As if rising coronavirus cases in Maharashtra were not enough to threaten business recovery of restaurants, the night curfew starting today will surely sound a death knell for the industry. “The physical occupancy of restaurants as it is remains erratic, with heavy reduction in diners during weekdays and lunch hours,” says Jaasjyot Surri, CEO & co-founder at Mumbai-based SJI Hospitality and Foods, which owns brands like Miniya Turk, Pachino Cafe and Roti Republic.
There was temporary relief with dine-in services picking up in January, but the second wave has started “pulling things back drastically,” says Anees Khan, chef & founder of Mumbai-based Staranise Cafe & Patisserie. Revenues were down by at least 20% at the last count and walk-ins have declined by over 30%, says Khan. Restaurants have been registering some bookings during the weekends, but they are not sure if things will remain the same amid fresh curbs.
Restaurateurs in Maharashtra, which was one of the last regions to allow resumption of dine-in services, had been fairly quick to get their businesses back in shape, probably driven by the sheer size of the market.
In fact, Anurag Katriar, president, National Restaurant Association of India, says sales had touched well over 70% of pre-Covid levels even with restricted seating capacities in place.
But the emerging second wave is worrisome, he says. To be sure, the prescribed seating capacity of 50% mandated by the state government at the time of allowing the sector to open up in October has stayed unchanged till date.
Analysts at Crisil Research say Mumbai and Delhi-NCR account for nearly 50% of the organised restaurant market.
AD Singh, founder & MD at Olive Group of Restaurants, which shut a few outlets last year, says the worst could be ahead. “We are hoping that we do not have to cut more jobs.”
Already, owing to the rules that had been in place in the state (prior to the second wave), revenue generation and footfalls have been 20%-30% less compared to other parts of the country.
“Post the lockdown we reopened with very sharp cost cutting which is helping us get back on our feet. Depending on how severe the next wave is, we will have to take a call on the next steps,” Singh says, who is hopeful that the impact will be somewhat mitigated with the options of vaccinations.
Tweaking of business models is imperative, says Surri. whose company has already started working on the same. Identifying additional revenue streams, micro-markets and catering to varied customer needs is essential and a “no-brainer”, he adds.
Kartik Ganesh, brand manager at Pune-based pizzeria Circle Of Crust, says with the curfew that had already been in place in the city, it was difficult to cater to dine-in customers who walked in post 9 pm as restaurants needed to start wrapping up and have their staff home before curfew.
“More than 40% of the restaurants and other hospitality ventures had to shut down post the first lockdown. The proportion of fixed operating expenses by way of rentals, utility expenses and salaries is quite significant and with little or no revenues, it is getting very difficult for restaurants to survive,” says Ganesh.