F&B sector in Singapore may see more closures, layoffs: survey

SINGAPORE'S embattled food and beverage (F&B) sector may see more closures and layoffs, with dining-in not permitted for a while even after the "circuit breaker" lifts. 

About two in five restaurants will not last longer than two more months with the revenues and costs recorded during the ongoing "circuit-breaker" period, going by a survey released by Chope on Wednesday. The restaurant reservations platform surveyed more than 150 dining establishments in the Republic a month after the "circuit-breaker" measures kicked in on April 7. 

Data from Chope's restaurant listings also showed that 50 per cent more restaurants closed in March and April this year, compared to the same period last year.

On Tuesday, the government said that dining-in will remain prohibited at F&B establishments in the first phase of Singapore's reopening on June 2 for at least a few more weeks, as the Covid-19 situation stabilises.

More than 25 per cent of the restaurants told Chope that they would implement more retrenchments if the dine-in suspensions are extended. 

This is even as about 11 per cent of restaurants had retrenched full-time staff by May, while 42 per cent implemented pay cuts, more punitive measures than the compulsory leave and shortened hours applied previously. Chope's earlier survey conducted before the "circuit breaker" had found close to 80 per cent of the 249 dining establishments choosing to reduce "casual labour hours". One-third imposed compulsory leave for full-time staff. 

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Revenues from takeaways and deliveries have been insufficient to offset restaurants' losses. Chope's latest survey showed that 62 per cent of restaurants still faced revenue declines of at least 50 per cent in April compared to last year. 

"The high cost of working with logistics or third-party delivery providers remains the biggest challenge faced by restaurants," Chope noted. 

It advised restaurateurs to make long-term plans with the novel coronavirus as "something to co-exist with", adding: "Even when dine-in services resume, you should be prepared for the eventuality that regulations may tighten again should there be a new wave of Covid-19 cases in the community."

The current period could also be a chance for restaurants to reconfigure operations and prepare for the time when dining-in resumes. Chope's reservation numbers for Hong Kong saw a "strong comeback" when safe-distancing regulations were eased and activity resumed. 

"Ensure your 'welcome back' menus, promotions, social assets, and media opportunities are geared for the post-'circuit breaker' demand," Chope said.