As chief executive of UKHospitality, Kate Nicholls OBE is one of the most powerful advocates for the sector and a regular fixture on television and radio news and current affairs programmes. As a preview to her appearance at EAG including as part of the Pub and Club Summit, Kate provides an insight to the many and challenging issues facing hospitality operators as well as explaining why Yes by McAlmont and Butler is her ‘go to’ tune on the pub juke box. To join Kate and be ‘part of the action’ at EAG 2023 (10th – 12th January) register at: https://www.eagexpo.com

You will be participating in The Pubs And Clubs Summit at EAG – how much are you looking forward to spending some time with operators involved in the amusements and low-stake gaming entertainment sectors?

One of my favourite things about working in hospitality is spending time with operators at shows like EAG and I’m really looking forward to being involved. This sort of event has been limited over the past few years during the pandemic so it’s really valuable to be able to get out there and speak to both operators and suppliers. 

From a work and business perspective one of the many experiences that people missed during lockdown(s) was attending in-person or live events. How much have you appreciated the return of exhibitions such as EAG?

I think I speak for us all when I say that we all really suffered through lockdowns and not being able to socialise like we normally would. Clearly, for hospitality businesses, that also meant a significant loss of business.

As a sector, we’re sociable people. It comes with the territory working in such a people-focused industry and the return of regular, in-person events is such a relief. We’ve all got used to working on Zoom and Teams, and hybrid meetings are now a typical part of our days, but there is nothing like having a conversation at an event or around a table.

It’s so valuable to be able to attend shows like EAG, not least to hear the latest news and see what innovations there are. There’s so much happening that it’s always useful to see with your own eyes, in one place, what new developments are coming down the track.

Do you think hospitality got a rough ride during Covid – I’m thinking about government policy regarding contracting the virus from flat surfaces and handling cash?

There’s no doubt that the pandemic was devastating for hospitality businesses. They were the first to close and the last to reopen. While there were intermittent reprieves for businesses in between lockdowns, these came with significant restrictions. For some parts of the sector, they weren’t able to open at all for two years.

It was a new and unique situation for the entire world and we were all working in the unknown. Tough decisions were made by government in a time of crisis, and we have to recognise the financial support the sector received, particularly in the form of furlough. Clearly lessons can be learnt from the decisions now, both good and bad ones, and the Covid inquiry now taking place will pick these up.

For this sector, there were some significant moves that took place quickly during the pandemic that otherwise may have taken years to come into force. For example, the concerns around transmission and handling cash expediting a move to contactless. That’s clearly a move that ensured we keep up with the times and the overwhelming movement towards a largely cashless society. When it comes to safeguarding, it’s also a positive move to help with self-exclusion.

There will always be measures that cause challenges and frustration, and we’re always keen to hear from operators and suppliers about those when they do occur.

Rail strikes, business rates, energy costs, food inflation and labour shortages – which of these represents the biggest challenge for hospitality?

They are all enormous challenges in themselves but, overall, I think energy costs have presented the biggest immediate challenge because of the scale of price rises we’ve seen and the impact this has had on business viability. Very few businesses can survive their energy bill tripling or quadrupling.

It’s that impact that allowed UKHospitality to make representations to Government about the vulnerability of the sector and helped to secure the energy support for businesses. It’s critical now that continues beyond the initial six-month scheme.

Business rates was presenting a significant problem with a £900m bill due to hit the sector in April if the Government didn’t take action. Thankfully, they listened to our concerns and extended business rates relief, as well as a freeze in the multiplier and no downward transition. That’s positive, but there is still an outstanding manifesto commitment for the Government to undertake a root and branch reform of business rates. As we know all too well, the system is out of date and not fit for purpose, which makes this reform even more urgent.

I’ll end with labour shortages because that has been an issue that has persisted for several years and it remains an enormous issue. Our latest data showed that there was a vacancy rate of 11 percent and the latest ONS figures showed there were 152,000 vacancies. Add in wage inflation, which stood at around 12 percent in our latest survey, and this is having a huge impact.

We’re urging the Government to take action on this, working with both the Home Office and Department for Work and Pensions, but the industry has taken matters into its own hands with the Hospitality Rising campaign. This campaign seeks to attract new talent into the industry and I’d encourage everyone to search it out and get involved, if you haven’t already.

Juke Boxes play an important part of the pub and club experience: with digital juke boxes providing access to literally millions of tracks what is your ‘go to tune’ on a pub juke and why?

Music is such an important part of my life and an essential part of visiting the pub. When I’m thinking of the atmosphere in a pub or a club, I want something upbeat so the easy choice for me is Yes by McAlmont and Butler. I have fond memories of that constantly playing in our college bar, alongside Janie’s Got a Gun by Aerosmith.

You are a powerful advocate for the broadly-based hospitality sector – do you think the government is listening to the industry?

During the pandemic, I think everyone in the country realised how important hospitality is in knitting our lives together. Whether that’s the role it plays in socialising with friends, connecting family, or just grabbing a coffee on your commute. I truly believe that resonated with Government too. There was obviously the significant support for and engagement with the industry during the pandemic, and that has continued since. For example, hospitality was singled out as a key sector during the announcement of the energy support scheme for business.

What is great about our industry is its breadth and that means there are plenty of Minister’s that do have responsibility for hospitality. There is of course the Hospitality Minister, but there are also Minister’s responsible for tourism, small businesses, employment, to name a few. UKHospitality engages with all of them, as well as the opposition and Peers, to ensure hospitality’s voice is prominent in Westminster.

The low-stake gaming industry is facing the same challenges as the rest of hospitality but isn’t able to increase prices due to regulations governing stake and prize levels on gaming machines. Do you sympathise with this unique predicament and what would you say to operators?

I absolutely sympathise with the predicament faced by the low-stake gaming industry. Clearly there are regulations there in terms of not being able to increase prices, which we do of course have to balance with safeguarding our customers, but the wider issue is possibly that the cost-of-living crisis is already having an impact on footfall into venues and that will of course have a knock-on effect on gaming. I know a lot of operators are doing all they can to continue attracting customers in during these difficult times and I hope we have as many make it through to the other side so they can turn it around in, hopefully, better economic climates and deliver growth for the sector.

A Pub’s AWP represents its most profitable foursquare feet of floor space – do you think the current economic crisis facing the pub and club sector(s) has focussed attention on the valuable revenue stream provided by low-stake gaming entertainment equipment?

The current economic crisis is focusing minds of operators on all their revenue streams and they’ll be looking very closely at how they’re performing. Gaming and entertainment are absolutely a key cog in the pub and club experience and it will certainly play a factor in providing revenue for operators. I know that operators will look to be maximising revenue from all the options they have before them to make sure they remain viable and that provides an opportunity for sectors such as low-stake gaming and entertainment to show its value. EAG 2023 (10th – 12th January, ExCeL London) register at: https://www.eagexpo.com