Restaurants feel the squeeze amid coronavirus outbreak
By Wei Diqi
Many restaurants and retail shops in China have been affected by the coronavirus outbreak, first reported in the Chinese city of Wuhan late last year. Some have come up with ways to minimize their losses. Work stoppages continue across China, with many people at home, losing precious, hard earned money. The restaurant business has suffered a huge hit since the Lunar New Year holiday.
CGTN talked to the Yun Nans, one of the popular Yunnan cuisine restaurants in China. Their branding director, Chen Na told us, "We have closed most of our stores in Beijing. People can't go out to eat. The closure means a big decline in our profit. We have so much raw food material stuck in stock. We thought there would be a large amount of orders during the Spring Festival."
Faced with these problems, they have to come up with efficient ways to survive.
Chen says she is prepared for the worst, and believes business will get better with the right efforts. They have several measures to cope with the current situation. She said, "For example, our employees are allowed to get temporary jobs at other companies through the 'employee-sharing' scheme. We work with some online delivery platforms to send out our dishes. We sell our food materials both online and offline to local communities."
But these measures may not be enough to ease financial pressure on restaurant operators.
The Beijing government recently rolled out a slew of measures to support small and medium-sized enterprises. "These measures help in two ways. First, they will enable businesses to get guaranteed loans much more easily. Most restaurants don't have too much cash flow, and rely mostly on bank loans. Secondly, the measures will allow restaurant owners to apply for a reduction in tax and rentals for tenants," said Zhao Ping, director of the Department of International Trade Research, China Council for the Promotion of International Trade.
With fewer people eating out, the restaurant sector is facing huge losses. But Zhao believes this won't last long as people are suppressing their desire to eat out for a while, which will lead to a rebound in the business once the battle against the virus is won.