Forty percent of restaurants will not reopen – Experts forecast.

Of those who remain, not all will make it to December, says experts in a restaurant forum.

MERIDA, Yucatán (La Jornada Maya) – “I have been meeting a lot of people in the market who are no longer going to open. Likely, 40 percent of the restaurants that closed will no longer open their doors. This is due to liquidity issues or because there are others that no longer want to start again.” Explained by Jorge Valencia, director of the Interfranchise Consultancy, during the “Planning the Reopening” Restaurant Forum, while adding that of those that will open, not all will be open by December.

Valencia, a specialist in franchise models in the food and beverage sector, said that “what we leave behind is not what we will find. We will face a completely different world out there”.

Guillermo Mantilla, National Soft’s marketing manager, said that both the federal and state plan of reopening “it is not very clear how the industry will operate. We only know that each state will make a plan and adapt it to their entities. There are no specifics about the protocols of care and opening. There are no official documents; there is a national Canirac document, a guide of recommendations for restaurants, but it is from the private initiative, not the government.” He added.

The situation has changed completely. We have to review our financial models to know how much cash flow we need, at least, by December, to support our business and review economic models. If we open, we must have enough to support the business”.

On the other hand, he said that the customer’s buying moments have probably already changed. 40 or 50 percent of the sale will have to trough home delivery. “We will have to think of a new message, what we are going to provide to the customers, and how we are going to get them back.”

Unfavorable outlook
Nayeli Robles, director of economic analysis at the Unifin Finance Company, predicts a 3 percent contraction globally, the most significant drop since the Great Depression of 1929, according to the International Monetary Fund (IMF). “In Mexico, the outlook is similar to the rest of the world, even more so unfavorable. The IMF anticipates a 6.6 percent contraction of the Gross Domestic Product (GDP), including analysts who predict a 7.6 percent drop and could reach, according to the most pessimistic, as much as 12 percent.

Roberto Quintero Vega, vice-president of the National Chamber of the Restaurant and Seasoned Food Industry (Canirac), said the first challenge would be to manage cash flow. The second is the health issues. “Not everyone will have the means to install screens or sanitizing tunnels. The third is to understand the new consumer”.

For the vice president of Tourism and Culture of the National Chamber of Commerce, Services and Tourism (Canaco) in Puebla, Guadalupe Lozano Garfias, the highest challenge will be to gain the confidence of tourists, travelers, and diners. She explained it will be imperative to start with local tourism, making adjustments “to the area in which we are”; from there, move on to national tourism.

Finally, the experts agreed that tourism in the international markets will have a slower recovery. It will take between 6 to 12 months to become fully active.

The losses
Due to the health emergency, one-third of the restaurants closed, and sales decreased by up to 90 percent in some states, according to the national Canirac.

As a result, CANIRAC estimated that 65 percent of restaurants in Mexico would have a higher risk of bankruptcy. Roughly 300,000 jobs will be lost if no action is taken to counteract the crisis that is currently underway.

Several restaurants have expressed their discontent in social networks to the applications of food delivery at home because of the increase in their commissions. They are left with more than 30 percent of the total cost of orders and make the operation of restaurants in this mode unaffordable.