Unlock 1.0: Restaurants welcome govt’s move but wary of challenges

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June 3, 2020 2:40 AM

Sagar Daryani, co-founder & CEO at Wow! Momo, said a considerable number of migrant labourers had moved back to their native places, and the biggest challenge would be to operate with limited staff.

Also, with the major chunk of business transactions happening late evening, the restriction on movement beyond 9pm is very “demotivating”. Also, with the major chunk of business transactions happening late evening, the restriction on movement beyond 9pm is very “demotivating”. (Representative image)

Faced with a truncated workforce, loss of peak business hours, operational restrictions in major markets and the uncertainty around uncorking liquor bottles, restaurants across the country are unsure if the permitted relaxations will enable them to ‘unlock’ their full business potential.

Sagar Daryani, co-founder & CEO at Wow! Momo, said a considerable number of migrant labourers had moved back to their native places, and the biggest challenge would be to operate with limited staff. Also, with the major chunk of business transactions happening late evening, the restriction on movement beyond 9pm is very “demotivating”. Daryani sees profitability taking a hit as adherence to social distancing norms will lead to cost escalation, but companies cannot afford to increase prices. “Business normalcy can only be expected in December. Next six months are going to be tough and companies will change their business models. We may have to look at sharing spaces with other brands or open more cloud kitchens,” Daryani told FE. Some landlords have agreed to rental waivers and discussions with the rest are on, Daryani said.

Jatin Mallick, chef and co-owner at New Delhi-based Tres, said the pain points were not being able to serve liquor and to operate with less than 60% seating capacity while maintaining social distancing. As dinner makes up the lion’s share of the eatery’s revenue, the 9pm deadline will further hurt business. “With the current restrictions, we are still contemplating whether it is worth opening up at the moment. Currently, we are focusing on home deliveries,” Mallick said.

Joy Singh, co-partner at Raasta & Yeti, said the workforce remained a cause of concern as people had relocated and calling them back was an arduous task. Singh said with brand Yeti, they had decided to continue with delivery-only service and would resume dine-in only after June 30, once the government allows operations with lesser restrictions.

Gaurav Narang, founder of restaurant-cum-cafe Coffee Culture that runs 22 outlets in 17 cities, said non-availability of labour, reinvestment of capital and renegotiating deals with landlords were the primary challenges. “We will be opening up in non-containment zones, but yes our peak hours have always been 7pm till midnight and the 9-pm curfew will definitely affect our topline. But, we hope customers understand,” he said.

Zorawar Kalra, founder and MD at Massive Restaurants that runs brands like Farzi Café, too, found timing restrictions a concern in an otherwise positive move for opening up businesses. Dinner time made up about 80% of restaurant business and as more offices reopened, corporates working till late hours would not be able to grab their dinner, he observed. Takeaway orders will certainly out-number dine-in, and the firm has curated an exclusive delivery menu for guests, Kalra said.

Echoing similar views, Kumar Saurabh, executive director at Burman Hospitality that runs Mexican food chain Taco Bell in India, said while the curfew would impact dine-in customers, delivery orders were expected to be steady and, in fact, grow until the environment stabilised.

Same was the opinion of Jaydeep Mukherjee, brand head at Smoke House Deli. He rather stressed that the company’s delivery sales were almost close to the pre-Covid levels although dine-in primarily contributed to the topline. While rise in operational costs to meet hygiene standards will hit business, the company does not plan to shut outlets, given its stable finances. “Store openings will be staggered. It will take at least six months before business is back to normal, that too if the government supports the industry. Else, some small restaurants may have to shut shops,” Mukherjee said.

“Peak hours for any restaurant is during the lunch and dinner hours. While the evening curfew will have an impact on the restaurant business, we are committed to continuing operations as per government directives across all our restaurants,” said Moksh Chopra, chief marketing officer at KFC India.

Neha, marketing director at Pizza Hut India, infused some positivity into the bleak scenario. Although hesitation to dine out would linger on even after the lockdown is over, trusted brands are well-positioned to weather the storm, she said. “There will be a spike in demand wherever we open – be it in Bengaluru, Mumbai or Delhi; we have equipped all our stores to offer contactless dining. Right from accessing the menu to making payments, the entire process will be digital,” Neha added.

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