Bouncing back? UK businesses’ views mixed as Covid lockdown eases | Economics


The UK economy returned to growth in February despite continued pandemic-related restrictions, as businesses and consumers adapted and prepared for the relaxation of lockdown.

The Guardian spoke to three businesses about how they have coped with the crisis over the past year and their hopes for post-lockdown trading.

Banquet Records, Kingston upon Thames

Banquet Records staff
Jon Tolley with the Banquet Records staff. Photograph: Jon Tolley

Banquet Records, an independent record shop, sometimes boasts queues of music lovers round the block. But even before the first lockdown, the owners chose to shut its doors. They have not opened since.

Jon Tolley, the shop’s co-founder, said they want to wait until all social contact resumes. “Record shops will always be about the charm and the cult of browsing in person. We are not an Argos. We need to be fully immersed in the tactile experience, or not bother doing it at all.”

The store’s resilience stems from running a varied business: putting on gigs, selling vinylover the counter and online, and owning its own record label. Government high street grants and the furlough scheme helped it through during the initial slump.

Banquet quickly adapted to online-only sales, which are now double the pre-pandemic levels, and organised virtual gigs.

“People have nothing to do apart from sit at home and listen to records,” Tolley said. “The biggest challenge is just not knowing where we are going to be.”

Banquet had to postpone some gigs four times, and issue refunds after sold-out shows were cancelled.

“I am nervous about a vaccine passport, but I cannot see any other pragmatic way to get 1,000 people into a sweaty room,” Tolley said.

Eli’s Pop Up, Hatfield

Danny Wheeler overcame the struggle of losing his job because of the pandemic by launching a takeaway with friends in Hatfield.

Keen to boost the Hertfordshire town’s street food scene, Wheeler and four friends pooled their savings to open a fried chicken business, Eli’s Pop Up. It employs 10 staff.

After generating a social media buzz, they began taking online orders in November and using a kitchen in a local pub to prepare food for delivery around Hatfield.

Wheeler, a former digital marketer, said: “There isn’t much government financial support for new businesses. You can get a loan at 6% interest rate, but that is a risk.”

“Lockdown’s toll on mental health paired with the stresses of a new business has made things hard,” he added. “What keeps us going is the drive to make this work.”

Open Wednesday to Sunday, the business makes £5,000 revenue a week, with plans to open a second location in Shoreditch, London, as an office lunch spot.

Wheeler said all the money earned is being reinvested into the business, which will pivot to outdoor sit-down dining at the pub. “Now the government is hitting the vaccine target, I’m optimistic that in June, things will go back to normal,” he said.

“People are buzzing to get back out there – we are trying to embrace that.”

AJ Power, Craigavon

AJ Power operations Director DrJames Cochrane and managing director and chairman Ashley Pigott.
AJ Power operations Director DrJames Cochrane and managing director and chairman Ashley Pigott. Photograph: Sharon Williamson

AJ Power manufactures diesel-powered generating sets for sale in international markets.

While the manufacturer has fared well during Covid-19, the post-Brexit Northern Ireland protocol has crippled the firm with an onslaught of paperwork and surcharges.

The protocol created a new trade border with Northern Ireland and the rest of the UK, resulting in additional checks on goods.

“It has been a huge problem to us,” Pigott said. “We have 15,000 production line items – 80% of which originate from mainland Great Britain – that all need to be customs coded.”

“On top of that, you have a whole administrative bureaucratic nightmare,” Pigott said, adding the government’s trader support service, which is intended to support firms moving goods in and out of Northern Ireland, had created unexpected difficulties for which they were not prepared .

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AJ Power now pays a transportation surcharge of about £30 for every consignment. “This will cost us a lot of money over the next 12 months,” Pigott said.

New tariff rules have also hit the firm. “We end up having to pay European duties on goods and components which will never enter the European market,” he said.

Pigott fears long-lasting damage to Northern Ireland’s manufacturing sector, which he says is a defining part of the country’s heritage. “It makes for a lot of costs and a lot of effort, which do not add any value,” he said.