if bars manage to operate with the new restrictions there’s no evidence that customers will come. Not only will establishments be reopening in the face of a recession, YouGov research has indicated that only 32 percent of people would feel comfortable going back to pubs and bars.
It is conceivable that we will see a continuation of increased levels of drinking at home. We are in some weird return of Prohibition-era cocktail parties, but with your friendly bartender giving direction over Zoom. If this is now the norm, how many people will return to the bar?
Chetiyawardana is not alone in thinking that this is a further reason why the post-coronavirus landscape will see fewer independent outlets and more chains—a reversal of the trend of recent years.
“There was a movement against chains,” he says. “The consensus was that there is value and interest in smaller venues, in the local and in creating links with like-minded smaller producers. The reality is, though, that this will change, because people will want the plasticization of chains, their ease, and reassurance. People will regress to that. There has to be innovative thinking to counter this.”
Berg is resigned to behavioral change. “It will be back to basics,” she says. “Go out, see people, sit down and enjoy nice food and drinks, which aren’t too theatrical.”
In the face of this perfect storm of problems, it rankles bar owners that, although bars and restaurants are central to people’s lives, they are some of the hardest hit economically and have received little help.
It isn’t just top-end bars who are affected. In the last decade, the UK has seen 11,000 pubs close and with the major pub chains considering further post-coronavirus consolidation, 40 percent of pub owners are predicting that they could go out of business.
It points to a long-term systemic ignoring of the economic importance of the hospitality industry.
“Tourism is too important to the economy for the hospitality industry to fail,” says Chetiyawardana. “It’s important to save the infrastructure, not just bars and restaurants, but the whole chain back to the farmer. We don’t want handouts, but lifelines.”
The problems are, clearly, enormous and with no resolution in sight it is taking a personal toll.
“Mentally, it has been pretty tough at times, but I have good days and bad days,” says Aikman. “I’ve kept busy with things and running loads has helped. Financially, as I am technically self-employed, there has been no provisions, so it has been very tough and will be for the foreseeable.”
“It’s a struggle,” says Berg. “In the first four weeks, many brands reached out asking me to do stuff online, but for the first time I didn’t have sufficient mental strength to cheer people up. I was grieving. Alex [Kratena] and I were accepting the fact that there is a 50/50 chance that we will never open our bar again. It is very difficult when people turn to you for answers when you have none. It is difficult to keep up the facade.”
“You feel guilty,” says Chetiyawardana. “Powerless. This is not what we are used to. We are meant to be near each other, talking, engaging, not this.”