GEORGE BUSINESS NEWS - The easing of lockdown regulations on the tourism sector and restaurant industry has been widely welcomed, but there is still much uncertainty about the future, especially in light of an economy that is predicted to shrink by as much as 7%.
It is estimated by the South African Tourism Business Council that the local tourism industry has suffered a loss of R70 billion during the 100-day lockdown in South Africa. This translates to R750 million per day.
According to the World Tourism Organisation, international tourism was down by 22% in the first quarter and could decline by 60-80% over the whole year.
George Tourism manager Joan Shaw confirms that the outlook for the industry in the George area is bleak. "Many of our tourism businesses are SMEs that live hand to mouth, doing temporary, seasonal work for relatively low hourly rates and tips. If the customers are not there, there will be very few hours or tips to be had, causing many associated social problems."
Clearer guidelines on who may travel to restaurants, accommodation and activity venues are needed.
"If it remains only business people, then would it be cost effective for tourism properties to open up to a limited amount of customers? If open to a wider audience, will prospective patrons risk sit-down meals, going through the hands of many employees? If limited numbers can be accommodated, will it be cost effective for properties to open their doors, especially in light of the extra costs of keeping customers safe?
"There are too many questions, and no answers at this stage, and although some are of the opinion that we are reaching a peak of the curve of the pandemic, it is just not possible to tell."
The George Tourism Department has various scenarios planned for the recovery of the sector and is focusing its business continuation planning on a more digital space. "There is no crystal ball, but we are compiling plans to assist in combatting the loss of any businesses and associated jobs, as best we can."
Domestic market alone not enough
Chairman of the Outeniqua Tourism Association Michael Cook says the Western Cape relies heavily on international tourism with 60% of visitors being from overseas. Even with the domestic market opening up, it will still be difficult to trade on a viable basis.
"Furthermore, we don't know if people will be confident enough to start travelling and staying over. The George Airport also still needs to be opened."
Annual leave used up during the lockdown and people's income that has taken a knock are other factors to consider. "With the economy that is going to slow down, less spend will be available. In the accommodation sector we are also concerned about protecting our staff. Many guest house owners themselves are over 60 years of age and would not want to bring the coronavirus into their establishment."
For an establishment the size of the Wilderness Hotel it is not as simple as opening up and waiting for visitors to arrive, says operational manager Leon de Kock. "We will be ready to open, but whether we will be able to afford it, is another matter. Will the regulations be practically executable? Starting up the boilers for hot water at this hotel costs R220 000 per month.
"We must be allowed to accommodate enough guests for it to be feasible. We also can't depend on Western Cape-based visitors alone and until interprovincial travel is opened up, we will not be able to start doing business. The George Airport is still not open, which is another big factor."
He said the management of their hotel group, that owns several hotels in the Garden Route, is nevertheless planning for possible reopening.
'Future depends on dine-in rules'
Dean Hahn, a shareholder and co-owner of the two Spur franchises and the local franchises of Panarotti's, Nando's and RocoMamas, said they reopened a few of their restaurants for delivery orders only, just before the lockdown level changed from 4 to 3. It was done in anticipation of the call-and-collect and drive-through options on Level 3, and since Level 3 has come into play, they have seen a big increase in turnover.
Hahn said the future outlook will depend on the conditions attached to the dine-in regulations - whether kids' areas can be opened and liquor sales allowed all week for day and night, and also what seating capacity will be allowed.
"The businesses are still running on skeleton staff levels. Staff and managers have been split into shifts to avoid any transmission of the coronavirus. If anyone becomes infected, a whole shift can be quarantined and business can continue. Staff training is an ongoing endeavor."
Flow of customers needed to survive Covid-19 crisis
Earlier this week David Maynier, Western Cape Minister of Finance and Economic Opportunities, also referred to the further clarity that is urgently needed on whether accommodation and intra-provincial travel for leisure purposes will be permitted.
"If not, these businesses will not get the flow of customers they need to survive the Covid-19 crisis. The opening of the George Airport under Alert Level 3 is also critical for business travellers working in the Garden Route District."
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