Extended Lockdown impacts Restaurants Cash-flow, may sees more restaurants closing

Restaurants across globe has been facing a tough time during the coronavirus pandemic. Earlier, all restaurants have announced to shut their shops till the lockdown but this extension is creating a bitter scene for the restaurant owners as they are unable to have the cash flows.

Yesterday, we came across the closure of much loved café Le15 by Pooja Dhingra to permanently close in Colaba. I think Pooja Dhingra became one of the first chef and restaurateur to feel the heat that the novel coronavirus has brought to the sector.

"These are uncertain times and everyone has to look at the vision of their companies to decide the road ahead. Unfortunately for us, that meant to cut down our overheads to ensure we can keep the dessert business going. The challenges we predicted were low walk-ins, high rentals and the onset of the monsoon and a general slow-down of business," shared Pooja Dhingra, owner, Le15.

Restaurateurs all over the country are suffering from the lockdown fever- their business and their health. Some have been getting panic attacks in the middle of the night. Most fear that if this crisis doesn’t end soon, they will not be able to pay out salaries for April and May.

“Alot of damage is already done to the hospitality industry, business have come to a standstill and revenues have already hit rock bottom with this new extension, besides the revenue of the industry, employment is also jeopardized. The industry will be heading towards a collapse which will be really difficult to revive,” said Taarun V Jain, Owner, Legend Group.

Though, the industry has asked for many reliefs from the govt as it sees the employment of close to 7.3 million people at risk, there is no positive response as yet. "The Hospitality industry is going through a major challenge and it requests the government to take the steps to help the sector. The extension of lockdown and suspension to our services further impacts our cash flow significantly. Bigger worry for the sector is how long it would take to recover. It would be really difficult to sustain in this crisis period,” pointed Arjun Suri, Owner at All Time Meal.

Commenting on the same Rachit Goel, Owner, Oriental.inc added, “The Hospitality Industry has been the worst hit due to the COVID 19 Pandemic. Businesses of the sector have come to standstill and it has become impossible to maintain full salaries of workers. If there will be no cash flows in the sector for months, the clock also needs to be stopped for cash outflows.”

Hence, we can say that we need to restructure the industry and support from the investors and Govt can be helpful for the survival of the existing restaurant business. Although, every year we see new restaurants opening up but this year would be more about saving the existing ones.