THE Omicron wave has dashed the hopes of Chinese restaurateurs to recover losses suffered over the last two years, with customers cancelling their reservations, especially during the Chinese New Year period, industry players said.

Many restaurateurs who were looking forward to the 15 days of the lunar new year to return to pre-epidemic gains are now looking at close to 60% losses.

Restaurants are not only contending with losses, but are also faced with rising cost of raw ingredients and higher salaries.

Malaysia Koo Soo Restaurants and Chefs Association president Wong Teu Soon said that while business picked up on the eve of the lunar new year, it went downhill after that.

“Before Chinese New Year, we expected business volume to recover by 75% but this has now dropped to 60%,” Wong told The Malaysian Insight.

“There were a lot of reservations that were cancelled after the seventh day of the new year.

“Small groups continued to have dinner reservations and wedding banquets, but new year dinners were mostly cancelled.

“Restaurants don’t ask for deposits when reservations are made, nor do they buy ingredients in advance.

“The day before, we will check with the customer. If they don’t cancel, only then will we prepare the ingredients.”

Also, they do not ask for cancellation reasons as they have grown accustomed to it over the past two years, Wong said, adding that it is usually because someone in the group has contracted Covid-19.

Malaysia is currently experiencing the Omicron wave, logging five-digit daily cases in the past few weeks.

In the last 11 days, daily cases have surpassed 20,000, with 25,099 reported yesterday.

Wong who is also the president of the Malaysia-Singapore Coffee Shop Proprietors General Association said business at coffee shops have also been severely impacted by the increase in daily cases.

“Before the new year, business in coffee shops was good and they were doing well. Now there is barely anyone.”

Coffee shops are also facing higher operational costs but are unable to raise prices as it is likely to incur the wrath of customers.

“We sacrificed our family time on the first day of the new year but no one understood our predicament.”

Sluggish business in Klang Valley

Justin Hor Chee Keong, deputy president of the Malaysia Selangor and Federal Territory Ku Su Shin Chung Hung Restaurants Association, said business volume started to decline by 40% after the eighth day of the new year.

“Food and beverage operators in the Klang Valley thought we would be able to return to pre-epidemic levels in the 15 days of the new year but business is still bad.

“We expected to recover by 70% but the sudden increase in daily cases led to a lot of cancellations.”

Currently most gatherings at restaurants are limited to three or four people but not more than 12.

He urged the government to control the epidemic and drive up the booster jab rate.

“If this is not brought under control, the industry will be affected until April or May.”

While business is bad, overhead and salaries have, however, gone up, Hor said.

“Goods are costing 10% more while salaries that used to be RM1,800 have gone up to RM3,300 as we can only hire locals.

“Given the current situation, how are we to pay our bills?” Hor asked.

Manpower shortage

Malaysian F&B Operators Alliance spokesman Tony Lim said business was slowly recovering from August to September last year but declined during the new year.

The decrease in business could be due to the Omicron outbreak, businesses repaying their loans or a lack of workers, Lim said.

“From February 7 large restaurants saw their business volume decline. Covid-19 is not the sole cause. The lack of manpower is another factor.”

The manpower shortage means many restaurants can only operate with 70% capacity, he said.

Meanwhile, the cost of raw ingredients have gone up by 15 to 20% but businesses can adjust the prices.

Lim is hopeful that business will pick up in April or May, closer to Hari Raya. – February 23, 2022.