Sheerness-based Kent Catering Service (KCS) has revealed to Catering Insight the real impact of the coronavirus crisis on the dealer.
General manager Mark Seager reported that as there has been a drastic reduction in the number of maintenance call-outs and projects, the firm has had to reduce staffing levels via the government’s furlough scheme in order to stem the loss of money.
“KCS works in the education, care home, hospice and NHS sectors, so we feel we have a moral responsibility to continue to provide services to these customers,” he believes.
However, this poses a dilemma for the dealer: “The problem is how do you staff for possible work?” said Seager. “Staff still need to be paid as the furlough scheme stops the employee from doing any work for you.
“With income from work substantially reduced, we are running at a daily loss in order to provide a ‘what if/as needed’ service.”
Seager praised the business, saying: “KCS is in a lucky position we have a dedicated owner in Tony Irwin who cares for his staff and customers. Tony has already donned work clothes and attended emergency callouts and takes no wage.”
In terms of how KCS’s own suppliers have reacted to the situation, Seager reported: “The vast majority of our suppliers have been excellent, providing constant updates and help.” He particularly singled out spares specialist First Choice Group as being supportive.
Seager further revealed: “We have had to ask for extension of terms to two suppliers as we battle to get monies owed into us by customers who have simply shut shop or are working reduced hours or from home and have payment issues.”
He reported: “The main surprise was the positive reaction to our request from our Italian suppliers at Comenda who could not have been more helpful, and the disappointment at an English supplier who we will not name which has put our account onto a proforma basis and threatened to place our account on hold.
“We have never paid late or owed money previously and have always had pride in this fact. It’s not as if we are not going to pay, we only asked for a small extension in time to pay.
“As a high proportion of our customers are governmental and they are running on skeleton staffing levels and from home, their payments to us at KCS are becoming well overdue.”
On the subject of whether the government’s financial rescue packages for businesses have assisted, Seager said: “The furlough system is working but has its issues. If we need to call back an employee to work due to an issue with another employee who is sick but not on furlough, then we understand this is not allowed as it is a 3-week block period for furloughing.
“There are concerns and issues with the government loan scheme with banks not applying the criteria laid down by the government making it hard for smaller business to take advantage of this.
“It’s ok to borrow and saddle the company in debt, but how do you recoup money for the repayments required from an industry that has suffered in the previous financial climate, let alone in the prospect of what awaits us on the other side of all this?”
So how will KCS move forward once the coronavirus crisis ends? “Hopefully we will be in a strong position once this crisis ends, provided we are not saddled with extensive debts, we have a clear and concise plan to return to normal as soon as possible,” according to Seager.
“We hope that being there for customers during the bad times will reflect on customer loyalty when things get back to normal.”
He concluded: “Hopefully there will be a resurgence in the hospitality industry at the end of this and KCS will be in the position to offer our expertise in sales, repairs and maintenance of all commercial catering equipment to customers both old and new.”