Operators braced for further turmoil

Child playing

Operators brace for further turmoil

A wide-ranging survey of operators around the UK has unsurprisingly highlighted the parlous state of the industry after the last eight months of lockdown and uncertainty.

As many of you will have read on the BBC news site last week, operators across the soft-play sector are struggling to survive the commercial impact of the pandemic.

To arm itself with the correct information to provide the industry’s voice in this article, the Association of Indoor Play (AIP) conducted its first State of the Industry survey, covering more than 1,000 indoor-play operators in the UK. The responses covered all manner of shape and size of centre, from role play cafes to multi-attraction centres incorporating many different areas such as soft play, climbing, laser tag and role play.

Questions looked at the most salient aspects of everyone’s business during this COVID-dominated period and the results give a broad perspective on the state of the industry at the end of September.

Results include:

September was an awful month for revenue – indoor-play operators reported they were down on average 65% year on year.

Customer confidence is an issue, but more so the inability to host parties – parties represent on average 37% of an indoor-play operator’s revenue. Not being able to run them will be the key determining factor in 97% of operators running at a loss this financial year. 40% of businesses expect to lose more than £50,000, while 19% put that figure above £100,000.

Most operators are not covered by insurance – only 8% believe they have a valid claim after a recent high court ruling.

Government support measures have been taken up – 94% of businesses have received a grant and 85% have taken advantage of a bounce back loan or CBILs.

But these support measures are not enough – the top three ways in which operators believe they can be supported more are 1) new grants 2) an extension of the 5% VAT rate and 3) an extension of business rate relief.

Without further support the majority of operators will cease to trade – having used up a significant proportion of their cash reserves, even a two-week lockdown would put 31% of businesses into administration and a further 56% would need more cash injected if this was to fall over the October half term.

As an industry, indoor play matters – it contributes £308 million to the Treasury every year and employs 14,400 people under the age of 25, way above the national average.

Children holding hands

"The AIP further reported that since reopening, many centres have received very positive feedback about their COVID-secure measures, with a large number of people identifying the sector as one of the leading lights in this regard. This is backed up by the fact that there has been a very low incidence of COVID infection or outbreaks connected to indoor-play centres, or of centres required to close due to COVID"

The statistics are already playing out as being true,” says the AIP. “We have seen dozens of centres already close their doors for good across the UK. More needs to be done to prevent further closures that will impact the mental and physical health of both children and adults for years to come.

If you have any questions about this data, want to comment further or you would like to join the AIP, email accounts@associationofindoorplay.org