|Date:||31st July 2020|
The business has now been fully operational for the last nine weeks and I think it is appropriate to update you as to what has happened during that period.
It is fair to say that I have been taken by complete surprise as to the bounce back that has been experienced across the group. Today we have very few people left on furlough leave and in excess of 90% of the team have now returned to the business. The same bounce back hasn’t been achieved by many businesses in our sector and I put our success down to the attitude of many of the team and the strategic planning of many of our Managers.
There are plenty of businesses out there who have relied too heavily on the government job retention scheme and we still hear plenty of stories where less than 50% of total employees have returned to work. It was always our intention to get as many back into the business as quickly as possible but not until we were comfortable that the levels of business were there to sustain the cost. Those businesses who have been slow to return to some form of normality have missed the bus and it’ll likely be these that end up making higher number of redundancies.
A few headline numbers as to what has happened in the business in the last 9 weeks:
New Retail Cars Delivered – 240
Corporate Cars Delivered – 146
Used Cars Delivered – 754
Service Hours Sold – 12,350
Bodyshop Sales – £220,000
Parts Sales – £2,350,000 (Including £750,000 of online sales)
Motorbikes Delivered – 82
Motorbike Service Hours sold – 1,200
Motorbike Parts Sales £180,000
All of the above are amazing results when compared to the same months last year. Our aftersales business has bounced back to very similar levels from last year and our sales departments have seen an incredible 25% increase in units. The results across all departments are very different to our expectations and whilst this is a great boost for the business, we’re not out of the woods just yet.
Like many of you, the business has benefitted from a capital repayment holiday on it’s mortgages and a huge level of employee salary support from the job retention scheme and even with this and the amazing result that you have all helped to deliver in the last two months, at the end of June the business had made a loss for the year. Fortunately, we will return to profitability in July, albeit very marginal, and as I’m sure you know, without profit there is no business and shortly the support from the government furlough scheme and our mortgage repayment holiday will cease which means profit generation and expense control is very much a part of daily life.
I am, however, delighted with the financial result and I’m exceptionally proud to be able to say that for the large part of you, Cotswold was once again responsible for generating enough profit in July to pay your wages and we relied very little on the government for support and this very much puts us on the road to recovery.
It is abundantly clear that the COVID-19 virus is going to be with us for some time and once again I urge you to take responsibility and protect yourselves as much as possible. I was talking with a colleague of mine who runs a dealership this morning, who received a phone call at the start of last week from a customer. The call was to advise that the customer had tested positive to COVID-19 and that he had recently been in fairly close proximity to one of the sales executives. Immediately the sales executive was asked to leave the business (despite not showing any symptoms and having a perfectly normal temperature) and seek a test which he duly did. The test results were positive and that is where the story begins. The positively tested employee was interviewed and it was found that he had not adhered to the social distancing guidelines with many employees within the business. The showroom was immediately closed down and all 200 members of staff were ordered to take a test, of which there were no other positive cases. However, due to the fact that the contaminated individual had been in close contact with a high number of the sales team, those in question were immediately sent home and ordered by NHE (National Health England) to self-isolate for 14 days.
In the above instance all employees ordered to self-isolate and unable to work were put on immediate SSP (statutory sick pay) which is currently less than £20 per day. There is no support from the government and under these circumstances, the employees cannot be re-furloughed.
The feeling amongst the majority of employees within the business towards the individual who contracted the virus is not good – a lot of them know that he hasn’t been adhering to the government guidelines and a fair number of employees have seen him behaving in an inappropriate manner out of the business. Whilst there are no guarantees that his behaviour has caused him to contract the virus, try telling this to those people who have been tested as clear but who, for no fault of their own have been significantly affected financially.
Is it a bit harsh that the company in question has taken the stance not to pay these people, preferring instead to put them on SSP? Not at all………we are working flat out to survive and paying people who (for no fault of their own) are unable to generate income for the business is a shortcut to bankruptcy. In April and May, our business lost in excess of £1,000,000 and therefore if we were to experience a similar outbreak in the work place, I’m sorry but we would take exactly the same stance.
So, what can you do about it?
You can ensure that you adhere to the social distancing guidelines and encourage all of those around you to do the same – including customers that visit the site. You can ensure that you stay away from the business and get tested if you or anyone you live with have symptoms of a high temperature, new continuous cough or loss of sense of taste and smell. Testing is readily available now for those with symptoms with a number of test centres being available to book within a short time period. The results are also returned within 24 hours if you go to a testing centre rather than opting for a home test.
You can use the correct entrance to the business and sanitise your hands as you enter and wash your hands frequently during the day. You can contact others by phone rather than moving from department to department and you can continue these behaviours when you’re not at work. There are many examples of people (I’m not on about employees of Cotswold) behaving inappropriately in their social lives and this is where the virus can so easily be picked up. Please, please, please can you adhere to the guidelines because whilst we are travelling along the road to recovery, an outbreak like the one I’m harping on about could very easily steer us at speed into an oncoming lorry, with I’m afraid to say dire consequences!
We have a great business which is built around a large amount of great people. We are currently a financially stable business and have come out of this first wave of COVID-19 with circa 95% of all employees. There are some horror stories out there and I can assure you there are more to come as the job retention scheme gets removed. Job losses within our industry at 35% of all staff is not unusual and once again, I believe there will be a number of businesses facing bankruptcy. I believe (maybe I am a bit biased) that we have a great business and together with the board, will do everything we can to steer the business to long term survival. My request to you is that you support us in that objective by working as hard as you can to get a result and protecting yourself from contracting the virus and bringing it with you into the business.
The only area of concern that I want you to take from this is about protection of yourself and our business from the virus. We are in a far better position financially post lockdown than I expected to be and if trading continues at reduced levels to what we’ve experienced but in line with the same period last year, we will turn the year in a good place, but not if we don’t manage the expense.