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HCMC restaurants, coffee chains struggle to reopen

Created 11 October 2021
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Immediately after HCMC lifted its lockdown this month, beverage chain The Coffee House introduced Fresh Bottle, a new glass bottle designed for easy delivery of its best-selling drinks.

Shippers wait to pick up orders at a coffee shop in Ho Chi Minh City on September 16, 2021. Photo by VnExpress/Quynh Tran

This and other delivery-friendly products such as instant coffee and canned drinks are the solutions the company came up with to "survive and overcome difficulties," CEO Le Ba Nam Anh told VnExpress International.

"We have reopened 40 percent of stores in big cities such as Ho Chi Minh City, Hanoi, Da Nang, Hai Phong, Bac Ninh, Hai Phong, but we have yet to reach pre-pandemic capacity due to social distancing in each city."

He still has to pay rents, salaries and for ingredients because everything was ordered two quarters in advance, and the cash flow imbalance is a big challenge, he added.

HCMC began allowing businesses to reopen on Oct. 1 after four months of lockdowns, but coffee chains and restaurants are still struggling to return to pre-pandemic levels of business due to a difficulty in hiring people and people’s reluctance to spend.

The city has allowed eateries to resume delivery services from Sept. 8 after suspending them for nearly two months.

Shippers wait to pick up orders at a coffee shop in Ho Chi Minh City on September 16, 2021. Photo by VnExpress/Quynh Tran

Shippers wait to pick up orders at a coffee shop in Ho Chi Minh City on Sept. 16, 2021. Photo by VnExpress/Quynh Tran

Pho 79, a high-end Vietnamese-style restaurant chain, plans to function at 15 percent capacity starting on Oct. 15 as it expects demand to be low.

"Over 70 percent of our employees have left for their hometowns," Huynh Huu Thanh Phuong, chairman of the chain, said.

"We do not have enough ingredients [for cooking], and demand has been falling".

Phuong plans to increase to 30-50 percent capacity before year-end, but expects revenues for the whole year to be 70 percent down from last year.

"We are waiting for authorities to lift more restrictions. We are also concerned about the possibility of another resurgence [in Covid-19]."

Other restaurants are unsure whether it is even the right time to reopen.

"It’s bad to remain closed, but it’s hard to reopen as the more we sell the more we lose," Ly Nhat Hieu, owner of three high-end restaurants, said.

He has been waiting for the city to reopen since closing for five months has cost him nearly VND2 billion ($86,206).

But a shortage of employees makes it difficult for him to restart now: many have left for their hometowns, some have started their own eateries or work as delivery persons to make a living.

"It is hard to find people for difficult positions such as head chef and station chefs. It is not easy for people to return to the city."

The food and beverage industry has been among the biggest victims of the fourth wave of Covid, which began at the end of April.

With over 2,000 new cases found every day, the city continues to impose restrictions to prevent another outbreak.

But with over 70 percent of the adult population vaccinated, the highest rate in the country, industry insiders have reason to expect that the difficulties will soon be over.

The Coffee House plans to build a new store model specializing in takeout and delivery in Ho Chi Minh City, and plans to replicate this in other localities across the country next year.

"In the short term, there will be losses, but in the long term, we will have new growth pillars along with the return of old ones."

 

Source: VNE

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