Amanda Dorel, regional director for Wales at Lloyds Bank, discusses the challenges and opportunities facing the tourism industry as businesses look to get back up and running.

The doors of the visitor economy are reopening this week for the first time in almost four months – but the question remains, will the demand be there for them to do so with gusto?

With a third of a year’s tourism trade lost, making a huge dent in firms’ confidence, the reopening is welcome news. To put it into context, our monthly Business Barometer, which indicates business confidence levels across the nation, has provided record-low figures since the start of lockdown.

But there is nothing like a crisis to bring out the resolve in a country.

The reopening of outdoor visitor attractions and self-contained accommodation is the first step in what will be a vital summer season. More long-term, it (we hope) marks the start of the recovery ahead.

With tourism generating more than £6billion of revenue every year and delivering around six per cent of Welsh GVA, it’s a sector at the heart of the nation’s economic drumbeat. It’s also a sector that in recent years has outstripped the wider economy in terms of job growth.

Speaking to customers across Wales, it’s clear that, while they are extremely concerned by the uncertainty ahead, they are also incredibly eager to welcome patrons back safely. This type of ambition will be essential if firms are to maximise the opportunities that are presented in the coming months.

Cottage holiday bookings in England are reported to have smashed daily records when it was announced at the end of June that the staycation market would be clear to reopen this month. And, while overseas bookings are picking up again, it’s clear that the majority of the UK plans to stay closer to home this summer. This will provide a major boost for Welsh destinations that have missed out on bookings at the start of the season.

The government-led furlough scheme continues to hold significant importance for travel and tourism business owners in terms of how they manage their resources as they look to bring in as much revenue as possible before the autumn.

According to our latest Business Barometer, around a fifth (18 per cent) suggest that they won’t be able to operate at full capacity due to social restrictions – an issue which will undoubtedly affect the industry’s 132,000 workers. Notably, two fifths (41 per cent) of businesses expected to reduce the size of their team in the next 12 months.

The furlough scheme will help businesses to be in a financial position to be stable and maintain staff levels, but strong and meticulous management of balance sheets is essential too. We’ve been working closely with businesses throughout the lockdown, providing support through the Bounce Back and Coronavirus Business Interruption Loan Schemes (CBILS).

We’ve also been providing capital repayment holidays to firms which have chosen not to take on new debt. Wales’ savvy tourism businesses are assessing the full suite of financial options available to them and taking advantage of the most suitable for their long-term success.

Over the last few months, I’ve been struck by the resilience of businesses up and down the country who have used the funding to pivot their offering. These examples of adaptability and ingenuity fill me with confidence that we will overcome the challenges ahead.

To further help with this, business owners should also be scenario planning and keeping close to their financial forecasts as their tills start to open again – typically a rolling 13-week view of predicted income and outgoings will enable them to see whether they are likely to need additional financial support. Getting the industry back up to running pace when it has been inactive for so long will also likely result in cashflow issues, so further short-term financial support may be required to ensure a return to long-term health.

The positive news is that the desire for the Great British holiday remains alive and well – if not further invigorated – following lockdown. The Welsh tourism industry has shown its resilience before, recovering from crises like the foot and mouth outbreak in 2001 to grow back stronger. I am convinced that, with the right support, this can still be a summer to remember for the right reasons.