Coronavirus: Auckland businesses not breaking even as Covid-19 continues to bite
Wednesday, 19 August 2020
Some businesses in Auckland are reporting they are not as busy during the return to lockdown as they were the last time the city was in alert level 3.
Marisa Bidois, CEO of the Restaurant Association, said it is hearing from businesses which say they are struggling more than they were in late April.
Bidois revealed 58 per cent of its Auckland members were open during the current level 3.
But she explained the conditions of this alert level 3 were different.
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“We came out of five weeks with no access to our favourite places to eat – so there was a rush for the first few weeks.
“However, even at this level the industry was still reporting significantly lower turnover than the same time last year and not everyone experienced the initial rush.”
The news comes as restaurants at Elliott Stables – some of which are open at level 3 – report they are not breaking even due to the coronavirus pandemic.
During alert level 2, the eateries said they were only making an average of between $300 to $350 a day – one business could only really pay for the phone and power to 'keep the business going'.
Then negotiating with their landlord for any kind of rent reprieve, they said they were finding it hard to see the light at the end of the tunnel
But two months on, their situation is still grim.
After nine years of hard work, George Panicker George had closed Indian-Mediterranean restaurant Ela Cuisine’s doors and was looking to put café Reslau on the market.
“We’re trying to keep open at level 3, but we are struggling.”
Last Sunday, George said he had only made $87.
Before Covid-19, Reslau used to make about $1200 to $1300 per day. Now he was making $300 “on a very good day” and on weekends hardly $100.
“I don’t know what else to do.”
Selesh Kumar, owner of The Seafood Kitchen, said he was open for takeaways during level 3 but there was “hardly any business”.
“At level 1 things were picking up slowly but as soon as level 3 hit – disasters.”
For Burg’z Burgers owner Shaleen Reubin, business is just as dire and he is not open during level 3.
He told Stuff he stopped opening on Mondays as the business was only bringing in about $100 to $200 per day.
Reubin described Burg’z Burgers before the return to level 3 as “dead” from Mondays to Wednesdays.
“We’re not doing normal turnovers, we’re barely breaking even.”
To break even, Burg’z Burgers would need to bring in about $10,000 to $11,000 per week.
“I’m stuck between a rock and a hard place,” he said.
“It’s getting harder and harder to get out of bed.”
With a personal guarantee on his lease, Reubin said his landlord could “pursue” him for ending it early.
“How can we liquidate when he can take everything I have, everything I’ve worked for, such as my house?” he said.
“We’re going to have to try to tick over.”
Heart of the City chief executive Viv Beck said raw data showed spending in the city centre in the last week was down a “pretty severe” 74 per cent or about $19 million compared to the same time last year.
Auckland is losing 250 jobs and up to $75 million a day in economic activity during the current level 3.
Beck said the return to level 3 on August 12 was a “massive change” particularly for businesses in the CBD which had full bookings and fridges and pantries full of food.
Only about 60 per cent of its members were currently operating with contactless delivery.
“We need a more sustainable way of facing these challenges in the future, balancing business and health.”