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"The impact has been devastating"

Thursday 30 July 2020

"The impact has been devastating"


It is unreasonable to think anyone in the hospitality business could have prepped for this. Months of no visitors at all being allowed into Jersey, at a critical time of year.

The near certainty that in trading terms, they will be facing the equivalent of three winters in a row. That is a crisis that encouraging local people to take a few ‘staycations,’ or consider eating out this weekend, just isn’t going to solve.

That is the extent of the existential threat facing the industry which has arguably done more than any other to put this island on the global map in the last 50 years, while also – critically – providing the work/like balance and choice of air links enjoyed by local residents; something which also underpins the more lucrative financial services sector

A future with a drastically smaller hospitality sector is a bleak one for Jersey, but that is what some fear may be coming.

Express caught up with Matthew Seymour, Group Operations Executive for Seymour Hotels, who should be celebrating their 100th year – but instead are urgently having to diversify, and re-plan their business...

What is the current effect of covid-19 on the business? 

Whilst covid-19 has affected businesses from every sector, it has been completely devastating for Jersey’s inbound tourism industry. 

Prior to ‘lockdown’ we were looking forward to a successful season whilst celebrating our centenary as a family business in Jersey. We were in the process of getting ready to open the Merton Hotel, the island’s largest, having undertaken a number of investment and refurbishment projects over the closed winter period. Many of our seasonal staff had already returned in order to commence pre-season training, ready to welcome guests. Unfortunately, the doors to Merton Hotel have remained shut ever since; the Merton Aquadome and Leisure Centre had to close to its members, and our Greenhills Country Hotel & Restaurant also had to close down operations.

Merton Aquadome

Pictured: The Merton, one of Seymour Hotels

The Pomme d’Or Hotel has been able to remain open on a vastly reduced scale so as to accommodate essential workers and healthcare professionals who were having to separate themselves from their families and loved ones in order to continue working. While the numbers of workers catered for at the beginning were quite high, they are now in single digits.

Our central reservations team has been sensitively managing the huge number of guests who were looking forward to spending their holiday in the island, advising them of the situation as time has progressed, and either offering them the opportunity to transfer their bookings to another time this year, or any time next year. Those who have pre-paid their accommodation, we are refunding accordingly.

The scale of this operation has been, and continues to be considerable, and understandably there are many queries from guests seeking assurances that we have been able to provide, as and when relevant information is made available to us.

With no guests and all other activities curtailed in the hotels, (functions, events, etc) normal revenues have dried up completely from the time we closed our doors at 18.00 hours on 22nd March 2020. 

Making use of resources, and many ‘people skills’ we have available across the Group, our Operations team were very quick to introduce other services where we identified there would be demand from islanders – i.e. home deliveries in the form of frozen and fresh meals, takeaways ranging from full on ‘Sunday lunches’ to home-made pizzas, as well as general home maintenance and cleaning services.

Even so, our revenues are between 5-10% of what we would normally expect at this time of year.

Pomme._External.jpg

Pictured: the Pomme remained open on a reduced scale.

Whilst the impact on the hospitality industry is particularly devastating, the knock-on impact of corona virus will be far reaching and will have ramifications for the island, and island-life, for years to come - to which we will all have to adapt. 

Connectivity to our outside world, public infrastructure, personal tax and choices for socialising, entertaining and shopping as well as attractions and activity centres will all be impacted. 

It’s been well-publicised the impact corona virus has had on airlines, and a lot of those air routes to and from Jersey that we’ve come to expect and enjoy, may never return. With less carrier competition and therefore little route competition, there is a very real prospect that getting on and off the island via air or sea will become more difficult and more expensive. Whilst Government and business execs may not bulk at this, it will impact all of us that plan on going on holiday or welcoming visitors, family and friends to the island. 

Many people have already forgotten that Flybe collapsed in March, before corona virus hit. Flybe accounted for 40% of all airlines seats to Jersey and no direct or comparable replacement service has filled that gap. The impact of this is yet to be felt due to the current restriction on travel. 

In Q2 & Q3 of 2019 (i.e. April through to September) 550k visitors came to Jersey and spent £215 million – much of which was on the Jersey ‘high street’, as well as in hotels and local restaurants, taxis, buses, coaches, attractions, activities and of course through all the associated supply chains providing services to all. With the high street already feeling the strain pre-corona virus, changes to retail habits throughout the pandemic are going to have further consequences, and an already sparse high street will no doubt see further vacancies. 

