Prime Minister Robert Abela’s decision to close all restaurants and bars in light of the COVID-19 outbreak has left business owners concerned about the future of their enterprise and, most importantly, the future of the people they employ.
Restaurants are particularly feeling the heat as the mandatory shutdown which came off the back of an industry-wide, and anticipated, bad four months in the winter season.
“As an industry, we just came out of the worst four months of the year, which is November to February,” said Managing Director of One80, Rouvin Zammit Apap.
“We are operating at 0% revenue and 100% expenses. The challenge is to keep our staff and keep our restaurants afloat. In reality, I don’t want to lose a single person from my staff, but what can I do?”
“These employees are mostly low-income people. The average barperson and waiting staff are low earners. They won’t have any savings,” said Managing Director of U Bistrot, Jean Vella.
The consensus amongst restaurateurs is that current government initiatives won’t stop businesses from having to implement unwanted cust costing measures including laying off their staff and potentially even shutting their doors.
“I have over 80 people working with me. The first week was ok but the rest will be a disaster. It isn’t the staff’s fault because they have rent to pay, they need to be looked after,” said award-winning chef Marvin Gauci.
“But once my funds have finished, what am I going to do?”
Though the current situation is somewhat inevitable, businesses have not been left with a security blanket that they feel will be able to catch them if they fall. Though the business is itself at risk, restaurateurs have expressed that it is the people they employ that they are worried about.
“If they don’t see bigger picture, we’re doomed. It’s not me that I am worried about, it’s the people that work for me. The last person I am worried about is me and my family,” Gauci said.
“It’s already a major issue. 95% of people can barely finish March. These people have loans, family duties, overdrafts on stock, wages and other costs to look after,” reiterated Gauci.
“We just want to be able to keep on providing for our employees, keeping them alive and not desperate,” said Vella.
“At least enough for them to pay rent and pay electricity so we all get out of it together.”
The situation varies from-business-to-business but many agree that if things continue this way, in a couple of months’ time there will be serious ramifications.
“You can afford a month of salary and maybe a second month,” said Zammit-Apap.
“We are proposing reduced hours and willing to give them leave in advance. Unfortunately, when we run out of annual leave balance, it will have to be unpaid.”
Malta is rushing to control the spread of COVID-19 but is losing sight of the long term effects some of these measures will have on businesses.
The sentiment of uncertainty has spread to many other businesses and organisations including The Chamber of Small and Medium-Sized Enterprises which warned that has government initiatives “will have no impact and are no way close to what businesses need to sustain jobs”.
“One day, when we’re back in operation, we will need the staff and there will be nobody here,” said Zammit-Apap.
“This year is down the drain, even if we open in a month’s time or two month’s time. You build up momentum slowly.”
“There is a general perception that the past four years were busy. Yes, we were very busy but we don’t just have money in our pockets.”
“A businessman invests in the business. Our business is only four years old, if you make a profit you invest in the company. We don’t have a well of money, it hasn’t been long enough running to say let’s go to the bank.”
“People might think restaurants make a lot of money because they seem full. In reality, a restaurant is left with 10- 15 % max-margin,” said Vella.
“The restaurant business is very different from other businesses. There’s a long process of hiring staff, training, onboarding, it’s a tough situation.”
With zero income and all the expenses to still incur, restaurateurs are looking to the government for more support to help them and their employees stay afloat.
“The government has to act now, there is no other way,” said Gauci.
“I’m not expecting the government to take all the blows, we all do during this time as long as we have enough to put a roof on your head and food on your plate.”
“If the government closes my business they need to stop utilities and rent as well. Why am I suffering all the expenses and utilities that come with their decision?”
“Government has come with this support, but it’s like sugar in the street, it’s nothing. They need to leave more liquidity in the company, for the self-employed. Maybe they can consider keeping the VAT down when we’re back in operation, it will take a very long time to get back on our feet,” said Zammit-Apap.
“If the government, employers, landlords, employees work together we can save thousands of jobs,” added Vella.
“If we are able to be strong and put it together these six months can be used for reflection and take action.”
“We understand the pressure from all directions and thank the minsters and everyone else involved for their continued effort.”
Earlier today, Health Minister Chris Fearne announced the closure of all non-essential retail stores and services and banned all public activities to help contain the spread of the COVID-19 coronavirus.
More government measures to aid businesses are expected to be announced in the comings days, with Prime Minister Robert Abela stating today that the government must be more aggressive in its approach.