COVID-19 Impact on Hospitality Businesses
In mid-March, we conducted a survey to understand the extent of the impact COVID-19 has had on the hospitality industry. We also asked how the industry is responding to these changes.
We gathered over 850 responses, mostly those in catering and also those working in events, country clubs, restaurants, and hotels. Here's a summary of their responses.
Immediate business impact
With nearly all gatherings canceled, most respondents had to react quickly to the sudden cash-flow crunch.
- 78% of respondents reported that employment impacts
- 32% of respondents laid-off employees, 22% reduced hours, and 15% furloughed employees
- Just from the survey alone, we estimate 38K employees affected in some way. The median reported is 15 employees per business, with a high of 5000+
Business outlook in 2020
How long will this last?
Oh, what we would give to have a crystal ball! Overall, businesses are cautious about the turnaround time, with 40% of respondents believe it’ll take longer than six months to get business ‘back as usual.’
Understandably, much of this hinges on external environmental factors. Currently, about 20% of respondents don’t know how long it’ll take to be business as usual again.
Expected Revenue Impact
Given uncertain expectations, businesses are planning for significant declines in revenue this year. 70% of respondents report expecting losses > 75%. On average, businesses are losing $500K in revenue, with a maximum report of $15M in revenue losses.
What’s happening to events on the books?
Luckily, businesses aren't seeing all of their upcoming events gone. 79% of respondents report postponing events, with 20% seeing mostly postponements. A survey conducted by WeddingPro also found that 96% of people are postponing weddings with the vendor.
How businesses are spending their time now
We asked how people plan to use their time while waiting for events to pick up again and received a range of responses. We’ve grouped the feedback into 3 main categories:
34% are investing time on education or training
People shared they’re spending time on their or their team's professional development. Respondents shared getting their CPCE or CMP certification, completing their MBA, or dedicating more time to reading and online learning.
Free training through April 30, 2020
ServSafe Food Handler Certification Learn more
Recently furloughed or laid off employees can get their American Hotel & Lodging Education Institute (AHLEI) certification. Learn more
With that in mind, many cited local associations are actively offering new educational content. Join an adjacent industry -- you may get some fresh ideas from them.
Check these out:
Respondents also cited these sites for vital COVID-19 related information
- U.S. Chamber of Commerce
- WeddingPro COVID-19 Resources
- Bambee HR Resources (free HR services for businesses affected by COVID-19)
30% are diversifying revenue
Several respondents included plans to diversify revenue streams, both for their business and for themselves personally.
The majority of respondents included some meal plan or delivery service. Respondents are also exploring selling:
- Event photos online
- Online workshops like in floral arrangements or other areas of expertise
- Gift cards to be redeemed later
- Inventory, especially essential goods like flour and toilet paper
- Adapting portion sizes / menus to fit today’s needs
Need a bit of inspiration? Check out what others are doing
- Caterers adapting their business
- Event rental companies supporting COVID-19 efforts
- Restaurants pivoting to groceries
- List of bakeries offering “Quarantine Cakes”
42% other activities
Lastly, many are taking the time to care for their business and themselves. This includes
- Back-office business projects: cleaning warehouses, updating SOPs, and revamping marketing, especially to increase organic traffic through website SEO and social media
- Family time: spending more time with family, especially with children being homeschooled or learning remotely
- Self-care: it’s ok to Netflix and chill. Here are some tips from the Mayo Clinic
Have more ideas on where to invest your time? Please add your comment below.