Arena boss issues redundancy warning as gigs still long way off

The chief executive of the complex housing the M&S Arena and conference and exhibition centre has given hints as to how major events could look under the "new normal".

Bob Prattey said the Covid-19 pandemic has been the "most difficult challenge" of his career, also adding that with around 100 staff on furlough, ACC Liverpool could soon be forced into making redundancies if the support scheme is not extended.

Speaking to BusinessLive, Mr Prattey warned that while he was hopeful business events may restart in October, music fans should not expect a return to any kind of concert until next year – or a Covid vaccine has been made available, meaning a worrying future for the venue.

Bob Prattey, chief executive of the ACC Liverpool Group

Mr Prattey told BusinessLive: "The word ‘unprecedented’ is on everybody's lips all the time, but I've been in the business for upwards of 35 years, and this is the most challenging experience that I've had.

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"It's really, really difficult because you're talking to lots of the organisers that are on the verge of going bankrupt, and some of the things that we're asking them to do are pushing them in that direction.

"These are people that we've worked with for many, many years, and they're just saying, 'you know, Bob, we can't do it like this'."

2020 set to be one of venue's busiest years

2020 was set to be one of the ACC's busiest ever years before the pandemic hit the UK.

But the lockdown forced the group to begin liaising with event organisers to push their events back.

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Mr Prattey said: “That involved an inordinate amount of work – we talked to all the organisers about the implications of moving, made substantial changes to our calendar, found space to get all these events in, but then obviously coronavirus rolled on in an inexplicable way.

“We were then having to move events into next year, which was already a busy year, anyway.”

He said difficulties arose with organisers – some of whom were on the “brink of liquidation” – being initially unable to cancel events due to commitments in the contract until the ‘force majeure’ (unforeseeable events) provision could be applied.

Mr Prattey added: “In the meantime, we were earning no money.

“We haven't had any income coming into the business since the end of April, so we are millions of pounds worth of revenue down, and obviously we've got continuing costs including maintaining the facilities and staffing.”

Mr Prattey said around 120 of 150 ACC staff were furloughed at the outset of the pandemic, and remain so to the current day, with the firm continuing to top up the 80% Government salary payment to 100%.

Redundancy fears

Staff who have not been furloughed work in marketing, sales, finance and planning, and have been looking at how events can still go ahead with restrictions in place.

That’s as well as helping with the centre’s recent work with the council and central government, acting as a distribution centre for food parcels and PPE.

Warning about potential redundancies, Mr Prattey said he fears that when the furlough scheme comes to an end in October, the centre may have to “follow suit”.

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He said: “We will have to look at all sorts of cost-saving measures to reduce the outflow of funds, which is haemorrhaging, just to keep the buildings ticking over.

"We're already struggling and like other venues are having to face up to potential redundancies and challenges across the board. Every day there are more and more redundancies announced in our sector."

Sadly for live music lovers, Mr Prattey said he could not foresee any gigs taking place until 2021.

“The consensus across the industry is that there won't be any concerts this year, potentially not this financial year.

Katy Perry performing on Witness The Tour 21st June 2018 at The Liverpool Echo Arena – photograph David Munn

“That’s because many of those [booked for this year] are 10,000 capacities that have sold out, and with social distancing, the capacities are going to shrink dramatically.

“We just don't think it's going to be commercially viable to stage those events.

“Normally, you’ve got massive queues outside the arena when we open the doors, with 5,000 people waiting to come in. How would we do that with social distancing of a metre? They would have to queue down the Strand.

“There needs to be some other way of doing concerts so we can get up to those kinds of capacities. That may mean other methods of pre-registration, or testing on the doors.

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"Sadly, a concert with Elton John and 10,000 people sitting in an arena is only going to work with 10,000 people sitting in an arena. So I think we are just going to have to wait until there’s a vaccine.”

Mr Prattey took up his role in 2005 – before the start of on-site construction of the arena had even started. It opened in 2008, with the exhibition centre later opening in 2015.

Mr Prattey said he is hopeful of business events returning in October following the Government’s announcement last month, but these would be subject to social distancing and successful pilot events, which will soon take place around the country.

How might ‘new normal’ events look?

So how would a socially-distanced business event look at the ACC?

“We will need to take larger amounts of space for each event," he said.

"So if you're running a conference with 1,000 delegates, we couldn't do it in the main hall of the convention centre – we'd have to move the main plenary sessions into the arena, and then put 1,000 people in the arena.

“All of the breakout sessions could then take place in other parts of the site.

“With every single event, we’re having to work out all the details of how it can work, and what additional facilities are required to enable social distancing.

The ACC Liverpool events campus

“We've done a huge amount of work, to show the organisers how we think it can work for them.”

In terms of public exhibitions, Mr Prattey said these would need bigger aisles, one-way systems and different forms of registrations, as well as alternative catering, queuing and car parking arrangements.

So how confident is Mr Prattey that some operations can begin in October?

He said: “We have to be confident and plan for the best-case scenario.

“We have built up a business here in Liverpool that brings around £200m a year worth of economic impact.

“That's a huge amount of money that comes into Liverpool – we fill hotels, we fill restaurants, we fill bars, we fill taxis.

'The organisers have got to want to do it'

“That's what we were built for. If that goes, or doesn't come back at the rate in which we want it to, that's going to have further knock on issues in all those sectors.

"We've got to have the organisers with us as well, the organisers have got to want to do it.

“One of the questions the organisers are asking is, ‘will the delegates turn up?’ Will they want to come back?

“It won't be the same environment, but what we need to do is to make sure that it’s as entertaining and fulfilling as public exhibitions and public conferences are.

“So we have to make the new norm as close to the old norm as possible, always being concerned with the principal health and safety of the delegates and obviously, our own staff.”

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For Mr Prattey, the pandemic has illustrated how hospitality venues are all connected – particularly in Liverpool.

He said: “The government's first move was to open up restaurants, open up retail, open up hospitality, but there aren't any people coming in to fill the restaurants, and this is particularly true of Liverpool. It does not have a huge business community.

“Restaurants are operating at massively reduced capacity, and they're also operating at massively reduced occupancy rates. The hotels are almost single figures, some of them, in terms of how much business they're operating at the moment, whereas normally there about 80 or 90%.

“The hotel general managers are asking us when we will restart.

“But we’re telling them events like the Labour Party conference, which would have filled all the hotels in the region and had an economic impact of about £19m, is cancelled.

“It is all connected – they are being affected by our continued closure. And whilst it's good news that retail, restaurants and hotels are beginning to open, if we can't get active with the arena and the convention centre and exhibition centre, we're not going to be able to feed that demand.”

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