After two months of making every effort to keep operating, F&B chains have reached ‘their limit of endurance’.
Some large F&B chains in Vietnam, including Golden Gate, The Coffee House, Aka House, Dairy Queen, Otoke Chicken, Guardian, Coffee Club, Hoang Yen, 30Shine, The Gioi Di Dong and Kids Plaza have said that if they don't receive support from the government promptly, they will face bankruptcy.
Three proposals have been made to help F&B businesses: confirming Covid-19 as a force majeure event; helping to settle financial crisis; or accepting online sales, and take-away and door-to-door delivery services during the social distancing time.
Many F&B chains said they have not had enough clients since February and closed shops on March 26. This caused serious economic consequences, especially in Hanoi and HCM City. They still had to pay for rent and workers’ salaries.
|Three proposals have been made to help F&B businesses: confirming Covid-19 as a force majeure event; helping to settle financial crisis; or accepting online sales, and take-away and door-to-door delivery services during the social distancing time.|
They tried to negotiate with partners who lease retail premises to lower the rent and delay payments. However, the partners refused to cut rent, saying that Covid-19 is not a ‘force majeure’ event.
F&B chains have been trying to promote online sales though the sales still cannot offset the decline. Some local management agencies do not consider online trade as an activity that businesses can implement during social distancing, even though businesses have been strictly following regulations on epidemic prevention.
Covid-19 has also caused retail and service businesses to lose liquidity. “If there is no plan for cash flow, retail and service businesses will be at high risk of bankruptcy. Millions of workers are at risk of losing their jobs,” the petition says.
Struggling to survive
Just days before sending the petition, an alliance of F&B businesses in Covid-19 times declared its establishment with the participation of nearly 2,000 members, including large chains and small eatery houses. This is the first time that rivals in the same industry joined hands to survive the epidemic.
Nguyen Ha Linh, the founder of the chain of five Thai Koh Yam restaurants, said she hesitated to reveal business information, but she still believes that the F&B community needs to share experiences and support each other to survive difficulties.
Thai Koh Yam closed five restaurants on March 11 and stopped food delivery service on March 15. The closure brought a loss of VND3 billion in April.
Linh believes that if businesses can survive the difficulties, they will regain growth three months after the epidemic ends because the business field serves the basic needs of society.
Foreign investors of the loss-making Vietnamese food chain Mon Hue have claimed that some US$80 million has disappeared from the firm’s bank accounts.
Some restaurants and hotels owned by Saigontourist have begun selling food online, while iVIVU, the online hotel room booking platform, has started selling combo lunch and Hue Smile local specialties.