|Date:||27th May 2020|
So, nine weeks after the government announcing that we had to close our showrooms, we’ve now had news that with effect from next Monday (1st June) we can reopen. Clearly there are essential practices that we have to adhere to, so it won’t be quite the same as it was but it will allow us to get a little more back to normal.
We have seen a steady increase in the amount of business that we’ve been doing in all areas of the business over the last few weeks.
Our Service departments will sell in excess of 1,000 labour hours in May which is circa 25% of what we would normally do and have been dealing with retail customers for the last few weeks. The daily customer numbers have been steadily increasing and this has allowed us to adapt our processes to ensure we are adhering to Government and National Health England (NHE) guidelines. The phone lines are getting busier and busier and as an example, yesterday there were more than 150 service bookings made.
Parts have been open for the duration and May will see them operating at circa 30% of their normal sales rates which with a massively reduced staff head count is a great result.
The Bodyshop is now fully open and is forecasting to generate circa 70% of the budgeted gross profit albeit with virtually all of the staff now back in the business.
Sales haven’t been officially open but have been handling on line and telephone enquiries and last week sold in excess of 50 cars which is circa 50% of the normal run rate. In addition to this we also sold 9 motorcycles which is in excess of 80% of the normal volumes we would expect to see at this time of the year.
Overall, there are some very encouraging signs of recovery and I think the month of June will see us gaining even greater momentum which hopefully will carry on through the months ahead.
Those who are required to return to work will have by now had contact individually from the business, therefore, if you’ve not be asked to turn up to work please don’t. Our planned return to work is phased and this is designed to enable everyone’s safety and to balance cost with demand. Therefore, for quite a few the furlough status will continue. We are still awaiting government guidelines on the revised Coronavirus Job Retention Scheme which will be valid with effect from the end of July. Once we are in receipt of the new guidelines, we will factor these into our planning and then communicate our thoughts.
The CJRS has worked extremely well for some and not so well for others, for those who are significantly worse off I apologise but I know that isn’t the case for everyone. When you do return to work, we will continue to pay bonus in line with pay plans but there is no availability of spare funds to offer any goodwill outside of your normal bonus schemes.
My very first communication spoke about protecting the core and the management board and I have never lost sight of this objective. The plan is to steer the business through this period of difficulty and have a business at the end of it, a business that will go on to offer secure employment to a large amount of people.
What has happened in the last two months will result in losses for the business which will exceed one million pounds. Just like you have no doubt had to get your own cost bases in order, we have had to do the same in the business. We have benefited from capital repayment holidays on mortgages along with numerous other things and had we not done this, we wouldn’t have survived. The majority will have suffered some form of financial pain and I can assure you that the business has taken more than its fair share of that financial suffering. The pain would have been far worse without the support of the government’s Coronavirus Job Retention Scheme, the business rate holiday and the delayed payment of VAT. What we haven’t been able to do however, is to access any additional loans from the government despite our very best attempts. We therefore have to manage the business tighter than ever before and it is partly for this reason that we are having a phased return to work and not able to offer any goodwill outside of your current bonus and commission schemes.
In line with our objective for protecting the core we need to confirm the treatment of holiday. The employee handbook that you have been issued with states the following:
“We expect employees to take a paced approach to holidays, with a minimum of 10 days to be taken before the end of June each year, with a further 5 days booked to be taken during the remainder of the year. By the end of September, a minimum of 16 days must be taken and a total of 26 days need to be booked. The balance of holiday entitlement should be taken before the end of the calendar year as unused entitlement can-not be carried forward to the following year.”
Those who are still furloughed at the end of June will be required to have had holidays in line with the handbook. Holidays taken during the furlough period will be paid at 100% rather than at furlough rate. For those who had taken 10 days holiday prior to lock down, nothing has changed. Those who have worked throughout the duration of the lockdown will be exempt from the 10 day ruling and will need to book remaining holiday through the normal channels. Those of you who have fallen between any of the above will need to discuss on an individual basis with your line manager and a form of pro rata entitlement will be applied.
All future holiday requests will be considered but the planning of this is imperative. With careful organisation there is more than enough time remaining this year for everyone to get outstanding days booked, but the business needs people in it to enable its efficient operation. Each department has a minimum amount of people that it needs and consideration of this will be a factor in granting any holiday requests. What I’m saying is don’t leave it until the last minute to request time off.
We are already hearing about redundancies within our industry and that is despite the protection that the Coronavirus Job Retention Scheme is offering. We are absolutely intent in working through the situation that we find ourselves in the midst off and will not make any knee jerk reactions. By managing the business in our chosen style, we are trying to protect as many as possible from job losses. Whilst we can’t guarantee that everyone will have a job to return to, the longer the government supports the cost of holding jobs open the better the chance of the business returning to normal.
I look forward to seeing those who are returning to work and apologise that this isn’t everyone at the moment. I will update you on a frequent basis as to the recovery of the business. For those that are back at work next week, it will be business as usual in terms of dress code, parking etc with any changes outside of this being communicated on a site by site basis.