What can HK restaurant owners do as F&B Industry has been rocked by constant protests against the extradition bill?
HK protests against the extradition bill have shook the city and HK restaurant owners. Scenes happened in HK has shocked many tourists, expatriates and restaurant owners. While political requests have yet to be answered, we don’t know when it will end.
Demonstrations in recent weeks have started to impact various industries in Hong Kong.
Among all commercial industries, the F&B industry is also under hit. What should HK restaurant owners do if this situation continues?
How Protests Affect HK Restaurant Operation
In recent months, protests and demonstrations that occur every weekend have affected tourism-related industries like hotels, retail shops, restaurants and bars.
If protests continue, impact towards the F&B industry will reveal itself in a more worsened state. However, what are the challenges by HK restaurant owners?
(1) Expected and Unexpected closures for operation during weekends:
Since protests in HK often are during weekends, HK restaurant owners are forced to close down. Demonstrations in districts of Central, Admiralty, Sheung Wan and Causeway Bay have badly impact F&B shops nearby.
According to Lacrucci’s statistics, 21% of restaurants in Hong Kong are concentrated in popular protest districts (Central, Western, and Wanchai), many F&B shops in these high density districts have closed doors for operation during the protest days in order to minimize damage.
Furthermore, Lacrucci has talked with several restaurants in Central and Sheung Wan. Among fine dining restaurants, one (1st starred restaurant) had 17 seat bookings canceled the next day after protests occurred in Sheung Wan.
(2) Impact on various districts:
In the coming days, such protests start to spread to various districts. As mentioned above, in addition to 21% of restaurants in Central, Western, and Wanchai, numbers of stores affected will rise to one-third or more of the entire F&B industry.
Hence, overall F&B’s industry revenue will continue to decrease furthermore.
How Protests Affect Hong Kong F&B Business
Hong Kong protesters flooding the city over the past month have grabbed international headlines. All I can say is it affects everyone—and if something affects everyone, it will affect business.
Apart from that, we all know it’s summer, which is already a low season for F&B shops. However, with tourists worrying about their own safety due to recent chaotic development. This caused restaurant businesses to lose their income furthermore.
What are the in-depth impacts that surfaced from the protests?
(1) On restaurant revenue/sales:
As it is summer, it’s already low season for F&B shops. And in addition to HK’s recent developments, tourists prone to avoid and not come to HK due to safety concerns.
During protests, fewer tourists would sit down and enjoy meals. Ultimately, this causes food businesses to lose their income source.
(2) On restaurant costs of operation:
We all know that to run and operate a food business, you need to pay rent, manpower, food ingredients, etc. All of such have fixed costs, but with the recent development of protests in HK, these costs are due no matter if restaurants operate during protest times.
Protests caused F&B shops to close doors for operation, since no one is going to order food, raw materials for cooking will become obsolete, cost for such will be wasted as you need to buy new raw materials to replace expired ones.
Unnecessary expenditure will be wasted on such due to closing shop.
What can HK Restaurants do now?
It seems inevitable to prevent such protest from stopping, F&B shops can only sit out the period and find other ways to maintain income and revenue. If fewer tourists are coming to spend on meals, why not focus more on local community spending? Here are some recommendations to help.
(1) Boost business during weekdays: For those restaurants in office districts, they can attract office crowds by giving promotions and discounts.
(2) Boost business during weekends: For those restaurants in residential districts, give discounts or lunch hours, shops can cooperate with online websites to attract locals with discounts and special offers.
(3) Attract more spending apart from lunch & dinner: F&B shops can give discounts in non-rush time, e.g. happy hour special. People can have a drink and some finger foods.
(4) Increase other sources of restaurant income: F&B restaurant owners can work with others to get more income, for example, food delivery services. Since people tend to stay at home instead of going out, delivery services can still help maintain revenue even when fewer people choose to dine in.
Hong Kong has gone through several hard times, such as SARS in 2003, and Occupy Central in 2014. We have survived through times tougher than this. HK restaurant owners will find ways out of these difficult periods, we are sure that our Hong Kong F&B community will pull through. Let’s keep our fingers crossed and hope all will be well.
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