Beginning from the outbreak of global pandemic from China Wuhan state, the term coronavirus (WHO formally coined the SARS enjoyed virus since COVID-19 on Feb 11, 2020) is a familiar term today. However, the panic and disruption it has caused, quickly spread across the world especially in Asia area.
Singapore is within the top 5 in the listing of the amount of infected patients internationally due to the standing as an air traffic hub and tourism is one of the focus industries where people around the world visiting Singapore through the year. It was our benefit for being a tourist-friendly nation but we’re exposed to the possibility of widespread of the infectious virus today.
3 months since the outbreak, the majority of the companies in Singapore have begun to feel the negative effect of considerably lesser diners and our PM, Mr. Lee has also highlighted the possibilities of negative economic growth for 2020.
Tourism, hospitality, and retail businesses are in the very first to hit the rapid reduction of traffic, resorts encounter lower occupancy rates, retail outlets, and restaurants get fewer client and footfall traffic.
In this guide, AskEdmund F&B adviser want to share with you some of the approaches to deal with the situation as we understand the F&B company is facing this crisis on all fronts!
What should you do to make sure your business survives?
1) Managing People
People are the middle of F&b company both internally (employees, shareholders) and externally (customers). During the period of crisis, it’s crucial to handle higher expectations particularly on the hygiene of your front line staff and the place and so your clients get a feeling of safety and ready to dine in peace.
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One great example is to offer hand sanitizer to your patron or any passed by visitors. A bit more cautious may lower the odds of infection of your employees and give your clients the impression that you take hygiene seriously and their wellbeing is your priority.
Have a look at following pointers which we shortlisted for you,
- Ensure the well being of your employees both front of house and back of the Home (image and perception)
- Make sure a higher level of cleanliness and hygiene on-premise and in the preparation of meals & drinks (avoidance of a worsening situation by hazard management, tests, education and enhancing processes)
- One great example is to offer hand sanitizer to your patron or any passed by visitors. A bit more cautious may lower the odds of infection of your employees and give your clients the impression that you take hygiene seriously and their wellbeing is your priority.
- Rearrange your movable furniture, make it comfortable and the less close proximity of tables into one another (Caring about your customers’ security, also you can control the flow of customers from the equation to you staff power or cost that you can afford)
2) Running Cost & Restoring the yields from the reduced Revenue
Thinking about the macro-environmental effect from the virus which shadowing the market because of the pandemic. You’re unlikely to get a good deal of customers for a long period until the public confidence restored.
Besides trying reducing the workforce to reduce costs (which has consequences to the morale), you can consider different approaches by trimming your menu and decrease the ingredients to simplify the menu, balancing profit margin, lower the food wastage and increase supply chain efficiency.
Here are a few suggestions that we prepare for you.
- Take lost leaders things (read about our pricing plan blog) off the menu, you do not have to bleed further with reduced earnings streams
- Take community meals off the menu and replace with individual dishes (for example, community hot pot to person hot pot, sharing platters to individual parts )
- Take the opportunity to start a new”promotional” menu that you can minimize wastage and trimmings, have shorter preparation time, avoiding ingredients that are now too in demand because of lack, less holding stock/inventory
- Offer packages that promote takeout and delivery straight or work with your Delivery Vendors (customer do not come to you, send them)
- Japanese notions that don’t usually allow Takeout or delivery, should take this opportunity to look into catering to Take-Out and delivery meals, produce a takeout/delivery menu for menu items that you Can maintain your established quality levels
3) Managing Company
In the time of emergency, it’s even more important to work together with an association like RAS (Restaurant Association of Singapore) to negotiate with the landlord for the rental rebate or with the government agencies to ease short term financial aid or tax refunds to restaurants and F&b companies .
Above is just one of an example to promote F&b company to work together with the upstream or downstream of the ecosystems so that it’s a higher chance or greater impact across the whole sector. You might also work closely with the people that you liaise with like your providers, banks, POS vendors, landlord, or builders are within the ecosystems.
Adopting self-ordering technology may be a fantastic advantage now because it’s more likely to succeed than before especially since the COVID-19 virus is contagious through close contact, individuals are most likely to avoid crowded places today. And it’s safer for your employees cashier to take care of the lesser client for making a payment or take orders.
These are the few points that we think are important to your survivor strategy.
- Renegotiate Rental rebates or waivers for this period with your Landlord (they do not want you to shut not throughout the crisis anyways)
- Renegotiate Procurement cost for raw ingredients together with your providers for this period, work together how to handle cost by consolidation, level and scheduled orders for delivery and switching to components that are more cost-effective (help each other, builds stronger bonds)
- Rework and Manage your operational budgets foundation on the worst-case scenario, this will allow you to maximize your cash flow
- Put aside reserve funding for a buffer and not to be used while all other avenues are exhausted
- Change your labour plan by employing technology in areas which could be independent of human dependence. E-menu ordering / BYOD / self-evident Kiosk etc..
- Work with neighboring restaurants to perform your procurement in bulk to Reduce cost
4) Handling Marketable Image of your Enterprise
Your brand is one of the key reasons that you’ve got more walk-in clients compare to the local restaurants that compete with you for the same pool of consumers.
Just like you won’t put up another fast-food restaurant close to McDonald’s trying to compete together. McDonald as an F&b giant has a well-established brand and a powerful brand message”Family-friendly fast food restaurant for ANYONE” which you feel welcomed when you see them.
Being socially responsible is 1 way to establish a fantastic branding too.
Below are a few takeaways to your consideration to exhibit corporate social responsibility and make people feel good about you.
- Engage and Help with the neighborhood prevention of the pandemic
- Be visible on your aid work
- Post it on your Social Networking sites as blog and info to share, do not be tacky by embracing it, be real
- Involve your business customers by their participation and support to the struggle… physically, soul and wherever possible and feasible monetarily. Everybody wants to be in control and able to do something in times of crisis.
What NOT to do
- Raise prices for existing menu items for pure profit even though its about supply and demand
- Sell by gimmicks any Sort of essentials needed for the struggle in this crisis
- Using the catastrophe as a marketing opportunity
- Fail on your Hygiene and Cleanliness – individual and assumption
- Fail to Plan for the worsening crises on your budgets/forecast and cash flow
- Not caring about your customers’ safety and concerns