Once crowded with customers throughout the day, Dine Hill, a popular restaurant in Hyderabad, now sees only empty tables. In the span of a few weeks, as cases of coronavirus have started increasing in India and shutdown orders have been issued, the restaurant has seen a 40% fall in business in just a few weeks.
And it’s not just Dine Hill. Restaurants across the country have seen a drastic decline in customers after the government advised people against public gatherings to contain the spread of COVID-19.
Anurag Katriar, president of National Restaurants Association of India (NRAI), notes that in the restaurant business, the proportion of fixed operating expenses are very high. That means any disruption or drop in revenue takes a significant toll. “And that's what we are facing. If you're talking about the extent of losses, I can't put a number to it, but all I can tell you it is almost a case of existential crisis for us,” he says.
Manu Chandra, chef partner at Toast & Tonic and Monkey Bar, which has a presence in Delhi, Bengaluru and Mumbai, is shutting down its restaurants. It’s no longer feasible to stay open, not only due to staff and guest safety, he says, but also because of the cost of running a business with nearly zero footfall.
He notes that while a 20% decline in footfalls was seen beginning in the second week of March, it dropped by 70-80% in just five days. “Plus, all corporate bookings, parties and caterings were called off. So that adds to the overall impact,” he adds.
Shalivahan Reddy, who runs popular pub Moonshine Project in Hyderabad, says that even before the Telangana government ordered a shutdown of pubs, there was a considerable decrease in people walking in from the end of February.
State governments across the country have ordered the closure of malls, bars, theatres.
Shalivahan says that they will be incurring a huge loss after having to shut down the pub for nearly two weeks.
“Business has been affected by about 30%. From the time people started becoming aware of coronavirus, we saw a change in number of people walking in,” he adds.
Despite this, on Tuesday, the NRAI sent out an advisory to its over five lakh restaurant members to voluntarily shut down their restaurants, bars, pubs, cafes etc., from March 18, until March 31 to curb the spread of COVID-19.
Anurag says that the state of the restaurant industry is currently the worst he has seen in the past three decades. However, this decision has been taken in the interest of public health.
“We employ lakhs of people; these employees are at risk since they travel on public transport. They will also be carriers or could get infected. We don't want to run this kind of risk. The whole idea is to make sure people don’t assemble at one place,” Anurag told TNM.
However, the shutdown could sound a death knell to these businesses.
Riyaaz Amlani, CEO and managing director of Impresario Handmade Restaurants, which runs Social, Smoke House Deli, Prithvi Cafe and Saltwater Café, says that there has been a 50% drop in customers at his restaurants. With Riyaaz running a mix of bars and restaurants, outlets that are inside malls and those directed to be closed by the government have been shut down.
At restaurants that are still open, Riyaaz says strict safety measures are in place. “We do a temperature check of all employees and customers and even look for symptoms. All employees in the restaurants wear gloves and masks. Surfaces that are frequently touched (door handles, tabletops, etc) are being sanitised every hour and every table has a sanitiser,” Riyaaz adds.
Prior to closing his restaurants, Manu also says that they had the prescribed safety measures in place, including hand washing, masks, sanitisers everywhere, temperature checks, surface cleaners, aerosols, no contact, spaced out tables, etc.
Impact on employees
Now with the decision being taken to shut down, Manu says that employees will be sent on leave and will be able to use up their paid leaves.
The employees at Moonshine Project have also been given a paid leave for the period of shutdown.
Anurag, who is also the director of DeGustibus Hospitality, which has restaurants such as Indigo Deli, Tote, Dakshin Rasoi says that he has given paid leaves to all his employees. He has also advised all restaurants represented by the company to do the same. However, the call on employees will be taken by each restaurant chain individually, Anurag added.
While NRAI has around 5 lakh restaurants under its ambit, the number of restaurants across the country is a much higher number and the industry employs lakhs of staff. While some restaurants have said that their staff will be given paid leave, it is unclear what would happen should the shutdown extend beyond March 31.
Delivery is one aspect that still brings some hope of business for restaurants. While NRAI has not mentioned delivery in its advisory, it has said that restaurants can deliver food as long as they follow the current global practice of contact-less delivery.