COVID-19 Pandemic: A nightmare for HoReCa Industry

08/gen/2021 17:25:05 Allied Market Research Contatta l'autore

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As the effects of COVID-19 spread across the entire world, the primary focus for governments and businesses is the safety of their people. The COVID-19 pandemic has not only created health crisis, but also deepened economic, political and social crisis worldwide.The impact is huge, and not yet predictable, on both revenue and supply chains. Decisions being taken to shut down hotels, restaurants, theme parks, cinemas, not to mention the entire disruptive effect of the travel ecosystem, all have a significant impact on worldwide HoReCa Industry.This is additionally anticipated to lead to loss of employment and income. The coronavirus pandemic has generated unprecedented crisis on the food & beverage sector.

The impacts of COVID-19 on the HoReCa industry?

The tourism industry is one of the major contributors to the HoReCa industry. The decline in tourism activities globally as a consequence of the COVID-19 disease, has been one of the largest contributing factors for the downfall in restaurant,cafeterias and hotel sector.

Covid-19 has affected every sector across the globe, and the hotel industry is among the hardest hit. According to the World Travel & Tourism Council (WTTC), 100.8 million are currently at risk in the tourism sector with 1 million jobs being lost every day. As per an Oxford economics study, Asia is expected to be the worst affected and data suggests the industry could take many months to recover.Governments will have to play a huge role in saving the hospitality industry. France, Switzerland, Spain and other European government have promised aid tallying millions of euros towards rescuing all types of local businesses hit by the COVID-19, and with similar practices adopted by many governments in other parts of the world.

Recovery is now expected to start later and be slower than previously foreseen. Travel restrictions and containment measures are likely to be in place for longer, and are expected to be lifted only gradually, with the possibility of reversal should new waves occur. Even when tourism supply chains start to function again, new health protocols mean businesses will be operating at restricted capacity. Demand-side recovery will also take some time, given the interlinked consequences of the economic and health crises, and the progressive lifting of travel restrictions, while consumer confidence and travel behavior will be more deeply impacted the longer the pandemic goes on. This will have knock-on implications for many national economies.

In Lithuania, the transformation of tourism sector will be pursued by promotion of innovation and digital technologies through the development of tourism services and products. To this end, the ‘E-business model’ tool will be used to finance new business models created via introducing e-business solutions, as well as the ‘Retraining of Enterprise Workers’ tool and the ‘Innovative Checks’ tool, which will finance the purchase of services of publishing, voice-reading, translation, photography, filming, design, communication, etc.

In France, on the 14 May 2020, the Prime Minister announced that the Government will commit $ 21.25 billion to the tourism sector to support the recovery. The support will start with $7.32 billion of guaranteed loans granted to 50,000 companies in the sector. A $ 1.53 billion recovery plan financed by public investment bank. This sum will be supplemented by additional private investments to reach a total of $8.26 billion.

Thus, the transformation by means of digital technology, support of government, and efforts by industry player to provide safety to customer will revive the demand in the HoReCa industry.

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