Covid-19 takes its toll on the mental health of small and medium businesses especially in hospitality

Thursday, 22 July 2021

Café Hanoi co-owner Krishna Botica says the last nine months have been the toughest she has experienced in business.

Covid-19 disruption and uncertainty has been taking its toll on the mental health and wellbeing of business owners especially in hospitality.

Restaurant owner Krishna Botica was mentally prepared for the challenging decisions she would have to make during the pandemic and decided to not drink any alcohol, do regular yoga and mediation to alleviate stress and keep her focus on the business and the wellbeing of staff.

She and husband Tony McGeorge own four restaurants in Auckland, Saan, Café Hanoi, XuXu Dumpling Bar and Ghost Street. She also heads the Auckland branch of the New Zealand Restaurant Association.

The first six months seemed fine since the first lockdown. Staff were retained and supported by the wage subsidy but on reduced hours, made up by the owners, Botica and McGeorge working 60-65 hour weeks to keep costs down.

Krishna Botica and her husband Tony McGeorge committed to move their Vietnamese restaurant Café Hanoi to Britomart and open another new restaurant in Auckland, Ghost Kitchen, a couple of months before Covid emerged placing great strain on their business.

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The staff became close. Some had lost loved ones and could not attend the funerals, others had family overseas, so Botica felt huge responsibility for their wellbeing.

“You’re worried you don’t have enough work for them, you’re worried about your business, and you have to make big decisions, so your cortisol levels are at an all-time high.

“For a long, sustained period something sort of has to give. That second lockdown (in mid-August last year) was it for me. I managed to keep it together well enough to keep on coming to work, to keep on making those decisions. By the time we got to October I was physically exhausted and mentally fatigued and irritable.

“I never dipped into depression, but I have enough experience in my life over the last 50 years to understand the warning signs. I noticed my anxiety levels had increased, I was breathing badly, so I had to go and get help for that.”

She found herself close to tears a lot, she felt the weight of having to still keep a bright smile on her face and was struggling to sleep even four hours at a stretch.

“The last nine months have been the toughest I’ve ever had in business,” Botica said.

Two months before Covid emerged the business had entered into its biggest capital investment, $1.2 million, in moving and expanding Café Hanoi and opening a fourth restaurant, Ghost Street. The latter’s opening was delayed seven months.

Business Mentors chief executive Sarah Trotman says businesses need to accept Covid has brought a new normal and make a plan around that.

“When the bank gets anxious you have to do more work to show them you are on top of things.”

They had to meet the bank more frequently, make arrangements with suppliers and borrow money from family.

Sleeplessness, worry, anxiety and exhaustion was rife in the industry.

“Some of us are actually starting to come out of it. I’m on top of my sleep now so that’s always a win,” Botica said.

Two surveys of small business owners show Botica and McGeorge are not alone.

Business Mentors New Zealand’s recent survey of more than 1000 small business owners revealed seven out of ten were feeling stressed and anxious with nearly half of them saying they were burnt out. Just over a quarter reported feeling depressed.

Business Mentors chief executive Sarah Trotman said the 70 per cent was higher than usual. Those surveyed were clients of Business Mentors and businesses subscribing to its publications.

'Our mentors are certainly experiencing business owners that are under immense pressure at the moment. It came on at the beginning of Covid, and it has not let up.

'What they need is to stop, put everything into perspective and accept that there is a new normal, and make a plan around what to address, the things that are causing them pressure.'

The cost of a business mentor is $295 plus GST a year with Business Mentors. Mentors are experienced business people who give their time free, but the charge is used for administration of the organisation.

Business management platform MYOB says its 2021 Business Monitor revealed that a third of SME owners and managers (36 per cent) had experienced a mental health condition since starting or taking over their current business. That compared with 31 per cent in an MYOB survey in late 2019.

Just over half cited Covid-19 lockdowns and uncertainty as the top factor impacting their mental wellbeing. Other stresses were lack of sleep, increased workload, personal and business finances and relationships.

Of those SME owners and managers who had experienced a mental health condition, three quarters said they had experienced stress, two-thirds anxiety, and 43 per cent said they had had depression.

Restaurant Association chief executive Marisa Bidois said the many roles restaurant owners played and the constant decision-making brought an enormous amount of pressure. Covid had been particularly hard on the industry.

The association had resources to help owners and managers manage the wellbeing of themselves and staff. It partnered with the Mental Health Foundation to run training programmes and linked with a mentoring service using experienced professionals who were out of the industry who could give advice.

MYOB senior sales manager SME, Krissy Sadler-Bridge, said the challenges of running a business, coupled with Covid had been pushing some businesses to their limits.

The MYOB survey of more than 1000 micro and small businesses with less than 20 staff ran from early February to early March.