From the President

Cause for Optimism

DAVID BASHEER – AHA|SA PRESIDENT

WATCH DAVID'S VIDEO UPDATE: https://youtu.be/rvATmQzhLhg

We have all suffered the frustrations of COVID-19 and the financial challenges it has inflicted upon us.

But looking at the facts, I am optimistic there are blue skies ahead.

It won’t be 100% smooth sailing and as Ian Horne forecasts in his column, there will be setbacks – but I expect those to be periods of short-term pain.

Here are the top 10 things to look forward to for a positive 2022 in business.

1. EVERY DAY CAN BE A BIT LIKE CHRISTMAS

Vaccination rates are on the rise, meaning the threat of mass lockdowns and large scale restrictions are diminishing. I am convinced the pent up demand for events, travel or just going out uninhibited with friends will result in a sustained period where every day can feel a little like Christmas.

So many events and special occasions were postponed - and many people will want to celebrate when finally given the opportunity.

Because pubs are such a part of South Australians’ DNA , we are well placed to capitalise on that.

After the first lockdown last year, we saw how strong trade was at re-opening. Most businesses reported strong trade in the weeks before the June border closures and July lockdown. When I look at the overseas experience, it also supports the argument for a period of strong trading in 2022.

Bring it on!

2. HOTEL VALUES UP

The spate of hotel sales in recent months, including renewed interstate interest, has seen hotel valuations rise. Even if selling your hotel is not part of your current thinking, a healthier valuation in the eyes of your bank releases opportunities for many.

It wasn’t that long ago that every hotel sale in this State seemed to be a distressed one. How quickly that tide has turned.

3. LOW INTEREST RATES AND BUSINESS CONDITIONS

Interest rates continue to be low. After their October board meeting, the Governor of the RBA confirmed the 0.1% rate was unlikely to rise until 2024 at the earliest. For any pubs that have been forced to take on extra debt through COVID-19 or are looking to invest in their business, this is welcome news. With the economy having an optimistic outlook and unemployment low, SA is considered a centre for good growth industries going forward.

4. REGIONAL VENUES GROW

A great legacy of the border closures is that South Australians have discovered their own backyard. Seeing what the regions have to offer and spreading the word to others will lead to regional tourism re-establishing itself and growth for our country venues who did it tougher than most.

5. GAMING GROWTH SUSTAINED

The new gaming legislation which came into effect on February 19 this year has seen a sustained growth in a market that has been flat for several years.

This growth has underpinned financial certainty in an otherwise most uncertain time, giving many hotels the confidence to start upgrading their entire premises, not just gaming rooms.

6. ON THE OVERSEAS RADAR

Our current quarantine laws make inbound tourism impossible. That won’t last forever. Following two years without international tourists and conferences, we would hope the floodgates will open. It is the perfect time to be ranked the third most liveable city in the world and attract International attention.

There is a strong expectation that the next State Government - after the March 2022 election - will pour serious funds into tourism to restore, then grow, our pre-Covid $8.4billion visitor economy.

7. NEVER WASTE A GOOD CRISIS

During the darkest times of COVID-19, many hotels took the opportunity to cast a critical eye over their business and determine what was important to them and ensure they have the most efficient cost base going forward to maximise their returns.

These tough times have also made us aware who we can count on and invest in for the future.

8. SUPPORT LOCAL

One of the key changes in consumer habits has been the desire to support smaller, local and family businesses. This plays right into our heartland and gives our 92% SMEowned hotels a great platform to grow.

Suburban and regional pubs have already enjoyed the benefit of this. It is a just reward for family-owned businesses that are taking risks, working incredibly long hours and turning their hand to every job that needs to be done.

9. OUR FOOD AND WINE

Buying anything from overseas right now is a challenge. No guarantee the kids’ Christmas present from Amazon will make it. Same with that furniture delivery from China.

On the flip side, some overseas markets have dried up for our local producers.

The best of our own food and wine is readily available in both quantity and quality. Time to cast your eye over existing menus and wine lists to reflect that and support each other!

10. THIRD TIME LUCKY!

And lastly, third time lucky. After two Preliminary Final losses, Port Adelaide are certain to be 2022 Premiers, meaning a bumper September for any pub willing to fly a black, white and teal blue flag outside their premises next year!