The pandemic devastated the hospitality sector

On the first day of the Business Days conference Gábor Tolnai, head of marketing insight division at Kantar Hoffmann gave a presentation, which was based on the company’s 100-respondent survey among HoReCa owners and managers with maximum 10 employees, in Budapest (60 percent) and the countryside (40 percent).

Mr Tolnai told that the pandemic devastated the whole bar and restaurant sector – only 10 percent said they hadn’t been affected by it. While 71 percent of owners and managers calculated with a sales growth for 2020, 80 percent saw their revenues decline. On average revenues dropped by more than 50 percent last year in comparison with 2019 and every 10th respondent basically lost their total income.

How could the pandemic be survived?

No less than 37 percent of hospitality units closed, trying to minimise the financial loss this way. 49 percent changed their profiles and 14 percent continued the same way as before. 40 percent of places had to lay off workers; only 30 percent replied that they didn’t have to make anyone redundant and kept paying employees during the pandemic. 84 percent didn’t change prices, 10 percent increased them – but they also changed profiles – and 7 percent cut prices. 80 percent of respondents applied for state aid but 30 percent claim this meant no real help to them. Supplier partners also tried to help restaurants, by making swift changes and with continuous communication and maximum empathy.

What is the situation now?

At the time of the survey – September 2021 – one third of respondents were optimistic, one third were neutral and one third were pessimistic about the future. Owners and managers were very hopeful that the government would offer some kind of help to the sector – 80 percent stated that this would be necessary. 100 percent of respondents agreed that the sector’s biggest problem was the workforce shortage.

What does the sector expect from the future?

35 percent of owners said the crisis will have long-term effects from their own business’ perspective, 38 percent said the same about the whole sector and 57 percent about the Hungarian economy. 66 percent of respondents claimed that a price increase would be inevitable, due to growing labour, ingredient, transportation and storage costs. 60 percent don’t plan to realise any kind of development project in the near future. //

This article was also published in 11/2021 of Trade magazin.