The impact of the lockdown varies according to the nature of the business, but most employees stay hopeful for the summer season.
Rotterdam – The reality of the food and beverage businesses in any country experiencing a lockdown has been dual and nuanced. Some of the businesses experienced unprecedented sales while others have entered a period of stagnation.
The fate of companies and their employees has depended on their nature—particularly, whether the service they provide is essential or non-essential. As a result, the industry has been split into “winners” and “losers” from the pandemic.
The overwhelming demand
The first weeks of the lockdown found both a grocery store and a distribution center—both classified as “essential services” in the Netherlands—extremely busy. As a worker of the food distribution center told Morocco World News, “In the first weeks we almost ran out of stock because people kept on buying everything.”
The panic buying that swept through Europe resulted in enormous increases in food sales—in the Netherlands, the numbers reached 250% of the regular weekly production.
The increased demand caused food distribution center managers to hire “plenty of temporary workers.” In the meanwhile, the grocery store experienced severe understaffing because many of its employees decided to self-isolate in order to shield themselves from catching the virus. The worker of the grocery store recalls these times as “very busy,” with some products running out quicker than the others.
Struggling to satisfy the skyrocketing demand, both companies faced “a lot of work, stress, and costs we did not expect.” The additional strain came from the necessity to make structural changes to ensure the safety of workers.
“In a factory, we had to change all working spaces to create distance between people, during work and breaks,” the food distribution center employee said. The reality of working from home required adjustments in software and servers, and working spaces had to be transformed to ensure safe distances between those that stayed in the workplace.
The changes generated substantial additional costs, but due to the increased demand, the employer managed to hire new temporary workers and even provide employees with small gifts to show gratitude for them staying at work.
Working outside of home during a global pandemic has a heroic feeling, originating in the real danger of getting infected. In the case of the grocery store, the employees’ fear of the virus resulted in a shortage of workers. The employers had to find a way not only to ensure the employees’ safety and comfort but also to appreciate their courage.
Food providers expect their businesses to continue doing well for the rest of the year. The worker of the food distribution center’s statement sums up the prevalent feelings: “We already managed it great during the most difficult time so it will only make us stronger as a company.”
The struggle for financial survival
Lockdowns forced non-essential services unable to offer take-out options, such as a cafe and a bar from the Netherlands, a restaurant from Morocco, and a nightclub from the UK, to shut down completely. The shutdowns immediately brought severe fiscal repercussions. Industry stakeholders, however, painted an image of a hopeful struggle. They talked about structural changes, time for maintenance, and expectations for the summer.
The evident main issue for non-essential services is the lack of turnover while maintenance costs remain. Some of the high-turnover days have already been lost. A Dutch cafe worker explains, “Normally the first few sunny days of the year are the busiest, but those days we are missing now.”
Another major blow is the delay of major sports events. In the words of a British nightclub employee, “The postponement of EURO 2020 and other big sports events will be detrimental to the hospitality business.”
Hotels will experience a significantly reduced demand because no sports spectators will travel internationally, and bars and restaurants will lack sports fans spending their time and money watching matches on television.
The main ways venues are enduring the income shock are: Reducing employee costs and securing income through loyalty programs.
The loyalty programs some venues introduced, such as a British nightclub’s “vouchers for future use, memberships valid for a longer period of time,” aim to sustain the company until it can reopen and generate revenue in a regular way. However, these measures have not proven effective.
Continuous employment not always possible
The survival approach of the businesses depends on their financial abilities. Some found themselves partially covered by the nature of their employment contracts. Zero-hour contracts, commonplace in the food and beverage industry, mean some workers have retained their jobs but do not get wages due to not being able to work.
Only a small portion of employees with zero-hour contracts still work. A manager of a bar in the Netherlands explains employees are “either at home or doing chores,” such as maintaining buildings or renovating venues.
The unusualness of the times corresponds with curious tasks some staff had to perform. The nightclub employee recalls moving “stock from some venues to upper floors, or basements, as large quantities of alcohol visible through windows in closed venues could attract looters.”
While governments are introducing schemes to help workers who suddenly found themselves unemployed, either temporarily or permanently, some businesses are doing what they can to provide for their employees. An employee of a Dutch cafe explains: “Luckily we had a few very good years, so everyone keeps getting paid and no one is fired and they are not planning to change that.”
On the contrary, the nightclub in the UK suffered extreme employment loss: “The Majority of the head office staff has been fired, the core staff has been furloughed.”
The approach of a Moroccan restaurant owner was mixed: “We were able to pay employees through March but we had no idea at the time how long this would last, and we still do not know.”
The uncertainty over the length of the lockdown is a concern workers of non-essential businesses repeated.
Waiting for the summer
The business insiders expect “booming as soon as the crisis is over,” as the Dutch bar owner summed up. “Once the lockdown will be lifted, people will go out and celebrate right away, which will bring in a lot of revenue to the business,” adds a British nightclub employee.
Summer months are traditionally one of the busiest times for the food and beverage industry. Adding to the joy of the lockdowns ending, the business owners hope their businesses will strengthen due to high turnovers during the summer. Some, like the Dutch cafe and the British nightclub employees, even predict the need to hire new employees to deal with the skyrocketing demand.
The workers hope the lockdowns will end in June at the latest. The biggest anxiety of the business insiders is the unpredictability of when the lockdown will end.
Although optimistic, the Moroccan restaurant owner tells the bitter truth for every non-essential business: “Restaurants will definitely take a big hit but the extent will be determined by when the lockdown ends and what other restrictions will remain in place going forward.” Even after the businesses reopen, strict safety regulations may mean it will still be extremely difficult to ensure their financial survival.
Maybe this summer, eating out will become an act of social solidarity.