Monday 17 May 2021

Crisis drowns restaurants and bars as entrepreneurs struggle to survive

During 2020 the sector had to reinvent itself to assimilate the coup of the covid-19; However, the pandemic left a deep scar, about 30% of the businesses did not reopen their doors

QCOSTARICA – During 2020, the bar and restaurant sector had to reinvent itself to assimilate the blow caused by the covid-19 pandemic and stay alive. However, the crisis arrived and left a deep scar, about 30% of the businesses will not reopen their doors.

Sanitary measures to contain the spread of the new coronavirus leave consequences for restaurants and bars. Working with a reduced capacity, for example, reduces the volume of sales. Photo: Alonso Tenorio.

This was estimated by Jorge Figueroa, president of the Costa Rican Chamber of Restaurants and Related Products (Cacore).

- Advertisement -

To cite some examples, the iconic Caccio’s pizzeria, located in the so-called Calle de la Amargura, in Montes de Oca (San Pedro), closed its doors definitively in 2020, after almost three decades of providing services in the surroundings of the University of Costa Rica (UCR).

The Casa Dominga restaurant will move to Barrio Escalante as part of a new, more simplified business model, and will now bet on delivery or pickup (option to order and pick up).

“In Plaza Antares, for example, which is by the Rotonda de la Bandera, gone are Spoon, Chilis, Tacontento, and others, only in that square. If you go to that square now there is no business except the Novillo Alegre, all the other stores are empty,” explained Figueroa.
Pains

Now, after almost ten months of getting around the sanitary vehicle restriction, the low demand in consumption, and the constant closures, and although the distancing measures have been softened, the outlook for the sector continues to be cloudy and business owners cry out for greater openness.

- Advertisement -

Sanitary measures to contain the spread of the coronavirus left its consequences in restaurants and bars. Working with a reduced capacity, for example, decreased the volume of sales and therefore, revenues.

Figueroa, who is also a partner owner of the Peruvian food restaurant Chancay, explained that in his case, it was not enough to remove half of the tables to reduce the capacity to 50%, because when he measured the distance between one table and another, he did not comply with the 1.8 meters distance, which established the Ministry of Health. To meet that distance, he could only use 30% of the tables.

The payment of the rents was another drag for the entrepreneurs, some obtained reduced rents or the owners requested a percentage of the gross sales, instead of a fixed rent.

However, others did not have the possibility and had to close their operation. Such was the case of the Caccio’s pizzeria.

Elliot Campos, owner of the Caccio’s, said that he could not reach an agreement with the landlord for a lower rent, despite having been leasing it for 20 years. However, he is still struggling to keep afloat the other three stores located near the Universidad Latina, in the La California neighborhood and in Moravia.

“We are struggling with the issue of double taxation on Uber Eats. We wish that we are not charged advance income tax withholding when paying by credit card. The restaurants have little liquidity, imagine that (the Ministry of) Finance retains a percentage of the income tax, they should eliminate the withholding and that it be paid later,” Campos said.

- Advertisement -

For the owner of Caccio’s, the vehicle restriction should be even throughout the week. Starting on Monday, January 4, for the month of January, the vehicle restrictions restric vehicles with odd ending license plates on Saturdays and evens on Sundays during the day (no such restrictions were in place in December) from 9:00 pm to 5:00 am, will drain the sector’s income.

In April, a special bill to take the edge off rent payments for housing and commercial premises was convened due to the national emergency, declared by covid-19, but the initiative did not find consensus in the legislative process.

Reinvent yourself to survive

Both Elliot Campos and Ricardo Ruiz, pastry chef-owner of Casa Dominga, agrees that since 2019 they already felt an air of crisis because people were not spending so much. This situation worsened with the arrival of covid-19.

But just as there are restaurants and bars that did not resist the crisis, others have reinvented themselves to give continuity to the business. This is the case of Casa Dominga, which this month opens its doors in Barrio Escalante, a gastronomic area with easy access for customers.

The change is due to the fact that Ruiz sought to restructure the company, lower costs, simplify the operational part (with a smaller store, easier to clean), and a better location to bet on express service and pickup.

During the longest period of confinement, Ruiz found that home deliveries and the pickup could be part of the long-term business.

“The change is to keep employees, I have not wanted to fire anyone because it costs a lot to find a good team. These are people who have made an effort along with me, who provide good service and quality. It is easier to say: the operation is reduced, but you have to continue with high standards and think that better days will come,” reflected Ruiz.

Currently, this restaurant employs five people.

Restructuring the business allowed Casa Dominga to stay alive; However, changing locations implied an economic investment in the midst of a recessive environment. Ruiz made use of his savings to pay for the new premises and modernize.

During the restructuring, the businessman had to deal with the red tape, one of the structural burdens that has lagged the productive sector for years.

“It cost me more in permits and stuff because the bureaucracy kills any business. That turned my hair gray,” he said.

- Advertisement -

FACT CHECK:
We strive for accuracy in its reports. But if you see something that doesn’t look right, send us an email. The Q reviews and updates its content regularly to ensure it’s accuracy.

Ricohttp://www.theqmedia.com
"Rico" is the crazy mind behind the Q media websites, a series of online magazines where everything is Q! In these times of new normal, stay at home. Stay safe. Stay healthy.

Related Articles

Q Media supports AmCham initiative to request donation of vaccines to the United States

QCOSTARICA - The Costa Rican North American Chamber of Commerce (AmCham)...

MOST READ

New batch of 124,000 doses of Pfizer / BioNTech vaccine arrived Tuesday

QCOSTARICA - A new batch with 124,020 doses of the covid-19 vaccine landed Tuesday night, as part of the weekly deliveries from Pfizer. With this...

Coronavirus digest: choice to get ‘vaccinated or infected’

The German health minister, Jens Spahn, said that despite falling daily cases of the COVID-19 in Germany, caution is still needed. "Everyone will experience this virus," Spahn...

These are the new sanitary measures that will be applied in May

QCOSTARICA - At the press conference from Casa Presidencial that started more than 15 minutes this afternoon, the government announced new sanitary measures that...

San Jose airport how has rapid covid-19 testing for travelers

QCOSTARICA -  Travelers who require a negative covid-19 test to enter their destination country may now get tested at the Juan Santamaría (San Jose)...

Top 3 Japanese-Inspired Online Slots

Slots are the most popular category in any casino. Gambling websites feature hundreds of these games, simplistic and elaborate. Reel symbols range from cherries...

New restrictions outrage hospital staff while business applauds “balance”

QCOSTARICA - The measures announced by the Government to reduce COVID-19 infections and hospital saturation unleashed a wave of reproaches, from one sector, and...

Keltner Channel Strategy Explained for Beginners

The trading world is full of trading strategies that vary by assets, timeframes, and, of course, technical indicators. In this article, you will learn...

Farmer’s fairs remain fertile despite the effects of the pandemic

QCOSTARICA - Despite the effects of the pandemic, "ferias" (farmers fairs) that are a staple on weekends across the country, from small towns to...

11,773 older adults rejected the covid-19 vaccine; another 441 missed the second dose

QCOSTARICA - A total of 11,773 older adults (defined here as those ages 58 and up) have rejected the covid-19 vaccine and another 441...

WANT TO STAY UP TO DATE WITH THE LATEST!

Get our daily newsletter with the latest posts directly in your mailbox. Click on the subscribe and fill out the form. It's that simple!

Log In

Forgot password?

Forgot password?

Enter your account data and we will send you a link to reset your password.

Your password reset link appears to be invalid or expired.

Log in

Privacy Policy

Add to Collection

No Collections

Here you'll find all collections you've created before.