Whilst some local restaurants, attractions, shops and bars will bounce back with the support of islanders as restrictions are lifted, the impact on hotels is likely to have far more dire consequences, and for some it will be terminal. To dispel a myth, hotels cannot survive on staycations. To replace inbound staying visitors to Jersey, it would mean that every single resident, from baby to pensioner, would have to spend annually at least 30 paying nights in Jersey’s hotels. That’s just not feasible.

With the majority of local hotels and guesthouses being family run, and owned, establishments, there is a high chance many may take this crisis to close down forever. History shows that these properties tend to get sold to developers, thus reducing the island’s bed numbers, and further constricting the hospitality industry. The correlation between the number of beds, and airlines servicing the island, is evident and future services will be at risk.

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Pictured: Greenhills Hotel

Are there any opportunities in the next 12 months?

The most obvious opportunity is that corona virus is forcing us to review our business model, and how we operate. The pandemic has exposed areas to our risk profile, yet given us an opportunity to evaluate our key assets, and how we can deploy the many resources and skill sets we have available. Our focus now is on re-aligning our business model to maximise opportunities in the ‘new normal’, streamlining our offering, whilst seeking out efficiencies. Looking forward we are considering digital solutions which assist service and enhance customer/guest experience. There is undoubtedly going to be a huge drive to support local as we all play our part in rebuilding Jersey’s economy. 

How are you planning for the obvious threats? 

Timing is crucial in order to make decisions, and to be able to plan successfully. Whether we are able to open hotels and welcome tourists is wholly dependent on whether we receive government guidance before the end of June, regarding ports opening and quarantine easing.

Whilst a requirement for two-week quarantine on arrival remains in place, it will be very difficult to attract tourists to the island.

That being said we are prepared for when they do arrive, and have implemented our new ‘Seymour Hotels Safe Stay Pledge’ which provides our guests with assurances that enhanced health & hygiene procedures are in place and gives confidence that their wellbeing is our priority.

As mentioned, we have already sought to diversify our operations by outsourcing our professional, and highly experienced, in-house maintenance team, housekeepers and chefs who have helped establish our Cleanse Cleaning Services, Seymour’s Toolbox Maintenance services and Seymour Home Delivery services. These initiatives allow us to continue supporting the local community and we hope to share news of further projects we believe will assist the local community soon.

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Pictured: Matthew Seymour, Group Operations Executive for Seymour Hotels

What could government help with, either for your business, or the sector generally? What else would help?

The most important thing the Government of Jersey can do is provide a strategy for the future of tourism. Government needs to decide whether tourism should feature as part of the ‘new’ economy and determine what shape, size and direction they want to pursue, and then encourage investment to achieve the objective. At its most basic, tourism for Jersey is an export and earns new money to circulate around the island. It is a multiplier in terms of creating additional spend and business revenues for the local economy. Can the government find another industry which introduces £280 million of new spend to the island, and which generates £14 million of GST, whilst underpinning the work/life balance enjoyed by so many? 

Can you draw out any personal stories from how the pandemic has affected your business so far?

Over the past three months, all our people have shown huge versatility and adaptability in the face of this crisis, and without that, we would be in a far worse place.  

In a short space of time we ‘pivoted’ and adapted our operations from hotel, restaurant and bar operator, to a business offering home delivery meals & takeaway, cleaning (Cleanse) and maintenance services (Toolbox). Whilst these businesses may initially have been set up as temporary services in response to the impact of corona virus, given the positive feedback and referrals we have received from customers and clients, there is good reason for us to consider expanding these operations further.

We were due to be celebrating our centenary year as a family business and a significant amount of hard work, planning and investment had gone into what promised to be a year of celebration with our teams, and fundraising for our chosen charities. Whilst it won’t be quite the same we will still find time to mark the occasion.  

How do you feel about the rest of this year? 

2020 is ‘write-off’ year for the hospitality industry, and for most - in particular hotels - success will be measured by survival. There is much talk of a ‘three winter’ trading scenario. Having come out of winter 2019, summer 2020 trade will now be on par with a regular winter at best. This will mean businesses will go into winter 2020 without the benefit of a summer season to boost coffers, and understandably reinvestment over the forthcoming winter will be minimal. This has a knock-on impact on all suppliers, contractors and trades who would usually rely on the winter refurb works undertaken by hospitality businesses.   

The immediate future promises to be tough, and stark business decisions will need to be made, depending on, and possibly despite, upcoming government guidance. The ramifications are likely to have a long-lasting impact on Jersey’s product offering, and future ability to market its self as a tourist destination.

This article first appeared in Connect Magazine, which you can read by clicking HERE.

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