On the day of the recent referendum, a selection of Chairmen, CEO and investors from across the Leisure, Hospitality & Travel sectors discussed their thoughts on the outcome and the implications of a Remain or Leave. Harold Wilson’s famous “a week is a long time in politics” quote certainly seems even more relevant now than it was back in 1977.
“They say a week is a long time in politics. Given events of the last few weeks, never has a truer word been said. On the eve of the EU referendum result, we hosted their latest Leisure/ Hospitality & Travel Boardroom Lunch. Held quarterly, they bring together some of the key influencers in the sector today. We had Chairmen from the hotel sector, casual dining and retail, NED’s from online travel and restaurants, CEO’s from pubs, tour operating and hospitality, along with representation from private equity and corporate finance. An entertaining, fun and lively discussion ensued that bumped along nicely until well after the cheese and coffee were consumed.
At such an important point in UK political and economic history, we asked the guests how they thought the vote would go and how confident they were therefore feeling for the six months ahead. I think it is fair to say that there universal certainty around the table that the vote would be to Remain, and that for the UK and the Hospitality/ Travel sectors, this was the right decision.
We touched upon the implications of a Leave vote but in our heart-of-hearts I don’t think many truly believed this would happen. Partners from separate private equity and corporate finance houses talked about the dire implications of a break with the EU, with uncertainty in the markets freezing or delaying activity for pent-up deals or potential IPO’s. The CEO of a leading pub group discussed the potential labour issues inherent in a Leave vote, with 60% of his staff being non-UK. And perhaps against the common misconception, not all these people were working in front-line positions, but many had progressed in to management and supervisory positions – both central to the success of the organisation. The Chairman of a casual-dining business discussed how the fact that their annual employee engagement surveys were carried out in three languages gave an indication of the diverse mix of nationalities working within his organisation. The CEO of a travel organisation touched upon the implications inherent in a move out and the nervousness from other European states about the outcome of the vote. I think it was fair to say, at least publicly, that no one really thought it would happen.
I therefore awoke the next day rather shocked (and disappointed) with the vote. I don’t think I was the only one. That morning, I met the CEO of a leading food-to-go business. He was leading the organisation’s strategic review/ planning process early the following week. In preparation, numerous reports had been created, various scenarios and options had been thought through, all however, with the caveat that the projections were based on a Remain vote. Back to the drawing board then!
Over the course of the last two weeks, Chairman, CEO’s and their teams have been grappling with the short and mid-term implications of the news. At this point, no one can project the long-term prognosis, and that uncertainty creates nervousness both for businesses, investors and consumers – all of which we could do without. However, already markets seem to be settling and people seem to be adjusting, quickly assessing the opportunities and threats ahead.