VIRUS OUTBREAK

F&B grouping says 80% of its 500 members may close in a month

It expects no dine-in rule to hasten process, unless there's intervention in rental and manpower costs

Singapore

SINGAPORE'S beleaguered F&B industry was dealt yet another body blow on Friday when the government moved to stop people from dining in restaurants for at least one month, as part of stepped-up measures to curb the spread of the Covid-19 virus.

Confusion and panic reigned as restaurateurs scrambled to absorb the latest ruling that only takeaway or delivery orders would be allowed at food establishments from April 7 - effectively forcing the closure of eateries which are unable to make the switch.

Even before Friday's announcement, several restaurants had already decided to close shop either temporarily or permanently, after suffering revenues that have plunged as much as 90 per cent since the start of pandemic.

Salt Grill at ION Orchard and its sister restaurant Botanic are among the first casualties, along with Italian restaurant Terra. Peranakan restaurant Violet Oon, too, has temporarily closed its tourist-centric outlets in National Gallery and Jewel Changi Airport, while the Michelin-starred Iggy's announced that it would close on April 6 and re-open after 30 days.

The new dilemma facing restaurants is whether it's viable to make the switch to delivery or to close completely. Among those which have decided to close are the one Michelin-starred Labyrinth and three-starred Les Amis.

Despite decent sales of its S$150 takeaway roast chicken, it doesn't justify keeping the restaurant open just for that, said its director of culinary operations Sebastien Lepinoy.

"It is better to close," he said, adding that the restaurant would stay in service until April 6, after which its staff would clear leave and take no-pay-leave until it re-opens. Labyrinth's chef-owner Han Li Guang, too, decided to put his planned delivery service on hold and close his mod-Sin restaurant at Esplanade Mall which had been badly hit by the drop in tourists and corporate business.

He said: "It's better for my bottom line. My staff will take no-pay-leave, but they will still get some salary from the government subsidy and I am splitting their May salary over two months."

Meanwhile, Desmond Lim, chairman of the Les Amis Group which includes a range of mid-priced eateries as well, added that his group would decide what to do after Monday when the government reveals more aid in a supplementary budget.

But for now, "we are scrambling to get our takeaway ordering, payment and delivery platforms up and running ASAP".

In the past couple of weeks, fine dining restaurants had been tentatively testing takeaway and delivery options as an alternative revenue stream, and this will now be ramped up, said Loh Lik Peng of The Unlisted Collection group of restaurants, which include Cloudstreet and Zen.

"We are aiming to start some form of delivery service and preserving our capabilities so we can re-open when this is over."

On his part, Beppe De Vito of the ilLido Group plans to shut down both his restaurants Art and Aura at the National Gallery, and focus on a new delivery concept.

The situation is dire for the industry, so much so that Mr Loh and Mr De Vito started #savefnbsg, which saw over 500 restaurants come on board in just three days to form a coalition to lobby for more government aid to save the industry.

The members include major players like Lo&Behold, Tung Lok, Crystal Jade, Paradise and Prive groups, as well as a host of smaller businesses, all of which have been hit hard by diminishing footfall and social distancing measures.

While they overlap with the Restaurant Association of Singapore and other bodies, "we cover another set of operators who are not represented in these groups, who have come together to protect businesses and save jobs", said Mr Loh.

The group estimates that without intervention in issues of rental and manpower costs, 80 per cent of restaurants are likely to close within the next month. The no-dine-in ruling will only hasten this process.

Despite mandating that landlords pass on full rental rebates to tenants, the reality is that "landlords can choose who to pass the rebates to", said Mr De Vito.

"We are fighting for a fair approach to distributing the rebates. And we need the rebates now, not three months down the road when we're done and dusted."

The group is pushing for landlords to operate on a "no base rent, pure GTO rent of up to 15 per cent" model as a temporary measure to help them save jobs.

"We need the government-linked companies to set the precedent, in order for private landlords to follow suit," added Mr De Vito.

They have also been working with Enterprise Singapore, Workforce Singapore and Singapore Tourism Board, and even plan to send a letter of appeal to Prime Minister Lee Hsien Loong.

"While the government bodies are trying to help, we still need to be heard," says Mr Loh. "(We want to highlight) the on-ground issues, so that the right measures can be implemented to save the industry."

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