The Food and Beverage Industry's Global Challenges During the COVID-19 Pandemic
By Lucheng Wang Part-time Teaching Assistant, Florida International University | June 28, 2020
This article was co-authored by Timothy Flohr, Program Manager, University of Memphis - Kemmons Wilson School of Hospitality & Resort Management
Since the first patient was reported in December 2019, according to the World Health Organization (WHO), the COVID-19 outbreak has infected more than 1,800,000 people worldwide. Over 170 countries and regions have reported infections with the United States, China, Britain, Italy, Japan, South Korea accounting for the most casualties (WHO, 2020).
Needless to say, many popular travel destinations around the world have been impacted (WHO, 2020). COVID-19 was declared a Public Health Emergency of International Concern on January 30, 2020 (WHO, 2020). With the escalation of the pandemic and the increasing number of infections worldwide, the impact of COVID-19 continues to expand. In the U.S, the stock market has been hit hard, and, the unemployment rate jumped to 4.4% in March 2020, the highest level since August 2017 and well above market expectations of 3.8%. (U.S. Bureau of Labor Statistics, 2020).
Under various pressures, the food and beverage industry is facing great operational difficulties. In order to avoid people gathering and reduce the infection rate, authorities around the world have issued regulations that either prohibit dine-in guests or mandate limitations on the number of dine-in guests in the restaurant.
For example, since March 16, New York City has limited its bars and restaurants to delivery and takeout only (Sadurní, 2020). The large number of outright shutdowns and sharp decline in sales volume have forced the food and beverage industry into its biggest crisis in a decade. According to the National Restaurant Association (NRA), there was a net loss of over 417,000 jobs in eating and drinking establishments in the United States in the month of March 2020 (National Restaurant Association, 2020).
Further, a survey of more than 5,000 restaurant owners and operators found that sales were down 47% nationwide during the period from March 1 to March 22. (National Restaurant Association, 2020) Practitioners in the food and beverage industry are eager to find solutions. In order to gain a better understanding of the challenges and coping strategies employed by the food and beverage industry associated with COVID-19,it is of value to refer to the actions taken by food and beverage operators in both China and the United States during the duration of their pandemic outbreak experience.
The outbreak of COVID-19 in China occurred during the Spring Festival, which is one of the peak periods of tourism, and thus for the food and beverage industry. In order to avoid the forming of crowds, the majority of celebratory dinners and wedding banquets during the Spring Festival were canceled, and a large number of restaurants were closed.