The restoration estimates that the pandemic will cause losses of 17,000 million euros, with a fall of 41.2%. In this way, the continuous growth experienced in the last five years has slowed. In addition, the losses will lead to the closure of up to 90,000 stores, while employment would be reduced by about 400,000 people. Catastrophic data in a year that was expected to be mature.
The data confirmed by the sector, which has been presented by the III Brand Restoration Yearbook, prepared by Restoration Brands, The NPD Group and KPMG, confirm that from the beginning of the state of alarm until June 30, the entire sector lost 7 billion euros. “The market bottomed out definitively during the end of March and the month of April, billing only 10% of what would have been its normal sales”, explains the document presented. In addition, the closures of the premises for three months have caused visits to collapse by 43.1% in the first half.
With this situation, the sector asks the Government “to act with coherence and rationality. The formula we ask for is very simple. Liquidity was needed and from the first moment ICO loans were put in that worked well. Templates needed to be standardized depending on the situation, and ERTEs have worked well so far, since they have left us out. We have followed the capacity rules as well. We ask tax aid, reduce VAT from 10 to 4% to the hospitality industry to help the entrepreneurs of the sector. We ask for normalization of the rents of the premises, adapting it to the reduction in billing affects, ”explained Carlos Pérez Tenorio, president of Maras de Restauración, an association that has brands such as McDonald’s, Burger King and Telepizza, among others.
The data presented in the yearbook also includes the evolution of the sector during 2019. Thus, it had a turnover of 37,390 million euros, of which about 10,000 million corresponded to organized catering. The number of visits and the average consumer ticket also grew, so that the sector as a whole increased by 1.7% compared to the previous year. Within this, organized catering increased its share of traffic, reaching 27.1%. «A two-speed market has been generated: an independent market that already represents less than three-quarters of the traffic and that continues to lose visits, in the last year at a rate of -1.2%; and an organized market made up of a growing number of chains and that has increased by + 5.4% the number of establishments that operate in Spain, which favors a greater attraction of visitors in 2019 ”, is added in the yearbook.
But although the crisis has slowed down the good progress of the restoration, the organized one is supporting the crisis of the crisis somewhat better due to its characteristics and structure and already accounts for 28.9% of the total visits of the commercial restoration (bars, cafes and restaurants). “Brand restoration has strengthened its position in the industry not only during the hiatus from mid-March to April, but also when the activity restarted. In the midst of this new situation, organized operators have shown their ability to adapt to the new context, streamlining processes, making their businesses more flexible and accelerating the integration of new technologies ”, highlights Javier García Maestre, expert consultant in restoration at The NPD Group.
For the future, most of the entrepreneurs, 63% do not believe it will return to pre-coronavirus levels until 2022. No channel believes that it will improve its turnover in 2020, while in 2021 only 11% think that the situation will be better.
Due to capacity restrictions as well as the increasing digitization of the industry and changes in the consumer, the restaurant chains are experiencing changes in the home-oriented service (delivery and take away) and see this trend as an opportunity. These alternatives to local consumption could practically double their weight in the chain business (from 12% pre-crisis to 22% in 2021). Chains expect take away to grow faster (almost tripling its relevance in the business, going from 5% of the total to 13%) and to be above delivery (7% before Covid-19, 9%) in 2021).
On the contrary, organized catering companies expect that in 2021 the business in their premises is reduced to 78% of the total, 10 points below what they obtained before March of this year. Specifically, this decrease would be explained by the drop in service inside the premises, which would go from 72% to 58%, while the terraces would gain a share, from 16% to 20%.