11/5/21, 12:39 PM 25% eateries closed in FY21 due to Covid: Study - Times of India

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25% eateries closed in FY21 due to Covid: Study

TNN | Oct 26, 2021, 08.18 AM IST

NEW DELHI: Around 25% restaurants across the country may have shut
down permanently and at least 23 lakh people have lost their jobs in FY21,
a study by the National Restaurant Association of India (NRAI) and
management consultancy firm Technopak shows.

Restaurants were not allowed to function for an average of over 100 days,
according to the study on the Covid impact on the food services industry.
NRAI has more than five lakh members.

The report aims to act as a compass for policy makers to support the
industry, said Nitin Saluja, NRAI managing committee member. With
inflation impacting prices for restaurateurs and diners, the sector will
continue to exercise caution, the report said.

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‘Food service industry met only 40% of its revenue target’

Kabir Suri, president NRAI, said the report is crucial for the industry to garner necessary support and recognition from the
government. The Indian food service industry met only 40% of its estimated revenue target of Rs 4.95 lakh crore in FY21, the
report stated, adding that it is set to meet 85% of the 5.48 lakh crore target In FY22.

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11/5/21, 12:39 PM 25% eateries closed in FY21 due to Covid: Study - Times of India

Restaurant numbers started declining from the third quarter of FY20, and the impact of Covid was seen from March 2020
onwards when India went into national lockdown. Hygiene concerns hit unorganized outlets first, and from April onwards food
industry sales were down by almost 90%, the report stated.

From July onwards, communications highlighting hygiene and safety added to consumer confidence, but multiple containment
zones, reduced operating hours and lower capacity impacted sales, which were down by 78% of pre-Covid level. As

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11/5/21, 12:39 PM 25% eateries closed in FY21 due to Covid: Study - Times of India

restaurants opened and restrictions eased, the industry managed to cut some losses and sales were 49% of pre-Covid
estimates by 2020-end, the report said. By the beginning of 2021, the overall food services market bounced back to almost
74%, with the organised sector showing almost 90% recovery. However, Covid 2.0 hit the industry hard again. Delhi and
Mumbai were the worst-affected. Lockdown, timing restrictions, no permission to serve alcohol and lack of confidence among
diners meant slow recovery in the two cities. Bengaluru and Kerala, too, witnessed closure of many eateries.

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