Page 25 - FoodFocusThailand No.172 July 2020

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profit per head for business operators. Restaurant owners in this restaurants even after a rollback of virus control measures is declared
group should consider; and based on fluctuations in daily food orders which differ from the
1. Diversifying their revenue streams, extending them to normal situation, adjustments to inventory management and limitations
encompass more customer groups in other fields, for example: to the variety of menu options are measures that could help reduce
presenting a weekly or monthly culinary course for customers who losses via mitigated costs.
have switched to working from home.
2. Adjust their business formats and processes in line with Summary
consumer demands and changing circumstances, for instance: cutting In summary, the improving COVID-19 situation has prompted the
down on the number of branches that operate as full service government to gradually ease virus control measures and allow
restaurants and choosing instead to use pop-up stores to reduce restaurant businesses to resume their operations in succession. Under
expenses and risks, or shifting to invest in cloud kitchens to coincide the assumption that no new waves of infection will resurface over the
with rising consumer demand for dining at home. Traditional forms of remainder of this year, restaurant businesses which emphasize on-
business operations may no longer be worthwhile under current premise dining should be able to capitalize on this opportunity. Aside
conditions, as break-even points have markedly increased. from this new and changing corporate environment, net income for
• The groups that are likely to see relatively limited impact restaurants in this group may vary according to key issues, especially
include typical restaurants, streetside eateries and food carts, as they the cost-effectiveness of products and services, the location of each
were among the first group of restaurants to experience the benefits eatery and differences in business operating costs. On top of that,
from the government’s easing of virus control measures. Moreover, changes in consumer behaviors – namely their growing familiarity with
a high proportion of income for restaurants in this group comes from online food services and home delivery – along with income limitations
takeaways. As some restaurateurs have partnered with food delivery that stem from the sheer number of customers who have yet to return,
service applications before the viral transmission, their revenue and rising expenses to restore consumer confidence, which are also in
streams have undergone diversification. line with business practices – all have impact on net income, especially
Since most of the restaurants in this group are SMEs, and are amid the public’s overall weakening purchasing power as a result of the
without franchises, their process adjustments are likely to be executed economic recession and a contracting tourism sector. Another cause
at a brisk pace. for concern comes from fierce competition among restaurant businesses
Because existing systems and processes were established without which may eventually cause some restaurants to close permanently.
standards, adjustments on the part of business operators are still KResearch projects that restaurants’ income will continue to shrink
necessary in upgrading dining venues to meet the new business for the rest of the year, leaving restaurant businesses with a market
standards. Such adjustments include; value of only THB 385 to 389 billion, or a contraction of 9.7% to 10.6%
1. Raising sanitary standards within eateries to attract consumers from the preceding year. This would mark a reversal of fortune as growth
and lessen their concerns over the cleanliness of raw materials, the would thus shrink for the first time in eight years. Based on the changing
dishes and utensils, and the personal hygiene of their staff and chefs business environment, restaurateurs must quickly adjust themselves to
2. Taking more precautions in managing raw materials and the “New Normal” for business conduct, in order to carry out business
inventories, including cutting down on the number of menu options. operations that are in step with changes in consumer demand.
Given that most consumers are still not expected to frequent

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