Long live the local – urgent support needed for hospitality industry

By Matt Wilson 14 Feb 2022

Long live the local – urgent support needed for hospitality industry

As part of New Zealand’s hospitality landscape for over 90 years, the team at DB are passionate about the industry and the role it plays in our communities. Bars, restaurants, cafes, pubs. They are places we come together and connect. They are run by hard-working, passionate Kiwis, and I fear the collateral damage we’ll see from Omicron if these small businesses aren’t given the support they need.

The Red Light setting is worse for bars and restaurants than lockdown. They can open, but under hugely uncertain conditions. Consumers are wary of social settings, isolation rules mean entire kitchen teams can be out of action for weeks, and inflationary pressure means operating costs are higher than they’ve ever been and it is very difficult to pass on the increased costs to consumers. On top of all that, the minimum wage is going up.

Speaking to one operator who owns a group of venues in Auckland, moving into Red resulted in a 37% decline compared to Orange. For comparison’s sake, Level 2 was an 18% decline (from pre-Covid levels) and at this stage the industry received Government support.

The ramifications are significant.

We’re already seeing venues reduce opening hours because they simply cannot afford to stay open. This means employees are receiving reduced wages which obviously has a flow-on effect to livelihoods and consumer spending. We are also seeing closures across the board from operators who simply cannot continue operating at a loss with no respite on the horizon.

The Government has said they can’t save every business. I understand that. But we are on the precipice of an entire industry facing unprecedented closures and the impact will be widely felt on both an economic and social level.

What can be done about it? We’d like to see a full Resurgence Support Payment and Wage Subsidy while the country is in Red Light setting for hospitality and tourism businesses that meet the 30% revenue drop threshold.

My plea to New Zealanders is to support your local when you can. We live in a highly vaccinated population and have measures in place to safely visit hospitality venues.