Restaurants bear the brunt of the second wave of Covid and lockdown

With the second wave of Covid hitting hard, and now the lockdown – the restaurant owners are a worried lot. Food delivery apps seem to be the only saviours.

The f&b sector sailed through the first wave barely making it. And, what looked like slowly getting back to normalcy, quickly spiralled to the other side, when Covid struck again. While night curfew itself was a damper, the lockdown has surely broken the spirit of restaurant owners.

Restaurateurs in Hyderabad are worried about incurring further losses again as they had just started to recover from last year’s loss. Hanumanth, the owner of Roast- The caffeine capital in Hyderabad mentions that Sales have seen a fall of almost 50% from the beginning of the second wave in April. Online sales are not helping much; Businesses have to pump in additional funds to stay alive. Rents are very high and many operations are being shut down. ‘It’s all about demand and supply, there is a lot of supply but no demand in the market, so one must cut down the costs. We cannot do much to push the sales, all we can do is control the costs, if possible, negotiate with vendors and rentals for a relief of a few months. The overall situation in the food industry is pretty bad’ says Hanumanth

Mr. Hanumanth

Naveen Nagaraj, Executive Chef, Tatva restaurant mentions that, the present scenario is much worse when compared to last year, “The sales have drastically dropped irrespective of the size of the restaurant. No matter how many steps are taken for the safety of customers, people now would not prefer eating out with the continuing surge in Covid cases. Since most of the staff are from other states like Andhra Pradesh, Madhya Pradesh, Jharkhand, Bihar and Uttar Pradesh, they were afraid that, just like last year, they may be stuck in the city if a sudden lockdown is announced by the Government. They were ready to leave their jobs, preferring to go back to their hometowns.

He also says that many restaurants are unable to pay their staff due to sudden cash crunch, so they are also reducing their manpower, if not, they are reducing their salaries. The situation is inevitable, the restaurants don’t really have a say in whatever is happening. Until a lockdown was announced by the government, most of the businesses continued operating irrespective of their profits as they wanted everyone to have their jobs and survive enough to run their expenses. It’s just a matter of survival. Just when things started to get back to normal, the situation turned grim and unfortunately, it’s going back to square one again.” After lockdown the only saviours seem to be food delivery Apps and restaurants that are open have to use these Apps despite not being able to make any profit.

Chef Naveen

According to Business Insider, the cost of running a restaurant post pandemic has skyrocketed, especially as much as 38 percent. Restaurants find it difficult to satisfy their customers with their menu prices, support their staff all whilst already being financially stretched. A co authored report by the University of Guelph and Dalhousie University has found that as customers re- allocate their dining out budgets to spending at grocery stores and as food costs rise, more restaurants are either closing for good or shifting to food delivery and pick up models.

Mr. Venu Bulusu

Before lockdown, atleast online orders and deliveries were happening and they were helping to pay salaries to the staff, with lockdown there is not much we can do about it. Asking staff to come is difficult in these circumstances, even though Swiggy and Zomato are operating for food delivery,” says Venu Bulusu, owner, Babai Bhojanam, a south Indian restaurant with three branches in the city.

It is still not clear how to procure passes that allow movement during the curfew hours, with extension it has become even more difficult for restaurants to deliver on their own. The speculation is that only those that are preparing food for Covid patients will be given passes. There seems to be a lesser number of food delivery staff with Swiggy and Zomato too. There was a confusion over not allowing Swiggy or Zomato food delivery partners recently but that has been cleared. That takes care of deliveries even though restaurants stand much to lose if they take the help of delivery Apps. However, the f&b sector, especially the hotels and fine dining restaurants and specialty restaurants that are already going through crisis are at wits end on the way forward.

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