APU Business Original

COVID-19: Maintaining Resilience in Hospitality Industries

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By Dr. Sheri Hernandez
Program Director, Hospitality Management, American Public University

Around this time of year, people are usually caught up in the traditional frenzy of the holidays. They may be rushing around from store to store searching for the perfect gift, writing out holiday cards and planning elaborate feasts. Also, they might be making travel plans, meeting friends for happy hour and responding to party invitations.

Of course, this year is different due to the impact of COVID-19 on virtually all aspects of our lives. Not only are many people suffering economically from business closures and loss of income, but also the recent uptick in COVID-19 cases and the resulting restrictions put into place have hindered our ability to socialize, travel, and spread merriment in the traditional ways.

The Hospitality Industry Was Especially Hard-Hit by COVID-19

The hospitality industry and its employees have been hit especially hard. Restrictions on indoor dining and gathering, placed on restaurants at the very last moment in several states on one of the biggest restaurant revenue days of the year, caused many service employees to wonder how they will be able to put food on their holiday tables, let alone gifts under their trees. Additional closures on restaurants during their busiest times of the year have forced restaurant owners to face the real possibility their business may not survive to see 2021.

Similarly, hotel occupancy rates — and in turn, revenue and the need for employees — are still at record lows. Restrictions on travel and gathering, coupled with a fear of the coronavirus, have had a ripple effect on people and the economy. Millions of jobs in the hospitality industry have been lost, and the industry is still rallying for help from legislators.

Americans’ Travel Plans Have Changed Due to COVID-19

The vast majority of Americans do not plan to travel for the holidays, and unless there is a dramatic change with the promise of a vaccine, most people do not plan to travel for quite a while after the New Year. The hotel, travel, and restaurant industries have been devastated. In an industry where the goal is taking care of others, it hits those owners hard when they have to let their trusted and valued employees go without income.

Many Americans are facing the fact that they will not be seeing their families this season, whether it is out of an abundance of caution, travel restrictions or deaths in the family. As a result, it is difficult to stay positive and hopeful during a time of year that is the traditional season of hope.

Hospitality Organizations Have Changed Their Operations to Stay Afloat

Yet there are still some bright lights in an otherwise half-lit string of Christmas lights. Many hospitality organizations have been able to pivot their operations and stay afloat, optimistic they will be able to re-hire employees once the pandemic has subsided and business restrictions have lifted.

Several contract service companies — those food service organizations that run hospital and office cafeterias — saw a dramatic decrease in food sales when hospitals worked to clear out patient rooms to make way for an influx of COVID-19 patients. Elective surgeries were postponed, so not only were patient meals reduced in quantity, but their retail sales also declined because there were no visitors permitted for the patients that remained hospitalized.

Some contract food service companies have shifted their operations. They have turned into a different sort of service for essential employees working in the hospitals and other organizations that cannot be run virtually.

For instance, some companies have offered healthcare workers a sort of grocery store, where they can pick up essentials and even ready to heat up meals so they can head home after a long shift. This tactic allows those healthcare workers to avoid stopping at grocery stores on the way home, reducing potential exposure to the coronavirus. Moving forward as patients and visitors return, they will continue to explore ways to reduce the germ-spreading tendencies of cafeterias and self-service areas.

Independently Owned Companies Have Adapted and Stayed True to Their Communities

Independently owned restaurants, breweries, and wineries have adapted to the ever-changing restrictions and stayed in contact with their communities. They are doing their best to not only bring some cheer, but also to try to stay in operation so that their products can be enjoyed in person in the years to come.

In one case, COVID-19 restrictions limited the number of people that could visit a fairly new winery that had been enjoying fantastic growth and positive reviews. Consequently, the owner decided to get creative.

Her seasonal sangrias had been popular with her restaurant guests, so she decided to offer sangria kits available for pickup and shipping. It was a way to spread some holiday cheer and hopefully build up some business when in-person restrictions were lifted.

Similarly, breweries and restaurants have continued to survive by shifting, innovating and engaging with the needs of their communities. Early on in the pandemic, wholesale food company Sysco sent food that had been destined for newly shuttered restaurants to places like breweries and outdoor spaces so that restaurant workers could visit those pop-up food banks.

Now that the holidays are here, several breweries are giving back by promoting drinking beer as an act of charity by giving a portion of their sales to the local food bank. Also, some restaurants have become creative, both in their dine-in offerings and employee care. One example is a restaurant that has taken some of their parking lot to build an outdoor patio to increase the number of guests they can serve, and they are also using a portion of their takeout and gift card sales revenue to give back to their employees who are struggling financially.

Restaurants that typically enjoy a very busy holiday season have shifted and turned to offering takeout holiday feasts and cocktails, both independent restaurants and chains. Not only does purchasing holiday meals from a local restaurant help take some of the pressure off a household, but it just may help bring some income to the employees who are struggling to make ends meet.

The industry remains hopeful. Hotels and short-term home rentals are beginning to see a glimmer of a bounceback. That bounceback is due in part to “staycationers,” people who need a change of scenery and spend a night or two in a hotel or Airbnb, but prefer to stick close to home. Some hotels have begun offering “day passes” to worn-out remote workers so they can get a change of scenery (or a break from the distractions of home) and finish that project in peace.

How to Support Local Hospitality Industries

Americans are still being urged to stay at home and avoid traveling or socializing in person. The hospitality industry will eventually recover, but without some additional assistance, time will tell how many organizations will go out of business.

When you are considering that perfect holiday gift, consider a takeout meal or gift card from a local restaurant, sending a bottle of wine or sangria kit from your local winery, or giving someone a six-pack of your favorite local brew. If you are at a low risk for COVID-19, treat yourself to an overnight stay in a local boutique hotel or spend a couple days working remotely from a local hotel.

If you are able to visit a restaurant, please consider over-tipping and be kind. Support those small restaurants that always sponsor your kids’ sports teams by buying a few extra gift cards or ordering dessert with your takeout order. So many are struggling in an industry that exists to serve others; it’s time to help out those people who are always here for us.

Dr. Sheri Hernandez is the Hospitality Management program director for American Public University’s School of Business. She has extensive knowledge of restaurant operations, food safety, purchasing and training. Dr. Hernandez combines her skills as a restaurant manager with her career experience in financial commodity risk management, consulting, and purchasing to enable her to educate her students with a customer-focused, yet financially sound approach to hospitality management.

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