The co-owner of the group behind the Di Maggio’s restaurant chain has highlighted the challenges that lie ahead this winter as the industry faces the prospect of a massive hit to the key festive trading period.

Tony Conetta said December traditionally accounts for about 20 per cent of annual revenues generated by the Di Maggio’s Restaurant Group (DRG), Scotland’s largest independent operator. The family-owned firm has 18 restaurants in Glasgow, Edinburgh and Aberdeen trading under the Di Maggio’s, Café Andaluz, Amarone, Barolo, Anchor Line, Atlantic and Cadiz brands, along with five food court outlets in Scotland, Belfast and Manchester.

With the new “rule of six” coming in at a time when bookings would normally start pouring in for office Christmas parties, Mr Conetta said the group is having to think of “innovative ways” to market its restaurants this festive season. While the temporary 5 per cent rate of VAT for hospitality businesses remains in place, the restrictions on gatherings of no more than six people from two different households has already led to some cancellations this month.

“If it is necessary now, then fine, we understand, but it would be good to have that removed as soon as it is possible,” he said.

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DRG is a member of the newly-formed Scottish Hospitality Group which yesterday warned that a national curfew of 10pm would have “catastrophic” consequences for the industry. Authorities are considering such a move in parts of England, while First Minister Nicola Sturgeon has refused to rule out the possibility of curfews in Scotland if coronavirus infection rates in Scotland continue to rise.

HeraldScotland:

Despite the immediate difficulties, DRG yesterday re-opened its Barolo restaurant in Glasgow following a complete refurbishment including new safety and social distancing measures. All bar one of the group’s restaurants – Di Maggio’s Theatreland Glasgow – are currently trading at about 70% of pre-Covid capacity.

“The one metre spacing rule has made that possible,” Mr Conetta said. “At two metres, a lot of our venues were not viable.

“We are still here punching, fighting. We are optimistic for the future. We know it is going to be a difficult six months, but we are of the strong belief that things will return to normal.”

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According to latest accounts filed with Companies House, DRG made an underlying operating profit of £4.2 million during the year to April 28, 2019, on revenues of £36.5m. The number of staff at 800 “hasn’t changed much since lockdown”, Mr Conetta said, with the company using flexible furlough to top up the wages of those not achieving the hours they worked previously.

Like many in the industry, DRG offered limited takeaway service when lockdown measures were at their most stringent. Employees were paid without interruption following the blanket closures in late March, with DRG meeting 80% of staff salaries from its own resources during the first six weeks before furlough assistance came through.

“We were fortunate that we were in a strong financial position to be able to do that,” Mr Conetta said.

To buffer the impact of what will be a vastly different festive trading period, DRG is looking at alternatives such as offering restaurant hampers and dine at home options. For those employers that normally contribute towards the cost of a Christmas office party, Mr Conetta said corporate gifting of an equivalent amount to each employee would allow them to enjoy a meal out in a smaller group.

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DRG is in the process of “winterifying” outdoor areas to maximise space amid social distancing requirements. Mr Conetta said the group also remains alert to opportunities for further expansion as the economic fall-out from the pandemic has made more properties available at more favourable prices.

“We wouldn’t be doing our jobs properly if we weren’t investigating those situations,” he said.