Covid-19 Impact: Activity sector in Wales

The future of the children’s activities sector in Wales has played heavily on my mind for many months on both a personal and professional level. Our devolved nation, led by First Minister Mark Drakeford, has taken an approach unique to Wales in terms of our response to the Covid-19 crisis; lifting different restrictions at different times to the rest of the UK as well as different advice and legislation.

The Sector in Wales

There are approximately 2,000 children’s activities providers in Wales and through research conducted by the Wales Children’s Activities and Services Awards I found out that of the cross section we surveyed 40% of these businesses are under two years old. We all know that the children’s activities sector is relatively new across the U.K in comparison to some traditional sectors, but the research suggests that this is particularly true for Wales. With this said, it is crucial to note that Wales is proudly home to some National and International franchisors within the sector as well as lots of successful franchisees and inspirational independent businesses.

It’s also interesting to note that 54% of businesses surveyed were run by one person with a further 34% of businesses made up of a team up 2-5 people. This tells us the vast majority of businesses in the children’s activities sector in Wales are made up of small teams (who from my experience are bubbling with enthusiasm and love for what they do).

The Here and Now

At the time of writing this article key changes have been made in Wales to impact the children’s activity sector including the fact that children under 11 years old are no longer required to social distance from each other and other adults, in line with scientific developments about lower transmission rates in this age group. This is a milestone development for providers in the sector but most notably for those running toddler to preschool activities whereby social distancing would have been near enough impossible to manage successfully.

Wales has also recently welcomed the news allowing outdoor meetings for up to 30 people meaning providers are now able to run classes outdoors over the summer period. And whilst this activity will be dependent on our wonderful Welsh weather, it is a welcome bridging gap for both families and providers at this time.

Indoor play areas, including soft play, are now open and this is something we did not anticipate in Wales for some time. This is another notable milestone in our progression to life after the pandemic.

Business confidence in Wales rose during the month of July and has done month on month according to research by the Business Barometer at Lloyds bank. The Business Barometer questions 1,200 businesses monthly and provides early economic trends and data both regionally and nationwide. Whilst businesses in Wales still unsurprisingly report to be negatively impacted by Covid-19 in July, it is very welcome to note an increase in business confidence in Wales for business owners. Although this is not specific to the children’s activities sector, this upturn in confidence seems to be evident through social media whereby I am seeing lots of Welsh providers busy and excited showing their customers their intricate plans for creating a Covid-Secure environment and opening booking systems ready for September. The last two weeks in particular I have sensed a distinct change in mood from unsettled and unsure to optimistic and excitement. This leads me to feel the future is bright, but we must not get complacent.

The Future

In light of the economic trauma we have faced not only in Wales but throughout the UK, according to experts at NatWest there is a real possibility that we will head into a recession. This is probably not surprising to you given the downturn we have all witnessed in the economy however, it is important not to panic at the R word.

What is important now is future proofing your business for all eventualities. NatWest’s research is based on previous recessions and suggests that people do not stop spending their money during a recession, but they do change their spending habits. Children’s activities will become a priority for parents after the loss of formal education and social activities for such a prolonged period. For example, several Beaming Babies classes became fully booked in record time when the booking was reopened ready for September, exemplifying my point that parents (and children) are craving our sector to reopen. Therefore, it is more important now than ever to offer parents the best value for money, as this is what people will look for during a recession. As a sector, we need to be ready for that. We must be thinking about how we can go the extra mile for our customers and pack as much value for money as possible into that weekly window with us in order to 1) attract customers and 2) retain them (this is key – according to research it costs 5 times as much to attract a new customer as it does to retain an existing one). Throughout lockdown businesses and consumers have become accustomed to an online offering and now is the time to explore how you could enhance your face to face services with a digital supplement. This could be in the form of digital downloads such as music, games or activities to do at home or even online communities. I surveyed a cross section of parents in Wales with children aged 0 – 16 years old and it was interesting to note that 50% of respondents would like online classes to continue into the future with people noting convenience rather than safety as being the main motivator for this. This is food for thought on enhancing the value of your offering in Wales.

Furthermore, having a strong business continuity plan in place will be critical to riding out the storm and coming out of the other end. Not only for the sustainability of your business but also for your wellbeing; knowing you have a secure plan will help you feel in control. This is an important part of any business but now more than ever. Although reported cases of Covid-19 are currently low in Wales, we are yet to understand the impact of the infection throughout the winter months. A business continuity plan will help you to continue your business with as little disruption as possible for both you and your customers should there be a second wave of Covid-19. Your business continuity plan should include what you and your teams’ responsibilities are if there is a second wave of Covid-19 or any other disaster type situation in order to ensure your business can continue throughout.

In terms of the practicalities of classes and groups in Wales, adults and children over 11 years old are currently still advised to social distance at 2m and there has been no indication from the First Minister that he is considering reducing this anytime soon. Whilst safety is of course of the utmost importance, the 2m social distancing rule will serve as a logistical issue for many providers, particularly for groups and classes where parents accompany children, such as baby and toddler classes. However, with this said, there are elements of legislation in Wales which are very positive for baby and toddler classes. At the time of writing this article, in Wales face coverings are only legally required on public transport. This is particularly beneficial for baby and toddler groups where there is usually an emphasis on close interaction and bonding which is often through eye contact, facial expression and verbal communication; all of which may be impacted during the class by the wearing of a face covering.

Moving on from baby and toddler classes, optimistic strides are being made for those where children (under 11 years old) attend alone and are no longer requiring to social distance from each other and other adults; no doubt these types of classes will be the first to feel and look like a glimmer of normality for both the children and providers. This gives me hope that the rest of the children’s activities sector in Wales will follow in time.

For those in Wales, we should also be mindful of the unique business support that is available to us such as the fully funded provision of Business Wales who are offering specific Covid-19 support at this time. There is also the Development Bank of Wales set up by the Welsh Government to support the economy of Wales by making it easier for businesses to get the finance they need to start up, strengthen and grow. When you get caught up in the tangles of Covid-19 it can be easy to overlook the support on our doorstep here in Wales. Use it to your advantage.

The long-term future is positive for the children’s activities sector in Wales with 70% of parents surveyed stating they would return to activities and classes as soon as they reopen. The customer appetite is certainly there. However, I believe the remainder of 2020 and even Quarter One of 2021 will be a period recovery for the children’s activities sector in Wales as we seek to rebuild businesses. Time is critical; it will allow restrictions to ease and science to gain a deeper understanding of the virus and its behaviours over the full course of a year. Future proofing your business now and preparing for every eventuality will put your business in the best possible position to come out stronger at the other end.

I wish you all the very best as you navigate your way through the rest of 2020 and beyond.

Author: Kelly Jenkins, Beaming Babies & Wales CASA

Kelly Jenkins is the founder of Beaming Babies, a story and sensory baby class franchise operating within South Wales. She is also the founder of the Wales Children’s Activities and Services Awards where she aims to place amazing businesses in this sector on a pedestal to be recognised and celebrated.

By becoming a member of ICAP you’re joining a community of like-minded professionals and business owners in the children’s activity sector working towards excellence